BAILII is celebrating 24 years of free online access to the law! Would you consider making a contribution?
No donation is too small. If every visitor before 31 December gives just Β£1, it will have a significant impact on BAILII's ability to continue providing free access to the law.
Thank you very much for your support!
 |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] | |
England and Wales High Court (Queen's Bench Division) Decisions |
||
|
You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Harty v Sabre International Security Ltd & Anor [2011] EWHC 852 (QB) (05 April 2011) URL: http://www.bailii.org/ew/cases/EWHC/QB/2011/852.html Cite as: [2011] EWHC 852 (QB) |
||
[New search] [Printable RTF version] [Help]
QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL |
||
B e f o r e :
____________________
| Anthony Harty |
Claimant |
|
| - and - |
||
| 1 Sabre International Security \Limited (formerly SIS Iraq Ltd) 2 Sabre International Security Limited |
Defendants |
____________________
WordWave International Limited
A Merrill Communications Company
190 Fleet Street, London EC4A 2AG
Tel No: 020 7404 1400, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
STEPHEN NATHAN QC (instructed by SJ BERWIN) for the DEFENDANTS
Hearing dates: 13.12.10 to 17.12.10
____________________
Crown Copyright ©
| paragraphs | page | ||
| Part 1 | The claim | 1.1 1.22 | 2 |
| Part 2 | Relevant provisions and the route to decision | 2.1 2.92 | 2 |
| Part 3 | The parties | 3.1 3.32 | 5 |
| Part 4 | The principal issue; Immunity from suit | 4.1 4.52 | 6 |
| Part 5 | Background facts and core documents. | 5.1 5.222 | 9 |
| Part 6 | The Defendants' case on immunity | 6.1 6.72 | 16 |
| Part 7 | The Claimant's case on immunity | 7.1 7.192 | 18 |
| Part 8 | Findings on immunity | 8.1 8.42 | 27 |
| Part 9 | Reasonable prospect of success | 9.1 9.32 | 30 |
| Part 10 | Waiver and retrospective legislation | 10.1 10.72 | 31 |
| Part 11 | The Spiliada principle | 11.1 11.22 | 34 |
| Part 12 | Decision | 12.1 12.42 | 36 |
1.2 He seeks to claim damages for personal injuries and consequential losses arising out of the alleged negligence of the Defendants. He wishes to bring his claim within this jurisdiction. The Defendants contend that any claim must be brought in Iraq.
2.2 CPR parts 6.36 and 6.37 govern applications for leave to serve process out of the jurisdiction.
Part 6.36 provides:
"the Claimant may serve a claim form out of the jurisdiction with the permission of the court if any of the grounds set out in paragraph 3.1 of PD 6B apply."
PD 6B para 3.1 so far as relevant provides:
"The Claimant may serve a claim form out of the jurisdiction with the permission of the court under rule 6.36 where
(9) a claim is made in tort where
(a) damage was sustained within the jurisdiction."
Part 6.37 (1) provides:
"An application for permission must set out
(b) that the claimant believes that the claim has a reasonable prospect of success."
Part 6.37(3) provides:
"The court will not give permission unless satisfied that England and Wales is the proper place in which to bring the claim."2.3 There are thus three stages.
i) That the claimant sustained damage within England and Wales
ii) That the claim has reasonable prospects of success
iii) That the court is satisfied that England and Wales is the proper place in which to bring the claim.
2.4 Stages (i) and (ii) have been jointly described as the "gateway". As to (ii) the parties are agreed that it is necessary for the court to consider whether the claim does in fact have reasonable prospects of success - not merely (to use the words in the Rule) "that the claimant believes that the claim has a reasonable prospect of success".2.5 It is common ground that I should approach the application in the following way: The Defendants may succeed in the application if the Claimant has failed to pass through the gateway; that damage was not sustained in England and Wales and / or that the claim has no reasonable prospect of success. If the Claimant gets through the gateway to stage three, the court has to decide, against a proven background factual matrix, that England and Wales is the proper place in which to bring the claim. Here there is potentially a two stage inquiry (see Spiliada Maritime Corporation v Consulex Ltd [1987] 1 AC 460):
i) Does the claimant establish that England and Wales is "clearly the appropriate forum for the trial of this action"?
ii) If not (and the court is satisfied that there is prima facie another forum which is more appropriate for the trial of the action) does the Claimant satisfy the court that there are special circumstances by reason of which the trial should nevertheless take place in this country.
2.6 The gateway: There are thus two preliminary requirements: (i) that the claimant sustained damage within England and Wales; and (ii) that the claim has reasonable prospects of success. This is the PD 6.37 "gateway". If the Claimant fails to negotiate the gateway, that is an end of the matter and he fails at the first stage. I should then set aside the Master's order and declare that the court has no jurisdiction.2.7 As to the first of those requirements, there is no issue and the Defendants did not challenge that the ground was made out under PD 6B 3.1 (9) (a) namely "a claim brought in tort where damage was sustained within the jurisdiction". At first blush, it might be thought that the Claimant should fall at that first hurdle; that the damage was sustained in Iraq and not within England and Wales. However, this is not a contentious issue between the parties. In Margaret Patricia Booth v Phillips and others [2004] EWHC 1437 (Admiralty) Mr Nigel Teare QC (as he then was) held that damage is not limited to the initial injury but is a continuous and on-going state of affairs. His decision was made under CPR 6.20 (8) (a) which is in the same terms as paragraph 3.1 (9) (a). This decision was subsequently approved by Tugendhat J in Shane Anthony Colley v Thomas Richard Ramsey [2008] EWCH 129 (QB). Thus it is argued that the pain and suffering, loss of earnings and other losses were sustained in part within the jurisdiction, it being the case that the Claimant returned to England and Wales for medical treatment and convalescence following the accident. The Defendants do not seek to argue this issue before me, although they reserve their position for the Court of Appeal.
2.8 However, the Defendants do take issue under CPR 6.37(1) (b) and the Claimant's assertion, made in the application, that the claim has a reasonable prospect of success. It is agreed that the requirement is not merely that the claimant should state his belief that he has reasonable prospects of success; when considering an application to set aside, the court must be satisfied that there are in fact reasonable prospects of success.
2.9 I will say at this stage in my Judgment that, in spite of the Defendants' submissions to the contrary, I am entirely satisfied that this part of the gateway is open and that the claim has good prospects of success. I will not give my reasons here - but reserve them to a later stage in the Judgment, when I have been able to consider the effect of the contractual terms agreed between the Claimant and the First Defendant. These terms are of more relevance in a different context; but they also have some bearing upon this issue. It is for that reason that I defer giving my reasons at this stage but will do so within Part 9 below.
