Globe Investment Holdings Limited v (1) Commercial Bank Of Dubai (2) Hortin Holding Limited (3) Lodge Hill Limited (4) Westdene Investment Limited (5) 1897 (Cayman) Limited [2024] DIFC CFI 028 (25 September 2024)

Claim No: CFI 028/2023

IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

GLOBE INVESTMENT HOLDINGS LIMITED

Claimant

and

(1) COMMERCIAL BANK OF DUBAI
(2) HORTIN HOLDING LIMITED
(3) LODGE HILL LIMITED
(4) WESTDENE INVESTMENT LIMITED
(5) 1897 (CAYMAN) LIMITED

Defendants

ORDER WITH REASONS OF JUSTICE MICHAEL BLACK KC

UPON the interim costs order of H.E Justice Nassir Al Nasser dated 18 September 2023 (the “Interim Costs Order”)

AND UPON the Defendants’ Notice of Commencement of Detailed Assessment Proceedings issued on 16 February 2024 and the bill of costs dated 16 February 2024

AND UPON the Defendants’ request for a default costs certificate issued on 13 March 2024

AND UPON the written directions of the DIFC Court on 1 April 2024 to the Defendants requiring the Defendants to comply with paragraph 7 of Practice Direction No. 5 of 2014

AND UPON the Defendants’ revised bill of costs dated 2 April 2024

AND UPON the Consent Order issued by the Court on 9 May 2024 recording the agreement reached between the Claimant and the Defendants on 7 May 2024 that the Defendants shall file and serve a revised bill of costs by 4pm (GST) on 13 May 2024 (the “9 May Order”)

AND UPON the consent order filed with the Court on 13 May 2024 and issued on 15 May 2024 amending paragraph 1 of the 9 May Order

AND UPON the Defendants filing a revised bill of costs on 14 May 2024

AND UPON the Fifth Defendant commencing enforcement proceedings against the Claimant in the Dubai Execution Court to enforce the Interim Costs Order under file Execution Court number 108 of 2023 (the “Execution Proceedings”)

AND UPON the Claimant commencing proceedings in the Dubai Court under the case number 633 of 2024 (Commercial) seeking a judgment for the set-off of the Interim Costs Order against amounts due to the Claimant by the Second to Fourth Defendants pursuant to a Sharjah Judgment dated 6 April 2021 (the “Sharjah Judgment”) and the appeal filed by the Claimant under Appeal No. 834 of 2024 (the “Dubai Set off Claim”)

AND UPON the Claimant commencing proceedings in Sharjah Court under the case number 999 of 2024 (Commercial) seeking a judgment for the set-off of the Interim Costs Order against amounts due to the Claimant by the Second to Fourth Defendants pursuant to the Sharjah Judgement and the appeal filed by the Claimant under Appeal No. 747 of 2024 (the “Sharjah Set off Claim”)

AND UPON the Claimant under application number 788062 of 2024 seeking the joinder of the Second to Fourth Defendants in the Execution Proceedings (the “Joinder Application”)

AND UPON further agreement between the parties in relation to the issue of the cost assessment of these proceedings displayed in the Consent Order dated 12 July 2024

AND UPON the Defendants’ Application No. CFI-028-2023/4 filed on 14 August 2024 seeking to delete the Bill of Costs filed on 14 February and on 13 March 2024 (“Original BOC”), and the amended Bill of Costs filed on 1 April 2024 (“Amended BOC”) from the eRegistry and from the internal records of the DIFC Courts (the “Defendants’ Application”)

IT IS HEREBY ORDERED THAT:

1. The Defendants’ Application is dismissed.

2. To the extent necessary the Court grants permission to use the documents annexed to the Bills Costs of 14 February, 13 March and 1 April 2024 in these proceedings in unredacted form.

3. The Defendants shall pay its costs of the Defendants’ Application to the Claimant to be assessed on the standard basis in default of agreement.

Issued by
Hayley Norton
Assistant Registrar
Date of issue: 25 September 2024
At: 3pm

SCHEDULE OF REASONS

INTRODUCTION

1. This is an application filed on 14 August 2024 by the Defendants that the Bill of Costs filed on 14 February and on 13 March 2024 (“Original BOC”), and the amended Bill of Costs filed on 1 April 2024 (“Amended BOC”) are deleted from the eRegistry and from the internal records of the DIFC Courts.

