BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMMERCIAL COURT (QBD)
Rolls Building, Fetter Lane
London, EC4A 1NL
B e f o r e :
| THE REPUBLIC OF ANGOLA
(ACTING BY AND THROUGH THE MINISTRY OF FINANCE OF ANGOLA)
(2) BANCO NACIONAL DE ANGOLA
- and –
|(1) PERFECTBIT LIMITED
(2) MAIS FINANCIAL SERVICES SA
(3) MFS & RESOURCE PROJECT PARTNERSHIP LIMITED
(4) RESOURCE CONVERSION PLC
(5) SAMUEL BARBOSA DE CUNHA
(6) HUGO ANTHONIE FOLKE GODFRIED REINIER ONDERWATER
(7) JORGE GAUDENS PONTES SEBASTIAO
(8) KERFALA SOUMAH
Mark Anderson QC and Steven Reid (instructed by Joseph Sutton Solicitors) for the Second and Seventh Defendants
Duncan Macpherson and Simon Jones (instructed by Zaiwalla & Co) for the Sixth Defendant
Hearing dates: 12, 13 and 14 March 2018
Crown Copyright ©
Mr Justice Bryan:
(1) the Second and Seventh Defendants challenged the jurisdiction of this Court to grant relief against them;
(2) the Second and Seventh Defendants applied to set aside the worldwide freezing order and proprietary injunctions alleging that the Claimants breached their duties of full and frank disclosure on the without notice application and/or that there was (and is) no real risk of dissipation of assets by them;
(3) The Sixth Defendant applied to set aside or vary the Freezing Order for breach by the Claimants of their duties to make full and frank disclosure of material facts and/or defences;
(4) The Sixth Defendant also sought a stay on case management grounds if the Second and Seventh Defendants' jurisdictional challenge succeeded and/or if the Third Defendant's application for stay under the Arbitration Act 1996 was adjourned (the Third Defendant was not able to pursue any application for a stay at the return date hearing);
(5) The Claimants applied for the continuation of the Order or the granting of a further injunction containing similar relief.
B. The Parties and Significant Persons
B1. The Claimants and Associated Individuals
B.2 The Defendants
(1) Banco Pungo Andongo is an Angolan Bank incorporated in 2013. It started trading in 2014. Dr Pontes says that this company will soon be renamed Banco Mais.
(2) Mais Seguros has approval to carry out business as an insurance company. The evidence is that the requisite approval was granted by Mr Mangueira in May 2017. Mais Seguros is not yet trading.
(1) He is the former CEO and current President of Banco Pungo Andongo.
(2) Through Mais he owns Mais Seguros.
(3) In 2006, Dr Pontes founded Investmeimentos e Participaçoes Lda ("Inpal") with Mr Filomeno dos Santos. Dr Pontes now holds 97% of the shares in Inpal, with Inpal itself having a 49% stake in Standard Bank Angola.
(4) Inpal is the parent company of Bromangol SA ("Bromangol"). In 2012, Bromangol was awarded an exclusive concession contract by the Angolan Fiscal Authority to check and certify all imported and exported food, beverages, cosmetics and pharmaceutical products. This concession was terminated by President Lourenço on 9 November 2017.
C. The Order of Popplewell J
D. Procedural Matters
(1) "[t]here has been a continuing and deliberate failure … which I regard as both serious and significant."
(2) "Angola has established a good, arguable case – indeed, on the evidence which I have seen so far, a strong prima facie case, that it has a proprietary claim to trace and recover the proceedings of those three payments [the €24.85 million]."
(3) ".. there is force in the claimant's argument that Mr Onderwater is not a man whose word is to be trusted in the absence of corroborative documentary material. There is, as I have said on the material I have presently seen, a strong prima facie case of his involvement in fraud and his involvement in forwarding forged documents. He has been deliberately evasive in response to asset disclosure and has committed knowing breaches of the order and has delayed in providing information. He continues to refuse to provide information which is required, and that continuing failure supports the allegation that his word is not to be trusted."
(1) unless Resource Conversion provided specified information by 4pm on 9 March 2018 it would be debarred from seeking a case management stay or applying to set aside (or otherwise challenging the continuation of) the Freezing Order (Resource Conversion having previously issued an application notice to make such a challenge).
(2) unless Dr Barbosa provided specified information by 4pm on 13 March 2018, he was debarred from defending the Claimants' claims, and the Claimants would be at liberty to enter judgment against Dr Barbosa.
E. The Applications
(1) An application by Mais and Mr Pontes challenging the jurisdiction of the English court (the "Mais/Pontes Jurisdiction Challenge");
(2) An application by Mais and Mr Pontes to discharge the proprietary injunction and freezing order for alleged breaches by the Claimants of their duty of full and frank disclosure (the "Mais/Pontes Discharge Application");
(3) An application by Mais and Mr Pontes to discharge the proprietary injunction and freezing order on the basis that there was, and is, no risk of dissipation.
(4) An application by Mr Onderwater to discharge the proprietary injunction and freezing order on the basis of alleged breaches by the Claimants of their duty of full and frank disclosure (the "Onderwater Discharge Application").
(5) An application by Mr Onderwater for a stay of the Claimants' claims against him on case management grounds if the Mais/Pontes Jurisdiction Challenge succeeded and/or if Project SPV's application for stay under the Arbitration Act 1996 was adjourned (the Third Defendant not making that application at the return date hearing) (the "Case Management Stay Applications").
(6) An application by the Claimants for the continuation, or re-grant, of the relief ordered by Popplewell J.
F. The Facts
F.1 Initial Contact
(1) provide a study to the BNA on the implementation of measures to develop the Anolan economy;
(2) create an investment fund with proceeds to be invested in a number of projects with the aim of diversifying the Angolan economy;
(3) provide foreign currency services; and
(4) assist in the management and reduction of Angola's national debt.
F.2 The "BNP Paribas Letter"
"BNP Paribas is a leading European financial banking institution that creates, implements and manages a variety of investment strategies, with a presence in various financial sectors at a global level and with liquid resources of over 345 billion EUR at its disposal, in accordance with our latest financial reports.
Through this letter, we have the honour of welcoming the Republic of Angola to our platform of investments, and inform you of the approval of the structure of the Special Purpose Vehicle (SPV) submitted by our partners Resource Conversion/Mais Financial Services to BNP Paribas Investment Partners, a financial institution responsible for the asset management of a portfolio comprising more than 500 (five hundred) billion assets in total, across the globe. Therefore, through the medium of an Investment Fund supported by us and the banks Bankinter, Deutche Bank, Société Générale, amongst others, we are prepared to:
1. Make available foreign currency, EUR/GBP/YEN, immediately and in an unlimited nature, to the Banco Nacional de Angola, through the international banks of WEU/UAE mentioned above.
2. To create a strategic fund for investment in Angola with an estimated financial capacity of Thirty billion Euros, through Asset Management and Project Finance.
3. To negotiate the purchase of the Angolan external debt with different countries.
This financial structure is coordinated by Hugo Onderwater, through the aforementioned European financial institutions and, in Angola, by Dr. Jorge Pontes. These entities, together with BNP Paribas, are available for a meeting, strictly at the highest level, subject to Your Excellency's availability and consideration of Your Excellency.
"We note the English translation refers to Resource Conversion Plc and Mais Financial Services S.A. as being "partners" of BNP Paribas Investment Partners.
We confirm that BNP Paribas London Branch has checked its systems and found no record of any relationship between any BNP Paribas entity and Resource Conversion Plc and Mais Financial Services S.A.
Further, on 1 June 2017 BNP Paribas Investment Partners rebranded to be called BNP Paribas Asset Management. This was announced on 25 May 2017 … . A genuine letter sent by the Chairman of BNP Paribas SA in mid-June 2017 would have very likely referred to BNP Paribas Asset Management rather than BNP Paribas Investment Partners.
