Thakkar v Thakkar & Ors

I have been hearing two preliminary issues in relation to a financial remedy application dated 27^th June 2014 made by the Applicant, Meera Thakkar against the First Respondent, Ashish Thakkar. The preliminary issues are:-

For convenience purposes alone, I propose to refer to the parties by their first names, namely:-

The burden of proof is on he or she who seeks to assert disputed facts, in this case, the Applicant, Meera Thakkar. The standard of proof is the civil standard, namely the balance of probabilities. The seriousness of the allegation makes no difference to the standard of proof to be applied in determining the truth of the allegation. The inherent probabilities are simply something to be taken into account, where relevant, in deciding where the truth lies.

There are issues in the case as to whether or not various parties and witnesses have lied either to this court or previously in relation to the beneficial ownership of the Group. First, I must decide whether or not anyone did deliberately tell lies. If I find that they did, I have to ask myself why they lied. The mere fact that a witness tells a lie is not in itself evidence as to the ownership of the Group. A witness may lie for many reasons. They may possibly be “innocent” ones in the sense that they have nothing to do with the ownership of the Group. For example, they may be lies to bolster a true case; or to protect someone else; or to conceal some other disreputable conduct unrelated to the issues I have to decide; or out of panic, distress or confusion.

It follows that, if I find that a witness has lied, I must assess whether or not there is an “innocent” explanation for those lies that is not relevant to the ownership of the Group. However, if I am satisfied that there is no such explanation, I can take the lies into account in my assessment.

The Third Respondent, Sarla has not filed evidence and has not attended court. Mr Pointer QC and Mr Webster who appear for the Applicant, Meera invite me to draw an adverse inference from this failure. They rely on the case of Wisnieswki (a Minor) v Central Manchester Health Authority (1^st April 1998) for the proposition that a court may be entitled to draw adverse inferences from the absence and/or silence of a witness who might be expected to have material evidence to give on an issue in the action. If the court is willing to do so, such inferences may go to strengthen the evidence adduced by the other party or to weaken the evidence adduced by the party who might reasonably have been expected to call the witness. There must, however, be some evidence, however weak, adduced by the other party on the matter in question before the court is entitled to draw the desired inference. In other words, there must be a case to answer. The court must, however, consider the reason advanced for the absence of the witness. If the court is satisfied as to that explanation, no adverse inference can be drawn. If something short of a full explanation is given but there is an explanation, even if not wholly satisfactory, the potential detrimental effect of the absence or silence may be reduced or nullified. Mr Scott QC, who appears for Sarla submits to me that there is a satisfactory explanation for her absence.

Mr Chamberlayne QC and Ms Owens, who appear on behalf of the First Respondent, Ashish Thakkar and Mr Scott for the Second and Third Respondents, Sarla and Ahuti refer me to the law on sham. They argue that the Applicant cannot succeed unless she shows that the 2012 structure that holds the shares in the Group is a sham. I was referred to the well-known dicta in Snook v London and West Riding Investments Ltd [1967] 2 QB 786 at 802:-

“[a sham] means acts done or documents executed by the parties to the “sham” which are intended by them to give to third parties or to the courts the appearance of creating between the parties, legal rights and obligations different from the actual legal rights and obligations (if any) which the parties intend to create”.

I was also referred to the case of A v A [2007] 2 FLR 467 as to the strong and natural presumption against holding a provision or document to be a sham, which I entirely accept. Mr Pointer, however, does not accept that he needs to prove that the 2012 structure was a sham. He argues that all he needs to show is that Sarla and Ahuti hold the shares either on trust or as nominee for Ashish. In this regard, he relies on Prest v Petrodel Resources Ltd in general but in particular the quote of Rimer LJ in the Court of Appeal at [201] 3 FCR 588 where he said:-

“[136]…If property held by a husband has been put into the name of someone who, on the evidence, is obviously a bare trustee for him, there will be no problem in holding that the beneficial ownership has not changed….the court will also not be bamboozled by the use by husbands to a like end of “shams, artificial devices and similar contrivances”.

I remind myself that a bare trustee is a trustee who is a mere repository of the trust property with no active duties to perform and no responsibilities in relation to the trust property other than to preserve the property for the beneficiary. The bare trustee is purely passive and “bare” or naked of active duties decreed by the settlor/transferor. Mr Pointer points to a number of instances of this family admitting/asserting that individuals or entities hold assets as nominee/bare trustee for the true owner but, in any event, he says that, if he needs to show sham, this is a sham.

Finally, in this regard, Mr Scott referred me to the case of Goodman v Gallant [1996] 2 WLR 236 as to the law in relation to joint tenants as compared to tenants in common. I entirely accept that, until severance of a joint tenancy, each tenant has the whole but, upon severance, each has an aliquot part (a half or less) according to the number of joint tenants. I am not, however, sure that this takes me much further in this case.

Jagdish was born in Uganda on 27^th April 1948 so he is aged 68. His family had moved to that country in the 1890s. Sarla was born on 12^th September 1952 so she is aged 64. They married on 21^st November 1971. In 1972, they were forced to flee Uganda by Idi Amin with nothing. They came to the UK and both started working in factories here before running their own market stalls selling clothes. By 1993, they owned a couple of retail shops.