2. The supporting evidence on the application notice given under a statement of truth signed by Mr Carlo Fedrigoli of Onoma ZZE (“Onoma”), the Defendants’ legal representatives, was as follows:

(a) On 6 June 2024, the Defendants filed a revised Bill of Costs (“Revised BOC”).

(b) The invoices included in the Original and in the Amended BOC were inadvertently filed (and subsequently served on the Claimant) in unredacted form.

(c) Those invoices contain privileged information relating to separate legal proceedings involving the Defendants in England and Wales.

(d) The invoices included in the Revised BOC have been redacted so that the privileged information is no longer visible.

(e) Since the Original BOC and the Amended BOC are no longer relevant to the Detailed Assessment, and include privileged materials, the disclosure of which risks prejudice to the Defendants in the abovementioned proceedings in England and Wales, we respectfully request that the Court grants an order requiring the Registry to remove the PDF files of the Original BOC and in the Amended BOC filed on 14 February, 13 March and 1 April 2024 from the eRegistry and any internal records of the DIFC Courts.

3. It is agreed that the application may be dealt with without a hearing.

BACKGROUND

4. On 19 June 2023 I discharged a without notice freezing order made on 2 May 2023 on the application of the Claimant and ordered that the Claimant shall pay the Defendants’ costs of the application to be assessed by the Registrar if not agreed.

5. On 18 September 2023 H.E. Justice Nassir Al Nasser ordered that the Claimant shall pay the Defendants USD 250,000 as an interim payment on account of the Defendants’ costs occasioned by these proceedings, pursuant to RDC 38.13, within 14 days of the Order.

6. On 16 February 2024 Onoma gave Notice of Commencement of Assessment of Bill of Costs attaching the Original BOC. On 13 March 2024 the Defendants filed a second copy of the Original BOC in support of an application for Request for a Default Costs Certificate, the Claimant having failed to serve any points of dispute.

7. The Original BOC failed to comply with paragraph 7 of Practice Direction of No. 5 of 2014 in that it did not include a statement signed by a registered practitioner that the bill accurately reflects the amounts which the Client is liable to pay and that there are no arrangements in place which will reduce the amount due and payable by the Client dependent on the outcome of the costs assessment. Accordingly, on 2 April 2024 the Defendant filed the Amended BOC which was the Original BOC with the addition of the following:

“This declaration is made pursuant to Par. 7 of the DIFC Courts’ Practice Direction No. 5 of 2014. I confirm that the statements of cost and the bills of cost enclosed to this declaration accurately reflects the amounts which our Clients are liable to pay and that there are no arrangements in place which will reduce the amount due and payable by our Client dependent on the outcome of the costs assessment. The costs are summarized below:

Onoma FZE:	USD 63,250.00
Faisal Osman:	USD 55,000.00
Jones Day, GBP 235,831.25	USD 297,942.00
Blackstone Chambers, GBP 71,793.12	USD 90,743.00
Grand Total	USD 506,935.00”

8. On 18 April 2024 the Claimant served Notice of Change of Legal Representative from Ince & Co Middle East LLP (Dubai branch) to Hadef & Partners (“Hadef”).

9. On 30 April 2024 by consent the deadline for the Claimant to file and serve its Points of Dispute, if any, was extended until 4pm on 6 May 2024.

10. On 9 May 2024 by consent it was ordered that (1) the Defendants shall file and serve a further revised Bill of Costs (“Revised BOC”) by 4pm (GST) on 13 May 2024; and (2) the Claimant shall file its response to the Revised BOC, if any, within 21 clear days from service of the Revised BOC. On 15 May 2024 the date for service of the Revised BOC was extended to 14 May 2024.

11. On 7 June 2024 the Defendants served the Revised BOC. The Revised BOC was identical to the Original and Amended BOCs save that large portions of the bill of Jones Day and the fee notes of counsel were redacted. Notwithstanding, the claim was unchanged.

12. On 12 July 2024, it was ordered by consent that the issue of the detailed assessment of the costs of these proceedings, the payment of the Interim Costs Order, and the issuance of any further costs orders, shall be stayed pending the final and unappealable determination of certain other pending proceedings before the courts of Sharjah and Dubai.