Accordingly, to the best of our information and belief, we believe the letter attached to your email to be a counterfeit."
F.3 The Presentations
F.3.1. The First Presentation
"Establish and set up SPV. SPV = RC-MFS Financial Engineering Ltd, with its head office at 6, Honduras Street, London, United Kingdom."
F.3.2. The Second Presentation
"- Create a strategic investment fund to accelerate diversification of the Angolan economy
- Create a fund with the capacity to act as a reserve fund for the Angolan State via "Asset Management"
Set up SPV: RC-MFS Financial Engineering Ltd: as qualified SPV "Qualified Trust Company"
Establish banking structure (Sumitomo) Transfer of assets: a) EUR 1020m (EUR 1.02 billion) Yearly profitability of 15%
Phase 5 (Model)
Use the AAA model *) between the receiving entity and the donor.
Assets placed under the system of management with two signatures from the RC and MFS for a period of 13 to 25 months.
*) AAA means the temporary transfer of assets without change of ownership taking place"
"Main operation in system of subcontracting with WEU banks/institutes in one or more of the following formats
b) Primary Market
Banks: BCE, DB; RBS; Bankinter; BPN-Paribas; Santander; Standard Bank*"
F.4 The Preliminary Analysis
"23. Taking into account the mechanisms' potential merits, we are recommending that the developers submit a more detailed technical proposal for the financing transactions. This will enable a better understanding of the costs, risks and benefits of the funding structure.
24. The technical teams from the Ministry of Finance and the BNA, supported by a team of lawyers, should start negotiations with developers (including BNP Paribas – the principal signatory) as soon as possible."
"At this stage, based on our analysis and the questions raised by NRF, the Ministry of Finance decided that it did not wish to proceed with the transaction. However, I now understand that the BNA continued with the transaction (i.e. without the Ministry of Finance)."
F.5 The BankInter Statement
"Management contract of instructions between the MFE and the syndicate of banks involved in the operation. This document has yet to be made available, because the account of the JV is pending in all the banks involved, as per points 3 and 5 respectively of the aforementioned timetable."
"In respect of the documents which have yet to be finalised, this is due to the principle of "Non Solicitation", a basic rule of compliance for the mechanism installed. Even though, even without some of the essential steps of the process having been completed, Resource Conversion and Mais Financial Services have commenced process within the banking structure, as demonstrated by the bank statement attached. DOCUMENT ANNEX VI."
F.6 The Contracts
F.6.1 The Consultancy Agreement
"K) In today's global economy and financial crisis is urgent to adopt an appropriate macroeconomic strategy and define and implement monetary measures to ensure the adequate development of the Angolan economy in order to overcome or at least decrease the effects of the financial crisis.
L) Such strategy and measures should be preceded by elaborating a comprehensive study of the country's economic and financial reality (hereinafter referred to as the "Study"), which provides for proposals for the adoption and contracting of adequate and effective financial instruments in the international financial markets, enabling the BNA to perform its legal duties to the best of its ability, including preserving the value of the domestic currency.
M) BSFS is a corporation dedicated, among other activities, to management, financial and technical advisory, having technical conditions to support the BNA in preparing and developing this study and in implementing the measure referred to in the previous Recital.
N) The BNA intends to enter into a Technical-Financial Consulting Agreement with MFS for preparing a study on the implementation of monetary measures to be adopted by the BNA and the Angolan government for the development of the Angolan economy, namely with respect to the assumptions and procedures for the constitution of a strategic reserve fund by means of the asset management of foreign currency for the BNA and a private equity fund in accordance with the outcome of the abovementioned study.
O) Subsequently, the BNA shall enter into a further asset management agreement with Mais Financial Engineering Ltd (hereinafter referred to, as abbreviated, "MFE"), a joint venture between MFS and Resource Convention Plc, ("RCP", which shall take the form of a "special purpose vehicle" ("SPV"), with a view to increasing BNA's foreign currency capacity by means of the opening of clearing accounts for the latter in Kwanzas, in banks that are members of the European banking syndicate and vice versa."
2. The precise object of the Services is:
a) The preparation of a comprehensive Study on the economic and financial reality of the Country;
b) The Proposal for the adoption and contracting, in the international financial market, of the existing financial instruments available in the international financial market, that allow the BNA to duly fulfil its legal responsibilities for the preservation of the value of the national currency and participation in the definition of monetary, financial and foreign exchange policies;
c) Definition of the appropriate assumptions and procedures for the constitution of the funds referred to in paragraph 3 of this clause.
The Study referred to in paragraph 2 of this clause shall address the implementation of monetary measures to be adopted by the BNA for the development of the Angolan economy, in particular with a view to promoting the constitution of a strategic reserve fund by means of the asset management of foreign currency for the BNA and a private equity fund chosen by the Angolan government, in accordance with the requirements and parameters previously defined by MFS, in accordance with the outcome of the aforementioned study."
"Clause Nineteen (SCOPE AND PRINCIPLES")
1. By this Contract, the MFS assumes as obligation to:
a) Provide technical assistance to the BNA in the origination of the following fund; (i) a strategic reserve fund (hereinafter referred to as "Reserve Fund") via "asset management" of the foreign currencies for the BNA and (ii) a private investment fund for management of a "private equity fund";
b) Establish the Reserve Fund;
c) Establish the Asset Management Fund;
d) Support the BNA in the fulfilment of monetary expansion operations, particularly with the objective of increasing the net foreign exchange reserves in the Country and protecting the value of the national currency, in line with what is stipulated in No of article 3 of law No 16/10, of 15 July;
e) Operate the asset portfolio to be managed, as well as the investments and operations in the financial market;
f) Support the BNA in setting up the protocols between this central bank and the WEU/UAE banks for operations in Kwanzas.
1. In the provision of the Services, the MFS must fulfil the following principles of proper management of the Reserve Fund and the Asset Management Fund, as applicable:
a) fulfilment of medium/long-term investments in the mixed portfolio regime;
b) fulfilment of international debt investment of the Sonangol and Angolan State;
c) participation in "buy-back" programmes of existing international debt and strategic assets."
"Clause 15 (Price of Services)
1. The price of the Services covers fees and expenses.
2. The BNA undertakes to pay MFS for the net amount of taxes and contributions of:
a) EUR 16,200,000.00 (sixteen million and two hundred thousand euros), as consideration for the rendering of Services for the preparation of the comprehensive study of the economic and financial reality of the Country and the drafting of a proposal for the adoption and contracting of financial instruments in the international financial market existing and available on the international financial market, in order to allow the BNA to duly perform its legal duties in order ti preserve the value of the national currency and to participate in the definition of monetary, financial and exchange policies;
b) EUR 33,500,000.00 (thirty-three million and five hundred thousand euros), for the provision of technical support services, the creation of a strategic reserve fund by means of the asset management of foreign currency to the BNA and a private equity fund chosen by the Angolan government, in accordance with requirements and parameters previously defined by MFS, in accordance with the outcome of the study referred to in item a).
3. For the provision of foreign exchange and asset management support services by MFS, the BNA undertakes to pay MFS or the entity subcontracted thereby, or a joint venture or any other form of association for the provision of such services, a percentage of the FOREX fee charged by WEU banks and an asset management fee, the amount of which shall be agreed upon by the Parties.
4. If any of the services included in this Agreement are not deinfitively provided (definitive non-compliance), MFS shall refund to the BNA the proportionate share of the price stipulated in this clause for the provision of services that have not been provided."
