Neutral Citation Number: [2011] EWHC 1019 (Comm)
Case No: CLAIM NO.2010 FOLIO 1157
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT

Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 19/04/2011

Before :

THE HON. MR JUSTICE BEATSON
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Between :

	DUBAI ISLAMIC BANK PJSC	Claimant	
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	PSI ENERGY HOLDING COMPANY BSC
RYAN CORNELIUS
CHARLES RIDLEY
EREN NIL
CCH(EUROPE) GmbH	Defendants	

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Stephen Phillips QC and Fred Hobson (instructed by Hogan Lovells International LLP) for the Claimant 
Max Mallin (instructed by Archerfield Partners LLP) for the First and Second Defendants
Mr David Mills, a non-practising solicitor, was granted an ad-hoc right of audience on behalf of the Third Defendant 

Hearing dates: 30-31 March 2011
Further submissions: 4 and 6 April 2011
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Judgment

The Hon. Mr Justice Beatson :
Introduction
1.	On 5 October 2010 Gloster J granted the claimant, Dubai Islamic Bank PSJC (hereafter “the Bank”) worldwide freezing and related relief including permission to serve out of the jurisdiction against the first to fifth defendants on a without notice basis. The Bank, one of the largest banks in the Middle East, alleges that it was the victim of a receivables fraud perpetrated by the second to the fifth defendants. The second and third defendants, Ryan Cornelius and Charles Ridley, have been in custody in Dubai since May 2008.  They are charged with criminal fraud against the bank. 
2.	The relief was sought and granted in respect of the Bank’s claim under a Restructuring Agreement (“the RSA”) made between it and the second to the fifth defendants on 19 August 2007. Under the RSA the fifth defendant, CCH (Europe) GmbH, and its parent CCH International plc (hereafter “the CCH companies”) agreed to repay some US$ 501 million to the Bank and the second to the fourth defendants agreed to guarantee the CCH companies’ obligation and to disclose their assets and to provide security over and transfer to the Bank proceeds derived from advances made by the Bank to the CCH companies. The immediate catalyst for the application that came before Gloster J was a transaction whereby a relatively illiquid shareholding owned by the first defendant, PSI Energy Holding Company BSC (hereafter “PSI”), a Bahrain company controlled by Mr Cornelius, was to be exchanged for shares in Afren plc, a company listed on the London Stock Exchange and in the FTSE 250 index. On the return date, 29 October, it was agreed at the hearing before Simon J that the freezing relief should continue with amendments which are not material for present purposes but that the defendants should have permission to apply to set aside or discharge the injunction without having to show a material change of circumstances. 
3.	I have before me two applications. The first, issued on 25 November 2010 by PSI and Mr Cornelius, is to discharge or set aside Simon J’s order. The third defendant, Charles Ridley, also applies for the discharge of Simon J’s order. The second application is a jurisdiction challenge by PSI and Mr Cornelius seeking the staying or dismissal of the proceedings issued on 6 October on the basis that the court has no jurisdiction or should decline to exercise such jurisdiction as it has. These defendants indicated their intention to challenge the jurisdiction of the English court on 10 November 2010 and the application was issued on 31 December. The third defendant, Charles Ridley, does not challenge the jurisdiction of this court. By the time the application challenging jurisdiction was lodged, Gloster J had given directions and set a timetable for this hearing, and ordered the second and third defendants to make disclosure of assets: see her order dated 20 December 2010. 
4.	The jurisdiction challenge by PSI and Mr Cornelius has two strands. The first is that the effect of proceedings in Bahrain, including the Bank’s claim in May 2009 and a counterclaim lodged in February 2010 is that the parties are no longer bound by an exclusive jurisdiction agreement in the RSA in favour of the English court. It is submitted that the Bank was either in repudiatory breach of the agreement, which breach was accepted by the defendants as discharging it, or that the Bank is estopped from relying on the agreement. The second strand assumes that there is jurisdiction, but maintains that there are strong reasons for this court not to exercise it both because the multiplicity of proceedings gives rise to the risk of conflicting judgments and because it was the Bank which first instituted proceedings in Bahrain which it now proposes should be stayed.
5.	Mr Ridley is not legally represented.  At the beginning of the hearing, in accordance with the Master of the Rolls and the President of the Family Division’s Practice Guidance on Mackenzie Friends, he made an application that Mr David Mills, a solicitor who has not been on the Solicitors’ Roll for some two years, be granted a right of audience on his behalf. Having regard to the terms of paragraphs 19-23 of the Guidance, I granted Mr Mills a right of audience for the purposes of Mr Ridley’s present application.
6.	On the issue of jurisdiction, the submissions of Mr Stephen Phillips QC, on behalf of the Bank, and Mr Max Mallin, on behalf of PSI and Mr Cornelius, rely in different ways on other proceedings involving all or some of the parties to these proceedings. Accordingly, before turning to the applications before me, I list those. Chronologically, the first is a claim brought in July 2008 by the second and third defendants for declarations that the defendants were not in default under the RSA and that the Bank had not been entitled to declare an event of default under the RSA.  On 14 July 2008 Tomlinson J discharged an injunction granted out of hours and without notice by Simon J on 6 July 2008 restraining the exercise by the bank of its security rights under the agreement. Tomlinson J held that there was no serious issue to be tried, i.e. it was not arguable that the defendants were not in default. No further steps have been taken in these proceedings. 
7.	Secondly, there are the proceedings in Bahrain, to which I have referred. In May 2009 the Bank commenced a claim against the second to fourth defendants for US$30 million of what it describes as the “profit element” under the RSA with ancillary attachment orders in respect of Bahrain property. The third claim is one commenced on 23 February 2010 in Bahrain against the Bank by the second to fifth defendants and two other parties.  It is in effect a counterclaim to the Bank’s Bahrain claim. This claim seeks an order that part of the security given under the RSA, in respect of a lease of property called Plantation, is worth more than the value of the debt under the RSA and that the Bank, having taken title to it, should repay the difference. 
8.	By orders dated 1 March 2010 and 24 January 2011 the Bahrain Court consolidated the Bank’s claim and the defendants’ counterclaim. On 21 February 2011 the Bahrain Court appointed Mr Abdulaziz, a banking and accounting expert, to consider inter alia:
“whether or not [the Bank] did in fact acquire Plantation holdings and the date that acquisition took place, and to establish the debtor/creditor position of each of the conflicting parties, and finalisation of the settlement of the accounts between them, and to examine the basis of their agreements. ”

Mr Abdulaziz’s fees have been paid and Mr Abdulla, Mr Cornelius’s Bahraini lawyer, estimates that he will produce his report by September 2011, the Court will give judgment by January 2012, and an appeal should be concluded by April 2012 . Mr Radhi, the Bank’s Bahrain lawyer, considers the most likely timetable is a first instance judgment in December 2012 and a further year before any appeal is resolved.
9.	The fourth set of proceedings is a claim made by the Bank ancillary to Dubai criminal proceedings in the capacity of a “partie civile”, for compensation equivalent to some US$70,000.   For completeness, I should also mention that there was an issue between the Bank and the fourth defendant, Mr Eren Nil, as to whether he has been served properly, which was determined in the Bank’s favour by HHJ Chambers QC, but which may be the subject of an appeal by Mr Nil. 
The evidence
10.	The evidence on behalf of the Bank consists of two affidavits by Hugh Jonathan Lyons, a partner in the firm of Hogan Lovells International LLP, dated 5 and 22 October, and four witness statements by him dated 9 and 16 December 2010 and 14 February and 23 March 2011, and a statement of Hassan Radhi, a Bahraini lawyer dated 14 February 2011. The evidence on behalf of the first and second defendants consists of two affidavits of Matthew Dowd, a partner in the firm Archerfield Partners LLP, respectively dated 26 November 2010 and 10 January 2011, and witness statements by him dated 16 and 18 March 2011, a witness statement of the second defendant, Ryan Cornelius, dated 14 March 2011, and one of Ahmed Jassim Abdulla, a Bahraini lawyer, dated 21 March 2011. There are also two witness statements of Charles Ridley, the third defendant, dated 29 November 2010 and 21 March 2011, and a number of other responses by him dated 29 November and 13 and 16 December 2010.  

