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Ahmed & Anor v Mustafa [2014] EWCA Civ 277

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The wife was seeking to appeal against a range of orders, including an anti-suit injunction restraining her from commencing or carrying on any proceedings in any jurisdiction, but in particular in TRNC

  • In a tweet: An anti suit injunction was imposed to prevent W re-litigating final order in Turk Rep of N Cyprus

    Summary: Following contested financial proceedings, a final financial order had been made which, amongst other things, apportioned the ownership of various properties in England and the Turkish Republic of Northern Cyprus ("TRNC" – the couple both came from TRNC and had retained some connections there despite living in England for over 40 years) to the husband ("H") and wife ("W").  H was to transfer to W a property known as Quested Court and also pay to her a lump sum of £31,000. The order went on to provide that neither party was entitled to make any further application in relation to their marriage in either England and Wales or in any other jurisdiction.  

    W had also previously given an undertaking to the court not to deal with property in TRNC or litigate in TRNC until "further order or final order in these proceedings".  

    W went to live permanently in TRNC and promptly issued a petition for divorce there together with a fresh claim for financial provision which went over and above that which she had received in the English proceedings. At about the same time, W was also refused permission to appeal the final financial order and decree absolute was granted on H's application. In accordance with the financial order, H transferred to W Quested Court which W then promptly "gifted" to her daughter. H did not though pay to W the lump sum.  

    At first instance, the judge focused on whether W had breached her undertaking by transferring Quested Court to her daughter and/or seeking to re-litigate matters in TRNC. The undertaking was not clear and the reference to "final order in these proceedings" referred either to the making of the financial provision order in December 2011 or the granting of decree absolute in May 2012. If it were the latter, then W's institution of fresh divorce proceedings in TRNC on 3rd April 2012 would be a breach of the undertaking.

    At first instance, H successfully obtained a number of orders which aimed to preserve the integrity of the financial order and prevent W from re-litigating her claims in TRNC: 

    • an anti suit injunction restraining W from commencing or carrying on any litigation in connection with their marriage in any jurisdiction; 
    • a stay on any attempt by W to seek enforcement of the outstanding lump sum (with the proviso that W could apply for a release of the stay upon final withdrawal of all the financial proceedings in TRNC); 
    • a purported s.37 MCA 1973 order setting aside the transfer of Quested Court to W's daughter; and 
    • an injunction under s.37(2)(a) prohibiting W from selling, mortgaging or otherwise disposing of the property until further order or final withdrawal of all proceedings claiming financial relief in TRNC. 

    W was also at the receiving end of a £12,500 costs order. W's application to enforce the lump sum was refused and the first instance judge, having deemed that W had applied to re-open and/or set aside the final financial order, also refused those deemed applications. W was not present at the first instance hearing and she appealed the orders made.  

    Held: W's appeal was allowed in part.  

    So where did W succeed? Her appeal against the transfer of Quested Court and the related injunction were allowed. The Court of Appeal held that the wording of s.37 was quite clear that a set aside could only apply to an extant application for financial remedy and not, as here, after a final order had already been made.  

    W also succeeded in relation to the refusal of the deemed application. W had not issued an application to set aside the final order (she had only raised assertions that H had failed to provide full and frank disclosure) and therefore it had not been open to the judge to deem that application made. Neither should the judge have proceeded in W's absence to dismiss the deemed application without hearing any evidence from W.  

    By default, you can see that W's appeal against the anti-suit injunction and the stay of her enforcement proceedings was dismissed.  

    Turning to the anti-suit injunction first, Lord Justice McFarlane (who gave the leading judgment) applied the cases of South Carolina Insurance Co v Assurantie Maatschappij "De Zeven Provincien" NV [1987] and Masri v Consolidated Contractors International (UK) Limited and ors (Number 3) [2009] and held that this case fell under the second aspect of the anti-suit injunction test – that it had to be shown that W's attempt to re-litigate matters in a foreign jurisdiction was "unconscionable".

    The appeal court judges were unconvinced by W's arguments that there was nothing objectionable in a foreign country revisiting financial relief after the English courts had made a substantive order. Lord Justice McFarlane said that the High Court did have jurisdiction to restrain a litigant, in personam, from re-litigating matters in a foreign jurisdiction where it was unconscionable to do so. And although there were provisions such as Part III MFPA 1984 which were internationally acceptable, that did not rule out the existence of cases where it was unconscionable to contemplate either party seeking to have the  very same issues re-determined before a different court. Here, W's conduct was significant. She had, for example, initiated the divorce and financial proceedings in England, she had attempted to appeal the ultimate decision, had given an undertaking to the court not to pursue matters in TRNC until the conclusion of the English proceedings and had never given any indication that she would seek to re-open matters in TRNC. Further, there was no evidence to suggest that the courts in TRNC did not accept the existing decree absolute so as to justify removing the injunction. The trial judge, Lord Justice McFarlane held, had been entitled to order the anti-suit injunction and entitled to find that W's conduct was vexatious and oppressive.  

    W's application to enforce the lump sum payment was also stayed, on Hadkinson principles. It was clear that W had breached the undertaking she had given to the court – the Court of Appeal agreed with the trial judge that the "final order" referred to had to be the decree absolute because, until that point, the financial order could not come into effect. The trial judge therefore had been justified in taking an adverse view of W's conduct and thus his decision to refuse to enforce the lump sum, at least until there was clarity and resolution of any proceedings within TRNC, was within that discretion.  

    Costs were subject to separate consideration.


Published: 28/04/2014

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