The Joint Official Liquidators of Abraaj Holdings v The GHF Group Ltd
| Jurisdiction | Cayman Islands |
| Judgment Date | 19 July 2022 |
| Docket Number | CAUSES FSD 150, 158 AND 203 OF 2020 (NSJ) |
| Year | 2022 |
| Court | Grand Court (Cayman Islands) |
(In Official Liquidation)
and
CAUSES FSD 150, 158 AND 203 OF 2020 (NSJ)
IN THE GRAND COURT OF THE CAYMAN ISLANDS
FINANCIAL SERVICES DIVISION
When documents are in the power of a party for the purpose of GCR O.24, r.1 and the Court's jurisdiction to give directions to a party subject to the discovery duty to write to third parties
On 23 and 24 March 2022 a case management conference (the CMC) was heard in the Related Proceedings. My judgment dealing with the issues raised at the CMC (the CMC Judgment) was handed down on 29 June 2022 (reference should be made to that judgment for a summary of the background and the defined terms used to describe the parties and the Related Proceedings, save in so far as terms have been defined below).
At the CMC, I confirmed my earlier decision, previously communicated to the parties by way of an email sent by my personal assistant, that Mr Jafar be required to produce a copy of the settlement deed entered into between him and Mr Naqvi (the Settlement Deed) within fourteen days of the order to give effect to that decision being sealed. That order was issued and sealed on 25 March 2022 and Mr Jafar produced a copy of the Settlement Deed on that date.
On 1 April 2022, before the handing down of the CMC Judgment, Ogier, the attorneys for Neoma Private Equity Fund IV (Fund IV), wrote to the Court regarding the Settlement Deed and its relevance to the matters dealt with at the CMC. On 5 April 2022, Nelsons, the attorneys acting for Mr Jafar, responded (again in writing to the Court). Following this correspondence, I directed that the parties should by 19 April 2022 (subsequently extended to 25 April 2022 upon a request by the GHF Parties) make any application they wished to make for permission to file further evidence and make further submissions with respect to the matters dealt with at the CMC (the Direction).
On 25 April 2022, as contemplated by the Direction, the GHF Parties applied (the Application) by a letter from Walkers their attorneys (the 25 April Letter), for the following relief:
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(a). leave to file the First Affidavit of Jonathan Turner sworn on 22 April 2022 (the Affidavit).
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(b). leave to make further submissions with respect to the matters dealt with at the CMC.
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(c). subject to such leave being granted, that certain further directions be made upon the CMC with respect to Mr Jafar's discovery.
After having reviewed the Settlement Deed, the GHF Parties had concluded that it was relevant to a number of the issues raised at the CMC (as they related to the Jafar Proceedings). They considered that the Settlement Deed was relevant in particular to (a) the scope of Mr Jafar's discovery obligations (the identity of his custodians and the end date by reference to which his discovery was to be given) and (b) the date on which the trial was to be listed. The GHF Parties took the view that had they been in possession of the Settlement Deed, or aware of its terms, before the CMC, which they were not, their submissions on these issues would have been materially different.
On 28 April 2022, Nelsons wrote to the Court in an undated letter setting out (at [24]) Mr Jafar's response and opposition to the Application. Walkers replied on behalf of the GHF Parties in their letter dated 3 May 2022. All parties (including Fund IV) consented to the Application being dealt with on the papers.
On 17 May 2022, I distributed to the parties a draft judgment. The draft judgment dealt with the question of whether clause 16 of the Settlement Deed resulted in the documents of Mr Naqvi referred to in the clause being within Mr Jafar's power for the purpose GCR O.24. I said that I had decided that this issue could be dealt with conveniently before and without waiting for the handing down of the CMC Judgment but that I planned to deal with the question of the date ranges to be applied to Mr Jafar's discovery and what directions should be given in relation to the listing of the trial in that judgment (which I was then in the process of preparing).
On 20 May 2022, Ogier wrote to the Court requesting that I defer handing down judgment until after Fund IV had been able to file brief written submissions in relation to the Application. Ogier pointed out they had written to the Court on 6 May 2022 saying that if the Court was minded to make a determination as to whether or not Mr Jafar had power over the documents held by Mr Naqvi — which they submitted was not a matter dealt with or necessary to the relief sought by their clients at the CMC — then Fund IV would wish to have the opportunity to make brief submissions.