"b) If the dispute relates to strictly legal questions, or if the provision of the legal matters shall have implications in all the other matters in dispute, the dispute must be submitted to the Angolan Courts as soon as possible, the parties agreeing, immediately, to cooperate in the swift fostering of the legal procedure; and
c) in any other case, the dispute shall be decided by the Angolan Courts, the parties being subject, for this purpose, to the exclusive jurisdiction of these former."
F.6.2 Invoicing and payments made under the Consultancy Agreement
F.6.3 The Letter from Sumitomo Bank
"I am writing in reference to the letter dated the 13th July 2017 which is addressed to MFS & RESOURCE Project Partnership Ltd (u.c.) with CC to Sumitomo Bank, Att; Mrs Nisrin Hala which was received by us from BNA on the 18th July 2017. We have carefully review the letter, taken note of the contents and after due consideration, we are writing to inform you that, unfortunately, Sumitomo Mitsui Banking Corporation Europe Limited (SMBCE – SMBCGB2L) is not in a position to accept a request to open an account in the name of MFS & RESOURCE Project Partnership Ltd as referred to in the letter. The proposed request of opening such an account sits outside of our appetite at SMBCE and therefore we would be unable to proceed.
We take this opportunity to note that BNA's account (account number: 304786) referenced in the letter is established solely for the purposes of deposit placements by BNA with SMBCE; noting that any deposits necessitate both incoming and outgoing payments to be made in accordance with BNA's standard settlement instructions for that account."
F.6.4. The Meetings at the Landmark Hotel, London
"In response to the authorisation to travel to London, United Kingdom, from 31st of July to 04th August 2004, for a business mission to get contacts and meetings with the banking union's international banks in order to create the investment funds, we inform that the tasks foreseen into the timetable for actions, duly agreed with the consulting entity, Mais Financial Services, SA, are carried out adequately.
So, after having prepared satisfactorily all the conditions and carrying out all the preparatory meetings, we were informed today that the meeting with Consórcio. Resource Conversation/Mais Financial Services and the main international banks were scheduled for the 07th and 08th August in order to have a final discussion about the documents, which will lead to our stay in London for another 5 (five) days, therefore, we request, Your Excellency, the appropriate authorisation."
DAY-04/08/2017 1. Meetings with Consórcio Resource Conversation/Mais Financial Services;
DAY-07/08/2017 1. Meeting with Sumitomo Bank;
DAY-08/08/2017 1. Meeting with the banking union; Sumitomo Bank, HSBC, BNP Paribas, Bankiter, ICBC – Standard Bank, Royal Bank Scotland and Deutsch Bank.
2. Meeting with Norton Rose Fulbright Law Firm, London;
We are aware of your thoughtful consideration.
We are hoping that this current issue deserves, His Excellency, your special attention, we reaffirm our best regards."
"Therefore, the following actions were carried out during the week:
HSBC's positioning in the trade union's leadership, which is replacing Sumitomo, in order to expedite the course of the fundraising process;
Creation of conditions for restoring the banking relations such as the case of HSBC;
Money transfer to Standard Chartered Bank, the bank operator mentioned by Consórcio Resource Conversation, which is replacing Sumitomo;
Analysis and negotiation of draft Agreement of the Asset Allocation & Management Agreement, which will serve as a basis for managing the accounts that will raise the funds;
Preparation and availability of the information requested by Consórcio Resource Conversation/Mais Financial Services to complete the compliance process with the bank operator;
The screening meetings with Consórcio Resource Conversation/Mais Financial Services.
Therefore, on 06 August, the transfer of USD1.5 trillion request for the Standard Chartered bank, since the type of bank account opened at Sumitomo does not work out with this banking operation.
During, this week, between the 8th and 11th of August, the Protocol/Trust Agreement will be submitted by the international banks' trade union and be signed the Asset Allocation & Management Agreement in London.
Moreover, the travelling to Angola of the representatives of the trade union of international banks and Consórcio Resource Conversation/Mais Financial Services are scheduled between the 14th to 21st August in order to carry out the courtesy meeting with His Excellency and sign the Protocol/Trust Agreement with BNA to boost the funds in Luanda.
In view of the foregoing, we request, His Excellency, your authorisation to sign the Asset Allocation & Management Agreement, whose contents are attached to this information. We also ask for the authorisation of our stay in London, as meeting and subsequent events require us to stay in London until the weekend."
"Given the economic state of Angola after the oil price drop, the BNA wanted to make the most of the assets they were holding, such as the country reserves and the "other assets". They wanted to use these assets to create liquidity and value in the Angolan economy.
Their trip to London was to review the London market and meet key players in the market.
The other aspect they were looking for is investments in Angola. They wanted to use funds under BNA's management to create value in the economy. They were looking for ideas to support this principle. I asked them if they were involving the Ministry of Finance. They clarified that they were doing this exercise independent of the MOF and said that I was not to disclose our discussions to the MOF.
Angola needed to focus on a diversified economy. The BNA wanted to raise funds for the following sectors: agriculture, mining and financial sectors. They want assistance as to how the BNA can help in the diversification and asset management. Basically, how can they use their reserves and assets to fund investments in Angola and generate value. I said that I had seen some documents on asset management and the BNA with Mais Financial and I asked them if they had seen Mais Financial during this trip. We did not get a concrete answer."
F.6.5 The Asset Management Agreement
"4. The MANAGER has business relationships with major international banks, investment houses, brokerages, lawyers and auditors in terms of which the MANGER is able to organize the receipt/transfer of Cash Funds, Bank Instruments and Bonds, and obtain cash liquidity against such the assets. Further, the MANAGER is able to arrange for the Project Finance and Funding Capacity through the creation of International Investment Funds based on the assets and project guarantees as own capital to finance the aforementioned projects.
5. The OWNER would like to avail itself of the contacts and experience of the MANAGER and make available its asset/s in order to accomplish the aforementioned to their mutual benefit.
6. The MANAGER is willing to make the necessary arrangements for the implementation of the above by acting as the Qualified Trust Company, for the purpose of accomplishing the above.
"(1) The MANAGER has business relationships with major international banks, investment houses, brokerages, lawyers and auditors in terms of which the MANAGER is able to organize the receipt/transfer of Cash Funds, Bank Instruments and Bonds, and obtain cash liquidity against the Assets. Further, the MANAGER is able to arrange for the Project Finance and Funding Capacity through the creation of International Investment Funds based on the Assets and project guarantees as own capital to finance the aforementioned projects." (Clause 2.2.1)"
F.7 The Transfer to Perfectbit
According to the AA-agreement dd. signed 10th August 2017 between Banco Nacional de Angola and MFS & Resource Project Partnership Ltd, we kindly request you to transfer the first tranche of USD 500.000.000,00 (five hundred million United State Dollars) to the bank account of the Trustee with the following co-ordinates:
Account name: PERFECTBIT LIMITED
Address: 179 TORRIDON ROAD, LONDON SE6 1RG, UK
Bank Name: HSBC Bank UK
Bank address 8 Canada Square London E14 5HQ
Concept: Trust Agreement Dr S. Barbosa"
F.8 The Letter to President dos Santos on 18 August 2017
"The MFS & Resource Project Partnership Ltd. Consortium, established between MAIS Financial Services S.A. and Resource Conversion Plc, are, by way of this letter, hereby confirming that, further to the signing, on 10th August 2017, of the Asset Allocation Agreement contract with the National Bank of Angola (BNA), the preparatory stage of the establishment of the Investment Fund for the purpose of supporting the diversification of the Angolan economy has now been completed. The main objectives of the fund are:
a) To invest a minimum of thirty-five thousand million Euros in structural projects within Angola under the heading of Project Finance.
b) To make immediately available to the BNA foreign currency, Euro/Pound Sterling/Japanese Yen, to the value of up to 300 million Euros a week, by way of the banking syndicate which supports the operation.
c) To negotiate the purchase of Angola's external debt with different countries.
