Mulugeta Guadie Mengiste & Anor v Endowment Fund for the Rehabilitation of Tigray & Ors

On an application to lift a stay imposed in favour of a more appropriate foreign forum, the question is whether there is cogent evidence of a real risk that justice will not be obtained. The English court does not sit as an appellate court over the foreign court’s factual or legal conclusions. An adverse or arguably irrational conclusion does not, without more, establish an unfair trial. A time limit for seeking review of a final judgment is not inherently unfair where it gives a real opportunity to raise the complaint. The foreign review process must be assessed objectively and in the round.

The appellants brought English proceedings alleging that Ethiopian judgments concerning a pharmaceutical joint venture had been procured by fraud and had led to the wrongful appropriation of their shares. The Chancery Division stayed the proceedings so that the appellants could seek review in Ethiopia, the more appropriate forum. They applied in Ethiopia under Article 6 of the Civil Procedure Code of Ethiopia, relying on alleged new evidence, the involvement of a judge married to a person connected with the respondent company, and defects in the commencement of the original proceedings. The Tigray Supreme Court and the Cassation Division rejected the review application. Peter Smith J refused to lift the stay and dismissed the English action: [2014] EWHC 4196 (Ch). The central issue was whether the Ethiopian review process supplied cogent evidence of a real risk of unfairness.

1. Appeal dismissed. The respondents’ notice succeeded. The order requiring payment of £200,000 on account of costs was upheld.
2. The applicable test was whether there was a real risk that justice would not be obtained in the foreign court, established by cogent evidence. The question concerned the review process that had occurred, not a prediction about a future trial. The judge’s reference to establishing that there would be no fair trial was inexact, but his adoption of the correct test meant that he had not materially misdirected himself (paras [21], [59], [66]-[67]).
3. The right to an impartial tribunal is an essential ingredient of the rule of law, but a court is not required to set aside a judgment whenever a judge should have recused himself or herself. The consequences of a failure to recuse, including any time limit for review, are governed by the relevant local law. Article 6 of the Civil Procedure Code of Ethiopia gave a real opportunity to raise the objection and was not itself cogent evidence of unfairness (paras [53]-[57], [76]-[79]).
4. The English court was not entitled to re-try the inventory evidence, Dr Asgedom’s authority, or the appellants’ knowledge of the judge’s relationship. The Ethiopian courts had considered those matters carefully. The alleged errors, whether separately or cumulatively, did not establish a real risk of unfairness; any defect concerning authority might also have been capable of ratification under Ethiopian law (paras [60]-[64], [80]-[81]).
5. There was no cogent evidence that the Cassation Division’s consideration of materials from the English proceedings was irregular under Ethiopian law, or that the appellants had been deprived of submissions capable of affecting the outcome. The judge had not dismissed the action because of non-payment of costs and was entitled to uphold the payment order (paras [60], [65], [82]).
6. Lord Justice Davis additionally questioned whether the claim was properly justiciable in England and whether the fraud principle associated with Abouloff ordinarily operated as a shield rather than a sword. Those observations were unnecessary to the disposition.

• Court of Appeal (Civil Division) — appeal from the Chancery Division dismissed; respondents’ notice succeeded. [2017] EWCA Civ 1326.
• Chancery Division — Peter Smith J refused to lift the stay, dismissed the action, and declined to vary the order for £200,000 costs on account. [2014] EWHC 4196 (Ch).
• Chancery Division — proceedings had previously been stayed to enable review proceedings in Ethiopia. [2013] EWHC 599 (Ch).