Mobile Telecommunications Co KSCP v HRH Prince Hussam Bin Saud Bin Abdulaziz Al Saud

For service of a bankruptcy petition out of the jurisdiction, the court applies Civil Procedure Rules 1998 Part 6 and the jurisdictional gateway in Insolvency Act 1986 section 265. The good arguable case test requires a plausible evidential basis, a reliable assessment where possible, and a flexible approach where the material does not permit a firm conclusion.

A good arguable case decision is provisional. It does not finally determine the jurisdictional issue or create an issue estoppel for a later petition involving a different statutory period. Cross-examination is generally inappropriate at the interlocutory jurisdiction stage, particularly where the same issue remains for final determination on the balance of probabilities.

MTC presented a second bankruptcy petition against the debtor and relied on Insolvency Act 1986 section 265(2)(b)(i), alleging that he had had a place of residence in England and Wales during the relevant three-year period.

MTC sought directions preventing reliance on new witness evidence, on the basis that the issue had been determined in an earlier petition, or alternatively directing cross-examination of the witnesses at the jurisdiction hearing. The earlier petition had resulted in a finding that MTC had a good arguable case, upheld on appeal by Roth J in [2022] EWHC 744 (Ch). The central issues were whether that earlier decision created an issue estoppel and whether cross-examination should be ordered before service and final determination of the second petition.

1. Issue estoppel. The application to exclude the new evidence was refused. The earlier decision determined only that MTC had a good arguable case under section 265(2)(b)(i). It was not a final determination on the merits. The phrase good arguable case is inherently provisional and assumes that the issue will be argued again at a later stage.
2. The two petitions concerned different three-year periods. Although the periods overlapped, the earlier court evaluated the evidence in the context of the first period as a whole. The overlapping months could not be separated from that wider evaluation. The earlier decision therefore did not determine the same question raised by the second set-aside application.
3. The finding that the debtor had permission to stay at York House was an evidential feature in the earlier evaluation, not a decisive determination that the statutory gateway was satisfied. A good arguable case conclusion is an evaluative judgment based on primary facts, rather than itself a finding of fact for issue-estoppel purposes.
4. Cross-examination. The application for cross-examination was also refused. The three-limb approach in Brownlie v Four Seasons Holding Inc and Kaefer Aislamientos SA de CV v AMS Drilling Mexico SA de CV requires the court to decide jurisdiction on the interlocutory material without determining the ultimate merits. Limb (iii) accommodates conflicts between objective material and untested assertions without converting the hearing into a trial.
5. The reasoning in Bols Distilleries BV v Superior Yacht Services Ltd supported avoiding oral evidence at the jurisdiction stage. The general principle in Stokoe Partnership Solicitors v Grayson and the analysis in BB & Ors v Al Khayyat likewise applied. The court’s procedural powers under Civil Procedure Rules 1998 rule 32.7 and the Insolvency (England and Wales) Rules 2016 did not make cross-examination appropriate in this case.
6. The proposed rolled-up hearing was rejected. The good arguable case threshold had to be satisfied before service, while the final issue had to be determined later on the balance of probabilities. Both directions were declined.

The judgment describes earlier proceedings concerning a first bankruptcy petition. Deputy ICC Judge Schaffer dismissed the first set-aside application on 14 December 2020. Roth J dismissed the debtor’s appeal and upheld service in a judgment dated 31 March 2022, reported at [2022] EWHC 744 (Ch).

The present court refused directions in relation to the second petition and proposed that the applications and petition proceed to a later hearing.