11.	At the hearing an issue arose as to the position taken by the second to the fifth defendants in the Bahrain counterclaim as pleaded in respect of further proceedings by the Bank and questions were raised about the translations of the pleaded counterclaim that were before the Court.  I gave permission for further evidence on this and have received a second statement of Mr Abdulla dated 4 April 2011 on behalf of the second defendant and a further statement of Mr Lyons dated 6 April 2011 on behalf of the Bank.  
Summary of the facts and the proceedings in the UK and in Bahrain 
12.	I summarise the facts and the procedural history in a broadly chronological order. What occurred before the without notice hearing before Gloster J on 5 October, is usefully summarised in the Bank’s skeleton argument prepared for that hearing, and  the pre-October 2010 material that follows is largely based on that.
13.	Since 2002 the Bank has entered into trade financing agreements with the fifth defendant, CCH (Europe) GmbH and its parent company CCH International plc. The relevant CCH company, acting as agent for the Bank, was to enter into trade finance contracts with third parties. The counter-parties were typically to be a seller who had extended credit terms to its buyer and wished to obtain financing from the bank by assigning the receivable to the bank. The arrangement was that the relevant CCH company would present documentation to the bank relating to an underlying sale transaction, the bank would then release funds to the company, and the company would in turn remit the funds to the seller. The bank advanced some US$500 million pursuant to such agency agreements, most of which was advanced pursuant to agreements entered with CCH (Europe) GmbH. It thought those funds were being applied for the purpose of legitimate trade financing in accordance with the agency agreement but in fact the bank was the victim of a substantial receivables fraud, which it discovered in the summer of 2007. Only some US$160 million had been used to fund legitimate trade finance transactions. Some US$330 million had been fraudulently diverted.
14.	The bank maintains that the main participants in the fraud were the second, third and fourth defendants. Mr Ridley is said to be its main architect. He and Mr Cornelius are both British citizens who have spent many years in the Middle East. The fourth defendant, Eren Nil, was the majority shareholder and chairman of CCH International PLC. He is in Turkey and is the subject of an Interpol arrest warrant. 
15.	According to the bank, Messrs Ridley and Nil employed a team to create fictitious documents showing underlying sale and purchase transactions in which the purported seller was one of a number of companies controlled by Mr Cornelius. Documentation showing that a sum was due to one of Mr Cornelius’s companies was presented to the bank which then released funds to the seller through the relevant CCH company.  
16.	The funds were diverted in a number of ways.  The most significant expenditure went on a project to build an oil refinery in Pakistan. But, for the purpose of the applications before me, the focus is on some US$5 million spent by PSI on shares in a British Virgin Islands (hereafter “BVI”) company called Black Marlin Energy Holdings Ltd, US$18 million spent on the development of property in Dubai leased for this purpose to a company called Plantation Holdings FZ LLC (hereafter “Plantation”) by Dubai Land LLC, and US$37 million spent on property in Bahrain in the name of Interstate Properties BSC. PSI is controlled by Mr Cornelius through his ownership of Kifaru Holding Company BSC (“Kifaru”). Mr Cornelius also has a majority interest in Interstate Properties BSC through his ownership of Kifaru. As to Plantation, Mr Cornelius had a minority interest in it and the majority interest was held by Arthur Fitzwilliam. Mr Cornelius accepts that various assets were purchased using the Bank’s money but (statement, paragraph 10 and see also Mr Dowd’s first affidavit, paragraph 29) does not say the money had been misappropriated and maintains that he was not party to and had no knowledge of any fraud. 
17.	After the fraud was discovered, on 19 August 2007 the bank entered into the RSA under which the relevant parties agreed to provide for repayment of sums due to the bank. The material provisions are summarised below.  The second to the fifth defendants were parties to the RSA but the first defendant was not. The CCH companies agreed to repay about US$501 million pursuant to a repayment schedule. In settlement of any potential claims against them in respect of the application of the advances, the second to fourth defendants provided a guarantee and indemnity in respect of that repayment obligation.  They also promised to disclose all their assets with a market value of over US$10,000 and to provide security over and transfer to the bank all proceeds derived from advances.  
18.	Recitals A and B of the RSA record that the Bank had advanced funds and CCH (Europe) GmbH and CCH International plc were indebted to the Bank in respect of those advances. Recital D records that Messrs Cornelius, Ridley, and Nil (“the individual guarantors”) guaranteed the obligations of the CCH companies under the RSA. The important provisions of the RSA  can be summarised as follows:-

(1)	Assets with a realisable market value of US$10,000 materially funded by the advances, whether directly or indirectly are, by clause 1, defined as “Proceeds Assets”.  
(2)	By clause 12.4 the Bank waived and compromised claims against the individual guarantors, but did not release claims to Proceeds Assets.
(3)	Clause 12.6 states that the Bank and the CCH companies acknowledged that the CCH companies and the individual guarantors entered into the RSA “without any admission of liability with respect to any allegations that monies received by them have been applied otherwise than in accordance with the agency agreements”. 
(4)	By Clauses 4(1) and 7(1) the CCH companies agreed to repay the bank US$501 million over three years in accordance with the schedule to the agreement.  
(5)	By Clause 6(1), the second, third and fourth defendants provided a guarantee and indemnity in respect of CCH (Europe) GmbH’s obligation to repay.  
(6)	Clause 7(2)(g) obliged Messrs Cornelius, Ridley and Nil to take reasonable steps to procure that any Proceeds Asset as defined in clause 1 “shall be applied forthwith upon receipt and in mandatory repayment” of the sum due under the agreement.  
(7)	Clause 8 provided for the provision of security by inter alia Messrs Cornelius, Ridley and Nil. Clause 8.2 provided for the grant to the bank of a first ranking charge over the lease of Plantation by way of a conditional assignment of its lease; clause 8.4 provided that Mr Cornelius was to grant the bank a charge over certain property in Bahrain, clause 8.6 provided that the guarantors were to grant security to the bank over “material assets”, defined as any asset with a value of over US$ 150,000, and clause 8.4(a) provided that the guarantors were to pay US$ 30 million “profit” to the bank within four years.
(8)	The RSA contains extensive disclosure obligations. For instance, clauses 17.4 and 17.5 required the second and third defendants to provide disclosure to the bank explaining how the funds advanced by the bank were applied and identifying all “Proceeds Assets” of which they were aware.  See also clause 13.1.
(9)	Clause 18 provides that the bank is entitled to make an immediate demand for the full amount owing to it upon the occurrence of various events of default.  Clauses 18.2 and 18.3 relate to Plantation. The Bank could not exercise its rights under the conditional assignment of the Plantation lease until a “Plantation Enforcement Event” occurred (clause 18.2) and if, having enforced the security, it sought to sell the lease it was (clause 18.3) obliged to commission a valuation by an independent valuer to determine the market price, and inter alia to inform Arthur Fitzwilliam of the instructions, to market the lease for a reasonable period, to seek to achieve best value, and to return any surplus from the sale proceeds to Plantation. 

19.	 As to choice of law and jurisdiction, Clause 27.1 provides that the RSA is governed by and is to be construed in accordance with English law, save in so far as inconsistent with principles of Sharia law. Clause 27.2 provides: 

“The parties submit to the exclusive jurisdiction of the English Courts with respect to all disputes arising out of or in connection with the terms of this [RSA]. The parties agree that the courts of England are the most appropriate and convenient courts to settle disputes and accordingly no party to this [RSA] will argue to the contrary.” 
20.	At some stage after the RSA, the Bank entered into a separate “Assignment Agreement” with the owners of the Plantation Lease, Arthur Fitzwilliam and Mr Cornelius, and the freeholder, Dubai Land LLC. The signed agreement before me is undated. Mr Ridley’s evidence is that he believes it was signed in late August or September 2007. In relation to both the RSA and the Assignment Agreement the Bank was advised by its present solicitors, Messrs Cornelius and Ridley were advised by SJ Berwin and Mr Fitzwilliam was advised by Clifford Chance. The following summary of the material terms of the Assignment Agreement is based on that in paragraphs 8 and 20 (note 9) of Mr Mills’s skeleton argument:
(1)	The owner of the Plantation irrevocably assigned all its right, title and interest in the Plantation lease to the Bank if, in the Bank's reasonable opinion, a relevant event of default [under the RSA] had occurred (clause 2.1).
(2)	The assignment of the lease to the Plantation (which constituted all the transferor lessee's right, title and interest) could only occur if the Bank had served a notice certifying that in its opinion there had been an event of default under the RSA (clauses 2.3 and 2.5).
(3)	"Upon the assignment of the Lease under the terms of Clause 2.3, all rights, title and interest of Plantation in the Premises and the Lease shall be assigned from Plantation to [the Bank] and [the Bank] shall be substituted for Plantation as a contracting party as if [the Bank] were the original purchaser thereunder." (clause 2.6).
(4)	"In general, all rights, interest and title whatsoever held by the [transferor lessee] in relation to the Premises under the Lease (i.e. the Plantation) shall be deemed to be irrevocably transferred and assigned to the [the Bank] other than as provided in the RSA." (clause 3.1(c)).
(5)	The Assignment Agreement is supplementary to the Plantation lease and the RSA and is to prevail in the event of any conflict between it, the RSA or "any other agreements, representations or arrangements between [the Bank and Plantation]" (clause 4.4).
(6)	The Assignment Agreement is subject to the laws of the UAE and the law of Dubai, whose courts have exclusive jurisdiction. (clause 4.6).
Neither the RSA nor the Assignment Agreement makes express provision as to how and as at what date the Plantation was to be valued in the event of its transfer to the Bank.
21.	On 9 June 2008 the Bank served a default notice threatening to exercise its rights in relation to Plantation.  On 21 July 2008 it served a written demand on the second to fifth defendants pursuant to clause 18 of the RSA for immediate repayment of the principal amount of US$440.8 million remaining due and the profit element of US$30 million owed under clause 8.4(a) of the RSA.  The Bank took title to the Plantation lease in August 2008 and still holds it.  On 11 September 2008, the Bank announced that “following enforcement of the security, [it] has assumed ownership of the land known as Plantation project, which covers the bank’s exposure to the transaction in question. At all times, [the Bank] had strong control of its security, as well as other securities covering the same transaction, and waited on foreclosure as per the requirements of the foreclosure process”. There is evidence that shortly before the Bank took title to Plantation, it had been valued by DTZ (on 13 July 2008) and Jones Lang LaSalle (on 11 August 2008) at about US$ 1.1 billion: see Mr Cornelius’s statement, paragraph 14 and Mr Ridley’s second statement, paragraph 7.2, which describes the valuations as on a “where is as is” basis. An announcement by the Bank on 2 November 2008 stated that ownership in the Plantation project had been transferred to it and that Arthur Fitzwilliam and Plantation Holdings FZ LLC are not the owners. Plantation’s management and contractors employed by it left the site in November 2008.   
22.	The proceedings brought in July 2008 by the second and third defendants claiming declarations that the defendants were not in default under the RSA were instituted as a result of the June demand.  The second and third defendants maintain that the first repayment by them was not due until 20 October 2008, but that in any event their debt was extinguished in August 2008 when the Bank enforced its security over the Plantation property development, and took title to the lease.   
23.	I have referred to the proceedings issued by the Bank in Bahrain in May 2009. Mr Lyons’s first affidavit (paragraph 210) recognised that the institution of those proceedings was a breach of clause 27 of the RSA, but characterises this as a technical breach. He also states that the proceedings relate only to the US$30 million “profit” payable under clause 8.4(a) of the RSA, but does not refer to the reservation in the Bank’s pleading (see below) of the right to claim the entire sum due. His third statement, made on 11 February 2011, states (paragraphs 29 and 32) that Mr Cornelius’s disclosure under the RSA revealed assets of some US$ 37 million in Bahrain funded using money from the Bank and that with the sums spent in acquiring the shares in the Ocean Sports Hotel in Kenya, the Big Yellow storage facility and Aject, a Bahrain construction company, some US$50 million of the misappropriated money had been spent in Bahrain. He stated the reason those proceedings were instituted was that the Bank feared that in the absence of protective relief those assets would be dissipated.   
24.	I turn to the pleadings in the Bank’s Bahrain claim. A section entitled “facts and reasons” summarised the terms of the RSA and maintains that Plantation has breached the RSA in a number of ways, in particular in relation to payments to be made and information required to be provided. Neither this section nor any other part of the pleading refers to the jurisdiction agreement in clause 27.2 of the RSA.   
25.	As to the claim, the second paragraph of a sub-heading entitled “The scope of such lawsuit” states:
“Whereas the plaintiff is entitled to request the Defendants to pay all indebted amounts whether the original debts or the profit amount …. The Plaintiff limits his requests in the lawsuit by requesting the profit amount valuing (thirty Million US Dollars) in addition to his right in requesting the Defendants  and other debtors with paying the total original debt whether in independent lawsuit or by modifying his requests in this lawsuit.” (translation by Kamil Bashir Legal Translation, Abu Dhabi)” 

