The Esteem Settlement and The No. 52 Trust

CourtCourt of Appeal
JudgeVaughan, J.A.
Judgment Date20 March 2001
Date20 March 2001
Vaughan, J.A.

J.A. Clyde-Smith for the trustee;

N.F. Journeaux for the plaintiff;

P.C. Sinel for the second and third defendants.

Cases cited:

(1) Att. Gen. v. Barra Hotel Ltd., 2000 JLR 150.

(2) Director Gen. of Fair Trading v. Proprietary Assn. of G.B. (2000), 151 New L.J. 17; sub nom. In re Medicaments & Related Classes of Goods (No. 2), 98(7) Law Soc. Gaz. 40; 145 Sol. Jo. (L.B.) 29, followed.

(3) Fey v. Austria (1993), 16 E.H.R.R. 387, considered.

(4) Hirschfield (née Shalome) v. Abacus (C.I.) Ltd., 2000 JLR 420, considered.

(5) Locabail (UK) Ltd. v. Bayfield Properties Ltd., [2000] Q.B. 451; [2000] 1 All E.R. 65.

(6) Mayo Associates S.A. v. Cantrade Private Bank Switzerland (C.I.) Ltd., 1998 JLR 173, followed.

(7) R. v. Bow St. Metropolitan Stipendiary Magistrate, ex p. Pinochet Ugarte (No. 2), [2000] 1 A.C. 119; [1999] 1 All E.R. 577.

(8) R. v. Gough, [1993] A.C. 646; [1993] 2 All E.R. 724; (1993), 97 Cr. App. R. 188.

(9) Sinel, In re, 2000 JLR 18.

(10) South Africa (President) v. South African Rugby Football Union, 1999 (4) S.A. 147, considered.

(11) States Greffier v. Les Pas Holdings Ltd., 1998 JLR 196.

Additional cases cited by counsel:

Piersack v. Belgium (1982), 5 E.H.R.R. 169.

R. v. Atkinson, [1978] 1 W.L.R. 425.

R. v. Inner W. London Coroner, ex p. Dallaglio, [1994] 4 All E.R. 139.

R. v. Queen's County JJ., [1908] 2 I.R. 285.

R. v. Romsey JJ., ex p. Gale, [1992] T.L.R. 16.

Shrager v. Basil Dighton Ltd., [1924] 1 K.B. 274.

Taylor v. Lawrence, [2001] EWCA Civ 119.

Courts—récusation—apparent bias—judge to determine issue of own récusation—although prudent not to do so in exceptional circumstances, normally wrong for others to resolve issue

Courts—récusation—apparent bias—objective test—whether all material circumstances would lead fair-minded and informed observer to conclude that real possibility or danger that judge biased—subjective opinion of party alleging bias irrelevant

Courts—récusation—apparent bias—expression in interlocutory proceedings of views as to prospects of success at full hearing, however inappropriately strong, not to preclude judge's sitting on substantive appeal—substantive appeal issues entirely different from those in interlocutory proceedings

Courts—récusation—refusal of application—where récusation refused, wrong in principle for judge nevertheless to decide not to sit, unless some personal or other difficulty

The second and third defendants sought the récusation of the Judge of Appeal from sitting as a member of the Court of Appeal in an appeal pending from a decision of the Royal Court.

The first defendant owed the plaintiff company approximately US$687m., arising out of fraud on his part. He had established two discretionary trusts worth approximately US$18m., of which he and the second and third defendants were beneficiaries. The plaintiff was attempting, in related proceedings, to enforce a judgment for the debt, obtained in England, against the assets of the trusts. The trustee surrendered its discretion to the court and applied for an order that all or most of the trust funds be distributed to the plaintiff in reduction of the debt. The second and third defendants opposed the application.

In subsequent interlocutory proceedings before the Court of Appeal (noted at 2000 JLR N-41), of which the Judge of Appeal was a member, the court expressed the opinion that it was highly likely that either a partial or a complete distribution of the trust assets would be made to the plaintiff when the main action was heard. On an application for special leave to appeal, the Privy Council, on October 10th, 2000 (noted at 2000 JLR N-6), criticized the Court of Appeal for expressing such "inappropriately strong" views as to the prospect of success of the main action in interlocutory proceedings.

When the matter came before the Royal Court again, it held (in proceedings reported at 2001 JLR 7) that there should in fact be no distribution of the trust assets. The plaintiff appealed against this decision and, on learning that the Judge of Appeal was to sit at the hearing of this appeal, the second and third defendants sought his récusation on the grounds of apparent bias.