On the same day, 20 May, I confirmed that Fund IV should have the opportunity to make and file submissions on the Application, as they had indicated they wished to do in Ogier's letter of 6 May 2022 (which appeared not to have made its way to me). I gave directions permitting the filing of those submissions and for the filing of brief further submissions in response by the GHF Parties and Mr Jafar. On 23 May 2022, Fund IV filed their further brief submissions and on 25 May 2022 Nelsons wrote to the Court setting out Mr Jafar's position and Walkers wrote seeking clarification of parts of the draft judgment.
I have carefully reviewed all the submissions and the evidence, and revisited the question of what relief if any should be granted on the Application. I have concluded as follows:
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(a). the GHF Parties should be granted leave to file the Affidavit and to make further submissions. That part of the Application is therefore granted.
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(b). the GHF Parties, supported by Fund IV, have sought in the Application an order directing Mr Jafar to write to Mr Naqvi to request that he provide documents to Mr Jafar as required by clause 16. The Application did not specify the terms or provide a draft of that request. The GHF Parties contemplate, as I understand it, that the form of the request will be settled by agreement or be approved by the Court after judgment on the Application has been handed down.
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(c). the GHF Parties submitted that the order was necessary in view of and in response to Mr Jafar's failure to agree to write to Mr Naqvi or to set out in writing with precision when and how that would be done.
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(d). the GHF Parties (and Fund IV) submitted that the documents covered by clause 16 are to be treated as being within Mr Jafar's power for the purpose of GCR O.24, r.1. In my view, clause 16 of the Settlement Deed alone does not result in all and any documents held by Mr Naqvi related to the Abraaj Group and to which clause 16 could apply, being in Mr Jafar's power.
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(e). however, some of those documents may be (and indeed are likely to be) in his power. An assessment has to be made in relation to particular documents or classes of documents as to whether it would be reasonable for Mr Naqvi to produce them. It may also be necessary to assess whether Mr Naqvi is under no obligation to provide documents because of the provision in clause 16 of the Settlement Deed that stipulates that he is only required to take steps “to the extent permitted by law and legal duties to which AMN is subject
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(f). at this stage, it is not possible for the Court to determine which documents Mr Naqvi holds, which of those documents are relevant to and would be discoverable in the Jafar Proceedings if they were in Mr Jafar's power, and which of those documents Mr Naqvi is obligated to provide to Mr Jafar pursuant to his obligation to provide Mr Jafar with reasonable assistance in accordance with clause 16 of the Settlement Deed. However, the evidence, albeit limited and in need of supplementation, supported by the parties' submissions, does establish that Mr Naqvi is likely to hold relevant (and indeed important) documents which he is required to provide to Mr Jafar pursuant to his obligations under clause 16 of the Settlement Deed.
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(g). I do not consider that the confidentiality clause in the Settlement Agreement prevents Mr Jafar from handing over to the GHF Parties and Fund IV copies of documents which are obtained from Mr Naqvi and which Mr Naqvi is required to produce under clause 16 of the Settlement Deed.
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(h). it seems to me that in these circumstances, as a matter of jurisdiction, (based on the materials available to me on the Application and recognising that I have not heard oral submissions on the point) the Court has the power to direct Mr Jafar to write to Mr Naqvi for the purpose of identifying documents which are in his power, subject to the need to ensure that any steps which Mr Jafar is required to take satisfy the test of proportionality and the Court's order is in accordance with the overriding objective. While the Court does not have the power to direct a party to take steps to bring into his power (or possession or custody) documents which are not already within his power, it seems to me that the Court can require a party to take proportionate steps to establish which documents in a class or pool of documents, which class or pool is likely to contain documents in his power, are actually within his power. Writing a letter to Mr Naqvi and taking some follow-up action appears to me to be proportionate and not onerous.
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(i). it would have been preferable for this issue to have been further developed in correspondence and discussions between the parties before an application to the Court was made for a direction. That would have at least allowed the relevant background facts to...
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