Ghazaani v Rowshan

Abbreviations

In this judgment I shall use the following abbreviations

Introduction

This is an unfortunate dispute between members of the Iranian community in Leeds. It is not in dispute that Mr Rowshan is the owner of the Leeds property. He is the registered proprietor under title number WYK204655. In these proceedings Dr Ghazaani relies on the doctrine of constructive trust and/or proprietary estoppel and contends that Mr Rowshan holds the Leeds property on constructive trust for him and should be compelled to transfer it to him.

There are substantial disputes of fact. Each side accuses the other of dishonesty. It will, of course, be necessary to set out the facts in more detail later in this judgment. For the purpose of the introduction it is sufficient to summarise the dispute which arises out of an oral agreement under which Dr Ghazaani and Mr Rowshan agreed to exchange the Leeds property for the Tehran apartment together with an equality payment.

It is Dr Ghazaani’s case that the equality payment was 500 million IR. He contends that in pursuance of the agreement he has transferred the Tehran apartment to Mr Rowshan and paid Mr Rowshan the 500 million IR. The Tehran apartment is now registered in Mr Rowshan’s name. Furthermore Mr Rowshan acting by his wife and lawyer Ms Mohammadi, has taken steps to evict the former tenant of the Tehran apartment, Mr Jazayeri and his family. The Tehran apartment is now occupied by Ms Mohammadi. Mr Rowshan has refused to transfer the Leeds property to Dr Ghazaani. Dr Ghazaani contends that a constructive trust/proprietary estoppel arises out of those facts under which Mr Rowshan can be compelled to transfer the Leeds property to him. Many of the facts supporting Dr Ghazaani’s case are supported by what appear to be certified copies of official documents and Court orders many of which bear the apparent stamp and apparent signature of Ms Mohammadi.

Mr Rowshan accepts that there was an agreement in principle between the parties. It is his case that that Mr Rowshan would sell the Leeds property to Dr Ghazaani for £175,000 payable by way of the exchange of the Tehran apartment (valued at £100,000) and £75,000 in Iranian currency. He denies that the Tehran apartment has been transferred to him. He denies that 500 million IR has been paid to him. He denies that he (or Ms Mohammadi) has evicted the former tenant. He denies that he is married to Ms Mohammadi and that she (or he) is in occupation of the Tehran apartment. In so far there are documents that support Dr Ghazaani’s case they are not genuine and/or have been obtained by corruption.

Mr Rowshan denies that the facts give rise to a proprietary estoppel or constructive trust. Although a number of legal points were taken in the pleadings there was in the end very little discussion or dispute about the law. It is therefore convenient to deal with the legal issues after the determination of the facts.

A large amount of oral evidence was called in addition to Dr Ghazaani and Mr Rowshan. Many of the witnesses did not speak English and gave evidence through an interpreter – Mr Sheikholeslami. Dr Ghazaani called Mohammad Ghazaani, Albolfazl Ghazaani and Dr Zargari who gave evidence about the discussions at the Zaffron restaurant and (in Dr Zargari’s case) other discussions with Mr Rowshan, Mr Beni who gave evidence about work done to the Leeds property, and Mr Lyons, his solicitor.

In addition he called (by means of a video link from Tehran) Iraj Ghazaani (his brother) and Mr Jazayeri (the tenant and former owner of the Tehran apartment) who evidence about the negotiations in Iran, the payment of the sums due in Iran and the eviction of Mr Jazayeri.

Mr Rowshan called Mr Bagheri the tenant of the Leeds property who dealt with the payment of rent of the Leeds property to Dr Ghazaani, and (by video link from Tehran Ms Mohammadi) who dealt with the registration of the Tehran apartment, the Court proceedings in Iran and her alleged marriage to Mr Rowshan.

I was also greatly assisted by the single joint expert - Dr Kakhki. Dr Kakhki practised law as a member of the Iranian Bar for a number of years. He has a Ph D from Durham University in Middle Eastern Politics and Law. He has been providing expert opinions on Iranian law and procedure since 2003 he has provided a holistic analysis and update of the Country of Origin Information report. His commentary and research have been integrated into the 2013 COIR for Iran. Dr Kakhki has provided 3 reports on the authenticity of a number of Iranian documents and on the Iranian legal system. He was cross-examined on behalf of Mr Rowshan for more than half a day.

Before turning to the detailed issues it is right that I should acknowledge the very considerable assistance I had not only from those representing the parties but also from the interpreter and Dr Kakhki. I have rarely had an interpreter who translated so faithfully and so accurately. This was especially helpful because the interpreters who were also present in Tehran were not familiar with English Court procedures and did not always interpret what the witnesses actually said. Furthermore there were a number of documents in Farsi where the translations before the Court contained inaccuracies. In every case Mr Sheikholeslami was able to provide me with an interpretation I could rely on.

The factual disputes

Dr Ghazaani is 55 years old. He came to the UK from Iran in 1992. He is married with 3 children. He graduated from Leeds University with a PhD in engineering in 1996. He runs a computer business – PC City alongside a property company – Farnaz Properties. He owns a number of properties both in Iran and in the UK. His properties in Iran are managed by his brother - Iraj Ghazaani.

Mr Rowshan is 74 years old. He suffers from ill health including prostate cancer and diabetes. He has been in the UK for 60 years. His first language is English. He has a basic knowledge of Farsi which allows him to communicate in basic terms in that language. He cannot, however, read or write Farsi.

It is not in dispute that up until the events giving rise to this dispute Dr Ghazaani and Mr Rowshan were friends. Dr Ghazaani accepted that Mr Rowshan was very helpful to him when he first came to the UK.

There is at least one previous transaction between the parties. About 15 years ago Mr Rowshan rented and subsequently sold a fish and chip shop to Dr Ghazaani. In cross-examination Mr Toone showed Dr Ghazaani a number of cheques which were signed by Dr Ghazaani and had not been cashed by Mr Rowshan. There was however a dispute, which I do not need to resolve, as to whether this was an act of generosity by Mr Rowshan or connected with an attempt by Mr Rowshan to increase the asking price for the fish and chip shop. It is, however, clear and common ground that the friendship survived the transaction and that they remained friends until 2011 when this transaction was being negotiated.

Mr Rowshan is the registered proprietor of the Leeds property under title number WYK204655. In 2011 the first floor of the Leeds property was empty. It had been used as a dental surgery and did not have planning permission for residential occupation.

The ground floor and the basement were let to Mr Bagheri at a rent of £6,000 per annum for a term of 9 years from 1 December 2005. Mr Bagheri ran an Iranian restaurant known as “The Darvish” from the premises.

The Tehran apartment is on the 4^th Floor of the Nasim complex in District 10 of Tehran. The Title Deeds for the Tehran apartment show that prior to 2009 the Tehran apartment was registered in the name of Mr Jazayeri and Ms Moharami. On 9 June 2009 Mr Jazayeri and Ms Moharami transferred the entirety (Footnote: ¹) of the Tehran apartment to Dr Ghazaani who was thereupon registered as the owner.

Dr Ghazaani entered into a lease back arrangement with Mr Jazayeri. The most recent agreement is for a period of 18 months from 5 May 2011 to 6 November 2012. The rent was a deposit of 400 million IR repayable at the end of the tenancy. The tenancy agreement was dated 3 May 2009 but, according to Dr Ghazaani, this was a mistake. The agreement was made in May 2011. The date was copied incorrectly from the earlier agreement.

In his witness statement Mr Jazayeri confirmed that he had sold the Tehran apartment to Dr Ghazaani in 2009.

According to Dr Ghazaani, negotiations for the transaction commenced in 2010. Mr Rowshan told him that he wanted an apartment in Iran so he could live there when he visited the country. He offered the Leeds property by way of exchange. At that time Dr Ghazaani thought that Mr Rowshan was asking too much for the Leeds property.

There is a conflict of evidence as to when an oral agreement was reached between the parties and as to its terms. There is also a dispute as to whether Mr Rowshan was pushing Dr Ghazaani to reach a deal or the other way round.

Dr Ghazaani says that the agreement was reached at an Iranian restaurant in Kirkgate, Leeds – the Zaffron – on 21^st March 2011 at a meal to celebrate the start of the Iranian New Year. The conversation was witnessed by a number of other people who were present at the meal including Dr Zargari, Abolfazl Ghazaani (Dr Ghazaani’s cousin and partner in PC City), and Mohammad Ghazaani (a cousin of Dr Ghazaani’s who lives in Birmingham) all of whom gave evidence in support of Dr Ghazaani’s case.

Dr Ghazaani’s case is that Mr Rowshan was offered a choice of two apartments in Iran. Insofar as he selected the Tehran apartment it was agreed that Dr Ghazaani would pay equality money of 500 million IR. In addition Dr Ghazaani agreed to pay the 400 million IR repayable to Mr Jazayeri on the termination of the lease. Once they had agreed the deal at the restaurant everyone congratulated them.

A short time later (in April 2011) Mr Rowshan met Dr Ghazaani, his wife and 3 daughters at the Hafsin restaurant in Leeds. Mr Rowshan brought his title deeds to the Leeds property. At that meeting Dr Ghazaani and Mr Rowshan discussed the question of lawyers. Dr Ghazaani indicated that he would be using Mr Lyons (of John Howe & Co). Mr Rowshan said that he did not need a lawyer in the UK.