They submitted that (a) the Judge of Appeal could not or should not determine an application for his own récusation made before the hearing; (b) when determining whether there was apparent bias, the court should take into account the subjective views of the party making the application as an important factor; and (c) the expression of inappropriately strong views on the plaintiff's potential success in the main action by the Court of Appeal in the interlocutory proceedings gave rise to a legitimate fear that the Judge of Appeal might not be impartial on an appeal in respect of the substantive issue.

The trustee submitted that although it believed there to be no basis for the Judge of Appeal to recuse himself, it might nevertheless be appropriate for him, as a matter of discretion, to decide not to sit.

Held, refusing the application:

(1) The Judge of Appeal should, as part of his duties as a judge, sit to determine the issue of his own récusation as he was in the best position to know whether the objections to his constitutional, judicial or personal circumstances were valid or not, or whether they might be perceived to be valid. Although in exceptional circumstances a judge might deem it prudent not to sit, this was certainly not one of those cases and it would normally be wrong for the question to be left to others to resolve ( para. 23).

(2) The test to be applied was whether all the material circumstances would lead a fair-minded and informed observer to conclude that there was a real possibility or a real danger that the judge was biased. This was a wholly objective test and the subjective opinion of the party alleging bias would not be taken into account ( paras. 21-22).

(3) Applying this test, the application would be refused. The expression of views as to the prospects of success at an interlocutory stage, however inappropriately strong, could not possibly be the basis for excluding a judge from sitting on the appeal from the final decision in the case. The questions to be considered in the substantive appeal were entirely different from those in the interlocutory proceedings, as they concerned whether the judgment of the Royal Court was correct in law and whether its conclusions were sustainable in the light of the evidence that it accepted, rather than issues of case management, which had been the main concern of the previous appeal ( paras. 26-29).

(4) Having decided not to recuse himself, it would be wrong in principle, unless there were some personal or other difficulty, for the Judge of Appeal to decide not to sit. Such behaviour would encourage récusation applications by suggesting that a judge might voluntarily decide not to sit even when the application had failed and lead to parties' attempting to select a Court of Appeal favourable towards them. Such "judge shopping" was not to be permitted ( para. 30).

1 VAUGHAN, J.A.: This is an application by Advocate Sinel, acting on behalf of the second and third defendants, namely Barbara Alison Al-Sabah and Mishal Roger Al-Sabah, that I recuse myself from sitting as a member of the Court of Appeal to hear an appeal against a judgment in this matter delivered by the Deputy Bailiff and Jurats de Veulle and Rumfitt, dated January 9th, 2001 (reported at 2001 JLR 7). The appeal is listed to be heard in the week commencing April 23rd, 2001.

2 By letter dated February 7th, 2001, the Assistant Judicial Greffier wrote to the parties informing them that "it is proposed to bring this appeal before the April court, which sits in the week of Monday 23rd to Friday 27th April (Gloster, Sumption and Rokison, JJ.A.)." Sumption, J.A., as soon as he knew that this case was in the list, informed the Assistant Judicial Greffier that he could not sit on such an appeal as he had been retained in England at some earlier stage on behalf of Sheikh Fahad Al-Sabah (the first defendant and the husband of Barbara Al-Sabah). I was then invited to replace Sumption, J.A. to hear that appeal together with Gloster and Rokison, JJ.A., and I agreed. Of course, I was aware this was the same case as the one on which I had sat in the Court of Appeal in July 2000 and which judgment had been the subject of criticism by the Judicial Committee of the Privy Council in October 2000.

3 The parties were informed by letter dated March 14th, 2001 that I would be sitting instead of Sumption, J.A. The applicants immediately objected to my sitting on that appeal.

4 I considered that it was important that the objection should be dealt with as soon as possible because, if the application were to be successful, then measures would have to be taken to ensure that a third member of the Court of Appeal be found to replace me to hear the appeal. Accordingly, I ordered that it should be heard at the first available opportunity and it was heard on March 20th, 2001. In this respect, it should be borne in mind that if this application were successful, it would not only relate to myself but it would also relate to Southwell and Nutting, JJ.A. I was informed at the hearing (on my enquiry) that such an objection would also relate (for different reasons) to the Bailiff and to the Deputy Bailiff (both had heard matters relating to this case, albeit different matters, at first instance). There are certainly other members of the Court of Appeal (in addition to Sumption, J.A.) who would have some conflict or other embarrassment to sit in the Court of Appeal in matters relating to Sheikh Fahad. The pool for choosing a replacement could be narrow and such persons may not be available for an April hearing. How narrow that pool is I do not know. It is also relevant that in the appeal there is already substantial documentation...

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