A section entitled “taking precautionary and temporal procedures against the defendants” refers, under a sub-heading “to indicate the requesting reasons and proofs”, to Article 176 of the Procedural Law which permits the court on the plaintiff’s request to effect precautionary attachment on the Defendant’s funds if the plaintiff has significant reasons to fear the Defendant “smuggling or disposing [of] funds with the purpose of hindering or delaying of judgment execution”. The next-subheadings list Mr Cornelius’s shareholdings and other assets in Bahrain and the bank accounts of Messrs Ridley and Nil in respect of which attachment was sought. 
26.	The Bank’s Bahrain lawyer, Mr Radhi, states (paragraph 10) that the primary purpose of the Bahrain claim was to enable the Bank to apply for attachment orders over the defendants’ assets because it was concerned that Mr Cornelius in particular was dissipating his assets and failing to account for “Proceeds Assets” in accordance with his obligations under the RSA. He also states (paragraph 11) that he advised that the Bahrain Court has power to grant precautionary relief but that an application for an attachment order had to be accompanied by substantive proceedings in Bahrain. He states that, although “it is technically possible” under Article 19 of the Bahraini Civil and Commercial Procedures Law for precautionary relief to be granted in support of foreign proceedings, in his years of practice he had “not come across such a case”.  He advised that the only way to safeguard assets in Bahrain from dissipation was “to apply for an attachment order in Bahrain ancillary to proceedings in Bahrain”. 

27.	As to the reservation by the Bank of the right to amend in order to claim the balance of the sums due, Mr Radhi states (paragraph 15) that he was concerned that “proceedings would be complicated by a defence that might be raised as to the jurisdiction of Bahraini Courts” and that “the prudent course for the Bank” if it wished to pursue those claims was to do so in England. With regard to the defendants’ defence and counterclaim that by enforcing its security over Plantation and transferring the lease into its name and taking possession of the property the obligations under the RSA have been discharged, Mr Radhi states (paragraph 22) that the Bahrain court is likely to rule that it does not have jurisdiction to hear the dispute but that the issue of jurisdiction will, under Bahraini procedure, only be addressed when the court gives its final judgment. 
28.	The defendants filed a “Reply Memo”. This stated inter alia:

“The defendants kindly request the court to refer that the original indebtedness claimed by the plaintiff bank has been entirely expired in return for transfer of Plantation Co, project ownership, as a guarantee, to the plaintiff Bank as mentioned in the [RSA]. The ownership of the project was transferred to the [Bank] whereby the original indebtedness, as proved in the documents enclosed herewith….” (translation by Kamil Bashir Legal Translation, Abu Dhabi)”