Mr Rowshan denies that he was present at the Zaffron restaurant at all. Thus none of the discussions alleged by Dr Ghazaani and his witnesses took place. He agrees, however, that he was present at the Hafsin in April 2011. He says that at this meeting there was an agreement in principle between himself and Dr Ghazaani. He says that the price that was agreed was £175,000 for the Leeds property and £100,000 for the Tehran apartment. The difference of £75,000 was to be paid by Dr Ghazaani. The equality money was agreed in sterling as the exchange rate between sterling and Iranian Rials kept fluctuating but was to be paid in Iranian Rials when payment was made at the prevailing exchange rate. Mr Rowshan denies that he was offered a choice of two apartments. It is his case that he was only ever interested in the Tehran apartment.

Mr Rowshan agrees that at this meeting there was a discussion about lawyers and that he said he did not need a solicitor in the UK. He did not, however, bring the title deeds of the Leeds property to this meeting.

Dr Ghazaani instructed Mr Lyons by telephone to act for him in the exchange and gave Mr Lyons the basic details of the arrangement. He told Mr Lyons that Mr Rowshan did not wish to instruct a lawyer. Accordingly Mr Lyons agreed to see Mr Rowshan on 13^th May 2011.

There is a file note of the meeting between Mr Lyons and Mr Rowshan. It records that Mr Rowshan told Mr Lyons that he did not wish to have a solicitor. Mr Rowshan accepts that he said this but there is a dispute as to whether Mr Lyons gave positive advice to Mr Rowshan that he ought to have a solicitor. Mr Lyons was certain that he did give this advice. Mr Rowshan denied this. He said that he asked Mr Lyons if he needed a solicitor. Mr Lyons told him that he did not need a solicitor because he had everything here.

Mr Rowshan brought the title deeds to the Leeds property and deposited them with Mr Lyons. In the file note Mr Lyons noted details of the registration and of the lease. He recorded that the value of the Leeds property was £100,000.

On 23 May 2011 Mr Lyons wrote to Dr Ghazaani and Mr Rowshan. In the letter to Dr Ghazaani he drew attention to the possibility of a rent review on 1^st December 2011. In the letter to Mr Rowshan he referred to the fact that Mr Rowshan did not wish to instruct his own solicitor. He enclosed the draft Transfer Deed for signature by Mr Rowshan and raised a query about the tenancy of the upstairs dental surgery.

On 21^st June 2011 there was a telephone attendance between Mr Rowshan and Mr Lyons. According to Mr Lyons’s file note Mr Rowshan informed Mr Lyons that he had sent the transfer duly signed and witnessed. He confirmed that the dental surgery was empty. He was visiting Iran on 26^th June and would telephone when the matter could be completed.

The TR1 duly arrived with Mr Lyons. It is signed by both Dr Ghazaani and Mr Rowshan and properly attested. Mr Lyons plainly understood (in my view correctly) that the Deeds and the TR1 form were being held to Mr Rowshan’s order.

According to Iraj Ghazaani Dr Ghazaani phoned him in June 2011 and told him that Mr Rowshan would be travelling to Tehran and was keen to buy a flat. He asked Iraj Ghazaani to show Mr Rowshan round 2 flats in Tehran – one was the Tehran apartment, the other was an office in Valiasr, Zartosht.

Mr Rowshan has a step brother who is a dentist in Tehran. The stepbrother phoned Iraj Ghazaani and asked for details of the flats. Iraj Ghazaani took him to show the areas where the flats were and gave him the details. A few days later Dr Ghazaani phoned his brother and told him that Mr Rowshan was only interested in the Tehran apartment.

As already noted Mr Rowshan contends that there was ever only one property in Tehran.

Mr Rowshan visited Tehran between 26 June 2011 and 24 July 2011. There is a conflict of evidence as to whether he viewed the Tehran apartment at this time. According to both Iraj Ghazaani and Mr Jazayeri the viewing took place in July 2011. Iraj Ghazaani picked up Mr Rowshan from his sister’s house opposite Mellat Park in Tehran and took him to the Tehran apartment. Mr Rowshan checked the flat thoroughly and spent a few hours there having a friendly conversation with Mr Jazayeri and his wife. After the viewing Mr Rowshan told Iraj Ghazaani that he liked the Tehran apartment and the tenants. Iraj Ghazaani asked him to contact Dr Ghazaani to talk about finalising the deal. The next day Dr Ghazaani contacted his brother and asked him to provide a Power of Attorney for the Tehran apartment as Mr Rowshan wanted to proceed.

Mr Rowshan denies that he visited the Tehran apartment at all during this visit. He says that he was told that without a Power of Attorney he would not be able to make any enquiries or inspect the Apartment. He tried to contact Iraj Ghazaani but did not hear anything from him until the day before he was due to leave to return to the UK when Iraj Ghazaani provided him with a document purporting to be a Power of Attorney. Mr Rowshan did not have time to do anything with the Power of Attorney as he returned to the UK the next day. It is Mr Rowshan’s case that he had no knowledge of any tenancy until November 2011.

The Power of Attorney was registered on 20 July 2011. It appoints Mr Rowshan as Dr Ghazaani’s attorney in relation to his entire 6 shares of the Tehran apartment.

In paragraph 3 of her witness statement Ms Mohammadi described the document as worthless for 5 reasons:

Both in his witness statement and in cross-examination Dr Kakhki rejected the suggestion that the document was worthless. Whilst he accepted that it was not irrevocable it was valid until revoked. There is no evidence that it was revoked. The reference to “registry no 33390 secondary from 2395 main at district 10 of Tehran” was the most accurate way of identifying the Tehran apartment. Mr Rowshan was adequately referred to by reference to his name, his birth certificate and national code. His address was not necessary to affect the validity of the Power of Attorney.

Dr Kakhki did not accept that the scope of the powers granted to Mr Rowshan were limited. In his view it granted him extensive authorisation to deal with all the administrative matters pertaining to the said property, including attending various governmental bodies such as the tax offices, council, judicial and disciplinary organisations, as well as relevant utility suppliers (gas, electricity, water etc.) to prepare the property for transfer. Mr Rowshan was even authorised to sign the Transfer of Title into his own name, or that of any nominee, with the power to instruct any lawyer to act on his behalf, including in any given eviction litigation.

It is convenient to deal with all relevant issues in relation to the Leeds property at this point and thereafter to deal with the issues relating to the Tehran apartment.

According to Dr Ghazaani in early November 2011 he agreed with Mr Rowshan that they would travel to Iran to effect the Transfer of the Tehran apartment. He believed the arrangement to be that once the Tehran apartment was transferred, the 500 million IR paid and the 400 million IR that Mr Rowshan would then authorise completion of the Transfer of the Leeds property.

In any event it is common ground that in November 2011 Mr Rowshan introduced Dr Ghazaani to Mr Bagheri, granted Dr Ghazaani possession of the upstairs and instructed Mr Bagheri to pay the rent to Dr Ghazaani.

There are a number of conflicts of evidence in relation to these events. Dr Ghazaani says he was introduced to Mr Bagheri as “his new landlord”; Mr Rowshan says that Dr Ghazaani was introduced as the person who “might be his new landlord”. Mr Bagheri’s recollection coincided with that of Mr Rowshan.

Mr Rowshan says that the instruction for Mr Bagheri to pay the rent was only intended to be whilst he was in Iran. It was given because he trusted Dr Ghazaani and was on the basis that Dr Ghazaani paid any Council tax/business rates due in respect of the first floor of the Leeds property. Dr Ghazaani does not accept this. He says that there was no such limitation on his right to collect the rent from Mr Bagheri. It is to be noted that Mr Rowshan returned from Iran in December 2011 yet took no steps to start collecting the rent from Mr Bagheri until April 2012.

On 5^th November 2011 Dr Ghazaani wrote to Mr Bagheri. In the letter he stated (incorrectly) that he had recently acquired the freehold of the Leeds property, that the rent was reviewable from December 2011 and that he proposed a new rent of £10,000 per annum.

There was no reply to the letter. According to both Dr Ghazaani and Mr Bagheri there were oral discussions between them during which Mr Bagheri offered a sum between £7,000 and £8,000. Mr Bagheri however said it was conditional on Dr Ghazaani proving he was in fact the landlord.

Sometime in April 2012 Mr Rowshan revoked the instruction to Mr Bagheri to pay the rent to Dr Ghazaani. Thus no sums were paid to Dr Ghazaani for May and June 2012. On 5^th June 2012 Dr Ghazaani sent a letter demanding the payment of arrears (on the basis of a valid rent increase to £10,000 per annum) and threatening forfeiture proceedings.

On 7^th June 2012 the bailiff attended the premises on Dr Ghazaani’s instruction and entered into a walking possession agreement in respect of what were alleged to be arrears of £3,333.31. Shortly thereafter a further £1,000 was paid to Dr Ghazaani and Dr Ghazaani instructed the bailiff to withdraw.

Mr Bagheri took the view that the £1,000 had been obtained by a trick in that he was abroad at the time. Furthermore he was faced with demands to pay the rent to both Dr Ghazaani and Mr Rowshan. Dr Ghazaani had not proved to him that he was in fact the landlord. In any event all further payments of rent were made to Mr Rowshan.