Their eldest daughter, Rona was born on 26^th October 1972 so she is now aged 44. Ahuti was born on 17^th May 1975, so she is aged 41. In 1979, the family moved briefly to Kenya and then onto Rwanda but, unfortunately, Jagdish had two heart attacks.

Ashish was born on 5th August 1981 and given the birth name, Prateen. He changed his name subsequently to Ashish. He is therefore now aged 35. He is a highly successful businessman. Meera was born on 27th March 1983 and is therefore aged 33. She is a journalist/author, now specialising in the field of cookery. I am told she is soon to publish a book on the subject.

In 1984, the Thakkar family returned to England. Jagdish started a women’s fashionwear business, again initially run from market stalls. The lure of Africa, however, proved strong. In 1993, the family returned to Rwanda and set up a small trading business, getting their stock from Dubai. It appears to have been very successful but, tragically, within months, the Rwandan genocide took place in 1994. I have no doubt that this period was extremely traumatic for everyone involved. They managed to escape but at a heavy cost both emotionally and financially. For the second time, the family lost everything. They moved to Kenya and then Uganda. Bravely, Jagdish commenced a business supplying fuel to Rwanda before starting a retail business in Uganda buying local goods and selling them through Exim (U) Ltd. Soon, the business started to import goods from Dubai.

Ashish left school at the age of 15 having shown a real aptitude for commerce. In particular, he was importing and selling computers, including one to his Headmaster. The family, with some reservations, agreed to set him up in business and the sum of $5,000 was provided as seed-corn capital from various sources. In 1996, he founded his first company, an IT business in Uganda called RAPS (U) Ltd. The initials were those of various family members, namely Rona, Ahuti, Prateen (his birth name) and Sarla. A number of other companies were later formed, including Riley Packaging (U) Ltd, which manufactured cardboard boxes. Although they started in a small way, the businesses grew rapidly to become a very successful African based conglomerate.

On 20^th February 2008, the RBH Global Foundation (Panama) (hereafter RBH) was established. In due course, its main asset became Inspire Corporation SA (hereafter Inspire Panama) which was incorporated in Panama on 12^th March 2008. Slightly unusually for the late 2000s, Inspire Panama issued bearer shares to the value of $10,000 on 20^th March 2008. The bearer shares appear to have been held by Fitrust in Switzerland via an entity known as Noman Ltd (BVI), a nominee company owned by Fitrust. This structure eventually held all the issued shares in Mara Group Holdings Ltd (Mara BVI), which was incorporated in the BVI on 19^th April 2010. Inspire owned all 50,000 shares.

It is clear that the two main trading businesses run at the time by Ashish went into the new structure. These were Riley Packaging, owned as to 25% by Ashish and 25% by Jagdish and RAPS Uganda Ltd (the sale of technology and related products). There is no doubt that Jagdish’s business, Exim did not go into Mara. Ahuti’s interests in Trio and Computerworld did not go in either. It does equally appear that Ashish’s 49% interest in RAPS Middle East, an administrative business, also did not go in. It is unclear what happened to three other businesses, namely Kensington Real Estate LLC (a real estate brokerage in Dubai), Kensington Africa (Uganda) and Kensington Global Investors Ltd. One possibility, not canvassed in argument, is that any business established in Dubai as an LLC could not go into the new structure due to the need for a local 51% shareholder. In any event, it is clear that Ashish’s two main businesses did go in and nothing else went in initially. Moreover, his subsequent entrepreneurial activity was undoubtedly conducted via Mara in its broadest sense. I was shown an organogram showing the up to date position. The structure is exceptionally complicated with around sixty different entities. There are numerous different levels of company split between holding companies and subsidiaries.

There is no doubt that Ashish was the founder of the Mara Group and is its public face. The issue is whether or not he is the beneficial owner. A prospectus sent out to potential investors in another business, Atlas Mara, that he started in 2013, with Bob Diamond the former CEO of Barclays Bank said this:-

“Ashish J Thakkar, Non-Executive Director

Mr Thakkar is the founder of Mara Group and Mara Foundation. Mr Thakkar started his first IT company in 1996 at the age of 15 in Uganda. Since then, Mr Thakkar has successfully driven the growth of Mara Group to become a globally recognised multi-sector conglomerate with investments in IT services, manufacturing, agriculture and real estate operations in 21 countries (of which 19 are African) that employ over 8,000 people….”

The Mara Group’s website offers the following description:-

“Mara’s first company was founded by Ashish J Thakkar in 1996. Ashish began his career in business at the age of 15 by borrowing $5,000 to set up an IT company in Uganda. Within a year, he transitioned from a high school student to a full time entrepreneur.

Since then, Mara has evolved into an international multi-sector business with operations and interests across 22 African countries. Ashish has successfully driven the growth of Mara by identifying opportunities to build businesses in under-served markets and by selectively partnering with international firms focussed on expanding in Africa.

Among Mara’s credits include building the leading corrugated cardboard packaging company in Uganda (Riley Packaging), founding a Pan-African IT services company (Mara Ison) and establishing an African business process outsourcing company, operating in ten African countries (Ison BPO).”

One of the issues in the case is whether or not Regulations were issued in 2008/2009 for RBH Foundation. An unsigned document has emerged which provided:-

The reason that it is not possible to be certain as to whether or not these Regulations were issued is that all we have is a draft with certain gaps that was later amended in manuscript by Ashish. There is, however, no doubt that, on 26^th January 2009, documents completed for Dresdner Bank listed the beneficial owners as Ashish, Jagdish and Sarla in that order.