The defendants also sought the reference of the lawsuit to an expert “to indicate the nature of the relationship between the litigants”, the accounts between them, and, if the Bank has taken ownership, the project value when the agreement was signed. The defence was thus that taking title to Plantation, extinguished the debt. I have referred to the valuations of a sum considerably in excess of the amount owed under the RSA by DTZ and Jones Lang LaSalle. The counterclaim later brought against the Bank, sought the repayment of the amount by which the value exceeded the debt.
29.	The Bank responded with a “Reply Memo” of its own, referring to a hearing on 1 February 2010. It rejected the claim that the transfer of Plantation discharged the defendants’ obligations and stated that the request that an expert be appointed “is futile as the relationship … is clear and established based on the [RSA] and the plaintiff has proved the obligation of the defendants of the amount of the claim amount in addition to proving their indebtedness with an amount exceeding five hundred and one million US dollars”.    
30.	On 23 February 2010 CCH (Europe) GmbH, Messrs Cornelius, Ridley, Nil and Fitzwilliam, and Plantation filed their counterclaim.  Their pleading relied on the fact that the Bank instituted proceedings in Bahrain and accepted Bahrain jurisdiction as the basis of the jurisdiction of the Bahrain court in respect of the counterclaim and pleaded their case as to the effect of the enforcement of the security over Plantation on the indebtedness under the RSA. I have referred to the issue that arose during the hearing as to the position taken by the defendants in the last sentence of the sub-heading “Bahraini jurisdiction” in the section of their counterclaim on “Lawsuit grounds” as to further proceedings by the Bank and to the additional evidence received, including a further translation of the relevant part of the pleadings. I shall set out the translations when dealing with the significance of this matter.    
31.	The Bank filed a defence to the counterclaim. It reserved its rights in relation to the counterclaims made by CCH (Europe) GmbH, Arthur Fitzwilliam, and Plantation, who were not defendants to its own Bahrain claim. The section on reservations states that “addressing the summary claim or the objective claim shall not, under any circumstances whatsoever, constitute an acknowledgment or acceptance of the courts of Bahrain to hear the so-called cross law suit filed by the aforementioned”. The section on defence also rejected the claims of Mr Fitzwilliam and Plantation and challenged the competence of the Bahrain court. The bank did not, however, expressly make any reservation in relation to Messrs Cornelius, Ridley, and Nil or reserve the right to oppose jurisdiction on the basis of the jurisdiction agreement in the RSA or the RSA generally.     
32.	I have referred to the Orders of the Bahraini Court ordering the consolidation of the Bank’s claim and the counterclaim, and the appointment of the expert on 21 February 2011. Mr Abdulla’s evidence (statement, paragraph 18) is that consolidation would not have been ordered if the Court had not accepted that it had jurisdiction to hear the counterclaim. The evidence on behalf of the Bank is (see Lyons, third statement paragraphs 51-53, Radhi, paragraphs 21-22) is that consolidation will not mean that the claim and the counterclaim will be dealt with by a single verdict, and that the Bank has not acceded to the Bahrain jurisdiction.    
33.	I now come to the events which were the immediate cause of the without notice application that came before Gloster J and these proceedings. I have referred to Black Marlin Energy Ltd.  Its annual report for the year ended 31 December 2007 states that PSI holds 17,083,333 shares in Black Marlin Energy. PSI, as I have stated, is controlled by Mr Cornelius. The Bank maintains that PSI’s shareholding in Black Marlin Energy was acquired with the proceeds of the fraud. The first affidavit of Mr Lyons (paragraphs 138 – 148) states that Mr Cornelius’s disclosure shows that a subscription of 3.75 million shares was funded by advances made by the bank. Mr Lyons also states that PSI made a loan of some US$4.07 million to Black Marlin Energy using funds advanced by the Bank; and that loan was converted into 13.33 million shares in Black Marlin Energy. The Bank’s case is that, as a result of this, the first defendant held 17,083,333 shares in Black Marlin Energy, which shareholding was acquired using monies diverted from the Bank. 
34.	In November 2009 Black Marlin Energy was acquired by a company which changed its name to Black Marlin Energy Holdings Ltd, another BVI company, which is listed on the Toronto Stock Exchange Venture Exchange. As a result of this, PSI’s holding of shares in Black Marlin Energy was converted on a one-for-one basis into a holding of the same number of shares in Black Marlin Energy Holdings.  Mr Barker, the CEO of the first defendant and a board member of Black Marlin Energy Holdings, informed the Bank’s solicitors on 18 August 2010 that the first defendant held the 17 million shares in Black Marlin Energy Holdings.   
35.	At the date of the without notice application which came before Gloster J, Black Marlin Holdings was, in the words of Mr Phillips QC’s skeleton argument for that hearing (paragraph 20) “on the cusp” of being acquired by a company called Afren plc, incorporated in England and Wales, listed on the London Stock Exchange, and in the FTSE 250 index. The acquisition was to involve a share exchange so that Black Marlin Energy Holdings’ shareholders would receive newly issued Afren shares for their holding, and PSI’s holding in Black Marlin Energy Holdings would be converted into a holding of 6,230,291 shares in Afren, the value of which was estimated to be around £7 million. It was (see Lyons, First Affidavit, paragraph 121) concern about relatively illiquid shares in Black Marlin Energy Holdings being exchanged for highly liquid shares in Afren and the implications for dissipation that triggered the without notice application. 
36.	Afren’s acquisition was effected as a scheme of arrangement under the  relevant BVI legislation by an order of the BVI court which heard the matter on 6 October, when the without notice application was made. The Afren shares were delivered to Hogan Lovells on 2 November 2010 pursuant to paragraph 24 of Simon J’s order. On 12 January 2011 Burton J entered a default judgment against CCH (Europe) GmbH for the US$ 440 million which remains outstanding.  
37.	On 11 March, the Bank invited PSI and Mr Cornelius to consent to a stay of the Bahrain claims until judgment in the English proceedings, preserving the attachment orders and reserving the costs position in Bahrain. This invitation was refused by them and, although Mr Ridley supports the suggestion, a stay requires the consent of all the parties to the Bahrain proceedings. On 16 March, shortly before the hearing, the defendants sought an adjournment of this hearing because unrest in Bahrain resulted in difficulties in communications and in preparing their evidence relating to Bahraini law. 
38.	Finally I deal with the evidence as to the risk of dissipation. At the time of the without notice application that came before Gloster J, this consisted of the allegations of substantial fraud which underlie these proceedings, failure to make the disclosure and provide the security required by the RSA, disposals of assets, and the imminence of the Afren transaction by which PSI would acquire shares traded on the London Stock Exchange in exchange for the less liquid holding in Black Marlin Energy Holdings. 
39.	In the case of Mr Cornelius, the evidence before Gloster J, and which satisfied her that there was a real risk of dissipation, was the imminence of the Afren transaction and information obtained by the Bank on 26 August 2010 (Transcript of Hearing on 5 October 2010, page 44E-F) from a Mr Fowke who ran the Big Yellow Franchise about Mr Cornelius’s disposal of his interest in it in Dubai on 15 July 2008 for no cash consideration and the disposal of shares in Interstate Properties BSC held by his company, Kifaru (Lyons, first affidavit, paragraphs 177 and 210). This was against a background in which Mr Cornelius had not made full disclosure of his assets or provided security over Proceeds Assets which he did disclose. The issue of delay in seeking a worldwide freezing order was raised by Gloster J. She considered that the recent appreciation by the Bank that, despite the terms of the RSA, there was continuing dissipation or concealment in breach of the RSA, and the fact that it was happening in relation to UK assets and that the Bank had recently been given information about the Big Yellow franchise, justified the grant of a worldwide order in the amount of the indebtedness “notwithstanding the delay” (Transcript, page 44G). 
40.	In the case of Mr Ridley, the evidence before Gloster J, and which satisfied her was that he only accounted for about US$ 15 to 20 million of the US$ 35 million he received from the bank via Mr Cornelius, leaving a “hole” of some US$ 15 to 20 million, that he gave different accounts for his inability to account for the missing amount, that in November 2007 he withheld from the Bank a US$ 10 million receivable remitted to CCH (Europe) GmbH, and that he failed to disclose his family trust until April 2008.   
41.	Since then, there has been further evidence. In relation to Mr Cornelius, this  (Lyons, third affidavit, paragraphs 50-70, first statement, paragraphs 40-67) concerns disposals of interests in land in Bahrain, the Big Yellow company, oil refinery components in Pakistan, and the Ocean Sports Hotel. Again, some of the information came from Mr Fowke. These interests are Proceeds Assets under the RSA and should have been charged to the Bank and, if sold, the proceeds should have been paid to it. It appears that the interests in Big Yellow and the hotel have, in part, been transferred to a Mr Wilkinson, who is a nominee for Mr Cornelius. The other shareholder in the hotel is JMN Investments, a Mauritius company. The Bank has been unable to identify the beneficial owners because JMN Investments’ registered agent is another Mauritius company. As to Big Yellow, 75% of the shares are owned by Bisteron Holding SPC, a Bahraini company. Mr Wilkinson is the sole director and owns all the shares in Bisteron.
42.	Mr Cornelius states (statement, paragraph 16) that in 2008 and 2009 he moved certain assets into the names of third party companies and individuals, whom he does not identify, to protect his ability to trade, fund his defence and support his family. He states (statement, paragraphs 14-16) that he did this because, shortly before the Bank took legal title, Plantation had been valued at US$ 1.1 billion, and he considered the Bank had been paid its debt in full and he was entitled to deal with his remaining assets entirely as he saw fit.  
43.	As to further evidence in relation to Mr Ridley, this (Lyons, third affidavit, paragraphs 71 ff)  is that there are further discrepancies between the payments to him and his assets and a continuing failure to disclose the accounts of his family trust or any document relating to it. 
Discussion

(1)	The challenge to jurisdiction
44.	A claimant wishing to serve out of the jurisdiction must satisfy three requirements.  The first is to meet one of the jurisdictional gateways set out in CPR 6B PD 3.1.  The second is the merits requirement in CPR 6.37 (1)(b), that the applicant must satisfy the court “that the claim has a reasonable prospect of success”. The third is the forum conveniens requirement in CPR 6.37 (3), that the applicant must satisfy the court that England and Wales “is the proper place in which to bring the claim”.  
45.	In this case, the RSA is governed by English Law (Clause 27.1) and contains an exclusive English jurisdiction clause (Clause 27.2).  Whether or not there has been a repudiatory breach of the exclusive jurisdiction clause, or the Bank is estopped from relying on it, since the RSA is governed by English law the first of the three requirements is satisfied in respect of all the defendants except PSI, which was not a party to the RSA: see CPR 6 PD 3.1(6)(c). As far as PSI is concerned, it is not suggested that it is not a “necessary or proper party” to the claim against Mr Cornelius, Mr Ridley and the other defendants. 
46.	In the light of Tomlinson J’s judgment in the proceedings brought by Messrs Cornelius and Ridley, the second merits requirement, “that the claim has a reasonable prospect of success”, is satisfied.  This requirement was described by Christopher Clarke J in Cherney v Deripaska (No. 2) [2008] EWHC 1530 (Comm) at [12] as “a relatively low threshold” and, in Swiss Reinsurance Co. Ltd v United India Insurance Company [2002] EWHC 741 (Comm) at [27], Gross J said it is synonymous with the "real prospect of success" test in CPR Parts 3 and 24, where "real" is to be contrasted with "fanciful".  
47.	The issue in this case concerns the third requirement. It is whether, in the light of the Bahrain claim brought by the Bank, England is the proper forum.  Mr Mallin submitted that the exclusive jurisdiction agreement is no longer of any effect because the Bank’s conduct in relation to the Bahrain proceedings was in repudiatory breach of that agreement, and that breach was accepted so that the agreement has been discharged. Alternatively he submitted that by their conduct the parties agreed to vary the agreement, or that the bank elected not to rely on it and is now estopped from doing so.  Mr Phillips QC submitted that the waiver and estoppel arguments are “the same wine in different bottles” and, although Mr Mallin did not abandon them, he accepted that the arguments based on those grounds did not add much to his contractual analysis.  
48.	Mr Phillips submitted that in relation to the forum conveniens requirement, the presence of the exclusive jurisdiction agreement means that the burden lies on the defendants to show either that the jurisdiction clause no longer binds either because it has been repudiated or because of the defendant’s estoppel or waiver arguments, or that, if it does bind, there is a strong reason not to give effect to it.  He relied on the statement of Lord Bingham in Donohue v Armco [2002] 1 Lloyd’s Rep 425 at [24], a decision of the House of Lords on anti-suit injunctions, for the proposition that a party who wishes to sue in the non-contractual forum bears the burden and must show there are strong reasons for doing so.  That case did not involve a situation in which it was alleged that the jurisdiction clause did not bind but, although it is not necessary to resolve the question of who bears the burden of proof on the facts of the present case, Mr Mallin did not demur from Mr Phillips’s submission that the burden lay on the defendants to show that the clause no longer binds. I therefore turn to the submissions based on repudiation, waiver and estoppel.  
(a)	Repudiation of the jurisdiction agreement
49.	There was broad agreement between Mr Mallin and Mr Phillips as to the principles to be applied but not as to the application of those principles.  Neither was able to rely on an authority concerning the repudiation of a jurisdiction clause, but both accepted that the normal contractual principles which have been applied to arbitration clauses are equally applicable to jurisdiction clauses. It seems to me, as it did in a slightly different context to Christopher Clarke, J in A.P Moller-Maersk A/S (trading as “Maersk Line”) v Sonaec Villas Cen Sad Fadoul [2010] EWHC 355 (Comm) at [33], that similar principles should apply.  
50.	The circumstances in which an arbitration agreement is repudiated by commencing court proceedings were considered by Lloyd J in The Mercanaut [1980] 2 Lloyd’s Rep 183 and The Golden Anne [1984] 2 Lloyd’s Rep 489. In the first case he stated that repudiation is “something which is not likely to be inferred”, and that where it is to be inferred from conduct “the conduct must be clear and unequivocal”. In the second case he stated that conduct by one party which is the normal response to a step in litigation taken by the other party falls short of what is required. 
51.	In The Mercanaut, shipowners started proceedings in Denmark on the same day as they appointed their arbitrator in England because of uncertainty as to which was the proper forum and concern lest their claim become time barred. They were held not to have repudiated the arbitration agreement.  In The Golden Anne a cross-claim by charterers against sub-sub charterers after they were added as defendants to a claim brought previously in the Florida courts against the shipowners was held to be a normal response to their joinder and not to a repudiation of an arbitration clause in the head charterparty. This was so even though it was done without a reference to the arbitration clause in the head charterparty or a reservation of the right to claim arbitration. The owners had, in accordance with the usual practice, intended to claim an indemnity against the charterers in arbitration should they be held liable in the Florida proceedings, but had not ever communicated that to the charterers.  Lloyd, J stated (at 495) that the character of the owner’s response was “neutral” and was “as consistent with an intention to keep the arbitration clause in suspense as to abandon it altogether”.  
52.	The most recent of the cases relied on is BEA Hotels NV v Bellway LLC [2007] EWHC 1363 (Comm).    The issue was whether the commencement and service of a second set of proceedings in Tel Aviv amounted to a repudiation of an arbitration agreement providing for arbitration before two named individuals or alternatively an arbitrator appointed by the President of the London Court of International Arbitration.  English law was the governing law of the arbitration agreement.  It was common ground (see Cooke, J at [13]) that:- 
(a) 	It was not repudiatory merely to bring proceedings in breach of an arbitration agreement even if the claims pursued in those proceedings were plainly ones which were subject to the arbitration agreement; 
(b) 	It was only a repudiatory breach where bringing the other proceedings was done in circumstances that showed that the party in question no longer intended to be bound to arbitrate; and 
(c) 	Such an intention could not lightly be inferred and could only be inferred from conduct which was clear and unequivocal.  

