Bank of Beirut S.A.L. & Anor v HRH Prince Adel El-Hashemite & Anor

For summary judgment, the question is whether the defendant’s case has a real prospect of success, not whether it is merely improbable. The court may conclude that there is no such prospect where the case contains inherent improbabilities and has a complete absence of reality, including in an alleged fraud case.

A certificate of registration under section 8C of the Limited Partnerships Act 1907 is conclusive evidence that the limited partnership came into existence on the registration date. That remains so where registration was procured by the applicant’s fraud, provided the Registrar acted bona fide. The court may control the register where a registered document is a nullity, but that jurisdiction cannot override the statutory conclusiveness of the certificate.

Three Middle Eastern banks sought summary judgment and declarations against the First Defendant, who had used purported powers of attorney to register limited partnerships naming the banks as general partners. They also sought orders requiring the Registrar of Companies to remove the registrations.

The First Defendant had not acknowledged service or served a defence, but sent notices of discontinuance and asserted that he was authorised to act for the banks. The Registrar accepted that the applications had been processed without verification, but opposed removal because section 8C of the Limited Partnerships Act 1907 made the registration certificates conclusive evidence of the partnerships’ existence. The central issues were whether the First Defendant had any real prospect of defending the claims and whether the court could order removal of registrations procured by fraud.

1. Summary judgment against the First Defendant. The First Defendant had no real prospect of establishing that he held powers of attorney from any of the banks. His cases contained overwhelming inherent improbabilities, lacked any credible explanation for the alleged transactions, and had a complete absence of reality. The court therefore granted declarations that the purported partnership agreements were not deeds of the banks, that the First Defendant held no powers of attorney, and that the registration applications were false, fraudulent and unauthorised.
2. The purported notices of discontinuance were ineffective because the First Defendant lacked authority to act for the banks. The court also granted judgment for damages to be assessed for unlawful interference with business interests. The pleaded ingredients were interference with business, unlawful means, intention to injure and damage. An injunction restrained further registrations involving the banks and enforcement of purported financial instruments. The First Defendant was ordered to pay costs on the indemnity basis.
3. The declarations did not include a declaration that the partnerships never existed. Section 8C(4) of the Limited Partnerships Act 1907 made the certificates of registration conclusive evidence that the partnerships came into existence on registration. The provision applied even though the applications had been procured by the First Defendant’s fraud, because the Registrar had acted bona fide.
4. The court’s public law jurisdiction to control the Registrar, recognised in Re Calmex Ltd [1989] 1 All ER 485, could apply where a registered document was a nullity. However, that jurisdiction could not be used to override section 8C. The court distinguished cases involving validly registered documents and accepted the approach in Exeter Trust Ltd v Screenways Ltd [1991] BCC 477, that a conclusive certificate could not be impeached in this way.
5. The Registrar was not in breach of public law duty by leaving the partnerships on the register with annotations alerting searchers to the fraud. No order was therefore made against the Registrar.