Following the signing of this contract, the Consortium and the banking syndicate which supports the structure detailed above, will start the operation which culminated, on 17 August this year, in the placement of the first financial instruments related to the fund which totalled 2,500,000,0000.00 (two thousand, five hundred million USD) of which 500,000,000.00 USD (five hundred million USD – Annex A) serve as a guarantee against the amount which has been deposited in the meantime by BNA in order to start the funding process.
BNA executed the instructions of the Consortium with the transfer of the first 500,00,000.00 USD (five hundred million USD), for the Trustee structure established by the banking syndicate, which confirmed, at the end of 18 August 2017, receipt of the aforementioned amounts within the operations account of the banking syndicate headed up by HSBC UK (annex B).
The capacity of the initial 2,500,000,000.00 (two thousand, five hundred million USD) having already been received into the financial market, we are awaiting authorisation by the Angolan government for the legal establishment of the Investment Fund in Angola.
This step will make possible the establishment of a Trust in London and Jersey by the Consortium (in the week commencing Monday, 21st August), which, in turn will make up the Fund, ensuring that when financial operations are executed in the European Union or Angola they will enjoy a different level of taxation.
Both the Trust and the Investment Fund must shortly authorise the opening of correlated bank accounts with BNA and with commercial banks which will operate in Angola, such as with HSPC, JP Morgan, Barclays and RBS-Royal Bank of Scotland.
In the context of the official launch of the fund in question, and of a meeting of parties strictly at highest level, subject to Your Excellency's availability and consideration, the Consortium believes that the necessary prerequisites have been met for an official visit by the dignitaries of some of the international banking institutes mentioned above to Luanda, during Angola's post-election period; from 4th September 2017 onwards."
F.9 The "Flag Emails"
"Dear Dr Jorge,
The following has just been advised:
Since the guarantee was established, the Euroclear system has already been consulted 4 times to verify the guarantee, but without using the correct codes. every time this happens, it leaves a "flag" in the system. this is because on the part of the BNA they are probably trying to see, but they do not have the subscription of Euroclear or not with the level of subscription sufficiently high. the market operator is upset because this phase of the process is supposed to be CONFIDENTIAL. therefore, PLEASE ask those at the BNA to CALM DOWN, and not screw things up now. no more checks please. Its' all OK"
"Dear Dr Jorge,
Today begins the financial part of the operation.
The market operator and Dr S.B. will advise BNA to maintain absolute 'radio silence.'
The most sensitive point for the banks is to check for a breaking of banking secrecy."
"1. You spoke to me about the possibility of someone giving BNA written directions of how they could follow the protocols of the guarantee. I only received an email from you saying BNA was leaving alerts in the system, since the instrument was not sufficiently verified. Their attempt to seek verification is legitimate and the negative results that arise from this are our fault, for no having facilitated this verification."
"Point 1: After lots of effort on my part, they told me this morning that the trading desk of HSBC or Credit Suisse will contact Dr Bule by email.
However, someone has already verified the guarantee 5 (five) times. This could only be someone who had access to the 14-page document.
"I will help BNA with the outline step-by-step how to verify the screen.
However, simple verification can be done on the ISIN number on the euroclear site. On the screen a message will pop-up requesting password access which the BNA banker must have. After the screen will open an they can see the 14 pages.
As will if they are on they own euroclear account screen, they only need to input the ISIN Number and all information will appear.
Let me know if they need extra help."
F.10 The Meeting on 20 October 2017
F.11 The Letter to President Lourenço of 20 October 2017
"The MFSRPP has signed an "Asset Allocation & Management Agreement" (AAMA) with BNA worth a total amount of USD$1,500m as part of which a transaction of temporary first allocation of funds worth USD $500m has been performed by MFSRPP via the appropriate financial banking institution.
The transfer of funds took place via the signing of a "Trust Agreement" with PERFECTBIT LTD – HSBC London, who is holding the untouched funds in its capacity as Trustee, as per the supporting documentation enclosed here in Annex 1.
The BNA assumes no risk as part of this transaction since, Credit Suisse, at the request of PERFECTBIT LTD – HSBC London, issued BNA with an irrevocable, unconditional and transferable bank guarantee for the same amount of transferred funds (USD $500M), guaranteeing its validity for a period of 1 (one) year, as per the supporting documentation enclosed here in Annex 2.
The operative instrument of this guarantee was put forward as per BNA's instruction. The initial funds transferred by BNA will be fully reimbursed during the week ending 10th November 2017, provided that BNA issues the "letter of confirmation" requested by HSBC, as per the supporting documentation enclosed here in Annex 3.
This initial, temporary transfer of funds permitted financial market transactions as per the supporting documentation enclosed here in Annex 4 and which, until the initial allocation of funds is reimbursed to BNA, will generate profits from developed financial instruments on the international financial markets by PERFECTBIT LTD – HSBC London, estimated to be worth up to USD $3 billion ("leverage") and which will then be used to establish an investment fund owed by the Angolan State."
(1) The first set of documents purported to be from the Credit Suisse Group and consist of a "Bank Guarantee", a "Letter of Guarantee" and a "Bank Confirmation Letter". These were supposed signed and stamped by the Chairman of the Board of director and the Chief Financial Office of the Credit Suisse Group.
(2) The second set of documents purported to be a series of Euroclear documents, issued by Credit Suisse AG with a total issued amount of 2,500,000,000, a fixed interest rate of 6.5%. BNA was expressed to be the beneficiary.
(3) The final set of documents consisted of a "Bank Confirmation Letter" and a "Ready Willing and Able Letter" dated 10 April 2017 purportedly from HSBC, London. The receiver identified in the Bank Confirmation Letter was Bar Trading Japan Co Ltd, the representative identified being Dr Barbosa. This supposedly confirmed that HSBC had the sum of €500 million which was "freely transferable, legally earner, good, clean, cleared funds of non-criminal origin" with HSBC being "ready, willing and able to provide it to [Bar Trading Japan Co Ltd] as an administrative-hold blocked funds via SWIFT MT 799/760 confirmation." This document was purportedly signed by HSBC's Chief Operating Officer and its Group Financial Director. The Ready Willing and Able Letter states that HSBC was ready, willing and able to provide an administrative-hold blocked funds with a blocked sum of €500 million. Again, this document was purportedly signed by HSBC's Chief Operating Officer and its Group Financial Director.
"BNA did not undertake any risk in this operation, since Credit Suisse, at the request of PERFECTBIT LTD – HSBC LONDON, provided an irrevocable, autonomous and transferable bank guarantee in favour of BNA in the same amount as the allocated funds (USD$ 500 million), a guarantee that is valid for the period of 1 (one) year."
F.12 Investigation into the Contracts
G. The Mais/Pontes Jurisdictional Challenge
"71 On an application for permission to serve a foreign defendant (including an additional defendant to counterclaim) out of the jurisdiction, the claimant (or counterclaimant) has to satisfy three requirements: Seaconsar Far East Ltd v Bank Markazi Jomhouri Islami Iran  1 AC 438, 453–457. First, the claimant must satisfy the court that in relation to the foreign defendant there is a serious issue to be tried on the merits, ie a substantial question of fact or law, or both. The current practice in England is that this is the same test as for summary judgment, namely whether there is a real (as opposed to a fanciful) prospect of success: eg Carvill America Inc v Camperdown UK Ltd  2 Lloyd's Rep 457, para 24. Second, the claimant must satisfy the court that there is a good arguable case that the claim falls within one or more classes of case in which permission to serve out may be given. In this context "good arguable case" connotes that one side has a much better argument than the other: see Canada Trust Co v Stolzenberg (No 2)  1 WLR 547, 555–557, per Waller LJ affirmed  1 AC 1; Bols Distilleries BV v Superior Yacht Services (trading as Bols Royal Distilleries)  1 WLR 12, paras 26–28. Third, the claimant must satisfy the court that in all the circumstances [England and Wales] is clearly or distinctly the appropriate forum for the trial of the dispute, and that in all the circumstances the court ought to exercise its discretion to permit service of the proceedings out of the jurisdiction."