3.2 The Defendants: The two Defendants have been described as sister or sibling companies. They are two of a small group of companies trading under the style "Sabre International Security" or "Sabre". The two companies now enjoy identical names although the first Defendant was previously known as "SIS Iraq Limited". Although each one is called "Sabre International Security Limited" the first Defendant is registered in the British Virgin Islands (BVI) whereas the second Defendant is an Iraqi company. No explanation has been given as to why two sibling companies bear identical names. There is undoubted confusion. One of the consequences of that confusion is that the Claimant sues the two Defendants separately and in the alternative. At the time that proceedings were issued the Claimant's lawyers were uncertain as to which company should properly be sued. This depended upon which company had contracted with the Claimant and which company was responsible for supervising the Claimant and other members of the security team at the time of the accident. In his first witness statement, dated 23.06.09 Mr Chamberlayne, the Claimant's solicitor, noting this uncertainty, said (bundle1/ page 81)
"The Defendant companies are part of a group of companies ..it would appear from the documentation that both SIS Iraq Ltd ...as the first Defendant was originally called) and Sabre International Security Limited are used in an interchangeable manner. To avoid issuing against the wrong Defendant, both Defendants are pursued and it is hoped after serving the claim form this matter can be resolved."3.3 In fact, the matter has not been resolved - and is now the subject of acrimonious debate. It is highly significant to these proceedings that the first Defendant is registered in the BVI and that the second Defendant is an Iraqi registered company. This is of significance because, subject to certain conditions, a company registered outside Iraq may enjoy immunity from suit in the Iraqi courts. Iraqi companies do not enjoy immunity. The further significance will become clear later in this Judgment. The Defendants both work from the same office in the International Zone of Baghdad. Until 22nd May 2008, the first Defendant was known as "SIS Iraq Limited". On that date it changed its name to "Sabre International Security Limited" (b2/ 292). It is BVI registered company number 570881. The second Defendant has ever been called "Sabre International Security Limited". It is registered in Iraq and was set up in June 2004 with trade licence number 17504; (b2/ 312 and b2/ 314).
4.2 These disputes are of importance for the reason already mentioned. If the Claimant is correct, the First Defendant (as a non Iraqi company) enjoys immunity from suit and the courts of Iraq have no jurisdiction. If the Defendants are correct the Second Defendant does not have such immunity and there is nothing to prevent the Claimant from bringing his claim in Iraq.
4.3 The dispute may be summarised in this way:
i) The claimant contends that his contract was with the First Defendant, the BVI registered company. The First Defendant had made a contract with IRD for the supply of security services. The accident occurred when the First Defendant was performing those services for IRD; it was the First Defendant which had organised and was responsible for the supervision of the relevant convoy on 6th August 2008. The First Defendant was a "Private Security Company" (PSC) and either a "contractor" or "subcontractor" within the meaning of Coalition Provisional Authority Order number 17 (CPA17). As such, the First Defendant enjoys immunity from suit in Iraq under CPA 17 and the Iraqi courts have no jurisdiction over his claim. In those circumstances, he has no alternative but to bring his claim in a different jurisdiction.
ii) The Defendants agree that the Claimant contracted with the First Defendant (the BVI registered company) to provide his services. However, it was the Second Defendant which had contracted with IRD to provide security. It was the Second Defendant which had been granted the necessary licence to provide these services and which was the PSC and "contractor". There was a contract between the two Defendants that the first Defendant would supply to the Second Defendant independent contractor personnel to work pursuant to the IRD contract, albeit that this was not a contract in writing. The First Defendant was a mere supplier of personnel. It did not undertake security work. It was not licensed to do so. It was the Second Defendant which organised the convoy; the vehicles were owned and maintained by the Second Defendant and the convoy commander was an employee or agent of the Second Defendant. Insofar as the Claimant might have a valid case in negligence, it could only be against the Second Defendant. The Second Defendant was registered in Iraq. Immunity from suit under CPA 17 was only available to contractors who were registered outside Iraq. Under no circumstances could the Second Defendant claim immunity from suit. Even if it could be shown that the First Defendant owed some duty to the Claimant (it could not be a contractual duty because the Claimant's case is limited to tort) and, even if the First Defendant was responsible for undertaking security work, it was still not (despite its out of Iraq registration) immune from suit. As the IRD contract was with the Second Defendant, the "chain of causation" would be broken. A proper analysis of CPA17 meant that, under no circumstances could the First Defendant enjoy immunity. Thus the claim could and should be brought in Iraq.
4.4 The parties agree that this dispute is central to the issue between them; and (although they neither of them put it so bluntly) its resolution may almost be determinative of the whole Application. They also agree that it is a dispute which I have to decide on the basis of written evidence. I do not have the benefit of hearing the witnesses on oath. In those circumstances I agree with the submissions made by Mr Nathan QC on behalf of the Defendants that I should not decide this issue on the simple balance of probabilities. The evidence upon this issue comes almost exclusively from the Defendants' witnesses. It is they who know the internal arrangements of the Sabre companies and their witness statements are backed by statements of truth. I should be slow to reject that evidence, when I have not heard it from the witnesses' mouths. I do not need to determine every issue - only those which are necessary to enable me to determine the application. Some issues may be left for another day. For example, there is a dispute about the signing of the operator contract (see below). That may be determined at a later stage (if it is necessary to do so) on the basis of oral evidence, tested by cross examination. However, as the parties agree, there are fundamental issues which need to be decided.4.5 Thus I make it clear at this stage that I direct myself that I should only reject the Defendants' evidence upon this issue if I am satisfied, in spite of not having heard the witnesses, to a much higher standard of proof than the balance of probabilities.
• The Operator Contract (5.2 5.9)
• CPA 17 (5.10 5.15)
• The IRD Contract (5.16 5.22)
5.2 The Operator contract dated 14.08.07; As mentioned earlier, the Claimant had spent some time working in Iraq for Securiforce International, before returning to the UK. He received an e-mail from Sabre dated 6th August 2007 (exactly one year before the accident) offering him work in Iraq (bundle1/ p54). The e-mail was sent by Mr Reweti of "Sabre International Security". The Claimant regarded Sabre as an English enterprise, owned by a British National and, as he understood, with a one time presence in Manchester. He accepted the offer and travelled into Iraq, with preferential immigration status (visa arranged by Sabre) on 13th August 2007.5.3 Mr Harty entered into a contract (described as an "Operator Contract") on a date which he says was not "until a few days after I had travelled out to Iraq and actually started to work for them" (b1 /45 see also b1 / 141-2). At one stage it seemed that there might be some issue as to whether this was truly a contract for the provision of services or whether it might properly be considered a contract of employment by a different name. However, it is clear (as counsel accepted during submissions) that nothing turns on this.
5.4 It is also clear that the other party to this contract was the First Defendant, the BVI registered company. The contract was made between Anthony Harty and "SIS Iraq Limited a company organised and existing under the laws of the British Virgin Islands". It is worthy of note, however, that the contract was written upon paper headed "Sabre International Security". As Mr Nathan QC submitted, it is open to parties to write a contract on paper belonging to a third party, provided that the contract itself is clear as to who the parties are. This is, however, still of interest. It illustrates how the various Sabre companies are careless of how they represent themselves. On behalf of the Claimant it is submitted that "Sabre International Security" was, in effect, a brand name for the group of Sabre companies; that use of those three words was commonplace in documentation, whether the document was written on behalf of the First Defendant, the Second Defendant or some other Sabre company. However, as to this contract, it is common ground that the parties were the Claimant and the First (BVI) Defendant.
5.5 The contract is dated 14th August 2007. Either the contract was pre-dated or Mr Harty is wrong when he says that he did not sign it until a few days after arrival in Iraq. There are real disputes about a number of matters surrounding the signing of this contract by the Claimant. These disputes are of little significance in the context of this Application. They are certainly not for resolution by me. However, there is one interesting feature of the operator contract which I should perhaps consider. The copy of the operator contract produced by the Defendants was exhibited to a witness statement from Mr Fisher (who describes himself as an executive officer for the security services contract between the Iraqi company and the US company IRD) and is to be found at b2 p456 - 465. This copy contains two pages no 8. The first unexecuted page 8 (b2 p463) describes Alex Breingan as CEO (Chief Executive Officer). The executed page 8 (b2/ 464) has been changed so that he is described as Executive Manager (EM). It is suggested on behalf of the Claimant that this is a significant change designed to support a part of what is alleged to be a misleading and manufactured defence. The possible significance of this change will be considered later in this Judgment.
