Libya -v- Capitana Seas Limited in the High Court


In the High Court today MS-Legal Solicitors successfully defended the State of Libya against a claim by Capitana Seas Limited with Mr Justice Knowles upholding an order to transfer UK property to the state of Libya.



QBD (Comm) (Knowles J) 05/08/2015
BENEFICIAL OWNERSHIP : DELAY : SETTING ASIDE : CIVIL PROCEDURE RULES 1998 r.13.3 An application to set aside an order requiring that a British Virgin Islands company transfer a UK property to the state of Libya because it had been unlawfully purchased using state funds was without merit.
The applicant British Virgin Islands company (C) applied under CPR r.13.3 to set aside an order declaring that it held a UK property on constructive trust for the respondent, the state of Libya, and requiring it to transfer the property to Libya.

The court had found that a son (G) of Colonel Gaddafi, the former leader of Libya, was the sole ultimate beneficial owner of C, and that the property had been wrongfully and unlawfully purchased with funds belonging to the state of Libya. C’s instant application was made by an individual (X) who claimed that he had become the sole owner and director of C on 1 May 2011, 11 months before the order requiring the transfer, but that he had only recently been alerted, following a worldwide audit of assets, to the fact that because of the court order C no longer controlled the property. He adduced three documents: a photocopy of a document headed “assignment of shares”, which on its face recorded the assignment by G to X of all interest and benefit in the ordinary shares in C; a photocopy of G’s consent to resign as director; and a photocopy of X’s consent to act as director.

HELD: There was no evidence before the court that any changes regarding the ownership and control of C were made known to any other person, or that any company books or records other than the three adduced documents were amended or updated to record the transactions described. C showed no real prospect of defending Libya’s claim on the merits. The claim was about whose money was used to buy the property and who was beneficially entitled, not about who its director or owner was or used to be. There was no other good reason why the judgment should be set aside or C be allowed to defend. Finality in legal proceedings was important. The delay had not been adequately explained. X had not made clear what he knew or when, and why the instant application was made after such a long time. Much greater detail and specific information as to dates would be needed to provide an adequate explanation. The application was without merit.

Application refused
For the applicant: In person
For the respondent: Mr Timothy Sharp

For the respondent: MS-Legal Solicitors