Cooke, J stated “if there was some other reason for the bringing of proceedings it would be hard to infer that the party bringing them intended to renounce its obligation to arbitrate”.  
53.	In the BEA Hotels case it was held that there was no breach of the agreement to arbitrate let alone any repudiatory breach.  Cooke, J (at [14]) rejected the submission made on behalf of BEA that, if Bellway was seeking to run the same claims against BEA in both the arbitration and the Tel Aviv proceedings, that would amount to repudiation because the intention expressed was to continue with the arbitration, albeit alongside other litigation.  He explained The Mercanaut and The Golden Anne as cases in which the court concluded that, although arbitration agreements were breached by the institution of proceedings, the breach was not repudiatory “because there was some explanation for bringing the court proceedings which in turn meant that the court could not infer intention to repudiate”.  
54.	In the present case in commencing proceedings in Bahrain the Bank was clearly in breach of the jurisdiction agreement in the RSA.  Mr Mallin submitted that the Bank did not “merely” issue its Bahrain claim but (see skeleton argument, paragraph 55.3) went well beyond this and that its conduct amounted to a repudiatory breach of the jurisdiction agreement. He relied on the following matters:
(1)	The Bank’s claim made no reservation of position as regards the jurisdiction of the English court. In the second (unnumbered) paragraph in the section headed “The scope of this suit” it stated that while it limited “this suit to the amount of the profits of US$30 million” it “reserves all its rights to demand the defendants and the other debtors to pay the whole amount of the initial debt, whether in a separate suit or by amending its request in this suit”.
(2)	Article 19 of the Civil and Commercial Procedures Law of Bahrain provides “the courts of Bahrain shall have competence to make provisional or conservative orders to have effect in Bahrain, even where is no competence to hear the original action.” Accordingly, notwithstanding Mr Rahdi’s evidence, in order to obtain the protection of an attachment order in Bahrain it is not necessary for there to be substantive proceedings in Bahrain. 
(3)	When the Bank commenced proceedings in Bahrain on 24 May 2009 there was no uncertainty or dispute as to the effect of the jurisdiction agreement.  Messrs Cornelius and Ridley had relied on the agreement in the proceedings they brought in 2008.  The position in this case thus differs from that in The Mercanaut where there was uncertainty as to the forum and a need to preserve the position lest it become time barred.  Mr Mallin also submitted it was significant in The Mercanaut, that, just under two months after instituting the Danish proceedings, the charterers applied to adjourn them in favour of the arbitration.  Here the Bank has only recently sought PSI’s consent to a stay of the Bahrain proceedings. Mr Mallin submitted this step was taken for tactical reasons.
(4)	The position in this case also differs from that in The Golden Anne because it was not the conduct of Mr Cornelius or the other defendants that led the Bank to commence proceedings in Bahrain; it was the decision of the Bank.  
(5)	The Bank has prosecuted its claim through a number of hearings and clearly intends to do so to judgment. It took no steps to institute proceedings in England for some 16 months after bringing the claim in Bahrain.  
(6)	During those 16 months the Bank replied to the defendants’ contention that any liability under the RSA had been extinguished by the transfer of the Plantation to the Bank, and pleaded a defence to the defendants’ Bahrain counterclaim without any reservation as to the competence of the Bahrain court to deal with the counterclaim whether based on the jurisdiction clause or otherwise.  Mr Mallin relied on the absence of any reference to any subsisting right to oppose jurisdiction on the basis of the jurisdiction agreement in the RSA or the RSA generally.  He also submitted that analysis of the Bank’s response to the counterclaim strongly suggests that it accepted the Bahraini court has jurisdiction to hear the counterclaim by Messrs Cornelius, Ridley and Nil but not the other defendants.  
(7)	The evidence on behalf of the Bank does not contain any basis for a challenge to the Bahraini court’s jurisdiction to hear Messrs Cornelius and Ridley’s counterclaim.  No evidence has been put forward showing that the Bank has requested that the Bahraini court determine the jurisdiction question.  
55.	As to acceptance of a repudiatory breach, Mr Mallin submitted that the defendants accepted the breach as ending the jurisdiction agreement by not challenging the jurisdiction of the Bahrain court and actively engaging in the Bahrain claim including bringing their counterclaim. He relied on Downing v Al Tameer Establishment [2002] EWCA Civ 271 in which the court was concerned with whether the service of a writ in response to letters denying that there was any actual contractual relationship amounted to an unequivocal acceptance of the repudiation in those letters of the arbitration agreement.  Potter, LJ (at [35]) considered that “the position of a party issuing a writ following a repudiatory breach of the arbitration agreement is different from that of a person issuing proceedings simply to test the water.  He stated:

