Home Information Cases JSC BTA Bank v Mukhtar Ablyazov (6 November 2012)

Skip to content. | Skip to navigation

Navigation
 

JSC BTA Bank v Mukhtar Ablyazov (6 November 2012)

Summary

There was no authority for the proposition that a full hearing on the merits was required in circumstances where a litigant had forfeited his right to a full trial by his own conduct of the litigation. The judge had been entitled to make orders whereby the appellant would be debarred from defending the claims against him unless within a stated period he both surrendered to custody and made proper disclosure of all his assets and his dealings with them.

Facts

The appellant (X) appealed against three decisions in litigation brought against him by the respondent Kazakh bank (J).

J's claims alleged that X had defrauded it of almost $5 billion. The three judgments appealed against had respectively (i) found X guilty of contempt of court; (ii) sentenced him on each of three proven contempts to 22 months' imprisonment concurrently; (iii) made unless orders whereby X would be debarred from defending the claims against him, and his defences would be struck out, unless within a stated period he both surrendered to custody and made proper disclosure of all his assets and his dealings with them. The contempt of court involved non-disclosure of assets, lying during cross-examination, and dealing with assets. X failed to attend the handing down of the judgment committing him to prison for contempt, and absconded to avoid his sentence.

X argued that (1) in concluding that he was in contempt of court, the judge had failed to apply the criminal standard of proof which he had set for himself and had made findings that he was not entitled to make. Furthermore, there were a number of pervasive flaws in his analysis; (2) the sentence of 22 months was too long, in circumstances where the maximum sentence was two years; (3) the judge lacked jurisdiction to make the surrender order. Furthermore, the European Convention on Human Rights 1950 art.6 gave him an express right to be heard, or a right to an adjudication on the merits, and the curtailment of that right inherent in the unless orders was absolutely wrong. The unless orders were not necessary, proportionate or justified.

Held

(Toulson L.J. dissenting in part) (1) The judge had overwhelmingly used the language of the criminal standard, and he uniformly did so when reaching his conclusions on any essential plank of J's case. There was no doubt that the judge had applied the criminal standard of proof. X's complaints about the judge's analysis fell to be rejected. X was simply attempting to reargue the trial, down to the smallest details. There was no error shown in the judge's findings or reasoning (see paras 48-101 of judgment). (2) There was no justification for interference with the sentence imposed. Although there had not been a total failure of compliance with the orders imposed, X was of central importance within the litigation, and his contempts had been multiple, persistent and protracted, involving offences of non-disclosure, lying in cross-examination, and dealing with assets, and had been supported by the suborning of false testimony and the forging of documents. Furthermore, X had failed to attend the handing down of the committal judgment and had subsequently absconded to avoid his sentence. The sentence imposed was fully justified, JSC BTA Bank v Solodchenko [2011] EWCA Civ 1241, [2012] 1 W.L.R. 350 applied (paras 102-109). (3) X had failed to provide any authority for the proposition that a full hearing on the merits was required in circumstances where a litigant had forfeited his right to a full trial by his own conduct of the litigation. The court was not required to persevere to a full trial on the merits whatever the circumstances. It was clearly in order to deploy even the final sanction of striking out, where necessary and proportionate to protect the interests of justice. X had not been able to show that there had been any element of judicial unfairness in the way that any of the numerous hearings concerning him had been conducted. X had been granted the opportunity for trial, if he complied with the court's orders, but had chosen to forfeit the opportunities which had been given to him. It was impossible to submit that the court lacked jurisdiction to do what was just and convenient, and necessary, to protect its own orders and to give effect to the interests of justice, AJ Bekhor & Co Ltd v Bilton [1981] Q.B. 923 applied. The order that X surrender to custody was not beyond the power of the court, nor was it particularly novel. The judge had been entitled to make the order, CIBC Mellon Trust Co v Stolzenberg (Sanctions: Non-compliance) [2004] EWCA Civ 827, Independent, July 2, 2004 and Lexi Holdings plc v Luqman [2007] EWCA Civ 1501 applied (paras 123-189). (4) (Per Toulson L.J.) The appeal against the order debarring X from defending the claims, unless he made proper disclosure of his assets and his dealings with them, should be dismissed. However, to debar X from defending if he failed to surrender was wrong in principle, and would be a form of additional punishment (paras 195-200).

Appeals dismissed

Court of Appeal
Sir Maurice Kay (VP CA Civ), Rix LJ, Toulson LJ
Judgment date
6 November 2012
References

LTL 6/11/2012 : [2012] EWCA Civ 1411