Ashish and Meera became engaged to be married in July 2006. They married in Kampala on 27th September 2008. There are no children of the marriage.

By 2011, it is clear that the lawyers and bankers began to get nervous as to the lack of clarity in the structure and, in particular, the existence of the bearer shares. In August 2011, Mara’s Group lawyers, Conyers, Dill & Pearman requested KYC (Know Your Client) documentation identifying the beneficial owners of Mara. It appears that Ashish said he was “not comfortable” releasing this information.

The requests continued, initially sporadically but gradually gathering increasing urgency. On 10^th June 2012, the solicitors said they required the information urgently. Amanda Heinrich of Fitrust sent an email on 12^th June 2012:-

“At the time the whole structure was set up, the idea was to keep the assets in the foundation for the family. Due to the fact that Home Management has the General Power of Attorney on the company Inspire Corporation Ltd, we are liable to our compliance department and therefore need to know what is going on and for what reason the new company is needed. Therefore, prior to incorporate (sic) a new company to the structure, I need to check with our compliance department and we need to give our approval to this transaction”.

The same day, Ashish replied to the lawyer, Nitin Saujani “I think we need to change trustees”. Mr Saujani’s response to Ashish was that “you will get this everywhere now with new regulations. But let’s finish this and then maybe all can be transferred to the new ones dealing with Mara – for now provide the info – I am getting this with ALL reputable Trustees everywhere”. Ashish responds “ok…Let’s pls get this concluded then maybe we go meet them or get her to come see us…”

On 13^th June 2012, Noman Ltd said that it held the shares in Inspire on behalf of a Panamanian Foundation whose owners were Ashish and his parents but no Regulations were provided. On 14^th June 2012, another lawyer, Atiq Anjarwalla wrote on Ashish’s behalf to Conyers, Dill and Pearman that the easiest way out of the impasse was to remove ownership from Inspire. It was said that the Mara Group would then be owned by another pre-existing BVI company, whose owner was Ahuti, who was based in Dubai.

On 16^th June 2012, Ashish wrote in an email that:-

“Unfortunately, do [sic] KYC issues with my family trust, I’m having to put the holding of Mara Africa Holdings and Mara Investment Partners in a temporary structure called Midas which is owned by my sister, Ahuti for 2–3 months and then re-position in my structure once we’ve sorted out the issues”.

Originally, the shareholding in Mara Investment Partners Ltd was held equally by Ashish and Prashant with 25,000 shares each. In due course, another investor came into the structure and Ashish and Prashant’s interest was transferred to Mara Cap Investments. On 25^th June 2012, 18,750 shares were transferred to Midas Touch Investments Ltd. It is clear that these shares were, to put it neutrally at this stage, the Thakkar shares. At the same time, 18,750 shares were transferred to Prashant. The Thakkar 18,750 shares were subsequently transferred to Mara Group Holdings Ltd BVI on 16^th September 2012. The Thakkar shareholding in Mara Africa Holdings Ltd was also transferred to Midas Touch Investments Ltd on 25^th June 2012 and, in September 2012, to Mara Group Holdings Ltd BVI.

In June 2012, a private placement memorandum had to be agreed in relation to Mara Africa Opportunities SPC Ltd. Fawaz Elmalki, a solicitor at Conyers Dill Pearman drafted a passage that includes “Ashish J Thakkar is a beneficial owner of MGHL.” An email dated 21^st June 2012 from Mr Elmalki says he had slightly modified the entire passage following information Ashish had sent him in the previous two days. Ashish sent the email to Prashant saying “This is ok right?”. Prashant replied that it was fine.

On 28^th June 2012, Ashish made a number of manuscript amendments to the document containing the RBH Regulations. On 15^th July 2012, these amendments were formalised and signed by the Foundation Council. The document says that “these regulations cancels (sic) and replaces the ones issued prior to this date” but that does not mean there were such formalised regulations before. Article 1 states that the first beneficiaries are Jagdish, Sarla and Ashish who “shall be solely entitled to the enjoyment of the foundation’s assets and its income during his (sic) lifetime, excluding any other beneficiaries”. Article 3 appoints the second beneficiaries after the death of all three of the first beneficiaries. Meera is to be entitled to 25% of the income of the Foundation’s assets as well as “maintenance of living standards, housing and living expenses that may occur”. Rona and Ahuti are to be entitled to 12.5% and Ashish’s children are to be entitled to 50% of “the foundations assets and interest”.

On 25^th July 2012, Ahuti’s husband died suddenly. There is no doubt that he had complicated business affairs and had got himself into significant financial difficulties which Ahuti had been endeavouring to sort out on his behalf. Indeed, at one point he had been imprisoned in Dubai for a week for debt.

On 23^rd August 2012, Hetal Shah of the Mara Group sent an email to Ashish, Prashant and two other employees of the Mara Group. It said, amongst other things:-

“As to avoid in detail KYC for all existing account and upcoming account, we need to open MG main account with SCB. Asif will manage the KYC for the same and will manage to open account without submitting any paper for Inspire. We will just submit the declaration that Ashish J Thakkar is the ultimate beneficiary owner”.

Ashish replied “JSR very good, go ahead with you as main contact and other points too…”

On 28^th August 2012, the beneficial owners of Inspire Corporation SA were declared by Home Management Inc to LGT Bank (Switzerland) to be Ashish, Jagdish and Sarla. No percentage share was specified.

