Khalik v London Antwerp Diamonds Ltd

LORD JUSTICE ELIAS: This is an appeal by Mr Khalik. He appeals from the decision of Mr Recorder Gregory in the Manchester County Court. The claim is against the defendant, London Antwerp Diamonds Limited. Permission to appeal was refused by the judge on paper and it has now been renewed before me. The judge who refused it, Christopher Clarke LJ, concluded that there was no error of law and therefore no realistic prospect of the full court deciding that the judge was in error. Mr Khalik seeks to identify an error of law before me, but I fear he has not done so.

The facts of the case are comprehensively set out in the judgment of the judge below. The background, very briefly, was that Mr Haque, an associate of Mr Khalik, sent an email to the respondent regarding a rough diamond which they wished to have valued and investigated; at least, they thought it was a rough diamond. The email had two photos, as the judge found. On 25 June 2009, Mr Khalik and Mr Haque visited the respondent's London premises. The stone was weighed and photographed and was found to be 279 carats. Mr Khalik says it was worth in excess of £5 million. On 8 July, Mr Russell from the defendants met Mr Khalik in Manchester. A receipt was issued, which included a photo of the stone. The judge found, having heard expert evidence, that it matched the photos sent by the email. There is a dispute as to whether the photo on the receipt was the photo of his stone, but in any event the judge found that it was.

Mr Khalik says that the stone which now the defendants are seeking to give back to him is not the stone he gave them. He says they have deceived him. They have told him that what he sent to Antwerp was not in fact the diamond that they had checked three times. He says that it was, and that they have sought to take his original and want to give him some fake stone in return which is of no real value whatsoever. It has to be said that the stone allegedly worth £5 million was acquired by Mr Khalik from the Manchester Museum shop for £51.48. That does not make it impossible for that stone to be worth £5 million, but, as the judge commented, it is highly unlikely.

The critical question which the judge had to decide is whether the stone which Mr Khalik gave the defendant is the same that they are now willing to return to him. That is a matter of fact.

There is no doubt that there were some oddities in this case, which the judge referred to. One in particular, which Mr Khalik has relied upon before me today, is that there was no paperwork accompanying any of the transactions where the stone was taken to Antwerp and was seen allegedly by the defendants by three different people in Antwerp, who were testing the hardness of the stone and the likeness and so forth to determine whether it was a diamond or not. The judge commented on that and made the observation that that was a point which was advanced by Mr Khalik's counsel quite properly in his favour, but in the end he read in particular the report of the experts as to whether the stone appeared to be consistently the same stone that was taken and was being returned. On the basis of those reports in particular, he concluded that it was indeed the same stone. It is not possible for the court to go behind that. That was most powerful evidence.

There are one or two other points made by Mr Khalik about the behaviour of the defendant. He says that Mr Russell from the defendant signed statements calling himself Andy Russell when that is not his true name, but that with respect does not go to the heart of this case. He says that the case should not have been heard in the Manchester County Court, but they have jurisdiction to do so if it is transferred there, and presumably there was an agreement, at the time at least, that it would be there.

Mr Khalik says that there is a material difference because the stone was said to be 279 carats, whereas the one in the respondent's possession which was tendered for return was 279.5, but that with respect is not a significantly material difference to suggest that it is not the same stone. It is not clear how specific or exact the first weighing of the stone was.

Mr Khalik says he did not have his rights under Article 6 respected, but I wholly reject that. He had a trial at which he could adduce evidence. He wants to adduce further evidence from Mr Haque, but he could have adduced that at trial. In any event, the truth is it would not really have undermined the finding of fact based upon the expert evidence.

Mr Khalik has suggested that his solicitor was in cahoots with the defendants and had taken a bribe from the defendants, and that that had undermined the case that he was presenting to the court. If that is true, then of course he may have a claim against the solicitors, but at this stage I have to determine whether on the material before the judge there was a proper basis for him reaching the conclusion that he did. It is not even a question of whether he reached the right finding of fact, it is a question of whether he reached a finding of fact which is binding on this court and was based on a proper evidential basis. The particular evidential basis here was the photographs.

There is no doubt that there was an oddity about some of the ways in which this transaction was handled. As I say, the lack of documentation was a matter of concern, and was properly identified as a matter of concern by the judge, but in the end it did not undermine the fundamental point that he had to determine, which was, was it the same stone that was returned as had been given? He was entitled to make that finding of fact.

There is no error of law, and therefore I refuse permission to appeal. I told Mr Khalik it would do him no favours to give permission to appeal in a case which, on the basis the material before the judge, would be found to fail, because it would be a very costly exercise.