Al-Khyami v El-Muderris

In a conversion claim, the claimant bears the burden of proving ownership or a right to possession and an unlawful dealing with the goods. The court should focus on central factual issues and assess them systematically by reference to admitted facts, objective evidence, independent witnesses and the surrounding circumstances. A claimant cannot establish conversion merely by proving that the defendant possessed or displayed goods. Where the evidence supports lawful acquisition, and the alleged taking is unsupported by first-hand evidence, the claim fails. Damages, if conversion were proved, are ordinarily assessed at market value at the date of conversion.

The claimant claimed damages for the alleged conversion of 11 luxury watches and items of jewellery said to have been stored in a garage safe. He alleged that the defendant unlawfully removed or dealt with them. The defendant denied taking the goods and relied on lawful purchases, dealings on behalf of the garage owner, or possession of excluded items acquired from the claimant.

The court considered ownership and possessory rights, the circumstances in which the goods were placed in the safe, whether the defendant had unlawfully taken any of them, and the appropriate measure of damages if liability were established.

1. The claim was dismissed. The claimant failed to prove that the defendant had converted any of the claimed goods.
2. In resolving disputed factual transactions, the court adopted a systematic approach. It considered the admitted or undisputed facts, objective evidence, independent witnesses, surrounding circumstances, general plausibility and consistency of the competing accounts. The court was not required to resolve every peripheral issue where it did not affect the result.
3. The defendant acquired the Audemars Piguet watches lawfully from Mr Kassab, who had acquired them from the claimant. The defendant therefore had not taken them from the garage safe or converted them.
4. The evidence supported the conclusion that the two Rolex watches had been provided to Mr Showai as security for the claimant’s loan and later surrendered to him in part payment. Photographs of the defendant wearing the watches did not prove that he had stolen them. The allegation that the defendant had contacted Rolex to remove the watches from its stolen list was unsupported.
5. The defendant’s account concerning the excluded necklaces was more probable than the claimant’s. There was no first-hand evidence that the defendant had taken them from the safe. The claimant’s proposed inference concerning the remaining goods therefore failed.
6. The absence of Mr Showai was significant. He was the only person who could have given first-hand evidence of a taking by the defendant. The evidence of Mr Ridha, including evidence that the claimant and Mr Showai may have agreed to allege falsely that the defendant had stolen the goods, further weakened the claim.
7. Had liability been established, damages would have been assessed at the market value at the date of conversion. The court would have awarded £210,000, with no separate award for loss of use, and aggravated damages of £21,000 because the defendant’s conduct would have been high-handed and oppressive. These observations were alternative and did not form part of the operative disposition.

First-instance decision. No prior appellate history was stated in the judgment.