On 12^th September 2012, Inspire Holdings Group Ltd was incorporated in the BVI. The legal owners were Sarla and Ahuti with 25,000 shares each. On 16^th September 2012, 50,000 issued shares in Mara Group Holdings Ltd were transferred from Inspire Panama to Inspire BVI. On 27^th February 2013, Inspire Panama was dissolved.

There is no doubt that the marriage got into difficulties in 2013 but there is a dispute as to the date of separation. Ashish says it was February 2013 whereas Meera contends for early 2014. Fortunately, I do not need to resolve that dispute.

The third party minority interest in Mara Investment Partners Ltd was held by a United Arab Emirates company. On 10^th April 2013, one half of this holding was transferred to Ashish and the other half to Prashant. On 15^th April 2014, Ashish transferred these shares to Mara Group Holdings Ltd.

On 10^th May 2013, Takecare Management Ltd declared on behalf of RBH Global Foundation that the beneficial owners of the assets deposited with LGT Bank, Geneva, are Ashish, Sarla and Jagdish. In relation to account number 2825133, they were declared as having a beneficial entitlement of 33.33% each. On 30^th July 2013, a letter of comfort was provided by RBH Foundation to Ashish stating that he can dispose of $250,000 from the RBH Global Foundation account number 2825134. On 14^th December 2013, Ashish transferred 30,000 share in Riley Packaging Uganda Ltd to Corpack Uganda Ltd, a company within the BVI structure.

Meera filed a petition for divorce on 27th June 2014. Decree Nisi was pronounced on 30^th July 2015. I refused an application by Ashish to make the Decree Absolute on 8^th June 2016. Meera’s Form A is also dated 27^th June 2014. Ashish was not served until 8^th July 2014. The following day, Jagdish signed a request to the Board of RBH Global Foundation that all the remaining assets should be transferred to his personal account in Dubai. The document makes it clear that the Foundation would be dissolved after the distribution due to lack of assets. Ashish signed on 28^th July 2014 and Sarla also signed although I cannot read the date of her signature. The Foundation was indeed dissolved on 10^th September 2014.

Ashish’s Form E was sworn on 10th September 2014. It gives his net assets as being £445,532. It makes no reference at all to the RBH Foundation and its dissolution is not noted in Box 4.1.1 which requires details of significant changes in assets or income during the last twelve months. There is no explanation as to the way in which the Mara Group is held and no reference to the BVI structure.

His first Replies to Questionnaire are dated 11^th December 2014. He was asked about Mara Group Holdings Ltd. He said he did not have a beneficial interest in this company and he had never had a legal or beneficial interest in it. He said that it had been agreed that he would be a legal shareholder in Mara Online Ventures Ltd to give investors comfort that he would be actively involved but one of his cousins was spending all of his time on the company and so he was the beneficial owner.

My copy of his third replies are undated but I believe they were filed on 9^th February 2016. They say the following:-

“RBH Foundation was set up by Sarla Thakkar, the Respondent’s mother and Ahuti Chug, the Respondent’s sister in 2008. Inspire Corporation SA was set up through the vehicle of the RBH Foundation as a holding company with bearer shares. However, the Respondent understands that Ahuti Chug’s husband required her to stop being a shareholder because his own business was in financial difficulty. The Respondent’s father, Jagdish Thakkar agreed to stand as a shareholder in place of Ahuti Chug. However, the Respondent’s father also wanted there to be an additional younger shareholder because of his and Sarla Thakkar’s ages. The Respondent’s father wanted the Respondent to hold the bearer shares on the basis that Ahuti was beneficially entitled to them. There is no documentation in relation to this as it was a family arrangement. On 25 July 2012, Ahuti Chug’s husband died suddenly and unexpectedly. Thereafter, along with the Respondent’s mother, Ahuti transferred the assets of Inspire Corporation SA to the newly formed Inspire Holdings Group Limited. The Respondent does not have and never has had any legal or beneficial interest in Inspire Holdings Group Limited and is not a director and never has been.”

On 28^th October 2015, Barry Goodman (MD of Trident Trust Company BVI Ltd) swore an Affidavit saying that, to the best of his knowledge and belief, the beneficial owners of Mara BVI are Sarla and Ahuti. He exhibited a declaration made to the authorities in the BVI showing Sarla and Ahuti as the beneficial owners.

On 11^th November 2015, Meera filed a statement in support of an application to join Sala and Ahuti as parties to the litigation. She said that Ashish had always led her to believe that he was the ultimate beneficial owner of the Mara Group and she was unaware of Sarla having any involvement. She said she understood Ahuti signed documents at Ashish’s request. The same was true of Rona, until she, Meera, assumed Rona’s role.

On 20^th November 2015, I directed the hearing of this preliminary issue with a five-day time estimate. After the application had been served upon them, I joined Sarla and Ahuti as Second and Third Respondents on 11^th March 2016. I made directions for pleadings, namely points of claim, defences and a reply.

Meera’s Points of Claim, served in April 2016, are straightforward. She says that Ashish was the founder of Mara. He is the driving force behind it and he is the ultimate beneficial owner of the shares notwithstanding the legal title. I remind myself that, at the time these were filed, the various versions of the Foundations regulations had still not emerged.