It is not in dispute that between November 2011 and April 2012 Dr Ghazaani carried out significant alterations to the first floor of the Leeds property and has converted it into residential accommodation. Dr Ghazaani has produced an invoice indicating that he spent £10,490 for the labour involved in the alterations. No doubt a substantial sum was also spent on the materials.

It is not in dispute that no planning permission or building regulation consent was obtained in relation to the alterations. On behalf of Mr Rowshan it has been suggested that the quality of the workmanship is low. Mr Rowshan exhibited to his statement a report from Mr Southern criticising the workmanship and estimating a cost of some £29,770 plus VAT to carry out the work in the report. This is not a case where any expert evidence has been authorised in relation to the quality of the workmanship and I make no finding on the quality of the workmanship.

There is a dispute as to the extent to which Mr Rowshan knew and/or approved of the work carried out by Dr Ghazaani. It is Dr Ghazaani’s case that Mr Rowshan knew and approved of the work that he was carrying out. Indeed on one occasion when he visited the property the work was being carried out and made suggestions as to further improvements.

Mr Rowshan’s position on this issue was not entirely easy to follow. His initial position was that the only reason he allowed Dr Ghazaani into possession of the first floor was so that he could instruct an architect to draw up plans for the conversion of the property. In cross-examination, however, he said that he agreed that Dr Ghazaani could apply for planning permission for the conversion works. He said that he was unable to get into the flat to see the works. He kept asking Dr Ghazaani if planning permission had been granted but Dr Ghazaani told him that no planning permission was needed.

At one time Mr Rowshan seemed to be suggesting that he consented to the alterations once planning permission had been obtained. However in re-examination he qualified this. He only consented to the works being carried out after completion of the transfer of the Leeds property to Dr Ghazaani.

Dr Ghazaani’s case was supported by Mr Beni and Mr Bagheri. Mr Beni is a part time joiner who did about 15 – 20 days joinery work in the conversion works. He said that whilst fitting the shower room Dr Ghazaani and Mr Rowshan came to check the progress of the work. Mr Rowshan made a number of suggestions to Dr Ghazaani as to the progress of the work.

Mr Bagheri referred in a cross-examination to a conversation with Mr Rowshan when he (Mr Bagheri) complained about the noise of the alterations especially during hours when the restaurant was open. Mr Rowshan said that Dr Ghazaani was not the new landlord but was doing work for him (Mr Rowshan). If correct this clearly implies that Mr Rowshan both knew and approved of the alterations.

It is not in dispute that Dr Ghazaani has retained possession of the first floor flat. He has 3 daughters and it has been occupied from time to time by two of them who were studying on graduate or postgraduate courses at Leeds University.

In June 2012 an attempt was made by Mr Rowshan to regain possession of the first floor flat. Both Dr Ghazaani and Mr Rowshan changed the locks. Eventually Mr Rowshan called the police. However the police took the view it was a civil dispute and did not get involved.

The end result is that Dr Ghazaani has retained possession of the first floor flat whilst Mr Rowshan has (since June 2012) collected the rents from Mr Bagheri. Mr Rowshan has not attempted to invoke the rent review clause with the result that the rent has remained at £6,000 per annum.

On 20 February 2013 Leeds City Council served a notice on Dr Ghazaani in respect of the failure to pay the non domestic rates for the first floor flat from 1 November 2011 to 1 April 2012 in the sum of £1,618.43. Dr Ghazaani replied that “we are in the process of buying the property and until completion are not liable for council rates”.

A further notice was served in respect of the 2012/2013 period in the sum of £4,050. Leeds City Council replied to Dr Ghazaani on 7 March 2013 asserting that he had occupied and had control of the property and had control of it. Dr Ghazaani replied on 23 March 2013 that he maintained that he was not liable for rates.

When he gave evidence I understood Mr Rowshan to have said that he was currently paying the rates on the first and second floor of the Leeds property. He said that he had come to an arrangement with Leeds City Council in respect of the arrears (which are being paid at £30 per month). Information supplied by Leeds City Council after the close of submissions indicates that he in fact has only paid

£1,691 in respect of the period from 1/4/2011 to 7/4/2011 – a period prior to Dr Ghazaani’s occupation

£110 only in respect of council tax charges for the period thereafter.

On 13 September 2013 Leeds City Council served a Notice under s 171 of the Town and Country Planning Act 1990 in respect of what was alleged to be a breach of planning control. The alleged breach was the change of use of the first floor flat from a dental surgery to self contained flat. The Notice required Mr Rowshan to provide relevant information to Leeds City Council.

On 2 October 2013 Mr Rowshan replied to the Notice stating that he was the owner, that Dr Ghazaani was using the land and that in his view planning permission was needed.

It is common ground that, to date, Leeds City Council has not followed up the service of the s 171 Notice. In particular no enforcement notice has been served.

Both Dr Ghazaani and Mr Rowshan were in Tehran in November 2011. Mr Rowshan’s passport shows that he entered Iran on 14 November 2011 and left on 15 December 2011. Dr Ghazaani travelled to Iran one day earlier. It is not clear when Dr Ghazaani left.

It is Dr Ghazaani’s case that the Transfer of the Tehran apartment to Mr Rowshan was effected by a Transfer registered on 28 November 2011 at Public Notary Office No 751 in Tehran.

The transfer refers to Dr Ghazaani as the seller and Mr Rowshan as the buyer. Mr Rowshan is said to be acting as Dr Ghazaani’s proxy by virtue of the Power of Attorney. The object of the transaction is to transfer the entire 6 shares in the apartment to Mr Rowshan. It appears to be signed twice at the bottom by Mr Rowshan – once in his own capacity and once as proxy for Dr Ghazaani.

In paragraphs 10 and 11 of his first opinion Dr Kakhki commented on the Transfer in this way:

In answer to a number of questions from Mr Rowshan’s lawyers Dr Kakhki elaborated on his advice:

There are a number of official documents which confirm the validity of the Transfer. These include:

A document dated 15/07/2013 from Notary Public No 751 (which is appropriately signed and sealed) stating that by virtue of the Transfer the entire 6 shares were transferred to Mr Rowshan.

A judgment dated 24 July 2012 and sealed on 15 August 2012 from Chief Judge of Branch 5 of Tehran Public Court of Law which after considering a reply to an enquiry made to the Registration Department declared that Mr Rowshan was the official owner of the property in question.

A letter dated 1 February 2014 from the Head of Deeds and Real Property Registration office of Northwest Tehran to the Presiding Judge of Court 5 which states in terms that the property was transferred to Dr Ghazaani on 9 June 2009 and then to Mr Rowshan on 28 November 2011 by virtue of the Transfer. The letter apologises for a mistake in an earlier reply.

In order to obtain registration of Title it is necessary to produce relevant documents from the Council to establish that municipal taxes and charges have been paid. According to Dr Ghazaani Ms Mohammadi telephoned him whilst he was in Iran and asked him to deliver the Council papers to her to enable the registration to take place. He referred her to Mr Jazayeri – the tenant. Both in his witness statement and in evidence before me Mr Jazayeri said that he had been helpful to Mr Rowshan by providing the necessary documentation to allow the registration to proceed. He had also said the same in his witness statement dated 21 July 2012 to Public Law Court no 5.

Mr Rowshan does not accept that the Tehran apartment was ever transferred into his own name. He denies that the signatures on the Deed are his signatures. In his witness statement Mr Rowshan says that he showed the Power of Attorney to Ms Mohammadi on about 15^th November 2011. Ms Mohammadi said it was invalid. Despite this they went to the relevant authority to transfer the Tehran apartment to Mr Rowshan. They were unable to do so because they needed proof of payment of bills and utilities. Mr Rowshan accepted that he or Ms Mohammadi telephoned Dr Ghazaani and Iraj Ghazaani in an attempt to obtain relevant documents. It was then he was told there was a tenant who would provide relevant documents. He denies that he was able to get the necessary tax receipt or the relevant utility bills.

He does not accept that his title was ever registered at Public Notary Office no 751. Ms Mohammadi rejected the letter dated 15/7/13 as a fake and did not accept that the registration was valid. She said it lacked a proper serial number. She denied that she had contacted either Dr Ghazaani or Mr Jazayeri to obtain municipal documents.

Ms Mohammadi seeks to rely on a letter dated 17 July 2012 from the President of the Real Property Registration office of Northwest Tehran to the Presiding Judge of Court 5 which states that the entire ownership of the Tehran apartment is in the name of Mr Jazayeri and his wife Ms Fatemah Moharrami. It is Mr Rowshan’s case that the statement in that letter is accurate. It follows that he does not accept that there was ever a tenancy between Dr Ghazaani and Mr Jazayeri.

It has to be pointed out that the letter of 1 February 2014 (referred to above) specifically acknowledges that the letter of 17 July 2012 (wrongly referred to as 18 July 2013 but giving the correct reference) was wrong and that Mr Rowshan was the registered owner.

Mr Toone seeks to destroy the significance of the letter of 1 February 2014 by referring to a further correction in a letter dated 22 April 2014 also from the Head of Deeds and Real Property Registration office of Northwest Tehran to the Presiding Judge of Court 5 which corrects the wrong date in the letter of 1^st February 2014 but otherwise confirms the rest of its contents.