5.6 The terms of the Operator contract: The contract provided, inter alia, for the Claimant (operator) to work as a security consultant on protective security detail and required him to provide such other services as the Company should reasonably request, at whatever location(s) within Iraq the company should determine. He was not to provide services for any other party. There was provision for remuneration, which included that he be provided with Defence Base Act Insurance (providing benefits in the event, inter alia, of death injury or illness). There was an acknowledgment by the Claimant that his status was as a self-employed contractor and that he should undertake not to represent himself as an employee. Of most significance were clauses 5.2, 5.3 and 8.6
5.7 In summary, the parties agreed that their relationship and any dispute between them should be governed by the law of Iraq. Insofar as claims by the company might be made against the operator, these could be brought in some other suitable jurisdiction. But the operator could only sue the company in Iraq. Mr Harty also agreed that the benefits conferred by the contract itself (this would particularly include the benefits conferred by the Defence Base Act Insurance) would be adequate compensation in respect of any injury sustained by him "arising out of or relating to the presence of the operator in Iraq pursuant to the terms of this operator contract". It is submitted on behalf of the Claimant that this would not prevent a claim if a tortious act could be proved against the company. He also agreed to waive any claim that he may have against the company (whether based in tort contract or otherwise) for compensation or damages beyond the compensation and benefits contained within the contract, including compensation for death or injury unless the claim were to arise from fraud or wilful misconduct.
5.8 These were the terms of the operator contract which were brought to my attention during the hearing and which may have some bearing on the issues which I have to decide. As to the waiver clause, it is sufficient, for the purposes of this Judgment to note that the parties are agreed that (i) under the law of Iraq, it is not permissible to exclude liability for unlawful acts; and (ii) whilst under the Iraqi civil code article 25.9 it is not permissible to exclude liability for fraud or wilful misconduct on the part of the company (and this is presumably why the contract itself acknowledged this) the claim is brought necessarily in tort (in order to allow for service out of the jurisdiction) so that the question does not arise. I am not sure whether or not it is conceded by the Defendants that this clause cannot operate as a waiver by the Claimant of a right to bring a case in negligence. That would be for determination on another day, whether in the courts of Iraq or of England and Wales.
5.9 Whatever the circumstances in which the Claimant came to sign this contract, those are its terms. There was nothing within the contract to the effect that the services which the Claimant was to provide would be to a third party.
5.10 CPA 17: The matter of dispute between the parties is whether or not the Defendants are immune from suit in Iraq. It is central to the Claimant's case that the Defendants (in fact the First Defendant) enjoyed immunity from suit.
5.11 In order to resolve this dispute, I need to consider the relevant Regulations, Coalition Provisional Authority Order Number 17 (CPA17). I will also need to consider the issues mentioned earlier in this Judgment: which of the two Defendants had contracted with IRD for the provision of security services; which of the two Defendants was responsible for arranging overseeing and supervising the convoy; and whether the Claimant was working for the First Defendant at the time - or was working for the Second Defendant as a result of an agreement between the two Defendants for the supply of personnel.
5.12 First, however, I must look briefly at the Regulations. CPA17 came into force on 1st April 2003 and ceased to have effect at midnight on 31st December 2008. Its terms were revised in June 2004. It is necessary to understand that, within the Regulations, terms such as "contract" "subcontractors" and "contractors" are given special definitions. I can summarise. By clause 1 (11) contractors are defined as non-Iraqi legal entities or individuals not normally resident in Iraq, including their non-Iraqi employees and subcontractors not normally resident in Iraq, supplying goods or services in Iraq under a contract. By clause 1 (12) a contract is defined as being a contract or agreement with the Coalition Provisional Authority, or a contract or agreement with a sending state, to supply certain defined goods or services in Iraq, including a contract for security services provided by Private Security Companies to various bodies including contractors. By clause 1 (13) subcontractors are defined as non Iraqi legal entities or individuals not normally resident in Iraq including their non-Iraqi employees, performing under a contract with a Contractor to supply goods or services in Iraq. By clause 1 (14) Private Security Companies are defined as non-Iraqi legal entities or individuals not normally resident in Iraq, including their non-Iraqi employees and subcontractors not normally resident in Iraq, providing security services to various bodies including other contractors. These are somewhat inadequate summaries of the relevant parts of the definitions; the full definitions may be found within CPA17 itself; b2 / 294 - 306.
5.13 Of immediate interest: "Contractors", "Subcontractors" and "Private Security Companies" must all be non-Iraqi legal entities or individuals not normally resident in Iraq; and these include non-Iraqi employees. It follows that the second Defendant, registered in Iraq, does not fall within any of these definitions. The first Defendant, registered in BVI may potentially do so.
5.14 By clause 4 of CPA17, "contractors" are given immunity. Insofar as relevant to this Judgment:
Clause 4 (2): Contractors shall not be subject to Iraqi laws or regulations in matters relating to terms and conditions of their contracts .5.15 In broad terms, the effect of these parts of clause 4 was to confer immunity upon contractors (who might also be Private Security Companies) their subcontractors and employees; and freed them (and their subcontractors and employees) from the obligation to comply with Iraqi laws in respect of acts in furtherance of the contract. This would include criminal acts, so that employees of contractors would not be subject to prosecution if, for example, they were responsible for assaults or worse in the course of their security work. Contractors were, by definition, non-Iraqi.Clause 4 (3): Contractors shall be immune from Iraqi legal process with respect to acts performed by them pursuant to the terms and conditions of a contract or any sub-contract thereto ..
5.16 The IRD contract: It is common ground that, at the time of the accident (a) one or other of the Defendants had contracted with International Relief and Development Inc. (IRD) for the provision of security services and (b) that IRD had a contract with the government of the US of A to rebuild Iraq, following the Gulf War under the US Aid programme. The issue is which of the two Defendants entered into this contract.
5.17 The Claimant had always believed that he was operating within Iraq with the benefit of immunity - that, like other security operators, he himself could not be sued or prosecuted within the courts of Iraq. He was also of the impression that those who had contracted for his services were similarly protected. His contract (the operator contract) was with a non - Iraqi company and he had no reason to believe that he and his "employers" (or those with whom he had contracted for his services) were operating without immunity.
5.18 The first the Claimant and his advisers knew of the assertion that there was no immunity was when they received the first witness statement of Mr Thomas Frank McDonald although there had been a hint of it in a letter from Messrs SJ Berwin dated 4th February 2010; b2 / 346 at p 347 para 4.2(c). This particular line of defence had not been foreshadowed in the correspondence which had begun over a year earlier. Mr McDonald's statement was dated 15th February 2010. He (see below) was a director of both companies. In that statement he said:
"The agreement between the Claimant and the BVI company was for the Claimant to provide services as an independent contractor under the operator contract. The BVI company was under contract with the Iraqi company to make available to the Iraqi company independent contractor personnel (including the Claimant) for the Iraqi Company's MOI-licensed PSC operations for which the Iraqi company had and has not immunity " (b2 /261).
The detail was enlarged and embellished in later statements, and particularly within his second witness statement, dated 30th July 2010 (b3/ 690 710).