“The question whether or not the issue in service of proceedings is an unequivocal acceptance of the repudiation will depend upon the previous communications of the parties and whether or not, on an objective construction of the state of play when the proceedings are commenced, the fact of the issue and service of the writ amounts to an unequivocal communication to the defendant that his earlier repudiatory conduct has been accepted, in the sense that it is clear that the issue of such proceedings (i) is a response to the defendant’s refusal to recognise the existence of the arbitration agreement or any obligation thereunder and (ii) reflects a consequent decision on the claimant’s part himself to abandon the remedy of arbitration in favour of court proceedings.”
56.	Mr Mallin submitted that the defendants’ conduct in bringing the counterclaim was an unequivocal and unambiguous acceptance of the Bank’s repudiation of the jurisdiction agreement. Had the defendants intended to do anything else they could not have brought the counterclaim which put all the issues under the RSA in play in the Bahraini proceedings. Bringing the counterclaim was inconsistent with the jurisdiction agreement. 
57.	On this issue I accept Mr. Phillips’s submission that the institution of the Bahrain proceedings in the circumstances of this case was not a repudiatory breach of the jurisdiction agreements.  The question is whether there is some explanation for the Bank’s conduct which means that the court cannot infer an intention to repudiate. I have concluded that there is such an explanation.
58.	Although the Bank did not take steps to institute proceedings in England after Tomlinson J’s judgment in the 2008 action, or until October 2010 this was because it was concentrating on identifying the location of assets and recovering them. Mr Cornelius and Mr Ridley were in default of their obligations under the RSA to disclose and to provide security in respect of “Proceeds Assets”.  Initially the Bank’s focus was on its security rights over Plantation, and, in the light of its supposed value, this may also have been contemplated by the defendants. Paragraph 5.3 of Mr Mills’s skeleton argument on behalf of Mr Ridley states that all parties regarded the Plantation as the most important security provided to the Bank by the RSA. However, (see Lyons, third witness statement paragraphs18-23) there were difficulties in enforcing the security and in obtaining a valuation, and (see Lyons, first affidavit paragraph 202) later the effect of the recession, the complexity of the structure of Plantation, and liabilities to third parties have meant the Bank has been unable to sell the lease. 
59.	The reason for instituting proceedings in Bahrain was that Mr Cornelius had disclosed that some US$37 million had been spent acquiring plots of land in Bahrain and with the money spent on the Big Yellow project in Bahrain and Dubai,  and in acquiring Ocean Sports, the Bank believed some US$50 million of its money had been spent in Bahrain.  The Bank was advised by its Bahraini lawyer, Dr Radhi, that the only quick way of freezing assets in Bahrain is by instituting proceedings.  In these circumstances, notwithstanding Article 19 of the Civil and Commercial Procedures Law, the institution of the Bahraini proceedings was not conduct which clearly and unequivocally pointed to an intention to no longer be bound by the jurisdiction clause because there was another explanation for bringing the proceedings in Bahrain.  
60.	Moreover, the Bahrain claim, notwithstanding the reservation in the pleading, was at that stage restricted to the profit sum due and not the principal sum.  The claim’s express reference to the right to bring separate proceedings in respect of debt due contemplated other proceedings might be brought but there is no inference that that contemplation was restricted to proceedings in Bahrain.  
61.	My conclusion that the Bank’s institution of the proceedings in Bahrain was not a repudiatory breach of the jurisdiction agreement means that it is not necessary to decide whether the defendants’ conduct constituted acceptance. Had I concluded that there was a repudiatory breach, standing back from the detail and considering the level of involvement by the defendants in defending the Bank’s Bahrain claim and in bringing their own counterclaim, but for one matter, Mr Mallin’s submission that the defendants clearly accepted the breach has considerable force. In particular, I do not consider that the defendants’ failure to discontinue the 2008 proceedings in itself means that the steps taken by them in response to the Bank’s Bahrain claim in 2009 preclude those steps from being an unequivocal acceptance. 
62.	The one matter concerns the defendants’ pleading in their counterclaim as to the position of further proceedings by the Bank. It is here that the issue as to the translation of the last sentence of the sub-heading “Bahraini jurisdiction” in the section of the defendants’ counterclaim on “Lawsuit grounds” becomes important. I now have three translations of this by independent professional translators and one, prepared during the hearing, by Mr Ahmed Jassim Abdulla, PSI and Mr Cornelius’s Bahraini lawyer. 
63.	The four translations of the material sentence of the pleaded counterclaim are:

(1)	“In the suit statement, the bank reserved the right to amend the request by demanding the defendants to pay the balance amount of the restructuring agreement of US$ 440 million,  whether in the same suit or in a separate suit.  Pursuant to the said agreement, the dispute should be referred to the English courts”. (Translation by Nasra Translations, Dubai instructed by the bank).

(2)	“Not only this but also the bank (plaintiff) in that lawsuit reserved for itself  in the declaration and in its requests to amend the requests by asking the defendants to pay the remaining value of a rescheduling agreement which amounts $440M whether in this lawsuit or in another one included with.  Meanwhile this dispute shall offer to the English court to apply the agreement’s provisions according to the agreement”.  (Translation exhibited to Mr Abdulla’s first witness statement and Mr Dowd’s affidavit).

(3)	“Moreover, the plaintiff bank in that case reserved for himself in that pleading the right to amend his demand by directing to the defendants the claim to pay the remaining of the value of the rescheduling agreement amounting to US$440 million whether in the same suit or in a different one to be attached to it, while and despite of the Agreement this dispute shall be presented before the English Judiciary in application of the provisions of this Agreement.”    (Mr Abdulla’s translation produced at the hearing on 31 March).