13. On 14 August 2024 the Defendants issued this application.

14. On 29 August 2024 the Claimant served the witness statement of Ms Harriet Lucy Mclaughlin Fong in opposition to the application. In her witness statement Ms Fong exhibited correspondence passing between Hadef and Onoma;

(a) Email 1 May 2024, Hadef to Onoma:

“The Revised BOC appears to be a collection of invoices from your firm, Jones Day, Faisal Osman of Counsel, Andrew Trott of Counsel and Anthony Peto KC of Counsel. We note that the invoices from Jones Day and Counsel significantly pre-date the commencement of these proceedings. Further, those invoices also appear to include time narratives which relate to proceedings happening in separate jurisdictions and are plainly not recoverable in these proceedings.

…

In light of the above observations, the Revised BOC has been prepared in a manner which makes a response by way of a Points of Dispute impossible for the Claimant to prepare. With that in mind, and to try and deal with matters promptly and without further wastage of costs by any of the parties, the Defendants are invited to agree to do the following:

1. Prepare and serve a further revised Bill of Costs in the manner which is expected in DIFC Court proceedings, and which (i) clearly identifies the costs claimed by the Defendants in the Notice of Commencement; (ii) adequately particularises (with full narratives) the costs claimed by the legal representatives of the Defendants so that the reasonableness of the same can be considered by the Claimant (and eventually the court); and (iii) is limited to matters which relate directly to these DIFC Court proceedings only (Compliant BOC), by close of business on Monday 6 May 2024; and

2. Agree that the time period for the Claimant to respond to the Compliance BOC shall be 21 days from service by the Defendants.”

(b) Email 3 May 2024 Onoma to Hadef –

“The Defendants agree in principle with the proposal set out in your email below, but they will require at least until 13 May 2024 to prepare a revised bill of cost. We note that Monday 6 May is a bank holiday in the UK. Please let us know if that would be acceptable for your client.”

“1. The Defendants served the Purported Revised BOC on 14 May 2024, but from a review of the eRegistry with the DIFC Court, the same was not filed with the DIFC Court.

2. The Claimant has made it very clear that the bills of costs filed by the Defendants in February and April of this year were not only insufficient to satisfy the Defendants' obligations in accordance with DIFC Court rule 40.5(2) but also lacked the required level of detail for the Claimant to be able to respond by way of a points of dispute. Despite this fact, the Purported Revised BOC does not provide the further detail required. This is not only due to the blanket and inappropriate redactions applied throughout, but also due to the failure of the Defendants to properly particularise how their claimed costs have been calculated, including lack of detail as to the fee earners involved and their respective charge out rates. It is not understood why the Defendants needed a further 2 weeks to apply bulk redactions to a document that had already been prepared several months ago.

3. Further, the "bills of costs" previously filed by the Defendants in February and April of this year were no more than a collection of invoices with no clear indication as to how the Defendants arrived at the figures for their claimed costs. As set out above, the purpose of a bill of costs is provide a forensic break down of the costs claimed by a party, enabling the receiving party and the court to clearly identify those figures have been arrived at. The Purported Revised BOC fails to do as explained in further detail below.

…

As to the issue of the claimed privilege in the bills of costs filed by the Defendants to date, no explanation has been put forward by the Defendants as to: i) why these documents are privileged, ii) the nature of that privilege, iii) or what steps the Defendants are going to take to seek to remove allegedly privileged material from the court record. In any event, the Claimant's position is that any privilege that existed in those documents has now been waived due to the purposeful and deliberate disclosure of the invoices contained in the bills of costs filed in February and April and the fact that the documents still remain on the court file available for download by any of the parties.”

(d) Email 7 June 2024 Onoma to Hadef –

“… our client’s obvious concern is that your client is impecunious and not able to pay the costs claimed.

In the circumstances, we propose to stay the Detailed Assessment Proceedings until your client pays the Interim Cost Order. The discussion regarding the remaining costs amounts claimed by our client can be resumed after your client pays the Interim Cost Order.”

(e) On 24 June 2024 Onoma wrote that“the Defendants agree in principle to stay the cost assessment proceedings”.

(f) On 8 July 2024 Onoma wrote to the Registry:

“The invoices included in the Original and in the Amended BOC were inadvertently provided in unredacted form; they contain privileged information relating to separate legal proceedings involving our clients. The invoices included in the Revised BOC have been redacted so that the privileged information is no longer visible.Since the Original BOC and the Amended BOC are no longer relevant to the Detailed Assessment, we are now writing to request that the Registry removes the PDF files of the Original BOC and in the Amended BOC filed on 16 February, 13 March and 2 April 2024 from the e-Registry.”