5.19 It was by this second witness statement that disclosure of the IRD contract itself - central to the Defendants' case - was made. It was made in response to an Order of the court (b3/ 815-6):
"By 4.00pm on 28.05.10 the Defendants are to serve evidence in support of their applications, with exhibited thereto all documents to be relied upon. In particular if it be the Defendants' case that CPO 17 of the Coalition Provisional Authority in Iraq does not apply to the contract between the Claimant and the First Defendant, then the document or extract therefrom is to be exhibited".5.20 In fact Mr McDonald produced (later than ordered), heavily redacted, two IRD contracts as his exhibits TFM 9 and TMF10. There was virtually total redaction; the only disclosure was of the title and signature pages. The first of these (TFM 9) is described by Mr McDonald as being contract "FY 2007 IR&D - Iraqi Company subcontract". It is to be found at b3/ 712 - 3. It bears the date on the first page; 16th August 2006. The subcontractor is identified as "Sabre International Security" (no Limited) and Sabre is declared to be "approved by the Government of Iraq to operate as a PSC and is licensed to provide security services in accordance with the regulations of Iraq". The contract is signed at the end by Mr McDonald "Chief Executive Officer, Sabre International Security". There is no date on the signature page.
5.21 The second (TFM 10) is described by Mr McDonald as being contract "FY 2008 IR&D - Iraqi Company subcontract". It is to be found at b3/ 715 - 6. This document is in a different form and the date appears on the signature page and not on the first page. Here the other contracting party is identified as "Sabre International Security LTD" (note the LTD). There is no similar recital as to approval and licensing. The contract is signed at the end by Mr McDonald on behalf of "Sabre International Security" as "Chief Executive Officer" and is dated (illegible) October 2008. There is another difference. Whereas Sabre had been a "subcontractor" in the earlier year, it was now described as a "contractor".
5.22 Neither of these contracts covered the period of the Claimant's accident. TFM 9 covered the period 16.08.06 to 13.07.07. TFM 10 covered the period 1.11.08 to 31.10.09. This omission had not been noticed by the Defendants until midway through the hearing when it was brought to their attention. Further exhibits were produced by the Defendants on the morning of 16th December. They produced (i) a largely unredacted version of the first IRD contract; (ii) a short "modification contract" which extended the period of the first contract to 30th September 2007: and (iii) the definitive IRD contract covering the period 1st October 2007 to 3rd September 2008, during which period the accident occurred. As to this document, it may be noted that the contracting party was again "Sabre International Security" ...on this occasion with no "Limited or LTD"). It is the Defendants' case that this contract evidences an agreement between IRD and the Second Defendant. The Claimant contends that it does no such thing.
"IRD entered into the security services contracts with the Iraqi company. I know this from my own knowledge, from more than two years of dealing with IRD and the Iraqi Company on those contracts in my capacity as US legal counsel for the Iraqi company." (b3/ 784).6.2 Thus the Defendants rely principally upon the evidence of these two witnesses. But additionally they rely upon a number of documents which are said to show conclusively that - independent of Mr McDonald's and Mr Mills' assertions - the IRD contract was truly with the second Defendant. Principally, the Defendants rely upon the IRD contract itself and say that it shows that this contract was between IRD and the Second Defendant. There are also other supporting documents upon which they rely. It is said that, in order to operate as a PSC in Iraq, a company must be (i) licensed as a PSC with the Ministry of the Interior; and (ii) registered with the Ministry of Trade, as a PSC. Additionally, the Ministry of the Interior maintains a list of licensed PSCs (see Mr McDonald at b3/ 692-3). I do not understand this to be disputed. Thus, in addition to the IRD contract, the Defendants have disclosed: (a) the licence (b) the list; and (c) the registration.
6.3 As mentioned earlier, three IRD contracts, covering three different periods, were disclosed. The first was with "Sabre International Security", the second (the third in time) was with "Sabre International Security LTD" although signed by Mr McDonald on behalf of "Sabre International Security". The relevant contract, covering the period of the Claimant's accident was with "Sabre International Security". The short and obvious point is that, at the time of the making of these contracts, the first Defendant had not yet acquired the name "Sabre International Security Ltd" but was still called SIS (Iraq) Ltd. The Defendants thus submit that it is obvious that the contracts must have been with the second Defendant. (Incidentally, at the time the October 2008 contract was made - where the contracting party is Sabre International Security LTD - the first Defendant had undergone its change of name. Of the three IRD contracts, this one is the third in time.)
6.4 The Defendants further contend that these documents are to be taken together with the other relevant documents - that together they give the true picture. There is the licence granted by the Ministry of the Interior. The relevant pages here are b2/ 329, 329A, 330, and 330A. They are alternately the Iraqi originals with the English translations. The letter enclosing the licence (329A) is to Saif International Security / Saber International Security, Saif being the Arabic for Sabre. The licence itself (330A) is in the name of "Saif Security Protection (Private Security Company)" and "Saber International Security". It is valid from 1st December 2008. There are two matters of note; the name (again) "Saber (or Sabre) International Security". And licence number 40.
6.5 There is also a list maintained by the Ministry of the Interior of PSC authorised companies. The list forms part of exhibit TFM 11 exhibited to Mr MacDonald's statement of 30th July 2010 (b3/ 717 et seq). The important pages are 719 (Arabic) and 726 (English translation). Sabre International Security is listed and its licence number is 40.
6.6 Finally, in support of this part of the argument, the Defendants rely upon the fact that the second Defendant was registered with the Ministry of Trade. The relevant registration documents are at b2/ 312 - 314. There is no doubt that this registration is indeed a registration of the second Defendant; it was registered at birth with licence / registration number 17504. Mr McDonald's asserts (b2/ 258 para 38[a]) that the Second Defendant "is registered as a Private Security Company with the Ministry of Trade in Iraq" (my emphasis) and this document is put forward to support that contention.
6.7 The Defendants' case can thus be summarised in the following way. At the time of the signing of the relevant IRD contract (as well as the previous one) the first Defendant was still known as SIS Iraq Ltd. Thus a contract made with "Sabre International Security" on 16th August 2006 must have been with the second Defendant. This is put expressly in this way by Mr McDonald at b 3/ 695: "Only in May 2008 did the BVI company change its name from SIS Iraq Ltd to Sabre International Security Limited Accordingly, if IRD had contracted with the BVI company, SIS Iraq Ltd for security services each IRD subcontract would have named "SIS Iraq Ltd as the party. Neither subcontract did so." Secondly, the IRD contracts were signed by Mr McDonald as "Chief Executive Officer" and Mr McDonald is an "Executive Manager" of the First Defendant. That he is described as CEO indicates that he was signing on behalf of the Second Defendant. Thirdly, the names of the First and Second Defendants are not actually identical. The First Defendant is Sabre International Security Limited whereas the second Defendant is Sabre International Security Ltd (my emphases). The second (third in time) IRD contract (albeit not the relevant one and albeit after the change of name) was with Sabre International Security Ltd and was therefore with the Second Defendant. As to the licence (the company was given licence number 40) and the list, they also refer to Sabre International Security and not to SIS Iraq Ltd. For the same reasons, this must be the Second Defendant. Finally, the registration with the Ministry of Trade was with the second Defendant; and that was not open to any doubt.
