His Excellency Sheikh Khalid & Ors v His Excellency Sheikh Hamed Bin Ahmed Al Hamed & Anor
[2024] EWHC 2448 (Comm)
Sanjay Shah & Anor v Christopher Chipperton
24 May 2024
[2024] EWHC 1696 (Comm)
High Court
Someone sued someone else in England over money allegedly held in trust to buy shares in a British company. The defendant (the person sued) argued the case should be in Dubai. The judge decided the case stayed in England because the trust was linked to England and the deal was done mostly in English. The defendant lost and has to pay costs.
Key Facts
- •Mr. Chipperton challenged the court's jurisdiction in a claim brought by Mr. Shah and Elysium.
- •The central issue was forum conveniens.
- •The claim concerned £10 million allegedly held on trust by Mr. Chipperton for Mr. Shah, used to purchase shares in Arix Bioscience Plc.
- •Arig Risk Management, a company owned by Mr. Chipperton, was involved in the transaction.
- •The dispute involved overlapping proceedings with the Danish tax authority SKAT.
- •The key document was a letter outlining the terms of the alleged trust.
- •The parties debated whether Dubai or England was the appropriate forum.
- •The governing law of the alleged trust was a key point of contention.
Legal Principles
Forum non conveniens: In a case with jurisdiction founded by service within the jurisdiction, a stay will only be granted if another forum is clearly more appropriate.
Spiliada Maritime Corporation v Cansulex Ltd [1987] 1 AC 460, summarised in Dynasty Company for Oil and Gas Trading Limited v Kurdistan Regional Government of Iraq [2021] EWHC 952 (Comm)
Factors considered in determining the appropriate forum include convenience, expense, witness availability, governing law, parties' residence/business, and the risk of irreconcilable judgments from parallel proceedings.
Dicey, paragraphs 12-029, 21-033, 12-034
Recognition of Trusts Act 1987 and the Hague Convention on the Law Applicable to Trusts: If the settlor chooses the governing law, that law applies. If not, the law most closely connected governs, considering factors such as place of administration, situs of assets, trustee's residence/business, and trust objects.
Recognition of Trusts Act 1987, Hague Convention on the Law Applicable to Trusts and on their Recognition, Articles 6 & 7
Implied choice of law: Determined by reference to the trust instrument and the place of administration at the time of the trust's creation.
Dicey 29-019, Chellaram v Chellaram [1985] Ch. 409
Situs of assets: For shares, the jurisdiction where the company is incorporated or shares registered.
Akers v Samba Financial Group [2017] UKSC 6
Outcomes
The defendant's application to challenge jurisdiction was dismissed.
The court found that England was the clearly more appropriate forum due to an implied choice of English law governing the trust and the closer connection of the dispute to England.
Costs of £50,000 were awarded against the defendant.
The court considered the high costs incurred by the claimants, citing inefficiencies in the defendant’s legal team.
Permission to appeal was denied.
The court believed there was no real prospect of success on appeal.
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