(4)	“However the Bank ‘Plaintiff’ in this law suit has reserved the right to amend the requests by claiming the defendants to pay the balance amount of the Rescheduling Agreement of US$440 million, whether in the same lawsuit or in any other lawsuit attached to it, whereas the Agreement stipulates that in case of any dispute it shall be referred to the jurisdiction of the English courts in implementation of the provisions of this Agreement.” (Translation by First Translation, instructed on behalf of the bank after the hearing).
64.	Mr Abdulla’s second witness statement does not address the question of whether he has pleaded in the Bahrain counterclaim that further proceedings to be taken by the Bank must be commenced in England.  He only addresses the question of whether it has been submitted on behalf of the defendants including Mr Cornelius, that the Bahrain counterclaim should have been commenced in England. But the translations of this sentence of the counterclaim show that it does not appear to address that question. 
65.	Moreover, as Mr Lyons states in paragraph 5 of his sixth witness statement, that is not the issue. Notwithstanding the differences in the language used it seems clear from the translations that the defendants pleaded that any further action by the Bank should be taken in England. That is, as Mr Phillips submitted, inconsistent with their acceptance of a repudiatory breach so as to bring the jurisdiction agreement to an end. In view of what they have pleaded, adapting the words of Potter LJ in Downing v Al Tameer Establishment which I have quoted, it cannot be said that the pleaded counterclaim reflects a consequent decision on the defendants’ part themselves to abandon the English jurisdiction clause in favour of proceedings in Bahrain.
(b) Waiver and Estoppel
66.	My conclusion on repudiation is also fatal to Mr Mallin’s submissions on waiver and estoppel.  The considerations which preclude the institution of proceedings in Bahrain being a repudiatory breach also preclude them giving rise to an unequivocal representation that the bank waived the jurisdiction agreement for all time and for all purposes or elected so to do.
67.	Mr Mallin submitted that election is a doctrine of general application which (see The Mihalios Xilas [1979] 1WLR 1018, 1034-5, per Lord Scarman) applies where there is a right to exercise one of two alternative and mutually inconsistent courses of action and a person chooses one and communicates that choice to the person concerned in such a way as to lead that person to believe he has made his choice.  But, as the decisions on whether an arbitration agreement is repudiated by commencing court proceedings suggest, the alternatives of proceeding in England or proceeding in Bahrain are not mutually inconsistent.  This is particularly so where there is a good reason for the latter, as there is in this case, where the Bahraini proceedings were commenced in order to obtain precautionary relief over assets in Bahrain.  See also the discussion of the position where proceedings are brought to obtain security by way of an attachment of assets in Dicey, Morris and Collins on the Conflict of Laws 14th ed at 12-07, albeit in the context of forum non conveniens and jurisdiction agreements.
68.	In The “Kanchenjunga” [1990] 1 Lloyds Rep 391 at 398 Lord Goff stated that, while election can be communicated by word or conduct; 
“perhaps because a party who elects not to exercise a right which has become available to him is abandoning that right, he will only be held to have done so if he has communicated his election to the other party in clear and unequivocal terms”
In the circumstances of this case it cannot be said that the Bank’s conduct clearly and unequivocally abandoned the English jurisdiction clause in the RSA for all purposes.  
(c) A stay on discretionary grounds
69.	Here too there is common ground as to the principles but not as to their application.  The principles are to be found in Lord Bingham’s speech in Donoghue v Armco [2002] 2 Lloyds Rep 425 at [24] – [25].  Where parties have bound themselves by an exclusive jurisdiction agreement, a party who wishes to depart from it will need to show “strong reasons” for so doing.  Whether there are such reasons sufficient to displace the other parties prima facie entitlement to enforce the agreement will depend on “all the facts and circumstances of the particular case”.  
70.	Mr Mallin submitted that, notwithstanding the undesirability of parallel proceedings, in this case there are strong reasons for departing from the Bank’s prima facie entitlement that effect should be given to the jurisdiction agreement in the RSA.  First, it was the Bank itself which chose to initiate proceedings in Bahrain in breach of the jurisdiction agreement.  In the light of the jurisdiction clause and the 2008 proceedings in England, it was unforeseeable to the defendants that the Bank would commence proceedings in Bahrain.  It was this he said (see British Aerospace plc v Dee Howard Co [1993] 1 Lloyd’s Rep. 368, 376 per Waller J) that enabled the defendants now to object to the jurisdiction of the English Court notwithstanding the bargain that they made.
71.	The Bank, he argued, has voluntarily submitted to the jurisdiction of the Bahrain Court both in making its claim and by responding to the counter claim without a reservation as to jurisdiction.  In Svendborg v Wansa [1996] 2 Lloyd’s Rep 559, 570, Clarke J stated that “voluntary submission to the jurisdiction of the foreign court will very often amount to … good reason [for refusing an application for an anti-suit injunction], especially where the proceedings have progressed for any period of time…”
72.	Moreover, the defendants have taken part in the Bahrain proceedings without protest for almost two years, incurring substantial costs, pleading a defence and bringing a counterclaim.  The Bahrain court has now consolidated the Bank’s claim and the defendant’s counterclaim and has appointed an expert.  By comparison there are as yet no pleadings in the English proceedings and Mr Phillips’s submission (Skeleton Argument paragraph 44(c)) that the parties “are very much on the home stretch in these proceedings” is not understood and certainly not accepted.
73.	Mr Mallin also relied on the decision of Australian Commercial and Development Ltd v ANZ McCaughan Merchant Bank Ltd [1989] 3 All ER 65. Sir Nicholas Browne-Williams V.C, stated that where the same plaintiff sues the same defendant in England and abroad, and both proceedings raise exactly the same issues, the court would not allow the continuation of proceedings in two different jurisdictions but would put the claimant to his election.  Mr Mallin submitted, however, that in this case, because it was the Bank which breached the exclusive jurisdiction clause by proceeding in Bahrain it is not for the Bank to elect between the two.  Moreover, the Bahrain proceedings cannot be unilaterally stayed by the Bank.  In any event, bearing in mind what Waller J said in the British Aerospace case (at 376 column 2) about taking part in foreign proceedings without protest and the advanced stage of those proceedings, the Bahrain proceedings are too far advanced for the Bank so to elect. Mr Mallin argued that the exception to the requirement on an election, identified in Dicey, Morris and Collins, 14th ed, 12-037 where the foreign action is brought to obtain security by way of an attachment of assets to which I have referred, does not apply.  First the Bank reserved the right to demand the entire debt and did not restrict its application to an attachment as it could have under Article 19.   Secondly the defendant’s counterclaim to which the Bank responded without any reservation as to jurisdiction went well beyond an attachment.
74.	Mr Mallin acknowledged that the mere existence of  lis alibi pendens between the parties in a foreign court will not of itself constitute sufficient reason for displacing a parties prima facie entitlement to enforce the jurisdiction clause in the contract.  In Breams Trustees Ltd v Upstream Downstream Simulation Services Inc and Ors [2004] EWHC 211 (Ch) at [27] Patten J rejected the submission that a strong case for displacing a jurisdiction clause will usually be made out if the consequence of enforcing the clause will be to create parallel proceedings.  After reviewing the authorities including British Aerospace Plc v Dee Howard & Co [1993] 1 Lloyd’s Rep 368, Mercury Communications Ltd v  Communication Telesystems International [1999] 2 All ER 33 and Import Export Metro Ltd v Com. Sud Americana De Vaporis SA [2003] 1 Lloyd’s Rep 405 and whether those first instance decisions properly took into account the judgment of Brandon LJ in The El Amria [1981] 2 Lloyd’s Rep 119 at 128 he stated that:
“The existence of earlier foreign proceedings between the same parties is simply a factor to be taken into account in the manner indicated by Lord Goff in De Dampierre”.
75.	In the de Dampierre v de Dampeirre [1988] AC 92 at 98, Lord Goff stated, of earlier foreign proceedings, that where:
“Genuine proceedings have been started and have not merely been started but have developed to the stage where they have had some impact on the dispute between the parties, especially if such impact is likely to have a continuing effect, then this may be a relevant factor to be taken into account when considering whether the foreign jurisdiction provides the appropriate forum for the resolution of the dispute between the parties”.
As to The El Amria, Patten J stated that in that case:
“The discretion was not exercised on the basis that the existence of parallel proceedings between the same parties ought as a matter of principal to justify departure from the terms of the jurisdiction clause”.
76.	Similarly, in Du Pont v Agnew [1987] 2 Lloyd’s Rep 585 at 589 Bingham LJ, albeit not in the context of an exclusive jurisdiction clause, stated:
“That while concurrent proceedings are generally undesirable as, in Lord Diplock’s words “a recipe for confusion and injustice”, that general undesirability is “but one consideration to be weighed as part of the overall assessment”.  He stated that “It cannot necessarily lead to a stay or setting aside of English proceedings””.
77.	In Highland Crusader Offshore Partners LLP v Deutsche Banke AG [2009] 2 Lloyd’s Rep 617, Toulson LJ, considering a non exclusive jurisdiction clause, stated (at [104]):
“However undesirable it is that parallel proceedings may proceed and in theory result in conflicting judgment, whether and to what extent it happens in practice… is another matter.  Experience suggests that when parallel cases continue to be fully fought after the initial jurisdiction battles the courts will do their best to use their management powers to prevent tactical obstructionism and to achieve a just and orderly disposal of the litigation, taking into account the progress of the parallel proceedings as may be appropriate”.
He also stated (at [110]) that:
“It does not follow that because parallel proceedings are undesirable they are necessarily oppressive.  If they are improperly brought they are oppressive, but here the argument becomes circular.”
78.	There is force in Mr Mallin’s submissions that the Bank, having chosen to ignore the exclusive jurisdiction clause in favour of England by instituting the Bahraini proceedings, appears to be playing fast and loose by now seeking to rely on the clause. However, notwithstanding that, I have concluded that in this case I should not exercise my discretion to stay these proceedings.  
79.	Staying proceedings against Mr Cornelius will not avoid a multiplicity of proceedings because Mr Ridley has accepted English jurisdiction.  Moreover, a default judgment for the full sum claimed has been entered against CCH (Europe) GmbH and, albeit pending a possible appeal on service, Mr Nil, the fourth defendant, has been validly served and has not challenged the jurisdiction of this court.
80.	As far as PSI is concerned, it is not a party to the RSA or to the Bahrain proceedings and, with regard to the latter, technically the multiplicity of proceeding point does not apply to it.  However, whether or not the claims against Mr Cornelius and Mr Ridley are stayed the Bank has a proprietary claim against PSI in respect of the shares in Afren Plc which (see Mr Radhi’s statement, paragraph 16) is not a cause of action that can be pursued in Bahrain because Bahraini law does not recognise a claim of this nature.  PSI needs to be a party to proceedings which will continue in England.  First, PSI owns the shares in Afren which are the subject of the freezing order and secondly, it is a “necessary or proper party” with regard to the Bank’s claim against the other defendants as well as the claim against Mr Cornelius, who wholly owns PSI.
81.	In these circumstances a stay against Mr Cornelius does not make sense and would not remove the multiplicity of proceedings concerning the RSA.  Mr Mallin relied on the financial implications of having to fight proceedings in both Bahrain and England.  PSI and Mr Cornelius are jointly represented and, for the reasons I have given, proceedings against PSI in England will continue.  Accordingly, staying them against Mr Cornelius may well not mean that the costs are reduced.
82.	I also take into account that the primary motive for the Bank instituting the proceedings in Bahrain was to get protective relief.  The fact that the claim was not pleaded so as to be limited to that was, as I have discussed earlier in this judgment, the result of the advice of its Bahraini lawyer.  The expansion of the matters before the Bahrain court is in reality the result of the defendants’ counterclaim.  Albeit late in the day, the Bank has proposed that the parties stay the Bahrain claims in favour of England and Mr Ridley has agreed to that approach.  The Bank has also stated that it is prepared to undertake to stay the English proceedings should the Bahrain court hand down its judgment before judgement is given by this court.  That seems a sensible way to achieve (in Toulson LJs words in the Highland Crusader case) a just and orderly disposal of the litigation, taking into account the progress of the parallel proceedings and to reduce the risk of conflicting judgments.