• Introduction (7.2 7.4)
• Pre-issue correspondence (7.5 7.11)
• Acknowledgement of Service (7.12 7.13)
• Sabre document ("proposal") (7.14 7.15)
• Reuters' Report (7.16 7.17)
• Immigration Visas (7.18)
• SIS (Iraq) Ltd Licence (7.19)
7.2 Introduction: In the application before the Master, the Claimant had asserted that his claim in Iraq could not succeed because of the Defendants' immunity. It was not until February 2010 that the Claimant and his advisers were told that the true Defendant should be the Iraqi company, that there was no immunity, and that there was nothing to prevent the Claimant from bringing his claim in Iraq. It is clear that this defence was received with some incredulity. There was particular incredulity, no doubt, having regard to the contents of some earlier "without prejudice" correspondence to which I will refer later.7.3 On behalf of the Claimant, Sir Geoffrey Nice QC submits that this defence is wholly disingenuous; manufactured for the single purpose of this application. It defies belief, he submits, that Sabre would so arrange its affairs that the Claimant and his fellows, working on a Sabre security convoy in this hostile territory, would not take advantage of the immunity which was available. Even more remarkable would be an arrangement which would not protect Sabre itself from prosecution or civil claims. The whole purpose of the immunity was to allow foreign companies and foreign nationals to work on contracts within Iraq without fear of prosecution and other legal process. What, he asks, would have been the position if some other disaster had overtaken this convoy and Sabre itself had been subjected to a claim or prosecution? Would Sabre have submitted to the process, or would it have claimed immunity? What possible incentive could there be (save for resisting an application to bring a claim in some other jurisdiction) for Sabre to organise itself so that it did not have the immunity which others operating in the same field undoubtedly enjoyed? Sabre's own workforce was, it seems, recruited from outside Iraq; the Claimant's fellow operators on the convoy were all non Iraqis and Sabre's very presence in Iraq was for the purpose of providing security during the period of the interim government. Why, he asked, would the Iraqi company need to source its workforce from a sister company rather than recruit directly? And, if it did use a sister personnel providing company, why would that company be registered in a different jurisdiction? The whole purpose of having the BVI registration (in the absence of any other explanation from the Defendants) would be to take advantage of the immunity provisions. All of this, he suggested, threw doubt upon the validity of the defence.
7.4 In further support of this, The Claimant relies upon a number of different strands of evidence. Some of this evidence has been produced by the hard work and investigation of Mr Chamberlayne, the solicitor acting on behalf of the Claimant, who has made six witness statements in support of the Claimant's case. I will refer to some of that evidence in due course.
7.5 Pre-issue correspondence: The first matter upon which the Claimant relies comes from the pre-issue correspondence which is to be found in b4/ 822 - 841. A letter before action was written on 13th January 2009. On 26th January 2009 a reply was sent by e-mail from Mr Mills in Washington DC. It was sent on behalf of the first Defendant, then called SIS Iraq Limited. Apart from noting that the claim appeared to "pertain to SIS's Defense Base Act Insurance a creature of US law controlled by US law " the letter merely promised to investigate the matter and to revert within some two to four weeks, if not earlier. There was then further correspondence, which may be of only marginal significance. On 9th March 2009 Mr Mills wrote:
"We will respond appropriately in due course. In this instance 'due course' means when we are satisfied we have reached a sound basis for our response. We may need another 3 4 weeks to satisfy ourselves that we have reached the point where we may respond further".
There was also a belligerent tone to the remainder of the letter (e-mail) about the Claimant's request for disclosure and information.
7.6 On 17th March 2009 Mr Chamberlayne wrote again. Of most significance was the request for "more detail on the jurisdictional issues". The letter made it clear that the jurisdiction issue needed to be ventilated, and Mr Chamberlayne asked for an explanation of the Defendants' position.7.7 This explanation was not forthcoming until 29th May 2009. What had been promised within two to four weeks was now provided after about four months. However, the letter was headed "without prejudice" and was not included within the court bundle.
7.8 The hearing of this jurisdiction application, which was listed for three days, in fact took a full week. The hearing commenced on Monday 13th December 2010 and concluded on Friday 17th. At the beginning of the week, Sir Geoffrey Nice QC had put down a marker that he considered that this letter was not truly "without prejudice" and was not privileged. Mr Nathan QC told me that he would consider his position. It was not until the Friday that the matter again came to the fore. Mr Nathan QC submitted that the letter was privileged and, when asked, declined to waive that privilege. In the event, I adjourned the case briefly and arranged for another judge to hear the application. In the interim, having considered their position, the Defendants agreed that I should see the letter. Whether it was a late waiver of privilege, as Mr Nathan QC submitted, or because the Defendants could see the merit of Sir Geoffrey's position is beside the point. Having heard the case all week, I was finally given access to this letter. I have numbered its pages 841(A) to 841 (I) and placed it into b4.
7.9 The letter of 29th May 2009 is, on any view, a remarkable letter. Marked as it was, it was never intended to be seen by a judge. It is designed to intimidate. It is threatening and bullying. It threatens the Claimant and his solicitors with claims for malicious prosecution, damages (including in respect of the damaged convoy vehicle) and indemnities of many sizes and hues. But of most significance, the letter is wholly at odds with the position which the Defendants jointly adopt in respect of this application. The letter is written solely on behalf of the First Defendant. It refers only to SIS (as the first Defendant was called before its change of name). There is an acknowledgment that the First Defendant is an Iraqi PSC, and that it provided security services to IRD. There is no mention of Sabre International Security Limited, the second Defendant. There is no mention of the First Defendant being a mere supplier of personnel. There is no mention of any arrangement between the two Sabre companies. The letter is fundamentally and diametrically opposed to the way this application has been run in this court before me. It fully supports the Claimant's case.
7.10 This letter was written after an investigation lasting about 4 months. As already noted, Mr Mills had said that he would respond "when we are satisfied we have reached a sound basis for our response." To this he had added "I am sure that you can appreciate the soundness of this approach" (b4/ 834). He was aware that Mr Chamberlayne wanted to know the Defendants' case on jurisdiction. And in spite of all that, it is now said that he made a mistake; that he got it wrong. There is no explanation for that fundamental mistake and no excuse has been tendered. Mr Mills cannot be heard to say that he misunderstood from afar the real contractual arrangements of the companies. In his third witness statement (made, of course, at a time when the allegedly "without prejudice" letter was expected to stay under wraps) he had said (again as previously noted):
"IRD entered into the security services contracts with the Iraqi company. I know this from my own knowledge, from more than two years of dealing with IRD and the Iraqi Company on those contracts in my capacity as US legal counsel for the Iraqi company" (my emphasis).7.11 The letter describes - exactly as the Claimant alleges - an agreement between the Claimant and the First Defendant; the performance of security duties by the Claimant working for the First Defendant (acknowledged to be a PSC); an accident at a time when the Claimant was working on security duties for the First Defendant as it fulfilled its obligations to IRD.
7.12 Acknowledgement of Service: This was not the only mistake which Mr Mills made at this time. A different mistake was made at the time of filing of the Acknowledgement of Service. A letter was written to the court enclosing the Acknowledgement of Service on behalf of:
"Sabre International Group Ltd (BVI) improperly named by the plaintiff as 'SIS Iraq Ltd' which Sabre International Group Ltd (BVI) has authorised us to file with the Court under a reservation of rights to contest jurisdiction".
It was accompanied by an e-mail dated 18th January 2010 containing the same information, a copy of which was sent to Mr Chamberlayne (b2/ 282-4). This, as I was told during the hearing had been a "simple mistake". It is a mistake which has never been explained, although the matter was dealt with in a letter from the Defendants' solicitors of 4th February 2010.
"Please note that the Acknowledgement of Service filed on behalf of our client, SIS Iraq Limited, should omit the words 'Sabre International Group Ltd (BVI) in lieu of ' Our client initially assumed in error that SIS Iraq Ltd had been replaced as an entity by Sabre International Group Limited. Upon investigation our client has found this not to be the case" (b2/ 346).7.13 The Claimant submits that this was a remarkable "assumption in error" to make, particularly where the issue of the identity of the Defendants had been marked up and was so crucial to the way the case was to proceed. How could Defendants make such an error? Particularly Defendants who were so "careful to be clear about the status of both the Iraqi Company and the BVI company" (see Mr McDonald b 3/ 704). At this time, it appears, they were unsure even about the First Defendant's name and / or whether it had been "replaced as an entity". I have not been told whether there is truly a company called Sabre International Group Limited (perhaps another of the Sabre siblings performing some other role?).