The Defence of Sarla and Ahuti is dated May 2016. It denies that the Points of Claim disclose any cause of action or arguable case pleading that it is so vague that it cannot be discerned. No admissions are made as to Ashish’s role in the Mara Group. It is said that the effect of the 2012 restructuring was to vest the legal and beneficial interest in Ahuti and Saria.

Ahuti replied to a questionnaire served by Meera on 30^th June 2016. Sarla adopted Ahuti’s replies. Ahuti repeated that, during the period that the RBH Foundation was in place, it was necessary to shield her interest from her deceased husband’s creditors. She said that this arrangement was hidden from the family lawyer, Nitin Saujani, because she was worried about confidentiality as they had a number of mutual friends. She added that Mara originated from various businesses started by Sarla and Jagdish and, in 2008, they sought to transfer part of their beneficial interests to the younger generation. They determined the transfer should be to Ahuti but Ashish replaced her as nominee due to the position of her husband.

Ashish’s defence is dated 29^th September 2016. He pleads that Mara Group Holdings Ltd has been and remains the legal and beneficial owner of the Mara Group. The beneficial interests in the bearer shares of Inspire Corporation Panama were held by RBH Global Foundation which was owned by Jagdish as to 1/3^rd, Sarla as to 1/3^rd and him as to 1/3^rd but he held his 1/3^rd on trust for his sister. He denies that the 2012 restructuring was his sole decision.

He filed his third witness statement on 29^th September 2016. He accepted that he was the founder of the Mara Group and is its figurehead so far as the rest of the world is concerned but said its origins were in the commercial activities of his parents. He said that Ahuti works tirelessly for Mara. She deals with much of the administration and management/finances. He adds that his mother, Sarla, is actively engaged in Mara’s offices and deals with its bankers. His father, Jagdish, is Chairman and manages the finances. His sister, Rona is also deeply involved. He says that he could not tell anybody involved in the Panama structure that he was holding his interest for Ahuti to protect it from her husband’s creditors. He did, however, indicate that he was prepared for Mara to be treated, for this litigation alone, as being a resource available to him to the extent of one-fifth. This was calculated on the basis of all five members of the family (Jagdish, Sarla, Rona, Ahuti and himself) as having an equal interest.

Ahuti’s statement is dated 3^rd October 2016. She refers to the birth of her daughter on 30^th October 1998, so she is now aged 18. Ahuti says she moved to Dubai in May 2000 and withdrew from business at any visible level due to pressure from her husband. She says she knew she was regarded as having an interest in the RBH structure but she did not know it was 1/3^rd. After the death of her husband in 2012, her interest did not have to be secret. By giving the shares to her and her mother, Sarla, “the old guard” and “the next generation” were both represented. Her father, Jagdish and Ashish did not have an interest although they regarded the business as being “for the family as a whole”. She and Sarla were chosen as they were regarded as safe investors whereas Jagdish and Ashish were risk takers. The current structure, therefore, maintained the equilibrium. Ahuti did not return full-time operationally to Mara until November 2014. Ashish remains the front man but all decisions are taken jointly with Jagdish and Sarla as the ultimate decision makers and controllers. She said that her mother would not file a statement nor attend court. She is not in the best of health and finds the proceedings distasteful.

Jagdish’s statement is dated 3^rd October 2016. He is the Chairman of the Mara Group. He describes Ahuti as Executive Director. He says she and Ashish worked together from the outset. She dealt with the suppliers and credit control whilst Ashish dealt with sales. Sarla was always asked for her opinion as she was the voice of reason. He said that the shares were divided into two for each household, namely Sarla’s for herself, Jagdish and Ashish whilst Ahuti’s were for Ahuti and her daughter, Ashish courts media attention so it was appropriate for him to describe himself as the owner of Mara but the legal ownership is in the safe hands of Sarla and Ahuti. Ashish is the CEO.

On 2^nd November 2016, I determined that I did not have the power to compel Sarla to file a statement or attend to give evidence. I indicated that I would have done so if I had power to do so.

Finally, Meera filed a statement on ^9th November 2016. She said that Ashish’s autobiography, “The Lion Awakes” shows that the rest of his family played no significant part in the development of the Mara Group. Ahuti’s daughter was never named in any RBH document whilst Ashish’s family took precedence following the death of the three first beneficiaries. She questioned the transfer of Mara Holdings Africa to Ahuti’s structure, Midas given that her husband was still alive at the time. She said that Ahuti had been very successful running her own real estate brokerage business but her business was entirely unconnected to Ashish’s business.

I heard oral evidence from Meera, Ashish, Ahuti and Jagdish. As already mentioned, Sarla did not attend court and did not give evidence.

I did not find the evidence of Meera particularly helpful. She told me she understood Ashish to be very wealthy but she accepted that they had never owned their own property. She said Ashish had led her to believe he was the beneficial owner of the Mara Group. He ran the business without input from anybody else. She did get herself into a mess as to her knowledge of a family trust during the marriage. She said she accompanied Ashish to Switzerland in 2012 for a meeting about a family trust but was unable to explain why her Form E said that she may be one of the beneficiaries when her case was that she had never been told that by anyone. Having said that, I am not sure this takes me any further in relation to determining who is the beneficial owner of Mara. She did say that, whenever she was with her brother, Prashant and Ashish, there were lots of discussions about Mara but there were none when Ahuti was present with her and Ashish. I accept that evidence.