"… the general rule is clear: where parties have bound themselves by an exclusive jurisdiction clause effect should ordinarily be given to that obligation in the absence of strong reasons for departing from it. Whether a party can show strong reasons, sufficient to displace the other party's prima facie entitlement to enforce the contractual bargain, will depend on all the facts and circumstances of the particular case."
"I accept that if the claim against the second defendant were a freestanding claim, all those factors would point overwhelmingly to Russia being the appropriate forum for the claim. However, the context is that the claim against the second defendant is not a freestanding claim, and it has to be considered in circumstances where the claimant has chosen to bring, and is entitled to bring, claims against the first and third defendants in England, which it says it anyway wishes to pursue, regardless of whether the second defendant is brought into these proceedings or not. What therefore has to be considered, as [counsel for] the claimant submits, is not whether England or Russia is the more suitable forum for the claim against the second defendant, other things being equal, but whether it is appropriate to have proceedings against the second defendant in Russia in circumstances where proceedings involving identical or virtually identical facts, all the same transactions, witnesses and documents, will anyway be taking place in England. The real question, in other words, is whether the factors which connect the claim against the second defendant with Russia carry weight in circumstances where to require the claim to be pursued in Russia would result in duplication of cost and the risk of inconsistent judgments – the same factors which make the second defendant a necessary or proper party".
"Although the burden is on a claimant to show, when seeking leave to serve out of the jurisdiction, that England is the appropriate forum where the case can most suitably be tried for the interests of all the parties and the ends of justice, the fact of continuing proceedings in England against other defendants on the same or closely allied issues virtually concludes the question, since all courts recognise the undesirability of duplication of proceedings and the lis alibi pendens cases make this clear. Although there are connecting factors with Kenya to which I refer later in this judgment, if proceedings are going on in this jurisdiction on the self-same or linked issues, this is clearly the most appropriate forum for those common or connected issues to be tried between all relevant parties".
"113. At paragraph 12-033, the editors of Dicey note the classic exposition of Lord Goff's forum non conveniens test in the Spiliada case, but add: Lord Goff could not have foreseen, however, the subsequent distortion which would be brought about by the decision of the European Court in Owusu v Jackson. The direct effect of that case is that where proceedings in a civil or commercial matter are brought against a defendant who is domiciled in the United Kingdom, the court has no power to stay those proceedings on the ground of forum non conveniens. Its indirect effect is felt in a case in which there are multiple defendants, some of whom are not domiciled in a Member State and to whom the plea of forum non conveniens remains open: it is inevitable that the ability of those co-defendants to obtain a stay (or to resist service out of the jurisdiction) by pointing to the courts of a non-Member State which would otherwise represent the forum conveniens, will be reduced, for to grant jurisdictional relief to some but not to others will fragment what ought to be conducted as a single trial … There is no doubt, however, that the Owusu factor will have made things worse for a defendant who wishes to rely on the principle of forum non conveniens when a co-defendant cannot."
H.1 The Parties' Submissions
(1) BNA's claim against Mais is in breach of the exclusive jurisdiction provision within the Consultancy Agreement.
(2) The same jurisdiction agreement also binds Angola, even though Angola is not itself party to the Consultancy Agreement, as Angola gave authority to the BNA by entrusting its foreign currency reserves and/or by reason of President dos Santos' (informal) approval of the Project. An analogy was drawn with bailment.
(3) The claims against Mais and Dr Pontes ought to be litigated in Angola given the nature of the claim (being "Angolan to its core"), the identities of the various parties, practical considerations as to documentary evidence and the giving of witness evidence, the applicable law and supposedly sensitive issues of Angolan politics.
(4) The Defendants should not be treated as being of equal importance – for example Perfectbit is of more limited significance given it now has no assets and SPV likewise has no assets. It was said that the "real defendants" are Mais and Dr Pontes in Angola (who, it is said, have resources sufficient to meet any eventual judgment) and Resource Conversion and Mr Onderwater (who appear to have limited assets).
(5) The Claimants are able to manage the risk of parallel proceedings and inconsistent judgments – there being no impediment to the Claimants suing the Defendants in Angola and the Claimants may prefer to sue in one jurisdiction and then go to the other afterwards if necessary.
(6) The Claimants agreed to two closely related contracts containing two different jurisdiction clauses. The risk of multiple sets of proceedings and conflicting decisions always existed.
(1) There will be continuing proceedings in England against four of the Defendants as it is not possible for the Court to stay the claims against Perfectbit, Resource Conversion, Project SPV and Mr Soumah in light of Owusu.
(2) The jurisdiction provision in the Consultancy Agreement does not bind Angola so there are claims against Mais outside the scope of that agreement.
(3) Given there will be proceedings in England, England is the proper place for the determination of all the claims. The contrary conclusion involves the duplication of costs and a risk of inconsistent judgments. In circumstances where a defendant is a necessary or proper party to a claim which will be taking place and is taking place in this jurisdiction it will normally follow that England is the appropriate forum, irrespective of whether or not there is a jurisdiction clause in favour of a foreign court.
(4) It is not open to Mais and Mr Pontes to suggest how the Claimants could possibly seek to manage these risks given it would be a problem created by their application.
(5) Nor is it open to Mais and Mr Pontes to say that the defendants domiciled within this jurisdiction (now) lack assets such that litigation within England may not go ahead if the proceedings against Mais and Mr Pontes were moved to Angola. It is not for the Defendants to engage in this exercise, but if it is to be done, matters are to be judged as of the date when the applications were made; at that point in time Perfectbit held the U$500 million in its account (where that money still remained at the date of the hearing before me albeit that a consent order was agreed by the parties during the course of the hearing that was intended to facilitate its return in due course).
(6) Various factors were also identified linking this claim with England. Dr Pontes and Mr Onderwater chose to use Project SPV and Perfectbit, companies incorporated in England. Dr Pontes is a director of Project SPV, and Mais is one of the shareholders.
H.2 Application of the Legal Principles
1) "the Court would inevitably have regard to the fact that the … claims against Ltd and SA respectively were inextricably interlinked and that … in the interests of justice they would be heard together, so as to save costs and avoid inconsistent results": Aiglon Ltd v Gau Shan Co Ltd  2 Lloyd's Rep 164 per Hirst J at 172
2) "there is a risk, if actions in respect of the same loss must be brought in different jurisdictions, that there will be inconsistent decisions on the facts": Citi-March Ltd v Neptune Orient Lines Ltd  1 WLR 1367 per Colman J at 1375F-G
3) "If the proceedings ... against the applicants are heard in Kazakhstan … there is an obvious risk of inconsistent judgments and of waste and duplication of costs. That is a powerful factor in favour of having the applicants as parties to this litigation": JSC BTA Bank v Granton Trade Ltd  2 All ER (Comm) 542 per Christopher Clarke J at paragraph .
I. The Discharge Applications
I. 1 Introduction
I.2 Relevant Principles
"In considering whether there has been relevant non-disclosure and what consequence the court should attach to any failure to comply with the duty to make full and frank disclosure, the principles relevant to the issues in these appeals appear to me to include the following.
(1) The duty of the applicant is to make "a full and fair disclosure of all the material facts:" see Rex v. Kensington Income Tax Commissioners, Ex parte Princess Edmond de Polignac  1 K.B. 486, 514, per Scrutton L.J.