15. The Defendants replied by the Fifth Witness Statement of Mr Fedrigoli dated 5 September 2024. In his witness statement Mr Fedrigoli stated that the disclosure was inadvertent as a result of a miscommunication between himself and Jones Day, the English Solicitors of the Defendants. As a result of that miscommunication, the PDF binder with the invoices of both Jones Day and the counsel instructed in these proceedings, had been provided in an unredacted form, and related to both these proceedings and ongoing proceedings in other jurisdictions; hence it includes privileged information relating to separate legal proceedings in England and Wales. On the filing of the Unredacted BOCs in February, March and April 2024, that miscommunication subsisted and he had not shared those documents with Jones Day, hence, the inadvertent disclosures remained undiscovered.

16. He said there was no waiver of privilege.

17. The Defendants served written submissions in support of the application on 19 September 2024. The Claimant served written submissions in response to the application on 20 September 2024.

DISCUSSION

18. The Claimant’s primary position is that the application is premature on the basis that these proceedings are presently the subject of a stay in accordance with the consent order dated 12 July 2024. I am not attracted by this argument. First, the stay was not a general stay of the proceedings but a stay of the detailed assessment of the costs of these proceedings, the payment of the Interim Costs Order, and the issuance of any further costs orders. Secondly, even if that does amount, as the Claimant says, to a stay of the material remaining part of these proceedings, I do not consider that this application is affected by the stay. In my view it is an ancillary matter that does not form part of the claims for substantive relief. The Claimant argues that the BOCs are an integral part of the detailed assessment of the Defendants’ costs. That is true but this application concerns the form of the BOCs rather than their substance.

19. I do however consider the application to be misconceived. It seeks deletion of the unredacted BOCs from the eRegistry and from the internal records of the DIFC Courts. That is a pointless exercise. It does not seek to restrain any person who may have had access to the unredacted BOCs from using the information and their deletion on oath. These would be the normal orders sought in a case of inadvertent disclosure of privileged information. The order as sought would not prevent the Claimant from using the information in these proceedings. There is no evidence that the Claimant is seeking to use the information in any other proceedings.

20. I put this to one side and consider the merits of the application.

21. The first question is whether the material is privileged at all. I have therefore been obliged to examine the unredacted bills and fee notes. The Bills of Jones Day have been extensively redacted and I do accept that some of the narrative might possibly contain information that might attract privilege in relation to other matters as stated in the application. Bizarrely innocuous entries that do seem to relate to these proceedings have also been redacted. Judging by the headings of the fee notes of Mr Peto KC and Mr Trotter of counsel, they do relate to other proceedings.

22. Notwithstanding, even after the redactions the Defendants continue to claim the same sum by way of costs as they did based on the unredacted documents. That means that the sums claimed by the Defendants as their costs of these proceedings are grossly over-inflated. The Court will in due course require an explanation from Mr Fedrigoli why the certificate under paragraph 7 of Practice Direction of No. 5 of 2014 dated 14 May 2024 is unchanged as is the Statement of Costs dated 3 July 2023.

23. The Claimant submits that the Defendants have in any event waived any privilege that might otherwise have attached to the BOCs by deploying the unredacted BOCs on no less than three occasions - 14 February, 13 March and 1 April 2024. The Claimants dispute that the disclosure was “inadvertent”.

24. I am not willing to disbelieve an officer of the Court giving evidence under a statement of truth in the absence of compelling evidence. I accept that Mr Fedrigoli did not consciously intend to disclose privileged information. In fact, I am inclined to believe that he did not even realise that the information contained in the Original and Amended BOCs was privileged until Hadef pointed out that the documents did not relate to the present proceedings. I am therefore content to accept that the disclosure was inadvertent.

25. InMohamed Al Fayed & ors v The Commissioner of Police of the Metropolis& ors [2002] EWCA Civ 780, [16] the English Court of Appeal gave some practical guidance as to when privileged documents disclosed by mistake should be returned. I find that guidance to be equally applicable in the DIFC when applying RDC 28.67 which provides that“Where a party inadvertently allows a privileged document to be inspected, the party who has inspected the document may use it or its contents only with the permission of the Court”:

(a) A legal practitioner considering documents made available by the other party to litigation owes no duty of care to that party and is in general entitled to assume that any privilege which might otherwise have been claimed for such documents has been waived;

(b) In these circumstances, where a party has given inspection of documents, including privileged documents which it has allowed the other party to inspect by mistake, it will in general be too late for it to claim privilege in order to attempt to correct the mistake by obtaining injunctive relief;