Ashish is clearly a very charismatic and engaging character. He exudes charm and enthusiasm. He clearly knows Mara’s business backwards. I am quite clear that he decides Mara’s direction of travel. He will take the decision to buy a business or diversify into another area. He is the entrepreneur and the money maker. I accept that this also means that he could lose money but that is an occupational hazard for such businesses. Without the risk of losing money, the businesses would never make money in the first place. He was asked why Ahuti did not put her business into Inspire Panama. He knew very well what Mr Pointer QC, for Meera was asking him but initially he did not answer referring to the property crash in Dubai not happening until after February 2008. He then said that Inspire Panama was “more set up for future projects than existing ones”. He was asked about putting two companies in Ahuti’s company Midas whilst her husband was still alive. All he could say was that it was a temporary measure and they did feel it was risky. They did not get advice as to whether Ahuti’s husband’s creditors could enforce against Midas, which is very surprising if this was a genuine concern. I asked why Mara’s interest in the two companies could not have been put in his name, as he had originally had shares in Mara Investment Partners Ltd. He did eventually concede that that could have been easier.

In answer to a question from Mr Pointer, he was constrained to accept that, if all three first beneficiaries had died, Ahuti would not have been able to claim her share if Meera was still alive. He was asked about the placement letter saying he was a beneficial owner of Mara, which he had blamed on Prashant in his replies to questionnaire. He said this was not misplaced as Prashant had been asked. He said it was a “clear oversight”. He was asked about the 11% of the shares in Mara Online that were in his name but held beneficially for his cousin. He told me about various conflicts of interest. He was asked about the minutes of a meeting of the Board of Directors of MARA Africa Opportunities SPC Limited held on 25^th June 2012 which refer to “each of Prashant Manek and Ashish Thakkar also declared their interest in MARA, Mara Group Holdings Ltd, MARA ICT and MIG…”. Again, he said it was a clear oversight. At one point, he tried to suggest it could not be accurate as it referred to Prashant’s interest in Mara Group Holdings Ltd but it is clear that the passage refers to their respective interests in the different companies and the reference to Mara Group Holdings Limited can only be to Ashish. He then said it was his mistake. He was then taken to the Minutes of the same Board on 4^th October 2012 which used identical wording as to this aspect. His response was that this was simply a cut and paste exercise from the previous Minutes although Mr Pointer drew his attention to differences in the wording of the rest of the paragraph.

Mr Pointer then asked him about a proposal to acquire the assets of Mara Africa Special Opportunities Segregated Portfolio (“MASO”) in November 2014 by another UAE company in which he and Prashant were to retain a 7.5% interest in B shares worth up to $25 million. A document dated 17^th November 2014 from Mara Holdings Africa Limited, signed by Ahuti, indicated that Ashish was to have 66% of these shares with Prashant having the balance. Mr Pointer asked why this was the case if Ahuti owned Ashish’s interest. He responded that he was representing the Mara Group and it was not true that Mara Group Holdings Ltd is his vehicle.

I then heard the evidence of Ahuti. Whilst she gave her evidence in a dignified and calm manner, she certainly did not come over as a leading player in Mara in the way that her brother had. She told me she knew she had an interest in RBH but they did not discuss percentages. She said things were very fluid. She later said she knew there were three parts and Ashish was holding her part. She accepted that, for a time in 2012, she held shares in two companies for Ashish via her structure Midas, even though her husband was still alive. She said that Midas was a new company and she did it as it was advantageous to the family. She was asked about what else Midas held. She told me it had a couple of real estate investments in the United Kingdom but, when it was put to her that these were vulnerable to her husband’s creditors, she told me she was not sure when the investments took place although she later said she thought they were in 2012 to 2013 but she did not remember the dates. I find this evidence surprising as she must have known whether they were before or after the death of her husband.

She said that the Midas arrangements worked well but also accepted that there would be no “Know Your Client” issues if the shares had simply been placed in Ashish’s name. She then said that the shares in Mara BVI were split between the two households but were not held for Ashish. The family discussed the structure after her husband’s burial ritual at the end of August/beginning of September. She postulated that the family may have been more generous to her “knowing her situation”, which I assume referred to her husband’s death and her responsibility for her daughter.

Finally, I heard from Jagdish. He was, on any view, a very unsatisfactory witness. He answered numerous questions on the basis that he could not recall or he did not know. It is extremely odd that he was not able to answer so many questions if he genuinely is the patriarch of this family and the active Chairman of Mara, as has been presented to me. I initially had difficulty in deciding whether he was deliberately refusing to answer, was so nervous that he could not answer (as suggested by Mr Scott QC for Ahuti and Sarla), genuinely unable to remember or very uncomfortable at having to lie. I do not find that he was so nervous that he was unable to answer as he did answer some questions. It follows that, either he was lying to me or he is certainly not a fully participating Chairman of Mara as suggested by the Respondents. I will return to whether or not he was lying later in this judgment.