(2) The material facts are those which it is material for the judge to know in dealing with the application as made: materiality is to be decided by the court and not by the assessment of the applicant or his legal advisers: see Rex v. Kensington Income Tax Commissioners, per Lord Cozens-Hardy M.R., at p. 504, citing Dalglish v. Jarvie (1850) 2 Mac. & G. 231, 238, and Browne-Wilkinson J. in Thermax Ltd. v. Schott Industrial Glass Ltd.  F.S.R. 289 , 295.
(3) The applicant must make proper inquiries before making the application: see Bank Mellat v. Nikpour  F.S.R. 87. The duty of disclosure therefore applies not only to material facts known to the applicant but also to any additional facts which he would have known if he had made such inquiries.
(4) The extent of the inquiries which will be held to be proper, and therefore necessary, must depend on all the circumstances of the case including (a) the nature of the case which the applicant is making when he makes the application; and (b) the order for which application is made and the probable effect of the order on the defendant: see, for example, the examination by Scott J. of the possible effect of an Anton Piller order in Columbia Picture Industries Inc. v. Robinson  Ch 38; and (c) the degree of legitimate urgency and the time available for the making of inquiries: see per Slade L.J. in Bank Mellat v. Nikpour  F.S.R. 87, 92–93.
"On any ex parte application, the fact that the court is asked to grant relief without the person against whom the relief is sought having the opportunity to be heard makes it imperative that the applicant should make full and frank disclosure of all facts known to him or which should have been known to him had he made all such inquiries as were reasonable and proper in the circumstances."
"The test of materiality of a matter not disclosed is whether it would be relevant to the exercise of the court's discretion. A fact is material if it would have influenced the judge when deciding whether to make the order or deciding upon the terms upon which it should be made. The question of materiality is a matter for the court and not the subjective judgment of the applicant or his lawyers."
"171 The obligation to anticipate defences in pursuit of the obligation to make full and frank disclosure is very important. Mr Smith submitted that his clients were not to know that these points were to be taken by Mr Pugachev because he had not then (and has not even now) put in a Defence in the supported Russian proceedings. However, the fact that they have not been articulated in the supported Russian proceedings is not the point. An applicant for without notice relief has actively to consider what points of defence might be taken by the defendant and put them before the court. That is a fundamental requirement, and safeguard.
172 In making an assessment as to whether a point of defence is sufficiently obvious, one must guard against assuming that any point that has occurred to the defence lawyers ought to have occurred to the claimants' lawyers. The obligation to disclose does not require that every potential point be flushed out. Nevertheless there is an obligation to look at things from a defendant's point of view and anticipate defences which are obvious and those which require some thought but are nonetheless plain enough (as arguable defences) when thought about. Each case will depend on its own facts, and it is impossible to define a neatly applicable test which is capable of answering the point in every case. It is going to be easier to see what ought to have been disclosed in the light of the alleged non-disclosure, but that is no excuse for not giving the matter enough thought beforehand."
"(5) If material non-disclosure is established the court will be "astute to ensure that a plaintiff who obtains [an ex parte injunction] without full disclosure … is deprived of any advantage he may have derived by that breach of duty:" see per Donaldson L.J. in Bank Mellat v. Nikpour, at p. 91, citing Warrington L.J. in the Kensington Income Tax Commissioners'; case  1 K.B. 486, 509.
(6) Whether the fact not disclosed is of sufficient materiality to justify or require immediate discharge of the order without examination of the merits depends on the importance of the fact to the issues which were to be decided by the judge on the application. The answer to the question whether the non-disclosure was innocent, in the sense that the fact was not known to the applicant or that its relevance was not perceived, is an important consideration but not decisive by reason of the duty on the applicant to make all proper inquiries and to give careful consideration to the case being presented.
(7) Finally, it "is not for every omission that the injunction will be automatically discharged. A locus poenitentiae may sometimes be afforded:" per Lord Denning M.R. in Bank Mellat v. Nikpour  F.S.R. 87, 90. The court has a discretion, notwithstanding proof of material non-disclosure which justifies or requires the immediate discharge of the ex parte order, nevertheless to continue the order, or to make a new order on terms."
"when the whole of the facts, including that of the original non-disclosure, are before [the court, it] may well grant … a second injunction if the original non-disclosure was innocent and if an injunction could properly be granted even had the facts been disclosed:" per Glidewell L.J. in Lloyds Bowmaker Ltd. v. Britannia Arrow Holdings Plc., ante, pp. 1343H–1344A"
"(1) If the court finds that there have been breaches of the duty of full and fair disclosure on the ex parte application, the general rule is that it should discharge the order obtained in breach and refuse to renew the order until trial.
(2) Notwithstanding that general rule, the court has jurisdiction to continue or re-grant the order.
(3) That jurisdiction should be exercised sparingly, and should take account of the need to protect the administration of justice and uphold the public interest in requiring full and fair disclosure.
(4) The court should assess the degree and extent of the culpability with regard to non-disclosure. It is relevant that the breach was innocent, but there is no general rule that an innocent breach will not attract the sanction of discharge of the order. Equally, there is no general rule that a deliberate breach will attract that sanction.
(5) The court should assess the importance and significance to the outcome of the application for an injunction of the matters which were not disclosed to the court. In making this assessment, the fact that the judge might have made the order anyway is of little if any importance.
(6) The court can weigh the merits of the plaintiff's claim, but should not conduct a simple balancing exercise in which the strength of the plaintiff's case is allowed to undermine the policy objective of the principle.
(7) The application of the principle should not be carried to extreme lengths or be allowed to become the instrument of injustice.
(8) The jurisdiction is penal in nature and the court should therefore have regard to the proportionality between the punishment and the offence.
(9) There are no hard and fast rules as to whether the discretion to continue or re-grant the order should be exercised, and the court should take into account all relevant circumstances."
"18 Without attempting a comprehensive restatement which would serve no useful purpose, I consider that the following points are particularly relevant in the present case:
a. A fact is material if it is one which the judge would need (or wish) to take into account when deciding whether to make the freezing order.
b. Failure to disclose a material fact will sometimes require immediate discharge of the order. This is likely to be the court's starting point, at least when the failure is substantial or deliberate.
c. Nevertheless the court has a discretion to continue the injunction (or to impose a fresh injunction) despite a failure of disclosure; although it has been said that this discretion should be exercised sparingly, the overriding consideration will always be the interests of justice.
d. In considering where the interests of justice lie, it is necessary to take account of all the circumstances of the case including (without attempting an exhaustive list) (i) the importance of the fact not disclosed to the issues which the judge making the freezing order had to decide; (ii) the need to encourage proper compliance with the need for full and frank disclosure and to deter non-compliance; (iii) whether or to what extent the failure to disclose was culpable; and (iv) the injustice to a claimant which may occur if an order is discharged leaving a defendant free to dissipate assets, although a strong case on the merits will never be a good excuse for a failure to disclose material facts.
e. The interests of justice may sometimes require that a freezing order be continued, but that a failure of disclosure be marked in some other way, for example by a suitable order as to costs."
"36 As long ago as 1990 Sir Nicolas Browne-Wilkinson V-C asked this court for guidance about the right approach to be taken to the inevitably lengthy hearings which were then growing in relation to non-disclosure in respect of freezing and search and seizure orders, see Tate Access Floors Inc v Boswell  Ch 512, 533H–534D. I am not aware that this court has ever answered that cri de coeur and we did not receive any argument which would enable us to do so authoritatively in the present case. The judge adopted the approach of Toulson J (as he then was) in Crown Resources AG v Vinogradsky (15 June 2001) for cases of any magnitude and complexity and I am content to do the same:
'… issues of non-disclosure or abuse of process in relation to the operation of a freezing order ought to be capable of being dealt with quite concisely. Speaking in general terms, it is inappropriate to seek to set aside a freezing order for non- disclosure where proof of non-disclosure depends on proof of facts which are themselves in issue in the action, unless the facts are truly so plain that they can be readily and summarily established, otherwise the application to set aside the freezing order is liable to become a form of preliminary trial in which the judge is asked to make findings (albeit provisionally) on issues which should be more properly reserved for the trial itself (pages 4–5 of the transcript).
