Abu Dhabi Commercial Bank PJSC v Shetty & others  EWHC 529 (Comm)
In early 2020, FTSE-100 listed NMC Healthcare PLC (“NMC”) (the owner of one of the largest private healthcare chains in the Middle East) announced to the market that it had discovered c.$3 billion of previously undisclosed debt in its books. Following this announcement, the company and many of its subsidiaries were placed into administration.
Subsequently, one of NMC’s main lenders, Abu Dhabi Commercial Bank PJSC (“the Bank”), issued proceedings in England against several of the company’s shareholders and certain members of its management team. In summary, the Bank claimed that the defendants had been involved in a dishonest scheme involving fraudulent misrepresentations, as a result of which the Bank had lent over £1 billion to NMC. In support of its claim the Bank obtained (ex parte) a suite of worldwide freezing injunctions from Mr Justice Bryan with a maximum sum of £1 billion.
In a judgment handed down on 1 April 2022, His Honour Judge Pelling QC (sitting as a Judge of the High Court) granted applications made by the first to fourth defendants: (1) challenging the English Court’s jurisdiction; and (2) seeking the discharge of the worldwide freezing injunctions.
The Judge ultimately concluded that Abu Dhabi was clearly and distinctly more appropriate than England for the trial of the action. The relevant factors in the Judge’s decision included the facts that the alleged wrongdoing took place in the UAE, the claim is governed by UAE law (which includes a significant Islamic law element), the witnesses live and work in the UAE, the Bank itself is based in the UAE and the costs of the UAE proceedings would be far lower than the costs of the equivalent English proceedings.
The Judge also held that the Bank had breached its duties of full and frank disclosure and fair presentation on the ex parte application before Mr Justice Bryan in several respects.
The judgment contains a number of interesting points on topics which arise frequently in jurisdiction challenges, including:
The Judge also embarked on a detailed examination of the potential impact of s.6 of the Statute of Frauds (Amendments) Act 1828 to the Bank’s claim.
Sam Goodman acted for the successful Second and Third Defendant (with Tim Penny QC, James Sheehan and Frederick Alliott), instructed by PCB Byrne LLP.