Shahraab Ahmad v Karim Ouajjou & Anor

Deliberate and substantial breaches of a freezing order are inherently serious because they undermine the administration of justice. Where custody is required, the sentence must be the shortest term that properly reflects the contempt, with mitigation and the impact on dependent children taken into account. Prison overcrowding may justify a modest reduction or, exceptionally, suspension, but it does not prevent immediate custody where that is otherwise appropriate. An untested witness statement may receive little or no weight, particularly where the contemnor deliberately fails to attend for cross-examination. A modest breach of a living-expense limit may fall below the custody threshold when considered alone, even though it may attract no separate penalty within a concurrent sentence for more serious contempts.

The respondent brought debt and fraud proceedings exceeding €25 million against a married couple who jointly owned property in Madrid. Worldwide freezing orders made in March 2022 prohibited dealings with the property and limited each appellant’s ordinary living expenses to €2,000 per week.

The appellants admitted three contempts: Mr Ouajjou’s transfer of his interest in the property to Ms Perez; Ms Perez’s subsequent sale of the property for €3,990,000; and Ms Perez’s expenditure above the weekly limit. Dame Clare Moulder DBE sentenced Mr Ouajjou to nine months’ imprisonment and Ms Perez to concurrent sentences totalling nine months, refusing suspension. On appeal, the issue was whether the sentences should have been suspended or reduced.

1. Appeal dismissed, subject to a minor variation. The three-month sentence imposed on Ms Perez for exceeding the living-expense limit was quashed, and no separate penalty was imposed for that contempt. The sentences for the transfer and sale remained in force.
2. The judge was entitled to give little or no weight to evidence in witness statements which was deliberately left untested when the appellants refused to attend for cross-examination. This was particularly so where the explanations were implausible and unsupported by contemporaneous documents. The findings that the transfer and sale were deliberate breaches were therefore open to her.
3. The sentencing approach in Attorney General v Crosland [2021] UKSC 15 applied. The court must assess culpability and harm, consider whether a fine suffices, impose the shortest custodial term properly reflecting seriousness, take account of mitigation and early admission, and consider suspension.
4. A deliberate and substantial breach of a freezing order will normally attract immediate custody measured in months and may exceed one year. Legitimate tax planning before the orders did not mitigate the subsequent breaches. The proper course would have been disclosure to the court and an application to vary the orders so that a controlled sale could occur with safeguards.
5. Prison overcrowding was relevant and might justify a modest reduction or suspension, but it did not justify avoiding immediate custody where that sentence was otherwise required. The proposed Sentencing Bill had no legal effect.
6. The interests of dependent children are relevant but must be balanced against punishment, deterrence, victims’ interests and consistency. As explained in R v Petherick [2012] EWCA Crim 2214, the assessment is fact-sensitive. The judge was entitled to reduce Ms Perez’s sentence while making no corresponding reduction for Mr Ouajjou.
7. The living-expense contempt, standing alone, did not pass the custody threshold. The excess was modest, concerned ordinary expenses and occurred within a household whose combined expenditure remained within the combined allowance. No separate penalty was therefore imposed.

• Court of Appeal (Civil Division): Appeal against sentence dismissed, save that the three-month sentence for the living-expense contempt was quashed and no separate penalty imposed. [2024] EWCA Civ 1480
• High Court of Justice, Commercial Court: Dame Clare Moulder DBE imposed nine months’ imprisonment on Mr Ouajjou and concurrent sentences totalling nine months on Ms Perez for three admitted contempts, refusing to suspend the sentences. [2024] EWHC 1096 (Comm)