He was asked why he lost his 1/3^rd interest in the transfer of Mara Group Holdings Ltd from Panama to the BVI. He responded that he did not lose his 1/3^rd interest as his wife, Sarla, lives with him and Ashish. He said the interest is divided between the two families. He said “we work as a family” and it did not matter to them if the shares were in Sarla’s name or his name. When asked about Ahuti’s interest, he said he had to look after his granddaughter. He repeated that Ashish has no interest. Neither does Rona. Initially, he could not recall Ashish’s position in the Mara Group. He did not recall if he was a director. He said he did not interfere in his, Ashish’s business. He then told me on numerous occasions that he could not recall pretty fundamental business details, including the ownership of Mara Global Technology. He was taken to a print out of his loan account with Mara Group showing large sums of money being received from and going to RAPS Middle East LLC and Mara Global Technology LLC. He was quite unable to provide any details about either company. Mr Pointer suggested that RAPS Middle East LLC must be a Dubai company and therefore have a sponsor. He accepted that would be the case but then could not name the sponsor. Earlier, he had been asked whether Ashish had any position in Mara. He told me he did not know. When pressed, he said he could not recall if Ashish was a director. He was asked about Ashish’s income and he said he did not ask him and he did not “interfere in his business”.

Sarla did not give evidence. She never filed a statement. She filed a “patient letter” from a doctor in Dubai dated 29^th January 2017 saying that she was suffering from generalised anxiety with depression. Her blood pressure had been well controlled but was now fluctuating and needed readjustment of her medication. She was advised to avoid stress triggers. The letter adds that she was due to travel to London for this hearing. It ends by saying that, in view of her condition, she is advised to avoid stressful situations which would worsen her condition. I was told by Mr Scott that she had not, in fact, travelled to London but, even if she had, it was clear she was not intending to give evidence. Mr Pointer invites me to draw inferences against her for this failure. I will return to this when I make my findings of fact.

Before making my findings of fact, I should deal briefly with Mr Scott’s submission that the pleadings are defective and do not show a reasonable cause of action. I disagree. I remind myself that the Applicant was hampered by not even having the regulations when she had to plead her case. That was not her fault. The pleadings make it abundantly clear that she is saying that Ashish, not Ahuti, Sarla or anyone else, is the beneficial owner of the Mara Group. There was no doubt about this. The Respondents were not disadvantaged and I reject the complaint.

I propose to deal first with the issue of whether or not Ashish was holding his share (whatever that may have been) for Ahuti in RBH Panama. Mr Chamberlayne had invited me to make my findings in a different order. He submitted I should deal first with the effect of the creation of the Panamanian structure in 2008. I have decided not to take matters in that order as I have been able to come to very conclusions on the Ahuti issue. It may well be that these findings will assist me in relation to the remaining matters I have to decide.

I am absolutely clear that, whatever interest Ashish held in Mara via the RBH Foundation, it was not held on trust for Ahuti. I do not accept the evidence, written or oral, of Ashish, Ahuti and Jagdish as to this. My conclusion is overwhelming. There are numerous reasons for this.

I now turn to my findings as to what was the actual position whilst the shares were held in the Panamanian Structure. On the balance of probabilities, I find that the first set of regulations was never properly executed by the Foundation Council. I find that the completed document would have emerged if there had been one. In one sense, this shows just how lax procedures were in relation to such offshore structures at the time. It also shows that caution has to be exercised before placing too much reliance on those documents that do exist. It is abundantly clear that it did not bother Ashish or anyone else that there were no regulations. I am satisfied that this is because he is equally lax about the structures that he uses. I need only give two examples. He was more than happy for Ahuti’s company Midas to hold Mara Investment Partners Ltd and Mara Africa Holdings Ltd in the summer of 2012 even though nobody was suggesting that Midas (or Ahuti) took the beneficial interest in these companies. He was happy to hold shares in Mara Online for his cousin. I am satisfied that this is because there is a very high level of trust between the various family members so they know they are safe doing things in this way. I have never been able to understand exactly why there is such a desire to distance oneself from ownership of assets but I find it clearly exists in this family. It may in part be tax related. It may in part be fear of creditors. It may be a precaution against future divorce proceedings. It may be a combination of all three and other concerns, genuine or otherwise. It undoubtedly exists however and is abundantly evident in this case.

I accept that the first draft regulations show Jagdish, Sarla and Ashish as the first beneficiaries. I accept Mr Pointer’s submission that the draft does not define their share at 1/3^rd each or anything else. I do not accept Mr Chamberlayne and Mr Scott’s submissions that silence means equality. That is not the way that a Foundation such as this operates. It is clear to me that naming all three just gave flexibility. I am quite satisfied that it was Ashish pulling the strings. It is quite clear that both Jagdish and Sarla would defer entirely to Ashish. If Ashish said that he wanted all the shares transferred to him, that is what would have happened. There were no Regulations but, even if there had been, they could be changed at the drop of a hat, as happened in 2012. Indeed, it was Ashish who directed the 2012 changes as can be seen from the fact that it was his manuscript amendments.

I do not find that the three beneficiaries held their interests as joint tenants although it is right that each of the three would disappear from the structure on death. It was likely that Ashish would live the longest. It was highly likely that, at some point, he would become the sole remaining first beneficiary. The clearest guide to the true underlying picture is to be found in what would happen on the death of the last survivor of the first beneficiaries. If Ashish had not changed the structure by then, it was not Ahuti or Rona or their families who would benefit. It was Ashish’s family. The draft includes as the first named “second beneficiary” his wife as to 50%. The other 50% was for his children, not Rona or Ahuti’s children. At the time of this draft, Ashish was engaged but not married. He did not have children. It may be that this was the reason the draft was not finalised at that point although it does not explain why it was not completed after the marriage.

