Arab Jordan Investment Bank Plc & Anor v Sharbain

Summary judgment may be granted where a defence has no real prospect of success and there is no other compelling reason for trial. The court must avoid a mini-trial, but may disregard expert evidence that is plainly unsupported or fundamentally flawed. A foreign judgment may be impeached for fraud only where there is conscious and deliberate dishonesty which was material and an operative cause of the judgment. The fraud exception does not apply where the alleged wrongdoing consists only of an agent’s lack of authority, and the principal has ratified the proceedings. Foreign-law expert evidence may be rejected where it lacks a reasoned methodology, supporting commentary and sound analysis of the relevant materials.

HSBC sought summary judgment to enforce two Jordanian judgments against Mr Sharbain, who had been held liable as guarantor of debts owed by two Jordanian companies. The judgments concerned sums exceeding US$10 million and had been upheld on appeal in Jordan.

The defendant advanced two principal defences. First, he argued that registration of HSBC’s Jordanian branch created a separate Jordanian legal entity, which—not HSBC—was the judgment creditor. Secondly, he argued that the lawyer who commenced the Jordanian proceedings lacked a valid power of attorney, had misled the Jordanian court, and had thereby tainted the judgments for the purposes of the fraud and natural justice exceptions.

1. Summary judgment principles. Under Part 24, the claimant had to show that there was no real prospect of a successful defence and no other compelling reason for trial. The court should not conduct a mini-trial, but could reject an allegation or evidential case that was clearly hopeless on the material available. Expert evidence on foreign law was not immune from rejection at the summary stage.
2. Wrong entity defence. The Jordanian Companies Law provisions concerning foreign operating companies regulated registration and the operation of a branch of the foreign company. They did not provide that registration created a new legal person. The references to a foreign company, its branch, its parent company and obligations incurred in Jordan were consistent with HSBC itself remaining the relevant legal entity. The contemporaneous documents, including the facility letters, registration materials and communications from the Jordanian authorities, confirmed that conclusion.
3. Even if a separate operating entity had been arguable, the documents and Jordanian proceedings identified HSBC as the lender, claimant and judgment creditor. The first defence therefore had no real prospect of success.
4. Power of attorney defence. The power of attorney granted Mr Al-Khalil extensive and continuing authority to conduct litigation for HSBC. The general words at its conclusion were a sweep-up clause and did not qualify the specific powers previously conferred. The subsequent termination of Ms Adams’s authority did not terminate Mr Al-Khalil’s authority. The contrary foreign-law opinion was plainly inadequate and could be rejected without opposing expert evidence.
5. Fraud and natural justice. The alleged fraud was based on the assertion that Mr Al-Khalil knowingly acted without authority. That premise failed. In any event, HSBC’s ratification of his acts meant that he was treated as having had authority, removing the alleged wrongdoing. The fraud exception was therefore not engaged. No separate irregularity or denial of natural justice was established.
6. There was no real prospect of a successful defence and no compelling reason for trial. Judgment was entered for the claimant.