Dar Al Arkan Real Estate Development Co v Majid Al-Sayed Bader Hashim Al-Refai & Ors (April 2014)
The court determined that it was better for a committal application to be heard well before the main trial and for the judge to recuse himself because in an earlier judgment he had reached conclusions adverse to the respondents on issues that were likely to be crucial in the committal application.
The court was asked to decide three issues concerning a defendant's committal application: when it should be heard; whether the judge should recuse himself from hearing it; and what, if any, use could be made of an earlier judgment ( EWHC 3539 (Comm)) on the defendants' application to set aside ex parte orders made against them.
The first defendant (M) had been dismissed from the second claimant company (B), which had common shareholders and directors with the first claimant company (D). After M's dismissal, B and D alleged he instigated a campaign to discredit their businesses, having enlisted the help of the second defendant (K). The latter made a committal application, seeking declarations that B and D were in contempt of court in that they breached undertakings to preserve some hard drives and deliver them to the defendants' solicitors. K also sought orders that B and D be fined and for D's managing director, who was also a director of B, to be imprisoned for deleting files from one of the hard drives. K contended that the application should be heard well before the trial in the action, whereas B, D and their director contended that it should be heard after the trial.
K submitted that unless the application was heard before trial, the court would not be able to impose any effective and appropriate sentence because B, D and their director, who were outside the jurisdiction, would otherwise ignore the contempt proceedings, and an early hearing would bring it home to them that they had to obey the court's orders, and so improve the prospects of a fair trial. On recusal, B and D submitted that, in view of the adverse findings in the earlier judgment in the defendants' setting-aside application, a fair-minded and informed observer would conclude that there was a real possibility that the same judge might pre-judge a major part of the issues in the contempt application. In regard to the earlier judgment, B and D submitted that it should be declared inadmissible in evidence, or at least inadmissible as evidence of the facts that were found, and K should be directed not to rely on the conclusions in it.
(1) It would not be as easy for B and D to ignore the committal proceedings as K suggested. However, the court would have more leverage before the trial to make appropriate orders to punish any contempt and to uphold its authority. If the allegations of contempt were established, the court had to bring home to B and D that procedural fairness and just process required it to enforce its rules and orders. Whilst there was some overlap on the pleadings between the questions with which the committal application would be concerned and the issues that would be determined at the trial, there was no realistic chance that the timing of the application would affect what evidence apparently would be available to B and D, JSC BTA Bank v Solodchenko  EWCA Civ 1241,  1 W.L.R. 350 distinguished and JSC BTA Bank v Ablyazov  EWCA Civ 1386,  1 W.L.R. 1988 considered. Furthermore, committal before trial might be appropriate in a very clear case, such as the instant case, given the extent of the admissions made by B, D and their director during the earlier setting-aside application, Malgar Ltd v RE Leach (Engineering) Ltd  C.P. Rep. 39 applied. Accordingly, the comittal application should be heard well before trial: that timetable was preferable in order to uphold the court's authority and to ensure fairness between the parties (see paras 17-20, 25-27, 31 of judgment). (2) The judge would recuse himself. He had not simply expressed views about issues that would arise on the committal application and witnesses who might well give evidence when it was heard: his earlier judgment went beyond that. His views about the credibility of B and D's witnesses were detailed and specific, and he had reached conclusions adverse to B and D not only on some questions that might arise on the hearing of the committal application, but on issues that were likely to be crucial and possibly on all the real issues that would arise (para.36). (3) There would be no ruling on how the earlier setting-aside judgment might be used in the committal application. Questions of admissibility of evidence and comparable matters were generally best decided by the judge conducting the hearing, and the present judge had recused himself from it (para.39).
LTL 22/4/2014 :  EWHC 1055 (Comm)