Secondly, where facts are material in the broad sense in which that expression is used, there are degrees of relevance and it is important to preserve a due sense of proportion. The overriding objectives apply here as in any matter in which the Court is required to exercise its discretion (page 6).
I would add that the more complex the case, the more fertile is the ground for raising arguments about non-disclosure and the more important it is, in my view, that the judge should not lose sight of the wood for the trees (page 7).
In applying the broad test of materiality, sensible limits have to be drawn. Otherwise there would be no limit to the points of prejudice which could be advanced under the guise of discretion (page 22).'"
J. The Mais/Pontes Discharge Application
J.1 The Description of Dr Pontes
"The Seventh Respondent, Mr Pontes, is a Chairman and director of Mais and a director of Project SPV. Companies House records list his occupation as accountant, his nationality as Angolan and his country of residence as Angola."
"There are a number of aspects of the Consultancy Agreement which I find concerning. In summary:
If the BNA was going to engage a third party to provide technical advice on macroeconomic matters and manage the State's assets, I would expect the provider to have appropriate expertise and experience of similar projects. As I explain in paragraph 76 below, while Mr Pontes is a well known businessman in Angola, I am not aware of a website for Mais or any online record of its prior experience or expertise (or indeed of Mr Pontes having such expertise). The absence of such matters casts considerable doubt, to the least, on the likelihood of Mais being experienced enough and able to provide the appropriate technical advice."
"Mais is incorporated in Angola, according to the Consultancy Agreement. Online and UK Land Registry searches have not identified any assets own by Mais. Mr Pontes, who appears to be the chairman of the board of directors, appears to have Angolan nationality and to be resident in Angola. On the basis of the available information it seems likely that any assets Mais or Mr Pontes have will be located in Angola.
Online searches have not identified any assets owned by Dr Barbosa, Mr Onderwater or Mr Pontes. To the extent they have assets, on the basis of the limited information available, it seems most likely they would be located in Japan, Portugal and Angola, where they are respectively resident.
I note that, given the urgency of the application and the importance of not alerting the Respondents in advance of the hearing, only very limited assets searches have been conducted and the Applicants have not engaged the services of an enquiry agent, who may ultimately be able to identify some additional assets."
J.2 The Roles of President dos Santos and Mr Filomeno dos Santos
"The Respondents may argue that the Consultancy Agreement and the Asset Management Agreement and the payments purportedly made pursuant to them were made at the request and/or with the knowledge, consent and/or involvement of officials in Angola. They may refer to the Presentations, which state "MinFin/BNA Request", and the letters from Dr da Silva on 3 and 7 August 2017 [to President Dos Santos] making reference to the proposed arrangements with Project SPV and requesting approval to sign the Asset Management Agreement. They may also refer to the SWIFT message from the BNA indicating that payment to Perfectbit was made under a Temporary Deed of Assignment, the BNA's initial failure to retract that SWIFT message when requested and the fact that Dr da Silva was dismissed on 27 October. I will leave legal submissions to our lawyers, but I do not see how such matters would be relevant if the Respondents obtained the Consultancy and Asset Management Agreements and payments of Angola's funds by deception."
(my bracketed inclusion and emphasis)
(1) President dos Santos had approved the Project having considered two conflicting reports and opted for the course suggested by Dr da Silva and Mr Filomeno dos Santos, and
(2) Mr Mangueira had met President dos Santos on the 17 or 18 September 2018.
J.3 Alleged Political Motivation
K. Risk of Dissipation
In this regard it is well established that the claimant must adduce "solid evidence" to support an assertion that there is a real risk that a judgment will go unsatisfied. There are many factors that may go to discharge this evidential burden, and many of these are considered by Gee at paragraph 12-033 of Commercial Injunctions. Amongst those are:-
Good grounds for alleging that the defendant has been dishonest is relevant. Dishonesty is not essential to the exercise of the jurisdiction and there is no need to show an intention to dissipate assets. But if there is a good arguable case in support of an allegation that the defendant has acted fraudulently or dishonestly (eg being implicated in an ingenious scheme for the misappropriation of funds belonging to the claimant), or with an unacceptably low standard of commercial morality giving rise to a feeling of uneasiness about the defendant, then it is often unnecessary for there to be any further specific evidence on risk of dissipation for the court to be entitled to take the view that there is a sufficient risk to justify Mareva relief. For this the dishonesty must be relevant to risk of dissipation, and not every act of dishonesty is relevant to this. Once the risk of dissipation is shown, the limit of the Mareva relief will take into account claims for which the claimant has a good arguable case, including those which do not involve such an allegation."
(1) At close of business on 5 December 2017, there was only €9,238,779.17 in the BCP Account (when Dr Pontes says he became aware of the Order).
(2) On 30 November 2017, Mais made a payment of €1 million to Concera SA (a company of which Dr Pontes is a director, direct shareholder of a 1% stake, and indirect shareholder of 97.5% of its shares). This was the date when Norton Rose emailed the Order to Dr Pontes. There were two subsequent payments of €100,000 and €350,000 on 4 December 2017. (I note that Mais made three earlier payments totalling €3 million from the BCP Account to Concera, and that Dr Pontes' evidence is that a substantial amount of this money has been paid out by Concera for the construction of a new laboratory for Bromangol).
(3) From 27 December 2017, Concera paid away around €400,000. Dr Pontes and Mais allowed this notwithstanding Dr Pontes' controlling interest in Concera and his (admitted) knowledge of the Order by this time.
(4) Dr Pontes has made a number of substantial payments from various bank accounts from December 2017 onwards, including but not limited to:
i. Numerous payments from an account held at Banco BIC including two substantial payments of 75 million Kwanzas (equivalent together to over £500,000) on 12 December 2017 and 12 January 2018;
ii. Payments exceeding 18.5 million Kwanzas (over £60,000) from an account with Banco Pungo Andongo since 26 December 2017;
iii. Payments out of accounts with Euro BIC and Novo Banco including numerous payments for luxury goods.
L. The Onderwater Discharge Application
L.1 Alleged failure to draw attention to facts indicating that the defendants
were unlikely to conspire to steal the funds
(1) as originally conceived the payment of the US$500 million was to be made to BNA's own account with Sumitomo, this being a trust account from which the money would not leave; and
(2) Dr Barbosa and Perfectbit were only brought into the Project in late July or early August.
L. 2 The Potential Political Angle
L.3 An alleged failure properly to address the possible application of Angolan law and associated consequences.
(1) By relying first on Article 4 and only then on Article 12. Mr Macpherson submitted that it is arguable that Article 12 trumps Article 4 in this case and that ought to have been made clear to Popplewell J; and
(2) By failing to consider Article 15(d) of Rome II which provides that "the law applicable to non-contractual obligations under this Regulation shall govern in particular: … (d) within the limits of powers conferred on the court by its procedural law, the measure which a court may take to prevent or terminate injury or damage or to ensure the provision of compensation."
"23.1 Article 4(1), which sets out the default rule that the law applicable to a tortious/delictual claim is the law of the country where the damage occurred "irrespective of the country in which the event giving rise to the damage occurred."
23.2 Article 4(2), which provides for the disapplication of the default rule where the claimant and the defendant are both habitually resident in the same country.
