Claim No: G01CL944
In the County Court in Central London
9 September 2021
His Honour Judge Hellman
Puli Bay Limited
1. This judgment is given pursuant to paragraph 14 of the Practice Direction (Committal for Contempt: Open Court)  1 WLR 2195, Sen Cts. It includes the details required by paragraphs 13(1)(i) to (iii) of the Practice Direction.
2. In relation to Case No: G01CL944, on 9 September 2021 at the County Court at Central London HHJ Hellman sentenced Murtadha Rajab (“Mr Rajab”) to 3 months imprisonment for contempt of court. The sentence was suspended for 9 months. The basis of the sentence was as follows.
3. On 11 September 2020, HHJ Gerald made an injunction order against Mr Rajab. The injunction recorded that counsel for Mr Rajab conceded that Mr Rajab was in breach of his duties to the Claimant, Puli Bay Limited (“Puli Bay”), by purporting to enter into a contract with another company on 15 July 2020 and by causing Puli Bay to make 11 payments totalling £50,000 to that company between 21 and 23 July 2020. The Court ordered Mr Rajab to pay £50,000 forthwith to Puli Bay.
4. The Court also ordered that Mr Rajab should not dispose of, deal with, encumber or in any way diminish the value of 3 Rolex watches purchased on 3 August 2020 and 5 August 2020 from “The Watch Gallery” for the amounts of £14,950, £8,400 and £8,300 (“the Watches”).
5. At paragraph 7, the Court ordered that Mr Rajab should by 4pm on Monday 14 September 2020 provide Puli Bay’s solicitors with details of the serial number, make, model, current location, and proof of purchase for each of the Watches, as well as details of the business in Germany to which they had been sent.
6. On 18 September 2021, HHJ Gerald made a further injunction order in which he ordered at paragraph 1 that the Second Defendant should by Monday 21 September 2020:
(a) Provide Puli Bay’s solicitors with details of the serial number, make, model, current location, and proof of purchase for each of the Watches, as well as details of the business in Germany to which they had been sent, including all phone, fax and email contact details; and
(b) Confirm to Puli Bay’s solicitors that he had taken all steps within his power to procure the return of the Watches by International Tracked and Signed Delivery (or its nearest equivalent in Germany) to Puli Bay’s solicitors from the person or company in whose possession the Watches currently were, and provide written evidence of having done so including full tracking details so as to permit Puli Bay’s solicitors to track any packages sent.
7. By a contempt application dated 6 October 2020, Puli Bay applied to commit Mr Rajab to prison for contempt of court for breaching paragraph 7 of the 11 September injunction order and paragraph 1(a) and 1(b) of the 18 September injunction order. After a two day trial on 3 and 4 June 2021, HHJ Hellman gave judgment on 7 June in which he found that these allegations were proved to a criminal standard. He dismissed two further allegations. Sentencing was adjourned to give Mr Rajab an opportunity to comply fully with the paragraphs in the injunctions which he had breached.
8. The sentencing hearing took place before HHJ Hellman on 9 September 2021. The judge reminded himself that he could only sentence on the basis of facts adverse to Mr Rajab if they were proved to a criminal standard. As a result he sentenced on the basis of Mr Rajab’s version of events, even though he was highly sceptical about some elements of this.
9. As to the two allegations that Mr Rajab failed to provide Puli Bay’s solicitors with details of the Watches, the Court noted that during the trial Mr Rajab had, at the Court’s suggestion, visited the shop where he had purchased the Watches and obtained receipts, as proof of purchase, which bore the serial numbers of the Watches. On his account, he had given the best account that he could of the location of the watches, namely the name and address in Frankfurt of the man to whom he had entrusted them. Mr Rajab was therefore in substantial compliance with the paragraphs of the injunction orders to which those allegations related, albeit belatedly.
10. As to the allegation that Mr Rajab had failed to take all steps within his power to procure the return of the watches from Germany, Mr Rajab gave evidence at trial that prior to the various injunction hearings a friend living in Germany had introduced him to a man named Mr Abaioui, who lived in Frankfurt. He had handed the watches to Mr Abaioui to take them to a jeweller or jewellers to have them encrusted with diamonds. This was to increase their value. Mr Rajab said that he had been in regular contact with Mr Abaioui and had asked him to return the Watches, but that for various reasons Mr Abaioui had not yet done so. Even on his own account, Mr Rajab’s attempt to get back the Watches had been dilatory, and he had been content to go along with Mr Abaioui’s reasons for not wanting to return them yet. He had not on any view taken all steps in his power to get them back.