Mr Toone points to a number of curiosities about this correspondence. First he points to the fact that there were no proceedings in Court No 5 in February 2014. Those proceedings ended in July 2012. Second he points to the fact that the letter of 22 April 2014 was apparently translated the day before it was written. Finally he noted that it was an exhibit to a witness statement apparently signed by Mr Jazayeri on 3 April 2014. He accordingly submits that the only reliable document is the original letter of 17 July 2012. He also points to the fact that the Council and utility bills are still in the name of Mr Jazayeri.

It will be recalled that it is Dr Ghazaani’s case there was an equality payment of 500 million IR payable by Dr Ghazaani to Mr Rowshan. There is a conflict of evidence as to whether this 500 million IR was ever paid.

Iraj Ghazaani manages his brother’s properties in Tehran. On the instructions of his brother, Iraj Ghazaani wrote out two cheques dated 18^th and 25^th November 2011 –for 200 million IR and 300 million IR respectively, placed them in an envelope with the original deeds and the Power of Attorney and instructed an employee to deliver them to Mr Rowshan at his mother’s house in Tehran.

It is Dr Ghazaani’s case that the two cheques were received by Mr Rowshan and that the proceeds of the cheques were paid into an Iranian Rial account in Mr Rowshan’s name at the Saman Bank (valiasr-za branch).

Mr Rowshan denies that he received the two cheques, denies that he paid any money into the Saman Bank and denies that he had an Iranian Rial account with that bank (though he acknowledges he did have a sterling account with that bank.

Although the cheques have never been produced there is considerable documentary evidence which appears to support Dr Ghazaani’s case. Mr Rowshan challenges the authenticity of these documents and/or suggests that they were obtained by corruption.

Iraj Ghazaani has disclosed a bank statement of his account with Keshavarzi Bank in Tehran which shows that on 17^th November 2011 there was a nil balance on the account. On 20^th November 2011 there was a transfer into the account of 200 million IR. This sum was transferred out on the same day. On 26^th November 2011 there was a transfer into the account of 300 million IR. This sum was transferred out on the same day. There was a nil balance after each of these payments. There is no evidence as to the source of the monies transferred into the account.

Two paying in slips which purport to show the payment in of the 2 cheques into the account of Mr Rowshan. There are a number of features of the paying in slips which call for mention:

Dr Ghazaani says that he discovered the details of Mr Rowshan’s bank account from the paying in slips. In a witness statement dated 5^th December 2013 Mr Rowshan denied the existence of account no 801 20 45444 1 but accepted that he had a sterling account with Saman Bank no 801 740 45444 1. As a result on 7^th and 10^th December 2013 Dr Ghazaani made two test payments of 10,000 IR and 10,001 IR (each equivalent to less than 50p in sterling) into account no 801 20 45444 1. Both payments arrived in the account.

Furthermore on 6^th January 2014 Dr Ghazaani and Mr Rowshan’s step brother, Fariborz Rowshan visited Saman Bank and obtained a bank statement for account 801 20 45444 1. According to Dr Ghazaani Fariborz Rowshan was a signatory on the account and thus able to obtain a statement. Fariborz Rowshan was willing to help Dr Ghazaani because he is in dispute with his brother over an unrelated inheritance matter. A number of points can be made about the statement:

It will be recalled that under the terms of the tenancy agreement on 6^th November 2012 Mr Jazayeri was entitled to the return of the deposit of 400 million IR. According to Dr Ghazaani it was a term of the agreement with Mr Rowshan that he (Dr Ghazaani) would be responsible for this payment.

It is not in dispute that Iraj Ghazaani gave Mr Rowshan 2 post-dated cheques for 200 million IR. The cheques were drawn on the same bank account as Iraj Ghazaani had used for the payment of the 500 million IR. One cheque was dated 21/04/2012 and the other 23/10/2012.

It is Dr Ghazaani’s case that those cheques were in respect of the rent deposit. Mr Rowshan denies this. As I understand his case the monies were paid generally on account of the monies due under the agreement.

In any event it is not in dispute that at some time (Footnote: ³) Mr Rowshan was the victim of a robbery in Tehran. His bag containing money, his passports and a number of documents including the two post-dated cheques was stolen. Mr Rowshan rang Iraj Ghazaani and asked him to stop the cheques.

Some time later someone found a few bags in a rubbish bin. One of them contained the two cheques, Mr Rowshan’s passports and (according to Dr Ghazaani) the paying in slips. Following a phone call from his bank manager these items came into the possession of Iraj Ghazaani.

Iraj Ghazaani removed the signatures from the cheques (which had in any event been stopped) and returned the cheques and passports to Mr Rowshan.

Some time (probably in February 2012) Dr Ghazaani deposited an Iranian bankers draft for 400 million IR with Mr Lyons to be handed over to Mr Rowshan on completion of the Transfer of the Leeds property to Dr Ghazaani.

On 27^th February 2012 Mr Rowshan telephoned Mr Lyons. He told Mr Lyons that he could do nothing with the bankers draft as he did not have an Iranian bank account and could not read Iranian. He also said that he wanted both transactions cancelled and for Dr Ghazaani to hand back the keys of the Leeds property. He said that his Iranian lawyer advised him that that the Tehran apartment had not been transferred to him.

It is common ground that there was some litigation between Mr Rowshan and Mr Jazayeri in respect of the Tehran apartment. There is, however, a very substantial dispute as to the extent and effect of the litigation. Dr Ghazaani’s version of the litigation is supported by a large number of documents (including many of which are apparently signed by Ms Mohammadi and bear her legal stamp). In the course of her evidence Ms Mohammadi disowned these documents. Whilst she acknowledged that the stamp looked like her stamp she said that her stamp might have been copied. Although the signatures were similar to her signature she disowned them. They must accordingly have been forged. In addition Dr Ghazaani’s version of the litigation is corroborated by Mr Jazayeri who helpfully produced a large number of the relevant documents.

So far as I can ascertain Mr Rowshan and Ms Mohammadi have not produced a single document in support of their version of the litigation.

According to Dr Ghazaani there were at least 4 sets of proceedings:

It is not clear when these proceedings commenced. There has been produced an undated petition for eviction apparently signed by Ms Mohammadi. A significant feature of the petition is that it asserts in paragraph 1 that Mr Rowshan purchased the apartment from Dr Ghazaani on 28/11/2011 (the date in the Farsi photocopy is not clear but the Court interpreter explained that this was the date). It made no mention of the tenancy and alleged that Mr Jazayeri was (in effect) a trespasser.

Ms Mohammadi made the point that this document does not bear the Court stamp.

Mr Jazayeri filed two lengthy documents on 21^st July 2012. Mr Jazayeri asserted he was the tenant. He referred to the fact he had provided utility bills to enable the transfer to proceed in November 2011. He complained of harassment by Mr Rowshan/Ms Mohammadi.

On 24 July 2012 the President of the Court issued a judgment in favour of Mr Rowshan. In summary the judge was satisfied as to Mr Rowshan’s title and held that Mr Jazayeri had not presented any evidence as authorisation for his possession.

On 3^rd September 2012 Mr Jazayeri submitted a Bill of Appeal. In summary he submitted that under Art 498 of Civil Law Mr Rowshan could have no better right to evict Mr Jazayeri than Dr Ghazaani. As the tenancy was still subsisting there was no right to evict.

On 1^st November 2012 Mr Jazayeri was served with a notice to appear on March 12 2013. Mr Jazayeri made a further submission on 11^th March 2013.

In a judgment dated 1^st May 2013 the appeal was allowed on the basis that there was a valid tenancy agreement binding on Mr Rowshan.

It appears that there were further negotiations in that there are further hearing notices and a further statement from Mr Jazayeri referring to tripartite negotiations but there is no further judgment from the Appeal Court.

The proceedings were begun with an undated petition to the Dispute Settlement Council apparently made by Ms Mohammadi on behalf of Mr Rowshan. It appears to be signed by Ms Mohammadi and bears her signature. It appears to exhibit Title Deeds showing Mr Rowshan as the owner. She claims an eviction order of the Tehran apartment on the ground that the tenancy agreement has expired.

There is an undated witness statement apparently from Ms Mohammadi setting out the same material and exhibiting the same documents. The witness statement is also apparently stamped with Ms Mohammadi’s stamp and signed by her.

There are two notices requiring Mr Jazayeri’s attendance at the Dispute Settlement Council on 14/7/2013 and 24/8/2013 regarding “Mr Rowshan’s lawsuit against you”. Both of those notices bear the appropriate stamp and seal of the Dispute Settlement Council.

There is a witness statement from Mr Jazayeri apparently dated 25/8/2013 referring to a hearing apparently on 13/7/2013 when there was concern as to the validity of the assignment of the lease from Dr Ghazaani to Mr Rowshan. Mr Jazayeri asked for a verdict for the “submission of the original lease agreement or a copy verified by Dr Ghazaani”. He also pointed out his wife was recovering from surgery and needed 3 weeks convalescence. He pointed out that he had to attend court sessions between June 2012 and July 2013 and been subject to both physical and non-physical damages.