(c) However, the Court has jurisdiction to intervene to prevent the use of documents made available for inspection by mistake where justice requires, as for example in the case of inspection procured by fraud;

(d) In the absence of fraud, all will depend upon the circumstances, but the Court may grant an injunction if the documents have been made available for inspection as a result of an obvious mistake;

(e) A mistake is likely to be held to be obvious and an injunction granted where the documents are received by a legal practitioner and:

(i) The legal practitioner appreciates that a mistake has been made before making some use of the documents; or

(ii) It would be obvious to a reasonable legal practitioner in their position that a mistake has been made;

and, in either case, there are no other circumstances which would make it unjust or inequitable to grant relief;

(f) Where a legal practitioner gives detailed consideration to the question whether the documents have been made available for inspection by mistake and honestly concludes that they have not, that fact will be a relevant (and in many cases an important) pointer to the conclusion that it would not be obvious to the reasonable legal practitioner that a mistake had been made, but is not conclusive; the decision remains a matter for the Court;

(g) In both the cases identified in 25(e) above there are many circumstances in which it may nevertheless be held to be inequitable or unjust to grant relief, but all will depend upon the particular circumstances;

(h) Since the Court is exercising an equitable jurisdiction, there are no rigid rules.

26. I reiterate that in the present case, for reasons that are not immediately apparent, the Defendants are not seeking equitable relief. Despite that, it seems to me that theAl Fayadguidance applies equally to the relief that is claimed. The question of“obvious mistake”is clearly one of fact in all the circumstances judged by the criterion of the hypothetical reasonable legal practitioner (seeInternational Business Machines Corp and another v Phoenix International (Computers) Ltd [1995] 1 All ER 413, 423d per Aldous J as he then was).

27. Hadef owed no duty of care to the Defendants and was entitled to assume that any privilege which might otherwise have been claimed for the documents had been waived. By 1 May 2024 Hadef had viewed the documents and had detected that they did not relate to these proceedings. Onoma say in their written submissions of 19 September 2024 that they wrote to Hadef on 9 May 2024 to advise them that the invoices appended to the Original BOC and the Amended BOC had inadvertently been provided in an unredacted form and that those invoices were privileged.

28. I consider that by then it was too late to claim privilege in order to attempt to correct the mistake. While the Court does retain jurisdiction to intervene to prevent the use of documents made available for inspection by mistake, I consider that in the circumstances of this case it is not appropriate to exercise that jurisdiction as in my judgment it cannot be said that the unredacted documents were made available for inspection as a result of an obvious mistake.

29. I do not consider that it would have been obvious to a reasonable legal practitioner that a mistake had been made. Far from it – the documents had been deployed on three separate occasions in non-redacted form and the totality of the documents was relied upon in order to support the costs claimed.

CONCLUSION

30. I am not satisfied that all the material that has been redacted could be said to be privileged.

31. Insofar as any of the documents may have been privileged I am satisfied that privilege has been impliedly waived by their disclosure and that this is not a case where the Court should intervene to restrain the use of the documents by the opposing party. The opposing party had no reason to believe that the documents were disclosed by mistake.

32. If and insofar as necessary I give the Claimant permission to use the documents in these proceedings under RDC 28.67.

DISPOSITION

33. The Defendants’ application is dismissed.

34. To the extent necessary the Court grants permission to use the documents annexed to the Bills Costs of 14 February, 13 March and 1 April 2024 in these proceedings in unredacted form.

35. The Defendants shall pay its costs of the application to the Claimant to be assessed on the standard basis in default of agreement. I shall not order an immediate assessment of the costs as they can be included in the pending assessment and deducted by way of set off.

The Dubai International Financial Centre

CFI 028/2023 Globe Investment Holdings Limited v (1) Commercial Bank Of Dubai (2) Hortin Holding Limited (3) Lodge Hill Limited (4) Westdene Investment Limited (5) 1897 (Cayman) Limited

	[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]
	The Dubai International Financial Centre
You are here: BAILII >> Databases >> The Dubai International Financial Centre >> Globe Investment Holdings Limited v (1) Commercial Bank Of Dubai (2) Hortin Holding Limited (3) Lodge Hill Limited (4) Westdene Investment Limited (5) 1897 (Cayman) Limited [2024] DIFC CFI 028 (25 September 2024) URL: http://www.bailii.org/ae/cases/DIFC/2024/DCFI_028.html Cite as: [2024] DIFC CFI 28, [2024] DIFC CFI 028