7.14 Sabre document ("proposal"): There were other "mistakes / errors". In a statement dated 10th September 2010 (b5/ 51 et seq), Mr Chamberlayne explained some of the investigations he had made about the Defendants. These investigations had been triggered by the assertions made in the evidence of Messrs McDonald and Mills, including the status of the two Defendants. He had found a "Sabre International" document which averred that "Sabre's experience as a foreign company doing business in Iraq is second to none" ...my emphasis) (b5/ 55). This appeared to him to be a Sabre brochure provided to prospective clients. As Mr Chamberlayne noted, this statement appeared to undermine the crucial question of Sabre's status as an Iraqi company. Maybe it referred to the BVI company in which case it may be accurate (if "business" was just the supply of personnel to a sister company). But otherwise it gave a false impression, suggesting to the world that Sabre was a non - Iraqi company (it would then have immunity) doing business in Iraq. Mr McDonald responded to this (b6 / 257). This document was a "proposal" which was indeed made on behalf of the second Defendant. It went out with his signature. It should have read "Sabre's experience as a foreign-owned Iraqi company is second to none" which he described as the "authorised" version. An incorrect version was included apparently from a word processing error. Another error. Or was it an error?
7.15 Incidentally, that document contained a second less relevant "error". It claimed that Sabre had conducted over 46,000 moves in Iraq over the previous five years during which time it had never sustained any injury to a client or team member, nor caused any injury to any Iraqi. This also was accepted to be a mistake made "through inadvertence"; Mr McDonald (b6 / 257). In fact, in addition to the Claimant, there had been another serious injury to an operative.
7.16 Reuters' Report: The Claimant relies upon another piece of evidence, produced as a consequence of Mr Chamberlayne's enquiries. In February 2008 Reuters ran an article (b2/ 482) about US and British - run military companies running lucrative businesses in a "legal grey area" with immunity from prosecution in Iraq. It reported the concern that had been voiced about a lack of accountability following an incident where a US of A firm had been responsible for killing Iraqis. Security companies could not be brought to account in Iraq, and it was very difficult for them to be brought to account elsewhere. The article reported on a conference attended by "foreign contractors". Although it appears there was a recognition that immunity from local laws was far from ideal, the alternative (accountability within the Iraqi courts) was worse. There was a concern "that Iraq lacks transparent independent institutions to implement its laws fairly".
7.17 The report quoted from interviews with three people. Two of them were Mr Mills and Mr McDonald. Both Mr Mills and Mr McDonald appeared to accept (i) that security companies were operating in Iraq with immunity and (ii) that although this was not ideal, Iraq could not be trusted to police these matters fairly. True it is that neither of them made any express statement about the status of Sabre operations. But, as Sir Geoffrey Nice QC submitted, it was a fair reading of the report that it would be unlikely that they would express these opinions if they were prepared to submit their own contractors (and Sabre itself) to the full force of the Iraqi courts. And why, he asked, when Mr McDonald was interviewed, did he not adopt the moral high ground and disclose that the companies which he represented had made an affirmative decision to submit to Iraqi law? That was a glaring omission. I have, of course, been taken to the parts of the evidence where Mr McDonald and Mr Mills say that their comments were misconstrued (Mr McDonald's statement of 30th July 2010 b3/ 701; Mr Mills' statement of 2nd August 2010 b3/ 780) Mr McDonald had reportedly (and admittedly) said:
"I am happy to come under any law. As long as the rules are fair then people can adapt but Iraqis cannot take over until they have a regulating body in line with international law".
Mr Chamberlayne had invited the "English court to take Mr McDonald at his word over that quote ...sic)" (b2/ 469). It is submitted that that quotation is not consistent with Mr MacDonald's explanation, and, in particular, his statement that:
"I and my fellow directors made an affirmative choice that both companies would be completely subject to Iraqi legal process. I had knowledge that the Iraqi legal process would provide for fair and just adjudication "(b3/ 701)7.18 Immigration Visas: There is another piece of evidence, potentially significant, upon the issue of immunity. Earlier in this Judgment I said "the workforce was granted preferential immigration status" and I referred to documents b 2/ 488 - 490 and b5/ 134 - 137. There are many examples of similar documents throughout the papers. But these will suffice for the point to be made. On each entry into Iraq, the operator would be granted a letter of identification such as at b2/ 488. This document recites that Anthony Harty is an employee of Sabre and "his travel is in connection with his work assignment in Iraq" The letter comes from USAID and identifies the contract between IRD (main contractor) and Sabre (subcontractor). Its purpose was to fast track the operator through immigration control, as IRD "has exception (exemption) for entry and exit visas" (5/ 134). The privileged entry provisions appear to be designed for workers who are to work under relevant contracts which were covered by CPA17. The visa exemption was granted on the back of a letter written from the US Embassy to the Immigration Authority (such as to be seen at b5/ 136) which recited that "IRD is conducting work in Iraq according to a contract with the United States Government and therefore falls under CPA Order no 17". The clear inference is that the privileged entry provisions are granted on the basis of a representation that those on the list will be working for foreign contractors in circumstances where CPA17 applies. The claimant was on the list (b5/ 137). Similar documents can be seen within the bundles in respect of each entry into Iraq by the Claimant and indeed by other individuals, such as the driver Shane Card. These are documents upon which the Claimant relies as being wholly consistent with his case; that he was being granted preferential immigration status in order to work for Sabre on a contract which was covered by CPA17.
7.19 SIS Iraq Ltd Licence: There is a further document which has relevance to this issue. This document is produced by the Claimant (in fact his expert in Iraqi law) and is at b5/ 50 (Arabic) and 50A (English). It is a Licence to operate as a PSC in identical format to that which we have already seen at b2/330A in respect of Sabre International Security. However, this document is undoubtedly in the name of "SIS Iraq Limited". The document bears examination. The words SIS Iraq Limited (PSC) are handwritten and are not as a result of some word processing error. This is clearly a deliberate insertion into the document. It is, of course, the Defendants' case that SIS Iraq Ltd was never a PSC, but merely a supplier of personnel. This document would appear - if it is what it purports to be - to show that in 2005 (at least) SIS Iraq Ltd was licensed by the Ministry of the Interior to act as a PSC. Mr Nathan's only response to this document is that it was yet another "mistake". He suggested that these words had probably been written by a Civil Servant and "we cannot say why he made this mistake". It is, however, the only licence which makes it clear as to which specific company is the grantee of the licence. Whereas there is scope for argument as to whether the documents produced on behalf of the Defendants (referring as they do to Sabre International Security) relate to company A or company B, this document clearly and unequivocally relates to the First Defendant; unless, of course it was a civil servant's mistake.
8.2 If I had previously entertained any doubt about it, this doubt was dispelled when, on the final day of the hearing, I was able to read the letter of 29th May 2009 - a letter which fully supports the case as advanced by the Claimant. In my judgment it is inconceivable that this letter could have been written by Mr Mills if the true position was as the Defendants now suggest. The letter acknowledged that the First Defendant was a PSC and made no mention of any contract with the Second Defendant. The acknowledgement of service is also of interest. The same question occurs. Why should such a fundamental mistake have been made at a time when the Defendants had been investigating the true position for several months? In the absence of a credible explanation (or indeed any explanation) one is left to ponder whether, at that stage some other different defence was being contemplated. I find Mr McDonald's explanation for that which he is reported as saying in the Reuter's report to be wholly lacking in credibility - the inconsistency is stark. I need go no further. Each one of the Claimant's submissions - together with the 2005 licence in the name of SIS Iraq Ltd - is individually persuasive. Cumulatively, the submissions are of overwhelming force.