On 26^th or 27^th August 2013 (the translation contains both dates) the court issued a civil execution notice addressed to the Head of Police requiring Mr Jazayeri to vacate within 3 days to avoid enforcement. The document is stamped and signed by the Justice Administration in Tehran Province.

On 10^th September 2013 the Enforcement Officer (Mr Baradari) signed a report (described as “Inquiry sheet and Procès-verbal”) in which he stated that he visited the Tehran apartment on that day. The property entrance was open. Mr Jazayeri was present and the property had been vacated. Mr Jazayeri handed over the property keys and the remote for the parking to Ms Mohammadi. The report is countersigned by both Mr Jazayeri and apparently Ms Mohammadi.

On 18^th September 2013 Mr Jazayeri received a cheque for 350 million IR from the Dispute Council in respect of his rent deposit.

According to the judgment Ms Mohammadi submitted a petition claiming repayment of 350 million IR. The claim was referred to Branch 20 of the General Court of Law of Tehran.

On 21/9/2013 Mr Atalebi, an Architect and Official Expert to the Administration of Justice who had been instructed to collect evidence, produced a detailed two page report addressed to the Council for Dispute Settlement. The report is signed and sealed by Mr Atalebi. It also is apparently signed by Ms Mohammadi and contains her stamp.

It is apparent from the first page of the report that he has studied the title deeds in some detail. These included the tenancy agreement between Dr Ghazaani and Mr Jazayeri, and the Transfer dated 28/11/2011 from Dr Ghazaani to Mr Rowshan.

It is also apparent that Mr Atalebi visited the Tehran apartment with Ms Mohammadi after the eviction on 10^th September 2013. He found that the apartment was not cleaned after vacation and that there were a number of items of damage. He assessed the rent (mesne profits) from 7/11/2012 until 10/9/2013 in the sum of 156.8 million IR and the damages for cleaning repairing and fixing the apartment in the sum of 5 million IR.

It is not clear whether the report of Mr Atalebi to the Dispute Settlement Council was part of the material before Branch 20 of the Public Court of Tehran.

In any event on 26^th January 2014 Judge Sarvi issued a judgment rejecting the claim. The judgment is signed and sealed by Judge Sarvi. It is also apparently signed and sealed by Ms Mohammadi on 10^th February 2014. It is said to have been given in the presence of the parties.

The judgment makes no reference to the report of Mr Atalebi. According to the judgment Ms Mohammadi had pleaded that there had been a suggestion by Mr Jazayeri in the earlier proceedings that the landlord (Mr Rowshan) would sell the rented property to the tenant (Mr Jazayeri) and that Mr Jazayeri would give up the amount of the deposit as his goodwill. In any event the judge rejected the claim on the basis that Mr Rowshan had provided no evidence that he was entitled to the payment.

Ms Mohammadi apparently submitted a three page Notice of Appeal against the judgment. The Notice of Appeal is apparently signed and stamped by Ms Mohammadi on each of the three pages. It is undated but states that it is made within the official deadline (20 days of the judgment date).

In the Notice of Appeal Ms Mohammadi referred to the other proceedings and to the transfers to Branch 20. She complained that the judgment makes no reference to the expert’s report dated 22/10/1993 (Footnote: ⁴). She asserted that Mr Jazayeri is attempting to compel Mr Rowshan (an old and retired person) to sell the Tehran apartment to him at a low price in instalments an in good condition. In the result she asked for a retrial.

On 15 April 2014 Mr Jazayeri filed an objection to the appeal in response to an official notice. Amongst other points he asserted that:

Mr Rowshan is not entitled to any rent for the period between December 2012 and the date of eviction because there was no repayment of the deposit of 400 million IR during this period.

7 months after eviction the balance of the deposit of 50 million IR has not been repaid

He asked for reimbursement of substantial costs which he had paid.

In his evidence Mr Jazayeri confirmed that events had occurred in accordance with the court documents set out above. Thus he confirmed that he had lost in the first court and had to go to appeal. He confirmed that he was evicted and had given up possession just after his wife had had surgery. He confirmed that he had received the 350 million IR but complained that he had not received the 50 million IR to which he said he was entitled.

He said that the documents were all genuine.

Ms Mohammadi’s evidence is contained in paragraphs 27 to 33 of her witness statement. Rather than summarise it I shall set it out in full:

As already noted when she gave evidence Ms Mohammadi disowned all of the documents which bore her apparent signature and stamp. These included the petition which she exhibited as LMNB4. She did not produce any of the documents that she said had been used in the legal proceedings. Thus she did not produce the petition which she said had been left on the court file. She did not produce any orders of the court or any witness statements that were before the Court.

She rejected Mr Jazayeri’s witness statements on the ground that they were not “legal procedures”; she denied that she obtained the possession order on 27^th August 2013; she pointed out that the report of the Court Enforcement Officer was not stamped; she did not pay any money to the Dispute Settlement Council to enable it to pay Mr Jazayeri 350 million IR. She did not visit the apartment with Mr Atalebi. She rejected the judgment of Judge Sarvi in January 2014 and denied that she had submitted a Notice of Appeal.

There is a dispute as to who is currently occupying the Tehran apartment. It is Dr Ghazaani’s case that Ms Mohammadi is in occupation. He relies on a document dated 22/11/2014 signed and sealed by the Board of Nasim Residential Complex. That document is a certificate that the apartment belonging to Mr Rowshan was renovated by his wife of Mr Rowshan and has been occupied by her since 23/09/2014. Dr Ghazaani has produced a request for payment of expenses of the apartment addressed to Ms Mohammadi.

Mr Rowshan and Ms Mohammadi deny that they are married or that Ms Mohammadi is in occupation of the Tehran apartment. They suggest that Mr Jazayeri is still in occupation. They have produced a document which purports to come from the Director’s Office dated 19/2/2015 which says that according to the latest documents presented to the directors Mr Rowshan is not the owner of the Tehran apartment. They have produced utility bills still in the name of Mr Jazayeri.

A major issue that has arisen in the course of this litigation is whether Mr Rowshan and Ms Mohammadi got married on 17^th April 2012. A number of the witnesses made reference to a possible marriage. Thus in paragraph 6 of her witness statement Dr Zargari stated that Dr Ghazaani and she had suggested that Mr Rowshan find an Iranian woman to marry so that they could live together and look after each other. Similarly Iraj Ghazaani in paragraph 9 refers to his wife introducing Mr Rowshan to “Akram”. They met, had a couple of dates but it did not work out.

The issue came to the fore in an application before DJ Goldberg which was heard on 12^th November 2014. One of the matters before him was a Part 18 request as to whether Mr Rowshan and Ms Mohammadi were married. It was supported by a witness statement from Naser Gholami dated 11^th November 2011. Mr Gholami describes himself as a close friend of Mr Bagheri. He said that in September 2014 he met Mr Rowshan accompanied by a lady in her late thirties. Mr Rowshan introduced her as his wife Leila.

When she gave evidence Ms Mohammadi accepted that she had visited the UK arriving on 13^th June 2014. She said she had remained in the UK for about 2 months and accepted that she had visited Leeds and seen Mr Rowshan. She has been a friend of Mr Rowshan’s sister for about 15 years.

In any event DJ Goldberg refused the application on the ground it was not a proper Part 18 Request. On 14 November 2011 Dr Ghazaani booked a flight to Iran in order to investigate further.

On 17^th November 2011 there was hand delivered to Mr Lyons’s office an anonymous letter from a person describing himself as a friend of Mr Rowshan which reads:

The enclosed document in Farsi purported to be an extract from the Bureau for the Registration of Deeds at the Notary Public Office for Marriage no 171. The document contains details for Mr Rowshan which are accurate (save that, according to Mr Rowshan it misstates his religion). It contains an accurate statement of Ms Mohammadi name, date of birth and place of birth. It states that Ms Mohammadi has been married before but is divorced. It states that “the legal formula for marriage was pronounced by me, Hadi Gholami the Notary Public”. It states that both Mr Rowshan and Ms Mohammadi signed.

The document was signed by Mr Gholami.

Dr Ghazaani was cross-examined as to the source of this document. It was suggested to him that he would not have booked the flight to Tehran on 14^th November 2011 if he had not know about it. Thus it was suggested that it was he who had provided it. Dr Ghazaani denied this.

In any event Dr Ghazaani flew to Iran on 18^th November 2011 visited Mr Gholami on 20^th November 2011 and asked him for a certified copy of the extract paying a fee of 200,000 IR. He was provided with 2 certified copies by Mr Gholami.

On 17/02 2015 Mr Gholami supplied a further document in Farsi which has been the subject of a number of translations. As a result I asked the Court interpreter to translate it again. The relevant part of his translation reads:

Thus he does not make any comment on the authenticity of the document itself. He simply says that it should only be provided to Mr Rowshan or Ms Mohammadi.

It was common ground that Mr Rowshan was in Tehran on 17^th April 2012. He had flown there the day before. However Mr Rowshan and Ms Mohammadi denied being married.

Ms Mohammadi criticised the extract. She made the point that it was not true and was not stamped. She said she visited the person who made it (Mr Gholami) and he said that it was a fake. She said that Mr Gholami should be prosecuted.

