The Companies Law (2010 Revision) v and Saad Cayman Ltd (in Official Liquidation) and Singularis Holdings Ltd (in Official Liquidation) and Saad Investments Finance Company Ltd (in Official Liquidation) and Saad Investment Company (No. 2) Ltd (in Official Liquidation) and Saad Investment Company (No. 3) Ltd (in Official Liquidation) and Saad Investment Company (No. 8) Ltd (in Official Liquidation) and Saad Investment Company (No. 9) Ltd (in Official Liquidation) and Saad Investment Company (No. 10) Ltd (in Official Liquidation) and Saad Cayman Ltd (in Official Liquidation)
| Jurisdiction | Cayman Islands |
| Judge | The Hon. Anthony Smellie |
| Judgment Date | 29 March 2011 |
| Judgment citation (vLex) | [2011] CIGC J0614-2 |
| Docket Number | FSD NO. 0015/2010 FSD NO. 0041/2010 FSD NO. 0040/2010 FSD NO. 0036/2010 FSD NO. 0037/2010 FSD NO. 0038/2010 FSD NO. 0039/2010 FSD NO. 035/2010 |
| Court | Grand Court (Cayman Islands) |
| Date | 29 March 2011 |
(COLLECTIVELY ‘the COMPANIES’)
The Hon. Anthony Smellie, CHIEF JUSTICE
IN CHAMBERS
The JOLs of the Companies by thisex parte application, seek various forms of relief (i) to dispense with personal service upon Mr. Maan Al Sanea and so to order substituted service upon him instead; and (ii) to further order with an extension of time, the earlier orders made under Section 101/103 of the Companies Law and to attach penal notices to those orders.
In its ruling of 26th November 2010 (with which this ruling should be read), this Court, being satisfied on the evidence before it that Mr. Maan Al-Sanea was deliberately seeking to avoid personal service, made an Order for substituted service upon Mr. Al-Sanea by service upon Messrs. Jeremy Walton and Graham Stoute of the local law firm of Appleby, the local legal advisers to Mr. Al-Sanea.
The Order for substituted service allowed for service by those means of orders requiring Mr. Al-Sanea to produce documentation belonging to the Companies. By the Order of 26th November 2011 the Court also required, under section 101 and 103 of the Companies Law (2010 Revision), (‘the 1st section 101/103 Order’) that Mr. Al-Sanea must;
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(i) Prepare and submit to the JOLs a statement of affairs for each of the Companies in Liquidation, verified by an affidavit of affirmation;
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(ii) Provide those statements of affairs to the JOLs before the end of 21 days beginning the date after the notices issued pursuant to section 101 were served on Mr. Al-Sanea; and;
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(iii) Delivery up to the JOLs of all property belonging to each of the Companies which may be in his possession, custody or control (including but not limited to certain specific property considered below).
On 8th December 2010, the Court further ordered Mr. Al-Sanea to attend the office of Dr. Al-Sawwaf in al Khobar, Saudi Arabia at 9am on 4th, 5th and 10th January 2011 (or at such other place and time as agreed with the JOLs) to be examined in the manner set out in that order about the matters described in schedule 1 to that order (‘the 8th December 2010 Order’).
Written reasons for those orders were prepared and later delivered on 4th April 2011.
The 1st Section 101/103 Order and the JOLs” request for statements of affairs were served on 26th November 2010 and 29th November 2010. The letters of service conveying that Order and the JOLs” request on the 26th November 2010 was marked for the attention of Jeremy Walton of Appleby as opposed to Jeremy Walton and Graham Stoute, as per the Substituted Service Order. I find that nothing turns on this omission and specifically that it is not sufficient to invalidate service. Moreover, the letter accompanying the Order and the JOLs request on the 29th November 2010 was marked, as required, for the attention of both Jeremy Walton and Graham Stoute. I note also that in accordance with the Order for Substituted Service, the 8th December 2010 Order was served on 9th December 2010 upon Mr. Walton.
The matter is now before the Court on the basis of the Eighth Affidavit of Mr. Hugh Dickson. It states that notwithstanding the deemed service of the 1st Section 101/103 Order and the 8th December 2010 Order, Mr. Al-Sanea has failed to comply with any part of either of those Orders.
In correspondence with the JOLs, Mr. Al-Sanea's legal advisers claimed to reserve Mr. Al-Sanea's right to have the 1st Section 101/103 Order and the 8th December 2010 Order set aside but to date, no such an application has been made.
