Case Comment: HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz Al Saud v Apex Global Management Ltd & Anor  UKSC 64
01 Monday Dec 2014
This case arose out of a disputed joint venture between Apex Global Management Ltd and Global Torch Ltd, which was a company part-owned by Prince Abdulaziz of the Saudi Arabian Royal Family. The facts of this case have been previously set out in detail on this blog here but are worth restating as follows.
Under the joint venture, Apex and Global together set up and ran a third company (Fi Call Ltd, incorporated in England), following which relations between the parties rapidly deteriorated. The result was that Global and Apex brought claims against each other seeking relief against the unfairly prejudicial conduct of the third company’s affairs. The various heads of claim were very serious and included allegations of money laundering, financial misappropriation, forgery of documents and the funding of terrorism. Apex’s claim against the Prince was for just under US$6m plus interest; the Prince disputed this, claiming he had already paid this sum into the account of another company at Apex’s request.
A case management conference took place in July 2013 before Vos J. One of the directions ordered was that each party to proceedings (which included Prince Abdulaziz) should file and serve a disclosure statement, certified by a statement of truth and signed personally. At the time of the order, Prince Abdulaziz’s legal team argued that he should not be required personally to sign the disclosure statement on the ground that, as a member of the Saudi Arabian Royal Family, he was forbidden by ‘protocol’ from taking part in litigation proceedings in a personal capacity.
These arguments were rejected by Vos J who stated that the Prince should not receive special treatment in English litigation, and the order stood. Subsequently, when the disclosure statements were served and filed, the Prince’s statement (in breach of the order) had not been signed by the Prince personally but instead by his close adviser.
As a result of the Prince’s non-compliance, the following events transpired:
1. Apex applied for an “unless order” calling for the Prince’s defence to be struck out should he not comply with the court’s order. On 9 September 2013 Norris J granted the order sought and gave the Prince 9 days with which to comply;
2. The Prince refused to comply with the “unless order” and Apex then applied for judgment (pursuant to CPR 3.5(2)) to be entered in default for US$6m plus interest. Norris J granted that application (on the papers) on 14 October 2013);
3. The Prince applied (under CPR 3.1(7)) to vary Vos J’s order so as to enable his solicitor to sign on his behalf and for relief from sanctions (under CPR 3.9). Mann J refused this application on 30 October 2013 because there had been “no change of circumstances”; and
4. On 29 November, Mann J refused the Prince’s application for relief from sanctions.
The Prince appealed the five orders of Vos J, Norris J and Mann J (together the “Orders”) to the Court of Appeal, which unanimously refused the appeal (as to all of the Orders) on 31 July 2014 (HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz Al Saud v Apex Global Management Ltd & Anor  EWCA Civ 1106).
The Court of Appeal held that it “should not lightly interfere” with case management directions and underlined the importance of the fact that all parties to English litigation should be treated equally. In dismissing the application, Lady Justice Arden stated that the Prince had “failed to comply with an order of the court and there is no reason why he should be relieved of the consequences”.
The Prince subsequently applied for permission to appeal to the Supreme Court. Permission was granted on the condition that he pay the judgment sum ($6m plus interest) to his solicitors to abide the order of the court. The Prince duly complied and the appeal was heard by the Supreme Court on 13 October 2014.
The Prince argued that (a) the Orders were disproportionate as they deprived him of the opportunity to maintain a defence on a substantial claim simply because he had failed to sign a document; and (b) the strength of his defence should have been taken into account by the courts below which, he argued, should have resulted in his being permitted to defend the claim.
Supreme Court Decision
The Supreme Court dismissed the Prince’s appeal by a majority of 4-1. The lead judgment was given by Lord Neuberger (with which Lord Sumption, Lord Hughes and Lord Hodge agreed). A dissenting judgment was given by Lord Clarke.
Following the Court’s review of the Orders given by the courts below, and the scope accorded to the courts when making case management decisions, Lord Neuberger remarked that “the decisions of Vos J, Norris J and Mann J in these proceedings were unassailable” (at paragraph 21 of the judgment, emphasis added). It had been contended on behalf of the Prince that the cumulative consequence of the Orders was disproportionate, but this was dismissed by the court on the grounds that there were no “special factors” to persuade the court to reconsider the Orders. Lord Neuberger stressed that “the importance of litigants obeying orders of court is self-evident” (paragraph 23 of the judgment).
As to the Prince’s second argument, that the strength of his defence should have been taken into account, Lord Neuberger said that “the strength of a party’s case on the ultimate merits of the proceedings is generally irrelevant when it comes to case management issues”, however “[t]he one possible exception could be where a party has a case whose strength would entitle him to summary judgment” (at paragraph 29). On these facts the court found that the Prince had a good prospect of defending the claim but that the merits of his case could not be said to be any higher than that (and thus did not engage the exception to the general approach).
Concluding, Lord Neuberger said that “when it comes to case management and the application of the CPR, just as the Court of Appeal is generally reluctant to interfere with trial judges’ decisions so should the Supreme Court be very diffident about interfering with the guidance given or principles laid down by the Court of Appeal” (at paragraph 39).
Lord Clarke, dissenting, was of the view that the Prince’s appeal should have been allowed. He said that justice requires that the Prince should be allowed to defend the claim against him. Further, Lord Clarke said that he would not limit the relevance of the merits to a case where that party had such a strong case that he was entitled to summary judgment, stating “it is almost always wrong in principle to disregard that underlying merits altogether as irrelevant” (at paragraph 75). Finally, Lord Clarke registered his agreement with the majority regarding the diffident role of the Supreme Court in relation to case management and CPR matters.
It is perhaps unsurprising that the Supreme Court has upheld the Court of Appeal’s view that all parties to litigation should be treated equally, and has been robust in ensuring that Prince Abdulaziz’s Royal status should not entitle him to any exemption from normal procedure.
The decision sends a strong message to litigants about the importance of complying with orders of the court.