11. Between the trial and the sentencing hearing there had been two material developments. First, Mr Rajab had gone to Frankfurt to try and procure the return of the Watches but had been unable to find them or Mr Abaioui. He gave evidence about this at the sentencing hearing.
12. Second, shortly before the sentencing hearing, Mr Abaioui, or someone using that name, had sent three watches to Puli Bay’s solicitors. These purported to be Rolex watches, but they bore different serial numbers to the Watches, and two of the serial numbers were the same. Puli Bay’s solicitors took the three watches to the store from which Mr Rajab had purchased the Watches. The store said that they did not appear to be genuine Rolexes. The Court concurred.
13. The Court was deeply suspicious that Mr Rajab was complicit in the non-return of the Watches and the attempt to hoodwink the Court by sending fake watches to Puli Bay’s solicitors. However the Court could not be satisfied of his involvement to the criminal standard. Accepting, for sentencing purposes, Mr Rajab’s version of events, by visiting Frankfurt he had had made a genuine attempt to get the Watches back.
14. Standing back, Mr Rajab had been reluctant to engage with the injunction orders, dragged his feet, and done the inadequate minimum he thought he could get away with to comply with them. Where there was a breach, he had at trial blamed his solicitors, or Puli Bay’s solicitors, rather than taking personal responsibility for compliance. This was deeply unattractive. But the Court was not satisfied that Mr Rajab had deliberately sought to withhold the watches from the Court. If he had done, the sentencing exercise would have taken a very different course.
15. The Court was referred to Financial Conduct Authority v McKendrick  4 WLR 65 and the various authorities cited therein. These included in particular, at paragraphs 31 and 32, JSC BTA Bank v Solodchenko (No 2)  1 WLR 350; Asia Islamic Finance Fund Ltd v Drum Risk Management Ltd  EWHC 3748 (Comm); and Crystal Mews Ltd v Metterick  EWHC 3087 (Ch).
16. Considering the various factors mentioned in the Crystal Mews Ltd case, the Court noted that Puli Bay had been prejudiced by the contempt as this had made the tracing and future recovery of the Watches more difficult. Mr Rajab had not been put under pressure to commit the contempts. The breaches of the injunction orders were deliberate, but in the sense described above. On Mr Rajab’s case, he had been unable to procure the return of the Watches due to the behaviour of Mr Abaioui, although the requirement of paragraph 1(b) of the 18 September injunction order was not that he manage to procure their return but that he took all steps within his power to do so; Mr Rajab appeared somewhat belatedly to appreciate the seriousness of his deliberate breaches; he had co-operated, albeit belatedly; there was some acceptance of responsibility and there was at least an expression of remorse.
17. Mr Rajab had no criminal convictions and was therefore analogous to a person of good character who was to be sentenced in criminal proceedings. A prison sentence would be more onerous than in normal times because of the restrictions placed upon prisoners due to the pandemic. Mr Rajab was the caregiver for his mother, who suffered from a number of medical complaints. He drove her and his older brother, who was disabled, to medical appointments and to the shops.
18. Breach of the disclosure provisions attaching to a freezing injunction was an attack on the administration of justice. It undermined the purpose of the freezing injunctions, which was to make available the watches as assets against which Puli Bay could enforce judgment. The breaches were all so serious that each merited a custodial sentence. Having regard to the nature of the breaches and the motivation for them and to Mr Rajab’s belated efforts to comply with the injunction orders, the appropriate sentence was 1 month’s imprisonment on each count of failing to provide information to Puli Bay’s solicitors and 3 months’ imprisonment on the count of failing to do everything within his power to procure the return of the Watches. The sentences on all three counts would run concurrently.
19. The Court was satisfied in all the circumstances, including the dependence of Mr Rajab’s mother and brother upon him, that the mere fact of passing sentences of imprisonment was sufficient to mark the seriousness of the breaches and that the sentences could properly be suspended. They would be suspended for 9 months.