The Judicial Committee of the Privy Council Decisions

(2) Mishal Roger Al-Sabah Petitioners

v.

(1) Grupo Torras S.A. and

(2) Abacus (C.I.) Ltd. Respondents

FROM

UPON A PETITION FOR SPECIAL LEAVE TO APPEAL

of the 5th October 2000, Delivered the 10th October 2000

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Lord Hobhouse of Woodborough

[Delivered by Lord Hobhouse of Woodborough]

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1. Their Lordships have humbly advised Her Majesty that this petition for special leave to appeal should be dismissed with costs. The petitioners were seeking special leave to appeal from an interlocutory decision of the Court of Appeal of Jersey giving various directions for the further progress of two actions presently pending in the Royal Court.

2. The subject matter of the actions are two settlements made by Sheikh Fahad Al-Sabah, the "Esteem" settlement in August 1981 and the "Number 52 Trust" in August 1992. The first of the actions, the 1999 action, was effectively started by Grupo Torras, judgment creditors of the settlor. They challenge the validity of the settlements and claim some or all of the assets presently held by the trustees, Abacus (C.I.) Ltd. The second action, the 2000 action, was started by the trustees under Article 47 of the Trusts (Jersey) Law 1984. They invited the Royal Court to make such orders as it thought fit under that Article. The Article empowers the Court, among other things, to make orders concerning the exercise of any power, discretion or duty of the trustees or to make a declaration as to the validity of a trust. The 2000 action had been started after an interlocutory hearing had forced the trustees, if they were to invoke Article 47, to do so in a separate action.

3. The background to the actions is the findings of fraud that have been made by the Commercial Court in London against the settlor. Grupo Torras was the primary loser as a result of the frauds. The sums involved in those frauds exceeded many times the sums settled. It is accepted that some of the sums concerned can be traced into the trusts. But the petitioners, the wife and son of the settlor, who together with the settlor himself are beneficiaries of the trusts, resist any further claims by Grupo Torras upon the trust funds and contend that they should be allowed to enjoy them in accordance with the terms of the trusts.

4. The respective proceedings in Jersey have been the subject of many procedural disputes and there had by July been regrettably inadequate progress towards reaching the stage where the various issues were ready for trial. Previous hearings before judges of the Royal Court had, in the opinion of the Court of Appeal, not been sufficient to achieve what the Court of Appeal considered to be the requisite sense of urgency and a timetable which would lead to a final determination of the dispute without undue delay. The Court of Appeal made orders which directed the parties to prepare for trial within a set timetable so that the trial could start in mid- December.

5. Normally all such questions of case management are matters for the courts concerned and are not suitable for any further review before their Lordships’ Board. The directions and orders which may be made cover a spectrum of possibilities and have to take into account all the prevailing local circumstances. In the absence of some error of principle or other special factor, leave should not ordinarily be granted for any further appeal. Such interlocutory appeals inevitably delay the action. This is the position in the present case. Their Lordships have advised that special leave be refused but they wish it to be understood that they do not thereby endorse everything that was said in the Court of Appeal. The substantive rights of the parties and what orders, if any, should be made under Article 47 will have to be the subject of decision at the trial (or trials) which are to take place. What was said in the Court of Appeal about the expected outcome of the Article 47 proceedings and anything their Lordships say should not be allowed to affect the decision of the Royal Court.

6. It is of the nature of case management and directions for the trial of actions that they may have to be flexible and adapt to developments and changes of circumstance. One of the decisions of the Court of Appeal was that the 2000 action should be taken first and, it seems, the trial of the 1999 action not be embarked upon until after the 2000 action had been concluded. Their Lordships have reservations whether this will be for the best and felt that there was force in the criticisms that were made in this connection by the petitioners. It may be thought that the trial judge, effectively trying both actions at the same time, should be left to decide in what order he thinks it best to take various issues. But their Lordships appreciate the importance which the Court of Appeal legitimately attached to seeking a procedure whereby the trial of at least some of the issues could start in December of this year.

7. The Court of Appeal predicted, in their Lordships’ view inappropriately, that an order would be made under Article 47 for the distribution of all the funds to the settlor and thence to the judgment creditors. The interlocutory comments of the Court of Appeal were inappropriate in their strength. Their Lordships would regard the outcome of the Article 47 proceedings as an open question raising issues both of fact and law. This does not make them unsuitable for determination in proceedings brought under Article 47 but does require that the procedures adopted sufficiently define those issues and provide for evidence to be adduced, if necessary with the cross-examination of witnesses, so that the issues of fact can be determined. This need is reinforced by the Court of Appeal's ruling that evidence of other trusts set up by the settlor shall be admissible. Their Lordships understand that the issues have only been pleaded in the 1999 action; questions may arise whether they have been sufficiently defined for the purposes of the 2000 action. Further directions may be necessary to coordinate the two actions.

8. The details of the procedure to be adopted in order to bring these actions to finality will have to be, as their Lordships understand will be the case, a matter of continuing review in Jersey. Their Lordships support the thrust of the Court of Appeal's approach in seeking to instill an appropriate attitude into the progressing of the actions. To grant special leave to bring an interlocutory appeal would be contrary to that objective and not assist in the achievement of a just outcome.

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