23.3 Art 4(3), which provides for the disapplication of articles 4(1) and/or (2) in circumstances where the tort/delict in question is "manifestly more closely connected" with a country other than that identified pursuant to those articles.
23.4 Article 12(1), which provides that, in relation to non-contractual claims arising out of pre-contractual dealings, the law applicable to the claim is that which applies to the contract in question (or which would have so applied, had the contract been concluded)."
"24. There are two distinct elements to the damage which the Claimants' have suffered as a result of the alleged wrongdoing; namely (a) the making of a payment of $500m to Perfectbit pursuant to the Asset Management Agreement; and (b) the making of payments totalling €24.85m to Mais pursuant to the Consultancy Agreement.
25. The Claimants submit that English law governs claims relating to the payment of $500m;
25.1 Applying article 4(1) of Rome II, English law would apply because the damage (which consisted of the making of a payment from one English bank account to another) clearly occurred in England.
25.2 It might be said that, under article 4(2), any claim against Mais in respect of this payment was governed by Angolan Law (because the Claimants and Mais could be said to be habitually resident in Angola). However, if it be right that all of the other claims in relation to this payment were governed by English law, with the result that Mais' liability arose entirely as a result of its participation in an English law conspiracy, then the Claimants would submit that Angolan law ought to be disapplied, in favour of English law, under article 4(3).
25.3 In any event, if the claim is properly to be analysed as one relating to the fraudulent inducement of contract, and therefore as being within article 12 of Rome II, English law would apply in any event. This is because the contract which was induced by the fraud, and pursuant to which the payment of $500m was made (namely the Asset Management Agreement) is expressly subject to English law.
26. If the claims in respect of the $500m are governed by English law (and the Claimants submit that they are for the reasons set out above) then it would follow that the question of whether Perfectbit holds that payment (or any of the traceable proceeds thereof) on constructive trust for the Claimants would also be governed by English law – see Dicey, Morris & Collins on the Conflict of Laws (15th Ed) at 29R-075. This conclusion would be supported by the general principle that claims to ownership of property or assets are governed by the lex situs of the relevant assets at the time of transfer. Given the transfer in England between two banks of the US$500m, it is clear that if the lex situs rule were applied, it would lead to English law applying as well.
27. It is the Claimants' case that the inducement of both the Consultancy Agreement and the Asset Management Agreement formed part of a single, continuous fraudulent conspiracy. In those circumstances, there is a strong argument that, under article 4(3) of Rome II, the claims in respect of the sum of €24.85m ought also to be treated as being governed by English law. However, in relation to the claim concerning this sum, there are arguments that some other law may apply:
27.1 The sum of €24.85 million was made pursuant to the Consultancy Agreement, which is subject to Angolan Law. Under article 12 of Rome II, non-contractual claims arising out of dealings prior to that contract would be governed by the same law.
27.2 The sum was paid from an account held by the BNA in Germany. Accordingly, under article 4(1) of Rome II, it might be said that German law applied. However, the Claimants submit that this possibility can be discounted in light of (a) the impact of article 12; and/or (b) the complete absence of any other connections between the Claimants' claims and Germany.
28. The Claimants maintain that the most appropriate law governing these claims is English law. To the extent necessary, the Claimants will submit that attempts to point to another law based on choice of law clauses in documents which appear to have provided non services, and were never intended to provide any substantive services or give rise to real obligations and were no more than mere vehicles for effecting the fraud should be discounted."
(1) §35-093 of Dicey, Morris & Collins on the Conflict of Laws (15th ed) states:
"Scope of Article 12. According to Recital (30) to the Regulation culpa in contradendo is an autonomous concept and should not necessarily be interpreted within the meaning of national law. The Recital goes on to point out that it should include "the violation of the duty of disclosure and the break-down of contractual negotiations." But Art. 12 "covers only non-contractual obligations presenting a direct link with the dealings prior to the conclusion of a contract. The means that if, while a contract is being negotiated, a person suffers personal injury, Art.4 or other relevant provisions of this Regulation should apply". The terminology and these various observations suggest that Art.12 will apply to fault based claims, for example, to non-disclosure, fraudulent or negligent misrepresentations and duress which occur during the negotiation of a contract. Accordingly other types of claim, for example a claim for the value of services provided in anticipation of a contract, may fall outside Art.12, and within other provisions of the Regulation (notably, Art.10 dealing with unjust enrichment). Equally, however, these observations emphasise that the "culpa" in whatever form must occur in the context of negotiations with a view to concluding a contract. Thus Art.12 would not, it seems, apply in a case where (for example) a misrepresentation is made outside contractual negotiations or where a third party relies on a representation made in connection with a contract concluded between the representor and a different party. Such cases will fall, normally, within Art.4. Finally, as the principal connecting factor under Art.12 is the law applicable to a contract (or putative contract), its application may be restricted to claims between the parties (or prospective parties) to that contract, and not against any third party (e.g. an agent) involved in the pre-contractual dealings."
(2) To similar effect, Dickinson, The Rome II Regulation states:
"12.07 As the primary connecting factor within Art 12 is the law applicable to a contract, either concluded or contemplated, there is a strong argument for restricting its scope to claims between the (intended) parties to the contract so as to exclude (for example) a claim for damages by one of the parties against the issuer of securities that he has purchased on the market or the agent of another for misrepresentation or as a false procurator. There may, of course, be good reasons for concluding that claims against an agent, whether in contract or in tort/delict, should be governed under the Rome I Regime or Art 4 of the Rome II Regulation by the law of the contract (lex contractus), especially if he has taken an active part in negotiations conducted on the basis of drafts containing a choice of law provision. Art 12, however, would appear to contemplate an existing or contemplated contractual relationship between the parties to the non-contractual obligation. That view is consinstent, for example, with the approach taken under English law to liability for misrepresentation, providing a separate claim for damages as between the contracting parties only. …
12.08 The language of Recital (30) (12.03 above) reduces the significance of comparative analysis of this kind, which in any event is inconclusive. On balance, therefore, claims by or against the representatives of negotiating or contracting parties should be considered to fall outside Art 12, although the contract or supposed contract to which the agent's conduct relates should be considered as a circumstance to be taken into account in applying a flexible rule of displacement such as that in Art 4(3) of the Rome II Regulation or in identifying the law applicable under the Rome I Regime to any contract between agent and counterparty."
(3) The Supplement to that text provides at 12.20C:
"It is possible that a claim may relate to the defendant's conduct preceding the conclusion of two or more contracts, with different governing laws. In such a case, unless there is one contract to which the others are clearly subordinate (in which case it may be possible to apply the maxim accessorium sequitur principale to support the application of the law of the principle contract, the laws of each of the individual contracts should probably be applied on a 'distributive' basis, with the damage being apportioned between them. This process will be more straightforward if a contract has been concluded and performance has taken place, than if the negotiations have failed."
"Despite that position, out of an abundance of caution, the Claimants consider it appropriate to address the question of how their claims against the Alleged Fraud Defendants would fall to be analysed under Angolan law:
29.1 In the limited time available, the Claimants have been able to obtain two letters from the legal office of the Ministry of Finance. These letters provide a brief summary of certain relevant principles of Angolan law.
29.2 Unsurprisingly, it appears that Angolan Law confers upon the victim of a fraud the right to claim damages against the fraudster.
29.3 In terms of interim remedies, Angolan law permits the seizure or freezing of assets "which have been improperly lost, and are in the possession of the defendant.
29.4 Where two or more persons conspire to commit unlawful acts, Angolan law renders them jointly and severally liable for the damages caused.
29.5 It therefore appears that, insofar as relevant to this application, Angolan law is sufficiently similar to English law that its applicability would not militate against the granting of the interim injunctions which the Claimants now seek."
M. The Case Management Stay Application
N. Overall Conclusion