Mr Rowshan referred to the fact that only a wife or a husband can get a copy of the marriage certificate. He made the point that many of the details about him were on his ID card which he lost in the robbery. Thus Dr Ghazaani could have copied them from that. He made the point that he was not a Shia Muslim. He was a Christian.

On 11^th July 2012 Mr Lyons wrote a letter before action to Mr Rowshan. After summarising the facts he invited Mr Rowshan to complete the transfer of the Leeds property within 14 days and threatened legal proceedings. He advised Mr Rowshan to consult solicitors.

There was no reply to that letter. As a result on 15^th August 2012 Mr Lyons made an application to the Land Registry for a unilateral notice against the Leeds property. The basis of the claim was “an Agreement dated 11^th November 2011” under which Dr Ghazaani agreed to transfer the Tehran apartment to Mr Rowshan in consideration of Mr Rowshan transferring the Leeds property to Mr Rowshan on payment of certain monies. It was alleged that the monies had been paid and the Tehran apartment transferred.

On 7^th September 2012 Mr Rowshan (who had by then consulted solicitors) applied to cancel the notice. On 12^th October Dr Ghazaani objected to the application to cancel. The proceedings were duly referred to the Adjudicator to HM Land Registry .

In the meantime on 3^rd October 2012 Mr Lyons wrote to Mr Rowshan and his solicitors offering to pay the 400 million IR and asking Mr Rowshan to identify a bank account into which the money should be paid.

On 29^th January 2013 the Chancery proceedings now before me were issued. On 20^th February 2013 the Adjudicator directed that the proceedings before him should be adjourned pending the outcome of these proceedings.

The expert evidence of Dr Kakhki

As already noted Dr Kakhki provided 3 reports.

In the introduction Dr Kakhki summarises the Iranian Law. He points out that its principles and legality are as prescribed under Shari’a Law. The Civil Courts serve as the initial legal venue for civil litigation. Civil claims are initiated by the filing of a petition by the Claimant or his legal representative. After the Court’s decision is final and all avenues of appeal have been exhausted the case is sent to the Civil Enforcement Office for enforcement.

In section 2 he considered the authenticity of the photocopied documents with which he was provided. Before considering the individual documents he outlined the general set of guidelines for Iranian official and legal documents:

In paragraph 9 he made the point that

In paragraphs 10 to 13 he summarised the documents forming the title of Mr Rowshan, and the tenancy of Mr Jazayeri. In paragraph 14 he considered the bank transfer records in relation to the 500 million IR and the 400 million IR. In paragraphs 16 to 20 he summarised the documents in relation to the various sets of proceedings.

He expressed his conclusions in paragraph 21 to 24 of his report:

In Section 3 Dr Kakhki considered a number of specific issues.

After considering the system whereby property is sold or transferred in Iran he concluded:

After considering the process for eviction he concluded:

He also made the point (in paragraph 39) that

In his second report Dr Kakhki was asked to reply to 24 questions including questions about the Power of Attorney and the Transfer. I have already set out his answers. It is, however, worth noting that in answer to query 15 which related to the validity of the eviction Order of 27^th August 2013 addressed to the Head of Police he said:

In answer to query 23 Dr Kakhki accepted that there is corruption in Iran in both civil and criminal spheres. In his opinion the creation of such a wide ranging chain of counterfeit documentation, if possible at all, would be highly unlikely.

In his third report Dr Kakhki considered the documents relating to Mr Rowshan’s marriage with Ms Mohammadi. These included the document delivered to Mr Lyons on 17^th November 2014 both before and after it had been certified by Mr Gholami and the further document sent by Mr Gholami on 17 February 2015.

In his report he concludes that the format and layout of the documents are correct and thus he confirmed the authenticity of the Transcript of the Marriage Certificate. He agreed with the Court interpreter as to the correct translation of the document of 17^th February 2015. The extract was invalidated solely on the basis that it was given to someone other than the husband who was the intended recipient.

He also considered the two documents dated 22/11/2014 and 19/2/2015 in relation to the occupation of the Tehran apartment. He made the point that the document dated 22/11/2014 (which asserted that Ms Mohammadi had been in occupation of the Tehran apartment since September 2014) has been issued on the letter head of the said residential complex and endorsed by a Mr Ghazi on the above date using their unique ink stamp of the complex management company in conjunction with the issuing official’s signature. He thus felt able to authenticate the document.

However Dr Kakhki was unable to authenticate the document dated 19/2/2015 (which purported to confirm that Mr Rowshan was not the owner of the Tehran apartment). In his view the document:

Dr Kakhki was cross-examined before Ms Mohammadi gave her evidence. However at the end of her evidence he stated that her evidence did not change his opinion at all.

He was cross-examined on a number of topics. These included the question of corruption in the judiciary in Iran. I was referred to a passage on page 20 of Dr Kakhki’s commentary of the January 2013 COI report. The passage in the report is concerned with corruption in cases of those facing criminal prosecution. He referred to a speech by the Judiciary Chief who acknowledged that some corruption existed but it was not fair to state that all judges were corrupt.

Dr Kakhki made the point that whilst the civil system of justice is not comparable with the UK system and is not perfect it is up and running and is used by a high proportion of the 74 million people who live in Iran. There are hundreds of people who have been provided with accurate legal proceedings with their own lawyer to represent them.

Dr Kakhki accepted that there were examples of bribery within the judiciary. Some top judges had accepted a huge amount of money (billions of IR). He pointed out that the criminal penalty for accepting bribes and forging documents is up to 10 years imprisonment. In his view it is unlikely that a judge would accept a bribe in a low level case such as this.

He was referred to paragraph 30 of the September 2013 COI Report for Iran which included a passage in paragraph 30.01:

However the following paragraph 30.02 includes:

Dr Kakhki did not accept that all the documents in this case could have been forged. It would have involved the bribery of a large number of Court officials. To obtain such a large amount of documents would have involved a huge amount of money.

He was cross-examined on some of the documents which are challenged in this case. In summary he maintained the position which is set out in his reports.

Assessment of Witnesses

This is not a case where it is possible to attribute the disputes of fact in this case to differences in recollection between the parties. The differences are so great that at least one of the parties must have been lying to the Court.

I agree with Mr Toone that in the light of the friendship between Dr Ghazaani and Mr Rowshan, the fact that Mr Rowshan helped Dr Ghazaani when his family came to the UK in 1992, and Mr Rowshan’s ill health it would be surprising if Mr Rowshan was lying over the matters in dispute in this case. I also agree that in the light of Ms Mohammadi’s qualifications as a lawyer it would be surprising if she were lying over the legal proceedings she was involved with and her marriage. On the other hand it seems to me that it would be equally surprising if Dr Ghazaani, Iraj Ghazaani and Mr Jazayeri were lying, and guilty of forgery and corruption to the extent necessary for Mr Rowshan’s case is to be accepted. All 3 are men of good character; whilst Iraj Ghazaani is Dr Ghazaani’s brother there is no apparent reason why Mr Jazayeri should support Dr Ghazaani’s case. It was, in fact, suggested at one stage by Mr Rowshan that Mr Jazayeri and Dr Ghazaani were former business partners who had fallen out. If so, it is difficult to see why Mr Jazayeri should lie on behalf of Dr Ghazaani. Thus, I do not think I can resolve the issues of credibility by reference to the question of surprise.

I also agree with Mr Toone that there are some problems with Dr Ghazaani’s case. I am in fact less concerned than Mr Toone about some of the minor dating issues that appear to arise on the documents. The differences may well be explicable by the differences between the Iranian and Gregorian calendars or the difficulty in reading and translating the Iranian dates (Footnote: ⁵). However I accept that there are difficulties in understanding the provenance of the extract of the marriage register anonymously delivered to Mr Lyons on 17^th November 2014. It is not completely clear why Dr Ghazaani booked a flight to Tehran on 14^th November 2014, the day before it arrived. It is not clear what evidence of title was before Court 5 on 24 July 2012 when the Judge gave judgment in favour of Mr Rowshan. It is not clear why the letter of 1 February 2014 (from the Head of Deeds to the Presiding Judge of Court 5) was sent to Court 5 when there were no proceedings in Court 5 at that time. The extract provided from Iraj Ghazaani’s bank account is not very satisfactory. Whilst it shows the payment out of the 300 million IR and the 200 million IR it gives no indication of the source of those funds. It is, to my mind, curious that the bank account had a nil balance both before and after this transaction. The chronology of how Dr Ghazaani obtained the paying in slips for the 500 million IR is not easy to follow. Whilst it is clear that the two post dated cheques were given to Mr Rowshan and were stolen from Mr Rowshan in November 2011 it is not clear when they were recovered. If however the paying in slips were recovered at the same time it is not clear why they were not returned to Mr Rowshan when the two post dated cheques were returned.

To my mind, however, the problems with Dr Ghazaani’s case pale into insignificance and are as mere thistledown when I consider the problems with Mr Rowshan’s case:

There is substantial corroboration for Dr Ghazaani’s version of what was agreed at the Zaffron restaurant. Whilst much of the corroboration comes from relatives of Dr Ghazaani who were present at the meal there is no real reason why they should commit perjury on behalf Dr Ghazaani. In any event I thought that Dr Zargari (Dr Ghazaani’s wife) was an impressive and truthful witness.