8.3 However, out of deference to the submissions of Mr Nathan QC, I need to consider the documents and submissions to which reference has been made in part 6 of this Judgment. I will deal with each of the submissions:
i) Defendants' Submission: The first argument is that at the time of the signing of the relevant IRD contract (as well as the previous one) the first Defendant was still known as SIS Iraq Ltd. Thus a contract made with "Sabre International Security" must have been with the Second Defendant. The same argument is advanced in respect of the licence and the list of licensed companies.
Finding: The Sabre organisation regularly called itself or any part of it or any one of the companies within it "Sabre" or (more frequently) "Sabre International Security". The papers demonstrate time and again the use of the words "Sabre International Security" to denote nothing more than that a part of the Sabre organisation was involved. Without an additional reference (eg the company registration number or its place of registration) any one of the Sabre companies could be put forward. The letters SIS are the first three letters of Sabre International Security. The way in which Sabre International Security was used can be seen in respect of the operator contract itself, where (albeit that the contract made clear that the contracting party was the BVI company) the contract was headed "Sabre International Security" and bore licence number 40. There are numerous other examples within the papers. In effect, "Sabre International Security" is used as a brand name for all parts of the Sabre organisation and is ambiguous as to which company is the contracting party. I rather tend to the view that the ambiguity was intentional so that any part of the organisation could be put forward interchangeably to suit the occasion but it is not necessary for me to go that far. The same applies to the licence, the licence number and the list of licensed companies. They also are all in the name of Sabre International Security with no further identification similarly ambiguous, capable of denoting any one of the Sabre siblings.
ii) Defendants' submission: The IRD contracts were signed by Mr McDonald as "Chief Executive Officer" and Mr McDonald was only an "Executive Manager" of the First Defendant. That he is described as CEO indicates that he was signing on behalf of the Second Defendant and not on behalf of the First Defendant.
Finding: I am not prepared to accept that Mr McDonald was merely an Executive Manager of the First Defendant. It suits him to say so, but there is only his word for it. Having taken a view that other important parts of his evidence are incapable of belief, I am not prepared to accept this small piece of evidence at face value. Neither he nor Mr Mills has disclosed the identity of the CEO of the First Defendant. This is a point which was taken in the statements and the point is obvious. It would have been a simple matter for the Defendants to give some evidence supported by some documentary proof of the identity of the "boss" of the First Defendant. Mr McDonald was the prime candidate for CEO of both companies. There is also the unexecuted page 8 of the operator contract describing Mr Breingan as the CEO of the First Defendant. But that as discussed earlier in this Judgment was not the case. There was a witness statement from Mr Breingan in which he described himself as an Executive Manager. And the executed page 8 showed an alteration to "EM". In the course of submissions, Sir Geoffrey Nice QC voiced what he described as a well-justified suspicion about this alteration, and generally about this bit of self serving evidence. It is a suspicion which I share.
iii) Defendants' submission: The further argument was this: the names of the First and Second Defendants are not actually identical. The First Defendant is Sabre International Security Limited whereas the second Defendant is Sabre International Security Ltd (my emphases). The third IRD contract in time (albeit not the relevant one and albeit after the change of name) was with Sabre International Security Ltd and was therefore with the Second Defendant.
Finding: As to this, it is of interest that the first two disclosed IRD contracts (made at a time when the First Defendant was still SIS Iraq Ltd) were with Sabre International Security; the third IRD contract (after the Claimant's accident and after the change of name) was written in the name of Sabre International Security LTD. Insofar as the argument has any remaining relevance, it does not bear scrutiny. When the First Defendant changed its name in May 2008, the Certificate of Change recorded that it had changed its name to "Sabre International Security Limited" (my emphasis). And the Certificate recording the setting up of the Second Defendant shows that it too was to be called "Sabre International Security Limited" (also my emphasis) (b2/ 292 and b2/ 312). The companies do, for whatever reason, bear identical names.
iv) Defendants' submission: Finally, it is argued the registration with the Ministry of Trade was with the second Defendant; and that was not open to any doubt. The argument appears to be that this registration somehow supports the case that it is the Second Defendant which is the PSC / contractor. I noted earlier in this Judgment that Mr McDonald stated (b2/ 258 para 38[a]) that the Second Defendant "is registered as a Private Security Company with the Ministry of Trade in Iraq" (my emphasis). The registration document was put forward to support that contention.
Finding: There is no doubt that this registration is indeed a registration of the second Defendant; it was registered at birth with licence / registration number 17504. But this is clearly just a trading licence with no relevance to security operations, or being an authorised PSC. This registration documentation, as it seems to me, could have assisted the Defendants' case if, for example, the IRD contract or the PSC licence revealed that the contracting company was operating under trading licence / reference 17504. It might also have assisted the Defendants if these Ministry of Trade documents had cross referenced with PSC licence number 40 (which we know was given to some branch of Sabre). It is clear that this registration document is independent of any PSC requirement and there is nothing to show that licence number 40 was given to the company with registration 17504. In my judgment Mr McDonald's statement that the Second Defendant "is registered as a Private Security Company with the Ministry of Trade in Iraq" is unsupported by this document. Registered; yes. Registered as a PSC; not as far as this registration document is concerned.
8.4 For all these reasons, I hold the First Defendant to be the party responsible for supervising this convoy and owing a duty of care to the Claimant. And to be immune from suit in Iraq.
9.2 There are two parts to this inquiry and I must start with the Operator contract. The terms of the Operator contract, which I summarised at paragraph 5.6 of this Judgment could potentially affect the determination of this issue. I can deal with this aspect briefly. As noted in paragraph 5.7, it is common ground that under the law of Iraq it is not possible to exclude liability for unlawful acts. I am also satisfied that it is strongly arguable (with reasonable prospects of success) (i) that the waiver clause cannot prevent the Claimant's bringing a case in negligence and (ii) that the provisions of clause 5.2 would not prevent his bringing a claim if a tortious act can be proved against the company.
9.3 The real question is thus whether there is a case in negligence with reasonable prospects of success. The starting point is that the Claimant was an innocent passenger in a vehicle belonging to the Defendants, being driven under their supervision and control, and by their servant or agent. Whether one applies the law of Iraq or England and Wales, the issues are the same. I do not propose to review the available evidence upon the issue of negligence as it seems to me that the answer to this question is overwhelmingly in the Claimant's favour. There is more than sufficient evidence for a court to conclude that the Defendants' systems of tyre maintenance and replacement were inadequate and that potentially dangerous old / worn tyres were used on convoy vehicles and, further, that the vehicle was likely being driven in excess of the speed limit and at a speed which gave rise to foreseeable risk. There is also scope for a finding of driver error.