I have already found that the amendments to this draft in 2012 came from Ashish. They are in his handwriting. The Foundation’s Council had absolutely no problem in agreeing them. This is the way such structures run. The only substantive changes relate to the second beneficiaries, effectively after Ashish’s death. This time, Meera is named as a beneficiary as to 25% of the income as well as maintenance of living standards, housing and living expenses. Ashish’s children are to be entitled to 50% of the foundation’s assets and interest. So 75% is for Ashish’s side of the family. Rona and Ahuti are to be entitled to 12.5% of the foundation’s assets as well as maintenance of living standards, housing and living expenses that may occur.

I accept that this is a close family. They look out for each other. It is, however, clear that this was Ashish’s Foundation. I find, having heard the evidence, that during his lifetime, it was his to do with as he pleased. He could have given assets to his sisters or to his parents but he would decide. It would be tempting for a judge to say that the 12.5% interests in favour of Rona and Ahuti indicate that 25% of this Foundation was held for them but I consider that would not be right. I have formed a clear view that these Regulations were, in effect, Ashish’s will. It was what was to happen to his assets after his death. Until then, he would do as he pleased. After his death, his wife would get 25%; his children 50% and his sisters 12.5% each. Like a will, it could always be changed but it was for him to decide. The Foundation was held for him as the true beneficial owner. He had created the assets. He had placed them in this Foundation. He directed operations and told the world, rightly, that it was all his. I so find. In doing so, I reject the written evidence of the Respondents that it was initially Jagdish and Sarla’s assets that went into Mara. It was not. The assets were Ashish’s assets.

I recognise that the documents at times say that Ashish is “a” beneficiary (although he cannot even accept that) and also that it is a “family” foundation. In that latter regard, Mr Pointer makes the point that this could be a reference to his family (himself, Meera and any future children) rather than the wider Thakkar family. I remind myself that it was said it was held for him in the Hetal Shah email. I have come to the conclusion that saying he is “a” beneficiary or that it is a “family” foundation does not even remotely affect my finding that it was his structure and he was the ultimate owner.

I now turn to the final question, namely whether or not the position changed after the 2012 restructuring. I have come to a very clear conclusion. This restructuring was entirely driven by the KYC problems raised by the banks and the professional trustees. The bearer share model simply could not continue. Ashish made the position abundantly clear when he said in the email to Mr Saujani that “I think we need to change trustees.” I find that this is all that occurred.

I have found that the Panamanian structure was held for Ashish beneficially. I am satisfied that he did not gift his beneficial interest to his mother and sister Ahuti in 2012. He certainly did not sell it to them. I find that it was merely the legal title that was being transferred. In other words, one structure was substituted for another. Ashish did not wish to divest himself of the beneficial ownership of this business in 2012 to his mother and sister. He merely wanted to deal with the KYC issues. Mara went on exactly as before. He has not been running this business for the sole benefit of his mother and sister. That was a blatant lie. He has been doing it for himself. This is what he told the world, other than this court, and that was the truth.

I therefore find that this was a nominee or bare trust situation. I have already noted that such a structure was not new to this family. Indeed, the Respondent Thakkars’ tried to convince me that the previous arrangement with the Foundation was exactly this in reverse. It does not lie in their mouth to argue that it was the position up until 2012 but it cannot possibly be the position since then. The legal title changed but the beneficial interests remain the same.

If I needed any support for the proposition that Sarla and Ahuti hold the shares as nominees/bare trustees, I find it in Jagdish and Ahuti’s own evidence. Both said that the shares were split “between the two households” meaning one half for Ahuti and her daughter whilst the other half was for Sarla, Jagdish and Ashish. Mr Pointer asked Ahuti if she was saying that was one-half for the two separate parts of the family and she said that was correct. She added that her half would be for her and her daughter. The other half would be for her mother and father. She was asked if this included Ashish and she said that would depend on her mother. I do not want to be unfair to her but she was essentially confirming this was a trust arrangement, just a different one to the one alleged by Meera. I reject Ahuti and Jagdish’s evidence as to this but I find that, in reality, they do not remotely think that the legal title is the end of the matter.

I reject the suggestion that I have to find that this was a sham to reach this conclusion. There are numerous examples of an individual or entity holding an asset as nominee or on trust for another without it being a sham. If that was the case, the arrangement by which Ashish holds shares in Mara Online for his cousin would be a sham and that is clearly not the case. I have made it clear that I accept entirely that the Foundation structure was not a sham, yet it held the assets for Ashish. The same is true of this second structure.

Mr Scott says that it is different because there was a declaration to the BVI authorities that the beneficial interests lay with Sarla and Ahuti. He points to the affidavit sworn by the Managing Director of Trident, Mr Goodman in the BVI confirming his understanding that the beneficial owners were Sarla and Ahuti. In this regard, I remind myself that, although I have not heard from Sarla, I am dealing with a witness, Ahuti who I have disbelieved on her oath. I am quite satisfied that, in so far as Sarla and Ahuti told Mr Goodman that they were the beneficial owners and allowed him to complete forms to that effect, they were not being frank with him just as they have not been frank with me. However, I am equally satisfied that, if it was necessary for me to so find, the document submitted to the BVI authorities satisfies the Snook test for sham. The declaration to the BVI authorities was a document that gave the appearance of creating a beneficial entitlement which was different from the actual beneficial entitlement.

It follows that I answer the questions posed in the following way:-