There is also corroboration for the fact that Mr Rowshan was aware and approved of the alterations to the first floor of the Leeds property. This was provided by Mr Beni. More importantly Mr Bagheri, who was called by Mr Rowshan and was plainly trying to be impartial, clearly implied that Mr Rowshan knew and approved the alterations.

Whilst Mr Rowshan asserts that he is not the registered owner of the Tehran apartment he acknowledges he attended the appropriate registry in an attempt to register his title. According to Mr Rowshan/Ms Mohammadi the application failed because of lack of receipts. Yet he now alleges that his signature (in 2 places) on the Transfer is forged. He has not produced the Deed he must have taken to the Registry. Equally he has not submitted any handwriting evidence to support his assertions of forgery.

Whilst plainly there has been some confusion in the letters sent to the Court the letter sent to Court 5 on 1^st February 2014 and document from the Public Notary sent to Dr Ghazaani on 15 July 2013 clearly state that the Tehran apartment is registered in the name of Mr Rowshan.

Whilst Mr Rowshan disowns the existence of account no 801 20 45444 1, the bank statement plainly shows the account to be in his name. The bank statement is in the same format as the account acknowledged by Mr Rowshan to be genuine. The account was apparently opened in December 2003 long before this dispute emerged and clearly shows them payment in of 500 million IR in November 2011. The account exists as the test payments made by Dr Ghazaani in December 2013 demonstrate. Mr Rowshan has produced no evidence from the Bank about this account. He should in my view have been able to obtain evidence as to its opening, as to the payment in and out of the 500 million IR. The account is, after all, shown in the Bank records as being in his name.

The 4 sets of Court proceedings have to be looked at as a whole. The documents relied on by Dr Ghazaani present a coherent picture of what happened. Ms Mohammadi presented a petition for eviction against Mr Jazayeri which succeeded in Court 5 but lost on appeal because of the existence of the tenancy. In those proceedings Ms Mohammadi presented a petition asserting that Mr Rowshan was the owner of the Tehran apartment and relied on the Transfer. After the tenancy had expired she presented a new petition also relying on the transfer to the Dispute Settlement Council. She obtained an order for eviction and was present when it was enforced. The Dispute Settlement Council paid a cheque to Mr Jazayeri for 350 million IR in respect of the deposit. Ms Mohammadi issued further proceedings for this sum relying on a report from the Court expert who had seen the title deeds verifying Mr Rowshan’s ownership. Many of the documents bear what appears to be her signature and stamp. Although Ms Mohammadi has alleged the documents relied on by Dr Ghazaani are false she has not produced a single document that she now says was used in the Court proceedings. Thus she has not produced the petition (Footnote: ⁶) she now says she used. She has not produced the application made by Mr Jazayeri alleging harassment. She has not produced any of the evidence that was filed in the proceedings. Although she challenges many of her signatures as not being genuine no attempt has been made to put forward handwriting evidence in relation to them. No attempt has been made to contact the various courts to see if the judgments, orders and other court documents are in accordance with the court records.

As Dr Kakhki points out Mr Rowshan’s case involves the bribery of or forgery of documents of a large number of officials. Amongst others this would appear to include the Notary Public No 751 in respect of the Transfer, various judges, the Court Enforcement Officer (Mr Baradari), the Court Expert (Mr Atalebi), and the Notary Public for Marriage No 171 (Mr Gholami). As Dr Kakhki points out the documents are in the correct format, have appropriate seals and appear to be authentic.

Although Mr Rowshan and Ms Mohammadi deny that they are married, there is no evidence that the contents of the extract of the Marriage Registry is not accurate. I would have expected them to have been able to obtain a copy of the actual Marriage Certificate and to have been able to establish whether or not the signatures were genuine. The document from Mr Gholami goes no further than to say that only the wife or the husband are able to get such a document. It does not say anything about the contents of the document produced by Dr Ghazaani and verified by Mr Gholami in November 2014.

In all the circumstances I have no hesitation in rejecting the evidence of both Mr Rowshan and Ms Mohammadi. In my judgment both were unreliable and dishonest witnesses.

In essence therefore I accept the case of Dr Ghazaani. It is not necessary for me to make precise findings as to how Dr Ghazaani acquired some of the documents he relied on. It may be (and I make no finding to this effect) that he knew about marriage entry before 14^th November 2014 and that the paying in slips were not recovered with the cheques after the robbery of Mr Rowshan. I am, however, satisfied that the paying in slips and the extract from the Marriage Registry are genuine documents.

I also agree with Dr Kakhki that all of the documents in relation to the Court proceedings are genuine documents and the picture they present of what happened in the various Courts in Iran is accurate. I cannot begin to understand why the Dispute Settlement Council should have paid Mr Jazayeri 350 million IR otherwise. I am also satisfied the signatures and stamps of Ms Mohammadi on the various documents in the Court proceedings are genuine.

The allegations of fraud, bribery and forgery made against Dr Ghazaani, Iraj Ghazaani and Mr Jazayeri are accordingly dismissed.

Findings of Fact

In the circumstances I make the following findings of fact:

I find as a fact that the oral agreement was in the terms alleged by Dr Ghazaani. In particular I find that the agreement was for an exchange of the Leeds property for the Tehran apartment with an equality payment of 500 million IR by Dr Ghazaani. I find that in addition Dr Ghazaani was to reimburse Mr Rowshan in respect of the moneys payable to Mr Jazayeri on the termination of his lease. I find as a fact that Dr Ghazaani did disclose to Mr Rowshan the existence of the tenancy in favour of Mr Jazayeri during the course of the lengthy negotiations.

I find as a fact that when Mr Rowshan visited Mr Lyons on 13^th May 2011 Mr Lyons did advise Mr Rowshan that he ought to have a solicitor and Mr Rowshan said that he did not wish to have a solicitor. I reject Mr Rowshan’s evidence that Mr Lyons advised him that he did not need a solicitor.

I find as a fact that Iraj Ghazaani did show Mr Rowshan around the Tehran apartment in July 2011. I find as a fact that during that visit that Mr Rowshan did have a lengthy discussion with Mr Jazayeri, his wife and son and that he did tell Iraj Ghazaani that he liked the apartment and that he would like the transaction to proceed. Mr Rowshan was plainly well aware of the existence of the tenant in July 2011.

I find as a fact that Mr Rowshan allowed Dr Ghazaani into possession of the Leeds property from the beginning of November 2011 and directed Mr Bagheri to pay the rent to Dr Ghazaani. I make no finding as to whether Mr Rowshan introduced Dr Ghazaani to Mr Bagheri as his new landlord or his prospective new landlord. I find that Mr Rowshan was well aware of the alterations which were being carried out to the upstairs and encouraged Dr Ghazaani to continue with them by making suggestions as to the improvements that could be made. I reject Mr Rowshan’s evidence in relation to the planning permission. I find as a fact that despite being in occupation of the upstairs and in receipt of rent for the downstairs Dr Ghazaani has not paid any of the Council Tax/Business Rates due in respect of the upstairs. I shall deal with the relevant figures later in this judgment. I find that Mr Bagheri paid 6 months rent (or £3,000) to Dr Ghazaani. Thereafter rent has been paid to Mr Rowshan. Dr Ghazaani has remained in occupation of the upstairs which from time to time has been used by his daughters form residential purposes. There are possible enforcement proceedings and proceedings in respect of Council Tax/Business Rates arrears in relation to the upstairs. Dr Ghazaani has denied any liability.

I find as a fact that in November 2011 the Tehran apartment was validly transferred to Mr Rowshan and that the Transfer was validly registered on 28 November 2011 at Public Notary Office No 751 in Tehran. I accept the evidence of Dr Ghazaani, Iraj Ghazaani and Mr Jazayeri that in order to obtain registration Ms Mohammadi contacted each of them in order to obtain the necessary receipts. I accept that Mr Jazayeri assisted by providing the necessary receipts. I find as a fact that the signatures on the Transfer which purport to be Mr Rowshan’s are genuine signatures. I find as a fact in order to register the Transfer at the Public Notary Office Mr Rowshan relied on the Power of Attorney and that the Power of Attorney was accepted as valid.

I find as a fact that Iraj Ghazaani did provide Mr Rowshan with the two cheques totalling 500 million IR in November 2011. I find that Mr Rowshan did have the cheques transferred into coded cheques and then paid them into account no 801 20 45444 1 at the Saman Bank. I find the paying in slips are genuine.

I find as a fact that Iraj Ghazaani gave Mr Rowshan two post dated cheques in respect of the rent deposit repayable to Mr Jazayeri on the termination of his tenancy. I find as a fact that the two cheques were stolen from Mr Rowshan and that he has not so far been paid the 400 million IR in respect of the rent deposit. I do, however find that on 3^rd October 2012 Mr Lyons made an unconditional offer to pay the 400 million IR to Mr Rowshan.

I find Ms Mohammadi, on behalf of Mr Rowshan, has taken steps to evict Mr Jazayeri from the apartment. I find that the progress of the litigation is accurately summarised in the Court documents referred to above which I find are genuine documents. I find that Mr Jazayeri vacated the Tehran apartment on or shortly before 10^th September 2013 and that he has not occupied it since then. I make no finding as to whether Ms Mohammadi is in fact in occupation of the Tehran apartment. That is a matter between Mr Rowshan and her.

