ABU DHABI COMMERCIAL BANK PJSC v BAVAGUTHU RAGHURAM SHETTY

On an application to serve proceedings out of the jurisdiction, the claimant must establish a real issue to be tried, a good arguable case within a jurisdictional gateway, and that England is clearly or distinctly the appropriate forum. At the jurisdiction stage, pleaded facts should generally be accepted unless demonstrably untrue or unsupportable; the court should avoid a mini-trial. Under Rome II, the place where damage occurs and the parties’ habitual residence are central to the applicable law, while the manifestly closer connection exception is exceptional. A foreign defendant may be served at an English registered address under section 1140 of the Companies Act 2006, even when resident abroad. The proceedings were stayed because Abu Dhabi was clearly the more appropriate forum and substantial justice could be obtained there.

Abu Dhabi Commercial Bank PJSC alleged that the defendants participated in a large fraud involving NMC plc and its subsidiaries. It claimed damages in deceit and unlawful means conspiracy arising from lending facilities advanced to UAE companies. The claimant sought continuation of a worldwide freezing order, permission to rely on an additional CPR jurisdictional gateway, and amendment of its Particulars of Claim. The defendants challenged service out, the existence of a serious issue to be tried, the applicable law, and the English forum.

The court considered whether the claims were realistically arguable under UAE law, whether the first defendant had been validly served under section 1140 of the Companies Act 2006, whether the claims passed the relevant gateways, and whether England or Abu Dhabi was the appropriate forum.

1. Real issue to be tried. The claimant’s pleaded factual allegations were not demonstrably untrue or unsupportable. The court should focus on the pleaded case and should not evaluate competing evidence as at trial. The deceit, reliance and consequential-loss issues therefore raised real issues to be tried.
2. Section 6 point. Section 6 of the Statute of Frauds (Amendment) Act 1828 applied procedurally, regardless of whether English or UAE law governed the claim. Its scope was confined to fraudulent representations concerning creditworthiness, but its application to the alleged implied representations and to representations concerning a holding company’s accounts could not properly be finally determined without trial. It therefore did not defeat the jurisdictional threshold.
3. Applicable law. Article 4 of Rome II pointed to UAE law. The damage occurred when UAE entities drew down or benefited from facilities advanced by a UAE bank. The parties were habitually resident in the UAE. Article 4(3) did not apply: the alleged wrongdoing was planned and implemented in the UAE, and the English contractual connections were mechanisms by which the alleged scheme operated rather than a manifestly closer connection.
4. UAE pleading. The Particulars of Claim and Schedule 2 had to be read together. The claims in deceit and harmful acts were realistically arguable under Articles 282 and 285 of the UAE Civil Code. Although UAE law did not recognise conspiracy as a cause of action, it was realistically arguable that procuring, encouraging, authorising or adopting another’s wrong could constitute actionable harm and attract liability under Article 291.
5. Service and gateways. Section 1140 of the Companies Act 2006 permitted service on the first defendant at his English registered address despite his foreign residence. He could therefore act as anchor defendant. The necessary or proper party gateway was satisfied in relation to the other defendants. The tort gateways were satisfied only to the limited extent identified in relation to the Accounts Representations and the two facilities said to have become effective in London.
6. Forum. Applying the principles in Spiliada, Abu Dhabi had the closest and most substantial connection. The parties, witnesses, documents, borrowers, loss, alleged wrongdoing and applicable law were centred there. The English connections were casual or adventitious. The differences in procedure and the risk of parallel or inconsistent proceedings did not show that substantial justice could not be obtained in Abu Dhabi.
7. Disposition. The proceedings were stayed, rather than dismissed, on the defendants’ undertakings to submit to the Abu Dhabi courts, with liberty to the claimant to apply to lift the stay if the undertakings were breached. The court did not need to decide whether the worldwide freezing order should be continued.

First-instance decision. The judgment records earlier orders permitting service out and a worldwide freezing order, but no appeal from an earlier judgment is identified.