Masri & Anor v Consolidated Contractors International Co Sal & Ors

When exercising the enforcement jurisdiction under section 37(1) of the Senior Courts Act 1981, the court must treat justice as the overriding consideration while respecting international obligations and comity.

A receivership order against a corporate judgment debtor may refer to foreign officers or persons acting in place of its decision-making organs where there is personal and subject-matter jurisdiction. The question whether contempt proceedings may later be served or enforced is distinct. Foreign judicial administrators are not immune merely because their powers derive from a foreign court, particularly where they act in commercial matters. Alleged conflict with foreign orders requires a flexible discretionary assessment of the real risk of sanctions.

The judgment concerned an application by Mr Joujou and other judicial administrators appointed over CCOG under Lebanese law. They sought discharge of a receivership order and removal of Mr Joujou’s name from its penal notice.

The order extended an earlier receivership over CCOG’s rights to oil from the Masila Concession in Yemen. It authorised the receiver to exercise CCOG’s contractual rights, commence arbitration against the operator and preserve the oil pending arbitration. The administrators relied on lack of personal and subject-matter jurisdiction, state immunity, international comity and the risk of conflicting Lebanese sanctions.

The central questions were whether the administrators could properly be treated as persons acting in place of CCOG’s decision-making organs, whether the English court had jurisdiction to regulate relevant conduct outside England, and whether the order should be continued as a matter of discretion.

1. The application was refused. The revised Third Receivership Order was continued, including a penal notice referring expressly to Mr Joujou.
2. Section 37(1) of the Senior Courts Act 1981 conferred jurisdiction to make an enforcement order where there was a sufficient connection with England. Justice remained the overriding consideration, but the court had to respect international obligations and avoid trespassing on the Lebanese court’s jurisdiction.
3. The decision in Masri v Consolidated Contractors (No 4) did not require the exclusion of foreign officers or persons acting in place of a corporate defendant’s decision-making organs. That decision concerned the construction and service of a judgment-enforcement summons under CPR Part 71. The present order was against CCOG. The persons named in paragraph 18(A) were identified because their acts or omissions could count as those of CCOG for the purposes of the order. Questions concerning later service of contempt proceedings, and whether particular conduct constituted contempt, could be determined when they arose.
4. There was subject-matter jurisdiction because the order was ancillary to English liability and quantum judgments, the judgment debtors had submitted to the English jurisdiction, and CCOG’s contractual rights could be determined through English arbitration under the JOA.
5. The administrators were properly capable of being treated as persons acting in place of CCOG’s decision-making organ. Their powers displaced those of the directors and enabled them to represent and manage CCOG. Applying the attribution approach in Meridian Global Funds Management Asia Ltd v Securities Commission of New Zealand, their relevant acts and omissions were capable of counting as acts and omissions of CCOG.
6. For the purposes of section 14(2) of the State Immunity Act 1978, the administrators were not exercising sovereign authority. In any event, the relevant activities were commercial. State immunity therefore provided no reason to exclude them.
7. The risk of double jeopardy or sanctions under Lebanese law required a flexible discretionary assessment. On the evidence, the risk was very small. The Lebanese orders did not require the administrators to take particular steps concerning the oil, there were no relevant assets in Lebanon, the administrators could seek further directions or resign, and the conflict had substantially resulted from a deliberate anti-enforcement strategy by the judgment debtors and their shareholders.