83.	There is conflicting evidence as to the likely timing of a decision in Bahrain.  The defendant’s evidence (Mr Abdulla, statement paragraph 29) is that a decision is likely to be given in January 2012 and an appeal concluded by April 2012.  By English standards, a three month period from first instance decision to the conclusion of an appeal is a very short period. The claimant’s evidence (Mr Radhi, statement, paragraph 30) is that is likely that there will be no decision until December 2012 and that an appeal will take a further year. It is not possible for me to resolve this issue.  Mr Abdulla accepts that there has been some delay in the appointment of an expert, albeit a month’s delay, and, given the unrest in Bahrain, which led to an application by the defendants to adjourn the hearing before me, the future cannot be said to be certain.
84.	Finally, notwithstanding the stage of the Bahrain proceedings, and the fact that there are no pleadings  in the English proceedings, the essential issue is one that will not involve complex or drawn out factual and documentary investigation.  The issue is whether the effect of the Bank enforcing its security over Plantation and taking title to the lease has discharged the defendants from their liability.  Even if one discounts Tomlinson J’s decision that it was not arguable that the defendants were not in default under the RSA, the nature of the defence raised by the defendants is narrow and should be capable of being decided speedily on a summary basis.
85.	For these reasons, I have concluded that this is not a case where the multiplicity of proceedings means there is a strong reason to depart from the contractual choice of forum.
(2)	Discharge of the Injunction
86.	Mr Ridley submits that the injunction should be discharged because the Bank does not have a sufficiently arguable case and also relies on non disclosure and misstatement of the facts by the Bank.  PSI and Mr Cornelius accept that the Bank has a sufficiently arguable case but seek the discharge of the injunction on four grounds.  The first is the lack of jurisdiction, which I have rejected.  The other grounds relied on are that there is no real risk of dissipation and no proprietary claim, material non disclosure, and delay. Reliance is placed in view in particular on what is described as the unexplained delay between the events giving rise to the claim and the without notice application. It is submitted that in view of this the court should not have exercised its discretion to grant the injunction. 
87.	I first deal with the submission on behalf of Mr Ridley that the Bank does not have a good arguable case.  The argument is that when the Bank took title to Plantation the debt was discharged. It can be summarised as follows.  Mr Mills’s starting point was that the meaning of the word “security” is prima facie inchoate until the item held as security is realised by sale.  To determine its meaning it is necessary to look at the agreement.  Here this is the Assignment Agreement, which (see Skeleton Argument paragraph 10) is said to be “unambiguous in its effect:  it makes the Bank the absolute owner of the Plantation”.  Mr Mills submitted that the document contains no language that can be construed as putting the Bank into the position of a mortgagee in possession pending sale and no language appropriate to charge, mortgage or trust.  He relied on the reference to “irrevocable” in clause 2 and the fact that there is no power of sale in the Assignment Agreement.  He argued that clause 18.3 of the RSA did not create a power of sale and noted that under clause 2.6 of the Assignment Agreement, upon the Assignment, the Bank was to be substituted for Plantation “as if [it] were the original purchaser” under the lease.
88.	The second limb of Mr Mills’s submissions concerns the valuation of Plantation.  While recognising that neither the RSA nor the Assignment Agreement make provision as to how and at what date Plantation is to be valued, he submitted (Skeleton Argument paragraph 18) that “the only term that can reasonably be implied is that the value of the Plantation is to be fixed at the moment it becomes the absolute property of the Bank”.  He submitted that this was so because any other time would give an unfair advantage to the Bank which would be able to fix a value at the time of its choosing. He also maintained that valuing it at the point of sale did not reflect the fact that the Bank, as an absolute owner, might never sell but might develop the property with or without a joint venture party.  He relied on the fact that, when the Bank announced that it had taken title to Plantation, it declared unequivocally that the debt was covered.  At that time the value of Plantation exceeded the debts under the RSA and, if the value did not crystallise at that point, it would be inaccurate to have said that the debt is “covered”.  Moreover, he submitted that this construction was in accordance with the Sharia principles which the Bank espouses.  He did not submit that the effect of the Bank taking title to Plantation was to be determined by Sharia law. He submitted (skeleton argument, paragraph 23) that Sharia law “is of indicative not determinative value” in a assisting the court to give the RSA and the Assignment Agreement business efficacy and to reflect the parties intentions.
89.	I reject the submission that the injunction should be discharged because the Bank has not shown a good arguable case.  First, whilst security is provided in many ways, it normally involves a transfer of title, the lodgement of deeds and documents or the creation of a mortgage by lease.  The manner in which the security is provided does not determine the basis upon which the security holder holds the security taken.  In the present case, on the argument made on behalf of Mr Ridley, the RSA and the Assignment Agreement are to be construed as giving the Bank absolute title with no equity of redemption in the debtors and no obligation on the Bank to account for the balance after recovering the sums due under the RSA. This, it is suggested, is how the Assignment Agreement is to be construed even though the potential value of Plantation appeared to be far greater that the sums outstanding under the RSA.  This is an uncommercial and unrealistic submission. Moreover, in the Bahrain proceedings, the counterclaim contends that the Bank should repay the balance.  The position taken on behalf of Mr Ridley in these proceedings is contrary to the position taken on his and the other defendants behalf in the Bahrain proceedings.
90.	Although it is undoubtedly the case that the Bank has power to sell and full title vis a vis third parties, it is not in my judgment arguable that vis a vis the debtors it has anything but a security interest.  The RSA expressly refers to a “first charge” and a “conditional assignment”.  It sets out the obligations on the Bank if it does take title.  The obligations to commission an independent valuer and to return any surplus from the sale proceeds to Plantation contained in clause 18.3 of the RSA are inconsistent with the analysis that after taking the assignment the debtors have no interest in Plantation.  
91.	I therefore turn to the submissions made on behalf of PSI and Mr Cornelius that there is no real risk of dissipation, and there has been delay, and the submissions made on behalf of them and Mr Ridley about non disclosure. I deal first with the risk of dissipation.  Mr Mallin accepted that the test of the risk of dissipation is objective. But he submitted (skeleton argument paragraphs 97, 99) that it cannot be said that there is a general risk of dissipation as a result of the exchange of the Black Marlin Energy Holdings shares for shares in Afren because the Bank has no evidence of any motive or intention in respect of these shares from which such an inference could be justified, and (see skeleton argument, paragraph 102 and paragraph 49 of Mr Dowd’s first affidavit) that it can not be right to look at Mr Cornelius’ conduct in moving certain assets given that he was not aware that there was any reason that he should not enter into transactions in order to conclude that there is a risk of dissipation of assets..  
92.	As to the effect of the exchange of the Black Marlin Energy Holdings shares for shares in Afren, I consider that, on the evidence before me and given the background, Mr Cornelius was in breach of his obligations under the RSA to disclose assets and to provide security for Proceeds Assets. Given that background, there was an objective risk of dissipation, which applied to the more liquid Afren shares as it did to other property. As to the submission that, because no claim was made against Mr Cornelius until 2009, there was, as he states in his evidence, no reason for him not to deal with his assets in a normal way, this might have been so provided he complied with his disclosure obligations under the RSA and such dealing was consistent with those obligations.  But, as he did not comply with his disclosure obligations under the RSA, even if he genuinely believes that he is entitled to deal with his remaining assets entirely as he sees fit in the light of the Bank taking legal title to Plantation, that does not remove the risk of dissipation. Indeed, that belief in itself posits a risk of dissipation.  I reject Mr Mallin’s submissions on this issue.
93.	Mr Mallin also submitted that the reliance at the time of the without notice application on the information acquired from Mr Fowke was misplaced, that Mr Fowke was unreliable and has denied making some of the statements about Big Yellow attributed to him in Mr Lyons’s third affidavit.  The court is, as Mr Phillips recognised, not in a position to make any findings as to Mr Fowke’s reliability but it is not necessary for it to do so to reach a conclusion on this matter.  It is clear that Mr Cornelius has made disposals of Big Yellow and Oceans Sports assets and the Bank’s evidence on this is not solely from the information from Mr Fowke. 
94.	I turn to non-disclosure.  Mr Ridley relied in particular on non disclosure of the Assignment Agreement which Mr Mills described as the document which governs the Banks relationship with the transfer of Plantation.   He also submitted that the Bank misled the court by claiming that it is in the position of an unsatisfied mortgagee in possession of what it says is an un-saleable asset and in the way Mr Lyons described the Bank’s announcement as nothing more that confirming that by foreclosure rather than appropriation the Bank had enforced the security by taking over ownership of Plantation.
95.	As far as PSI and Mr Cornelius is concerned the non disclosure they rely on is failure to give a full picture of the Bahrain proceedings, failure to explain in the weight attached to and the circumstances relating to the information given by Mr Fowke, and failure to disclose the existence of civil proceedings in Dubai.
96.	I reject the submission that there has been inadequate disclosure of the relationship between the Bank and Plantation and the nature of its security.  Mr Lyons’s first affidavit refers to the argument that when the Bank enforced its security over Plantation this caused the liability under the RSA to be discharged.  It is true that the Assignment Agreement was not exhibited to the affidavit but the relevant provisions of the RSA are set out in paragraphs 193–196. Mr Lyons also referred to the obligations owed to Plantation and Mr Fitzwilliam as to the marketing and sales process, to the difficulties in obtaining a valuation and to the announcement to the Dubai financial market:  see paragraphs 200-204.  The duty of an applicant is to make “a full and fair disclosure of all the material facts”. In this case, given the nature of the Bahrain counterclaim in which the defendants claimed repayment of the surplus between the value of Plantation at the date of the transfer of title and the amount owed, it was, moreover, not to be anticipated that an argument would be deployed that the effect of the transfer vested absolute title in the Bank.
97.	As to the non-disclosure relied on by PSI and Mr Cornelius, Mr Phillips submitted that the Bahrain proceedings were referred to “in some detail” in Mr Lyons’ first affidavit at paragraphs 210 and 211 and the statements of case in the Bahrain proceedings were attached to the exhibit.  The affidavit does not, however, refer to the counterclaim or to the reservation by the Bank of the right to demand the entire debt in those proceedings. Nor does it refer to the stage the Bahrain proceedings were at.  It would have been preferable to do so.  However, since both in the documents and at the hearing the Bank informed the Judge about the Bahrain proceedings and of the nature of the argument put by the defendants, although they did not disclose that is was by way of counterclaim to which the Bank had responded, I will not set aside the order on this ground.
98.	As to the weight attached to and the circumstances relating to Mr Fowke’s information and the alleged failure of the Bank to satisfy itself as to his credibility, the Bank disclosed the information provided by Mr Fowke.  That information was directed to the question of whether there was a “real risk” of dissipation.  The information so conveyed has been proved to be right.  Some has been confirmed by Mr Wilkinson and some has been confirmed by Mr Cornelius’ evidence as to the transfer of assets he made.  As to the compensation claim in Dubai, the Bank drew attention to its participation as a partie civile to the criminal proceedings in paragraph 212 of Mr Lyons’ first affidavit and in paragraph 49 of its Skeleton Argument for the without notice hearing.
99.	Finally, there is the question of delay. I have referred to the consideration of the delay between the events giving rise to the claim and the without notice application at the without notice hearing. I have also referred to the fact that, given the perceived value of Plantation, the Bank’s focus was initially on its security rights over that. The Bank was, in my judgment initially entitled to take the view that, in view of the disclosure and security obligations in the RSA, it was not necessary for it to seek a world wide freezing order. Once it was informed of the disposal of the Big Yellow franchise and the imminent exchange of the Black Marlin Energy Holdings shares for the Afren shares it did not delay. 
Conclusion
100.	For the reasons I have given, the jurisdiction challenge does not succeed and the application to set aside Simon J’s order is refused.