• Expert evidence (10.2 )
• Waiver (10.3 10.6)
• Retrospective legislation (10.7)
10.2 Expert Evidence: The parties have produced expert evidence on questions of Iraqi law. The Claimant has produced the evidence of Mr Dawood (although originally Mr Numan had been instructed) and the Defendants have produced evidence from Mr Al Jibori. They have provided statements upon a variety of topics but I have not found it necessary - or desirable - to refer to any part of their evidence except within this part of this Judgment. In many respects, it seems to me that their evidence has been largely overtaken by events - for example where they have expressed an opinion upon the basis of a misunderstanding of the opponent's evidence or upon an assumption which has turned out to be false, through no fault of theirs; or expressed at a time when the issues between the parties appeared to be different from the issues which were finally identified. I have, of course, read their evidence. But, for the purposes of this jurisdiction application, I have reached the conclusion that much of their evidence is either surplus to my needs, not relevant, or of marginal value. I mention this only to emphasise that this Judgment is in no way informed by anything which has come from the pen of the experts, except for the two matters which now fall to be considered.10.3 Waiver: If there is immunity from suit, is this something which the Defendants can waive? I do not now understand the Defendants to be saying that clause 8.6 of the Operator Contract which provided that "the parties submit to the exclusive jurisdiction of (the Iraqi) courts in respect of claims brought against the company" acts as a waiver of their right to immunity from suit. Rather what is advanced is that the Defendants are entitled to give an undertaking to this court to waive their rights to rely upon immunity and to undertake to submit to the courts of Iraq. In his third witness statement, Mr McDonald said this:
"in any event, and in order to put the issue to rest, I am authorised to say that the BVI company will provide an undertaking to the English Court that, if the Claimant's claim here is halted and service out of the jurisdiction is set aside and if Mr Harty thereafter commences new proceedings in an Iraqi court for the damages claimed in this actions (which the Defendants say is the proper forum) the BVI company will not assert any immunity that might arise from CPA Order No. 17 and agrees to subject itself to the jurisdiction of the Iraqi Court in respect of such proceedings" (d6 / 288).10.4 The expert witnesses differ about this. Mr Dawood, who has reported on behalf of the Claimant, says that waiver is not possible; this is a matter of jurisdiction, not a matter of defence. The Iraqi court will not accept jurisdiction where CPA17 grants immunity. Mr Al Jibori on behalf of the Defendants expresses the opposite opinion. Mr Dawood, in support of his position, has produced authorities from the Iraqi courts. A decision in the Karkh Court of First Instance (2006) RAM Services v Triple Canopy was concerned with the provisions of CPA 17 and the court reached the conclusion that "whereas the Defendant company is an American company located in America it is immune against the Iraqi legal procedures as defined in paragraph " of CPA 17 and "the claim and this case are to be dismissed for lack of functional jurisdiction" (see b3/ 678 - 9) (my emphasis). In a case in the Karadah Court of First Instance (2004) - Ready v RTI - the Defendant argued that there was immunity from suit. "The court ruled to dismiss the claim filed due to the lack of jurisdiction pursuant to Article 80 of the code of civil procedure number 83/969 as amended and the order of the CPA No 17 " (again my emphasis).
10.5 Upon this issue, the Claimant also points to the Order CPA 17 itself with particular reference to b2/ 299. Section 5(1) of the Order provides that "immunity from Iraqi legal process is not for the benefit of individuals concerned and may be waived pursuant to this section." Section 5(2) and (3) then provide for formal applications for waiver. The application, to be effective must be "express and in writing". And such requests shall be referred to the Sending State and must also be "express and in writing" to be effective. On behalf of the Claimant it was pointed out that no such request had ever been sent.
10.6 On these authorities, it seems clear that this is not a matter of discretion but of jurisdiction and it is clear that there is no possibility of waiver. The first Defendant is immune from suit.
10.7 Retrospective legislation: CPA 17: does it continue to have effect now that it is no longer in force? This is a further issue between the parties. With the support of Mr Al Jibori, the Defendants submit as follows. CPA 17 was in force until midnight on 31st December 2008. During the currency of CPA 17 there was immunity from suit if the conditions were satisfied. However, from 1st January 2009 all claims could be brought, including those which related to the period when CPA 17 was in force. In other words, immunity from suit was no longer available in the Iraqi courts, regardless of when the action, upon which the claim was founded, was committed. Thus, it is said, those who had immunity in the past, relating to their activities between 2003 and 2009 may now be prosecuted or sued. If that is correct, of course, it would mean that Mr Harty could sue in Iraq, if that were the correct forum. At first glance the proposition is a startling one; that the repeal of the Order retrospectively abolished all its provisions and created "open season" as Sir Geoffrey Nice QC put it for prosecutions and claims which had previously been prevented by the Order. It is perhaps not surprising that Mr Dawood did not agree. He produced a case from the Baghdad Al - Khark Federal Court (2010) Shaima Amir Abbas v Arkel Company, a claim by a widow for the wrongful death of her late husband. The defence included that the Defendant, an American company, enjoyed immunity from suit under CPA 17. The court held, inter alia, that "the death was during the validity time of the dissolved CPA 17 and for non jurisdiction of this court, it was decided to reject the claimant's claim and charge her all fees and expense and defendant's lawyer's wages " (b5/ 43) (my emphasis). I note that Mr Al Jibori considers that decision of the court to be wrong in law. However, it is the only authoritative statement of the law which I have; and I am wholly unpersuaded of the Defendants' position.
11.2 The Defendant contends that, applying those principles, this case has the most real and substantial connection with Iraq. The alleged tort was committed there, at a time when all parties were resident and working there. The contract of service had been made there and it had specified that the courts of Iraq should determine any dispute between the parties. There are many other reasons why the natural forum for this dispute is Iraq. I do not understand the Claimant to be contending that - all things being equal - Iraq would not be the proper forum. I agree that, prima facie, the courts of Iraq would be the natural forum and - subject to the Claimant's submissions about the security position - if I had been persuaded that there was no immunity, I would have been minded to grant a stay. But things are not equal. The second stage of the Spiliada formula has to be invoked. Justice cannot and will not be done in Iraq because of the First Defendant's immunity. Justice requires that the English court should accept jurisdiction. In view of my decision on immunity (and my decisions in parts 10.2 and 10.3 of this Judgment) it seems to me that this submission is unanswerable. The Claimant does advance the additional ground, namely that the security position in Iraq at the present time militates against a trial there for the reasons set out in the skeleton argument. Sir Geoffrey Nice QC conceded that this submission, on its own, would not be sufficient. He described it as a make-weight. But in view of my finding on immunity, and that the courts of Iraq are not open to the Claimant, it is not an issue which I propose to consider further. I should just add this. I have noted the submissions that the Claimant, although of Irish nationality, was previously resident in England, that he came here to convalesce and has close associations with this jurisdiction. These submissions would have been of relevance if there were a genuine dispute upon an issue of "forum conveniens" at Spiliada stage one. As there is no other forum advanced by the Defendants other than Iraq, the question does not arise. It is sufficient that the Claimant is permitted to issue his claim here with the leave of the court - that he passes through the CPR part 6 gateway and that he cannot bring his claim in the one jurisdiction for which the Defendants contend.
12.2 Since adjourning this case and reserving judgment I have taken the opportunity to read all the evidence in the sequence in which it was produced and I have a real sense of the way in which the evidence has been presented. I am satisfied to a very high standard of proof that the defence position has been manufactured, shaped over a period of time, and is wholly disingenuous.
12.3 I suspect (but do not make a finding) that this group of Sabre Companies (and particularly the two Defendants) operates as one overarching business and that there is no real separation of roles between the different companies. The business is done in the style of "Sabre International Security" so that either (or any) Sabre company can be put forward as the relevant company as and when necessary. In most instances, there will be no need to distinguish or differentiate. But there is no doubt that if, for whatever reason, the convoy had run into trouble and had killed or injured those who had attacked it or perceived to attack it, Sabre would have claimed immunity in respect of any claim made against it. In those circumstances the First Defendant BVI would have been put forward as the holder of licence number 40 and as the contractor with IRD. In those circumstances, I dismiss this application also insofar as it relates to the Second Defendant. Whether or not the Claimant continues to pursue the claim against the Second Defendant is a matter for him and his legal advisers. Mr Nathan QC expressly accepted that, if the claim could be brought in this jurisdiction against one defendant, the court should not direct that a claim against the other should be brought in a different jurisdiction.
12.4 The Defendants' application for a stay is refused.
..
The Honourable Mr Justice MacDuff
5th April 2011