Additionally, in correspondence, dated 13th December 2010, Mr. Al-Sanea's legal advisers requested copies of any proceeding brought by the JOLs in Saudi Arabia against Mr. Al-Sanea and purported to reserve their client's position as regards the jurisdiction of this Court to make any orders in relation to him. In further correspondence dated 22nd December 2010, Mr. Al-Sanea's legal advisers raised the following points:
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(i) Some of the documents which Mr. Al-Sanea was ordered to deliver up to the JOLs were already the subject of pending legal proceedings in Saudi Arabia. Further, this was not drawn to the attention of this Court at theex parte hearing and, given that that question goes to the exercise of the Court's discretion, is a material non-disclosure.
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(ii) The orders aimed at acquiring oral evidence and other information from a Saudi citizen in support of foreign legal proceedings were unlawful, as a matter of Saudi law, unless“appropriate procedures in Saudi Arabia for obtaining recognition of their status as JOLs” were obtained.
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(iii) That a Letter of Request should be issued to the Saudi Ministry of Justice through the Saudi Ministry of Foreign Affairs and if approved, the matter will be referred to“the appropriate local court which will supervise the taking of the evidence/information”. Further, the failure to bring this Saudi Arabian legal requirement to this Court's attention at an ex parte hearing was another material non-disclosure.
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(iv) Mr. Al-Sanea will not attend for examination until the requirements of the Saudi law are dealt with. Additionally, Saudi Arabian procedure requires the following;
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(a) Oral examination in local court in Arabic;
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(b) Foreign nationals appearing in the Court must have valid visas, entry permits, be licensed to practice in Saudi and be authorized by the Saudi Ministry of Justice to participate;
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(c) The assigned judge to record and produce an official transcript;
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(d) The proposed participant expressly confirming their willingness to comply with these procedures.
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(v) That a confirmation of appropriate procedural requirements may be obtained by requesting an opinion from the Saudi Arabian court.
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(vi) That the extensive volume and absence of structure of the materials on which Mr. Al-Sanea is sought to be examined is oppressive and prejudicial. Specifically, Mr. Al-Sanea's legal advisers allege that the materials were a“mass of un-indexed documents” and “not cross referenced to the wide ranging topics of examination or questions that are being proposed”. Further, the fact that these documents were not shown to the Court is another material non-disclosure.
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(vii) That the Statements of Affairs be delayed or dispensed with until after the oral examination of Mr. Al-Sanea.
I see the need to deal specifically only with certain of these complaints.
The Affirmation of Dr. Mujahid Al-Sawwaf (a Saudi Arabian legal adviser engaged by the JOLs) evidences that two applications have been made in the Shiri'a Court in Al-Khobar. To date, the Shari'a court has made no substantive order in respect of either of those proceedings.
The first of those applications, filed on 30th March 2010 by the JOLs seeks the delivery up of documents belonging to Saad Investment Company Limited (‘SICL’) which were removed form Saad Financial Services” office in Switzerland (‘SFS’). The application is for SICL to be allowed to “review and take copies and extracts of…” those documents. On its face, the parties to that application before the Shari'a Court are different to the parties in this application. And, on the evidence before this Court, and while there may be some overlap between the documents demanded for copying and review purposes in that application and the documents belonging to the Companies ordered by this Court to be delivered to the JOLs ; the basis on which the documents are sought here is different.
The application brought in the Shari'a Court to the extent it relates to him, is brought against Mr. Al-Sanea personally, whereas the application before this Court for delivery of documents and the giving of a deposition is made under thestatutory rights and powers of the JOLs under the Cayman Islands Companies Law and directed at Mr. Al-Sanea in his capacity as a former officer of the Companies in respect of each of the Companies.
Notwithstanding those differences, in the Eighth Affidavit of Mr. Hugh Dickson the JOLs undertake that they will not seek to enforce the same relief against Mr. Al-Sanea in the Cayman Islands and Saudi Arabia, and by so doing seek to satisfy this Court that there will be no prejudice to Mr. Al-Sanea.
The second application to the Shari'a Court — that filed on 21st November 2010 by the JOLs — is an application made against Saad Specialist Hospital Company for ‘actual and real accounts for all transactions’ which the plaintiff SICL has the right to review, copy and extract. Again therefore, there appears to be no overlap such that Mr. Al-Sanea can claim to be prejudiced by having to respond in that action as well as in this.
In particular, I...
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