GFH Capital Ltd v Haigh & Ors

The first defendant, Mr David Haigh, has applied today to set aside an order made in these proceedings by Sir Andrew Smith, sitting as a judge of this court, on 22 June 2017 on the grounds of apparent bias. Three complaints are made. The first is based on the fact that Sir Andrew Smith has retired as a High Court judge and is now, for the purposes of arbitration work, a member of Fountain Court Chambers, a barristers’ chambers. The second and third complaints are based on the fact that he now also sits on a part-time basis on a court which has been established in Abu Dhabi for financial matters, known as Abu Dhabi Global Market. It is suggested by Mr Haigh that those connections create an appearance of bias on the part of Sir Andrew Smith and that he should have recused himself as a result from hearing applications in this case.

The test for this purpose is well-established. The leading case is the decision of the House of Lords in Porter v McGill [2002] 2 AC 357, which establishes the test as being whether a fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the judge was biased.

As regards the first complaint, the relevant facts are that one element of the claim in this case is to seek to recover monies of which Mr Haigh allegedly defrauded the claimant. Some of those monies were paid apparently pursuant to invoices raised by Fountain Court Chambers for work purportedly done by a barrister who is a member of those chambers. Evidence has been given by a clerk of Fountain Court Chambers to confirm that the invoices in question were not in fact raised by Fountain Court Chambers and that the bank account to which the monies were paid was not a bank account of the barrister in question. It was, in fact, a bank account of Mr David Haigh, the first defendant. He, as I understand it, has not disputed that the invoices were forged, the only issue being whether, as the claimant alleges, it was Mr Haigh who forged the invoices or whether, as he maintains, they were forged by other people, without his knowledge.

I am entirely unable to understand how, in those circumstances, any fair-minded observer would conclude that the involvement of Fountain Court Chambers has created a possibility that Sir Andrew Smith might not approach the case independently and with an open mind. Mr Haigh suggests that he wishes to investigate the account into which the various payments that were made purportedly on the strength of those invoices. I cannot see that this makes any difference whatever to the conclusion I have just reached.

The second complaint is that it might appear that Sir Andrew Smith was biased because he sits as a part-time judge on a court in Abu Dhabi, in circumstances where the first defendant has made very serious allegations in other proceedings against the police and government of Dubai, another member of the United Arab Emirates, to the effect that he was tortured and otherwise mistreated whilst in custody in the UAE. However, the whole point of having independent judges is that claims, including claims against the executive of a country, can be independently and fearlessly adjudicated. Even if Sir Andrew Smith were a full-time judge of a court in Dubai, I cannot begin to see that the fact that the claimant has made these allegations would be any reason to disqualify him from hearing the present case. As it is, Sir Andrew sits part-time in a separate court dealing entirely with commercial matters. The suggestion that he could be perceived by a fair-minded observer to be biased on this account is utterly fanciful.

The third and final matter of complaint is that the judges of the court on which Sir Andrew sits on on a part-time basis have a financial interest because the court is owned by an investment group in Abu Dhabi which also indirectly through several companies has a small stake in the claimant company. Mr Haigh goes so far as to describe that connection as shocking and suggests that, once again, it creates an appearance of bias. Again, the complaint seems to me wholly misconceived. It is quite clear from its constitution that the commercial court in Abu Dhabi has been set up as an independent court with its independence guaranteed. It contains a number of very distinguished judges who sit as part-time members of the court. The mere fact that the same commercial entity funds the court and also, as one of a huge portfolio of investments, has an indirect stake in the claimant company could not reasonably be regarded as giving rise to any possibility that Sir Andrew Smith would approach the present case in anything other than an entirely independent way.

I conclude that this application is unfounded. It will be dismissed and certified as totally without merit.

The claim in this action, as framed when it was brought, seeks to enforce a so-called immediate judgment (equivalent, as I understand it, to a summary judgment) given in Dubai against the first defendant on 10 November 2016. The first defendant, Mr Haigh, has appealed against that summary judgment, and on 22 November 2017 the Court of Appeal in Dubai set aside the judgment with the consequence that the claim must be decided at a trial.

It is relevant to note that the Court of Appeal judgment does not identify any particular grounds so far raised by Mr Haigh in the Dubai proceedings that are said to have a real prospect of success. But essentially the Court of Appeal decided that he ought to have an opportunity to give oral evidence, not least in light of the difficulties that he has on any view encountered in presenting his case, before a decision is made finally against him.

In these circumstances, it is plain that the present claim cannot now proceed. The only question is whether it should be stayed or struck out. Very little seems to me in practice to turn upon the difference between those two courses of action. But in the circumstances I think that a stay is the appropriate course for a combination of two reasons.

First, the proceedings are continuing in Dubai and there must be, not least in light of the terms of the Court of Appeal's judgment, be a real prospect that the claimant will ultimately be successful and will then have a judgment which it can seek to enforce in this country. Second, it seems to me to be unnecessary to put the claimant to the expense, should that situation occur, of having to issue fresh proceedings and pay a further issue fee in this court.

I make no assumption about what the outcome of the Dubai proceedings will be and Mr Haigh has explained that there are new matters which he is seeking to raise in those proceedings. It seems to me that the appropriate course is to stay these proceedings now and, at the conclusion of the Dubai proceedings, the parties can, if either of them chooses, come back to this court. If the claimant has succeeded in Dubai, it will no doubt ask for the stay here to be lifted and will seek to rely upon the new judgment. If the first defendant has succeeded in Dubai, he will no doubt ask for the stay to become permanent or for the claim to be struck out.

It seems to me that questions of costs are best dealt with at that stage, when the court can take account of whatever happens hereafter in Dubai. Accordingly, the claim in these proceedings will be stayed with liberty for either party to apply.

I will summarily assess the costs in the sum of £15,000 but there will be no order for payment of this sum.