It is not necessary for the purpose of these proceedings to decide whether Mr Rowshan and Ms Mohammadi are married and accordingly I have already commented that I regard the copy of the entry at the Marriage Registry as genuine.

The Law and Conclusion

At one time Mr Toone raised a number of legal defences to the claim. Thus he claimed that the agreement between the parties was tainted by illegality or by a breach by Mr Lyons to comply with the professional conduct rules applicable to solicitors. He also suggested that Mr Rowshan was discharged from further performance as a result of an acceptance by Dr Ghazaani of a repudiatory breach by Mr Rowshan. None of these arguments were pursued in his closing submissions and I propose to deal with them very shortly.

The supposed illegality arises out of the fact that the parties agreed that the Transfer of the Leeds property contained a figure of £100,000 in relation to the sum received by Mr Rowshan. I am far from convinced that in a situation where the critical figure was the equality money that it was illegal for the parties to agree that the figure received for the Leeds property was £100,000. Even if there was any illegality I am far from convinced it would have defeated the claim for a constructive trust and/or proprietary estoppel. [See Davies v O’Kelly [2015] 1 WLR 2725]

In my view Mr Lyons was not in breach of his professional obligations to Mr Rowshan. I am quite satisfied that Mr Lyons did advise Mr Rowshan that he ought to seek advice from a solicitor on 13^th May 2011. He wrote to Mr Rowshan on 23^rd May 2011 and spoke to him again on 21^st June 2011 after he had received the Transfer Deed which he held to Mr Rowshan’s order. I am not satisfied Mr Lyons owed any other duty to Mr Rowshan.

The allegation of acceptance of a repudiatory breach was based on a letter supposedly sent by Dr Ghazaani’s Iranian lawyer (Mr Saeidi) to Mr Rowshan. The letter was said to require that Mr Rowshan return the 500 million IR and transfer the Tehran apartment back to Dr Ghazaani. In fact the only letter written by Mr Saeidi to Mr Rowshan is dated June 26 2012. Rather than demand the return of the 500 million IR and the transfer of the Tehran apartment back to Dr Ghazaani it demanded that Mr Rowshan comply with his obligations in relation to the Leeds property.

At a very late stage in the proceedings, that is to say after the conclusion of the evidence Mr Toone sought permission to amend so as to allege that this Court had no jurisdiction to deal with the matter on the apparent ground that part of the dispute related to immovable property in Iran. I rejected the application without calling on Mr Birch. It seemed to me to be far too late to take points on jurisdiction. In any event both parties were resident in the UK; the principal relief claimed by Dr Ghazaani related to the Leeds property, and part of Mr Rowshan’s counterclaim sought the cancellation of the unilateral notice registered at HM Land Registry. I should have thought it self evident that this Court had jurisdiction to deal with the matter.

The elements of the doctrine of proprietary estoppel can be taken from the formulation in “The Law of Real Property” by Megarry and Wade, 8^th ed., at para. 16-001, as follows:

“An equity arises where –

(a)

the owner of land (O) induces, encourages or allows the claimant (C) to believe that he has or will enjoy some right or benefit over O’s property;

(b)

in reliance upon this belief, C acts to his detriment to the knowledge of O; and

(c)

O then seeks to take unconscionable advantage of C by denying him the right or benefit which he expected to receive.”

It is also common ground that the discussions between Mr Rowshan and Dr Ghazaani were oral and that there is no document which satisfies s 2 of the 1989 Act. The relevant parts of that Act provide:

There have been discussions in a number of cases as to how the principles of constructive trust/proprietary estoppel apply in a situation involving a commercial contract to transfer property which does not satisfy s 2.

These include Cobbe v Yeoman’s Row Management Ltd [2008] 1 WLR 1752 at paragraphs [28] and [29] and [81] (Lord Scott), paragraphs [85] to [91] (Lord Walker); Thorner v Major [2009] 1 WLR 776 at paragraphs [93] to [99] (Lord Neuberger); Herbert v Doyle [2010] EWCA Civ 1095 at paragraphs [ 44] – [57] (Arden LJ) and Lloyd v Sutcliffe [2007] EWCA Civ 153.

There were no detailed submissions on these cases in the oral submissions before me. Indeed in his closing submissions Mr Toone expressly accepted that Dr Ghazaani was entitled to relief if I accepted his factual case. In those circumstances it is unnecessary for me to set out extensive quotations from the above cases. A number of points can be made:

Despite the observations of Lord Scott in paragraph [29] of Cobbe it is probably still possible to have a proprietary estoppel in the case of a contract which does not satisfy s 2. However this will necessarily be an exceptional case. As is pointed out in Megarry & Wade it would be difficult to establish if the parties intended to enter into a formal agreement setting out the terms or where further terms remain to be agreed.

This is an area where there is a considerable, but not a total overlap between the areas of constructive trust and proprietary estoppel. After setting out passages from Walker LJ’s judgment in Yaxley v Gotts [2000] Ch 162 at 176 and his subsequent comments as Lord Walker in paragraph 37 of Stack v Dowden [2007] A.C 432 Arden LJ summarised the position in paragraphs 56 and 57 of Herbert v Doyle in this way:

It is also worth citing a passage from paragraph 64 of the judgment where Arden LJ said:

In my view the important features in this case are:

This is not a case where there was ever any intention to enter into a formal written agreement. Dr Ghazaani and Mr Rowshan were quite content to proceed to completion on the basis of the oral agreement they had reached.

At least by November 2011 (and probably by July 2011) all of the terms had been agreed between the parties. There were no further terms to be agreed between them.

In November 2011 Mr Rowshan granted Dr Ghazaani possession of the Leeds property and instructed Mr Bagheri to pay the rent to Dr Ghazaani. Dr Ghazaani carried out improvements to the first floor of the Leeds property with the approval and encouragement of Mr Rowshan in the expectation that the Transfer of the Leeds property would be concluded.

Dr Ghazaani transferred the Tehran apartment to Mr Rowshan and paid him the equality money of 500 million IR. He also provided the two post-dated cheques for the 400 million IR. This, too, was in the expectation that the Transfer of the Leeds property would be concluded. He has subsequently offered to pay the 400 million IR to Mr Rowshan. Mr Rowshan has used his ownership of the Tehran apartment to evict Mr Jazayeri and obtain possession of it.

In my view it would be unconscionable for Mr Rowshan to refuse to complete the Transfer of the Leeds property to Dr Ghazaani in the exceptional circumstances of this case.

I accordingly conclude that Dr Ghazaani has made out his case for a constructive trust and/or proprietary estoppel. It is well established that the nature of the relief granted in this sort of case is discretionary. The essence of the relief is to avoid an unconscionable result.

Mr Toone submitted that I should not order a transfer of the Leeds property because Mr Rowshan does not accept that the Tehran apartment has been transferred to him. For reasons I have given I am satisfied that the Tehran apartment has been transferred to Mr Rowshan and I thus reject this submission

In my judgment the appropriate relief is to put the parties in the position they would have been if the contract had been concluded in November 2011. In that event:

the Leeds property would have been transferred to Dr Ghazaani.

Dr Ghazaani would have received the rents from Mr Bagheri. Dr Ghazaani did in fact receive rent until June 2012. There are thus 3 years rent that Dr Ghazaani has not received. Ignoring the possibility of rent increases this amounts to £18,000.

Dr Ghazaani would have been liable for any Council Tax/Business Rates for the first floor. Since the argument in this case information has been received from Leeds City Council as follows:

Dr Ghazaani remained liable to pay 400 million IR to Mr Rowshan as at 6^th November 2012. The exchange rate as at November 2012 was 19,498.80 IR to the pound sterling. Thus 400 million IR is equivalent to £20,514.08.

If the Leeds property had been transferred to Dr Ghazaani in November 2011 he would have been able to take steps to increase Mr Bagheri’s rent. It is true, of course, that his first attempt at this did not comply with the terms of the lease but there is no reason to suppose he could not have put that right and taken the appropriate steps under the lease. I have no valuation evidence but I note that Mr Bagheri indicated that he would have been willing to pay between £7,000 and £8,000 p.a – an increase of between £1,000 and £2,000 per annum.

When I take all this into account it seems to me that the overall loss of rental income is sufficient to satisfy the loss of the 400 million IR and any Council Tax paid or payable by Mr Rowshan in respect of the first floor flat since November 2011.

Thus I will simply order Mr Rowshan to Transfer the Leeds property to Dr Ghazaani. Any further rent payable by Mr Bagheri should be paid to Dr Ghazaani.

Under s 116 Land Registration Act 2002 an equity arising by estoppel and a mere equity are interests capable of binding successors in title. As a proprietary right such equities can (under s 32) be protected by unilateral notice.

Thus, although the application settled by Mr Lyons wrongly referred to an agreement dated November 2011 Dr Ghazaani did at the time of the application have an interest in the Leeds property capable of binding successors in title which could be protected by notice.

In those circumstances although I accept that this Court has power to vacate the notice, I would, in the circumstances refuse to do so.

It may be that once the Leeds property has been transferred to Dr Ghazaani it will in any event be vacated.