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	England and Wales High Court (Commercial Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Commercial Court) Decisions >> Albesher v Ryan & Ors [2016] EWHC 541 (Comm) (15 March 2016) URL: http://www.bailii.org/ew/cases/EWHC/Comm/2016/541.html Cite as: [2016] EWHC 541 (Comm)

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IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		15/03/2016

Mr Justice Walker:

[Table of Contents]

A. Introduction	1
B. The claim	4
B1. The parties and the claim form	4
B2. The property	7
B3. The primary claims against Mr Ryan	8
B3.1 Primary claims against Mr Ryan: general	8
B3.2 Primary claim against Mr Ryan for deceit	10
B3.3 Primary claim against Mr Ryan: unlawful means conspiracy	11
B4. The primary claims against Ryan Corp	15
B5. Declaratory claim against Ryan Corp	18
B6. The primary claims against Credit Suisse	20
B7. The supplemental claims against Credit Suisse	25
C. Procedural history	29
D. Ryan Corp's answer to the claim	43
D1. Ryan Corp's answer: general	43
D2. Relevant assertions in Ryan 1	45
D2.1 Ryan 1: general	45
D2.2 Ryan 1: Representations and agreement on financing	46
D2.3 Ryan 1: Denial of conspiracy	57
D2.4 Ryan 1: Dr Albesher's actual and proposed funding	59
D2.5 Ryan 1: Mr Ryan's arrangements for funding	71
D2.6 Ryan 1: Events after 16 January 2014	82
D3. Assertions in Albesher 1	90
D3.1 Assertions in Albesher 1: general	90
D3.2 Albesher 1: financing representations/agreement	92
D3.3 Albesher 1: conspiracy	107
D3.4 Albesher 1: Dr Albesher's actual and proposed funding	109
D3.5 Albesher 1: Mr Ryan's arrangements for funding	114
D3.6 Albesher 1: events after 16 January 2014	117
D4. Assertions in Ryan 2	137
D4.1 Assertions in Ryan 2: general	137
D4.2 Ryan 2: Representations and agreement on financing	138
D4.3 Ryan 2: Denial of conspiracy	140
D4.4 Ryan 2: Dr Albesher's actual and proposed funding	141
D4.5 Ryan 2: Mr Ryan's arrangements for funding	142
D4.6 Ryan 2: Events after 16 January 2014	143
D5. Ryan Corp's answer: argument and analysis	149
E. Discretion	169
F. Additional observations and conclusion	186

A. Introduction

1. This is an application by the second defendant ("Ryan Corp") to set aside a default judgment. The issues which arise are whether Ryan Corp's proposed defence has a real prospect of success, and whether it is appropriate to exercise discretion in favour of Ryan Corp.
2. At the hearing of the application Ms Alexia Knight, instructed by Goodman Derrick LLP ("Goodman Derrick"), appeared for the claimant ("Dr Albesher") and Mr Edward Cohen, instructed by Gresham Legal in succession to Hierons LLP ("Hierons"), appeared for Ryan Corp. At my request counsel prepared a joint note sent on 14 January 2016 in order to deal with developments in November and December 2015. I am grateful to the legal teams on both sides for the assistance provided to me.
3. For the reasons given below, I find in favour of Ryan Corp on each of the issues described above. Before turning to examine those issues, I set out in sections B and C below a summary of the claim and the procedural history.

B. The claim

B1. The parties and the claim form

4. Dr Albesher is the Saudi Arabian ambassador to the United Arab Emirates. He was formerly the ambassador of Saudi Arabia to the Kingdom of Morocco. In addition to Ryan Corp, there are two other defendants. The first defendant is Thomas Gerrard Ryan ("Mr Ryan"). He is both the director, and the indirect owner, of Ryan Corp. In circumstances described in section C below, he has now filed a defence denying the claims made against him. The third defendant is Credit Suisse (UK) Limited ("Credit Suisse"). Credit Suisse's liability to Dr Albesher is said to arise by reason of the activities of Mr Hans-Olav Eldring ("Mr Eldring"), who was an employee, and was described as a "director", of Credit Suisse. In June 2015 Credit Suisse filed a defence denying liability for the claims made against it.
5. The claim form gave brief details of the claim. Under this head, substantive claims were listed at paragraphs 1 to 5:

1. The Claimant entered into an agreement with the First and Second Defendants to purchase Hertsmere House, 2 Hertsmere Road, E14 4AA as a development property. As a result of a fraud perpetrated by the First, Second and Third Defendants, the Claimant has suffered financial loss and seeks the remedies listed in paragraphs 2 to 6 below.

2. Against the Second Defendant a declaration that it holds the benefit of any rights as it may have including the right to seek to obtain relief from forfeiture of the deposits paid of £20 million upon trust for the Claimant.

3. Against the First, Second and Third Defendants damages of £25.4 million in deceit and/or unlawful means conspiracy.

4. Against the Third Defendant an order that it do pay the sum due of £10.4 million.

5. Against the Third Defendant, in the alternative, damages of £5 million in dishonest assistance of a breach of trust.

6. The largest claims are those advanced in paragraph 3 against all three defendants, seeking damages of £25.4 million "in deceit and/or unlawful means conspiracy". I shall refer to these claims as "the primary claims".

B2. The property

7. The claim concerns a property known as "Hertsmere House" ("the Property"). It benefits from a prime location in the Canary Wharf business district and financial centre.

B3. The primary claims against Mr Ryan

B3.1 Primary claims against Mr Ryan: general

8. The primary claims are for losses totalling £25.4 million. These losses are said to arise as a result of payments made in September and November 2013 by Dr Albesher to Mr Ryan's personal account with Credit Suisse. There was a further payment of £12 million in January 2014, but this was frozen by Credit Suisse and was returned to Dr Albesher.
9. The primary claims are put in two ways. The first primary claim is advanced in deceit, as discussed in section B3.2 below. The second is for unlawful means conspiracy, as described in section B3.3 below.

B3.2 Primary claim against Mr Ryan for deceit

10. As against Mr Ryan, Dr Albesher's claim in deceit was put in this way in the particulars of claim:

i) Dr Albesher became interested in purchasing the Property together with Mr Ryan, for the purpose of developing it, on the basis of an equal investment by each and an equal sharing of the profits from the development. The acquisition of the Property was to be structured through a company, the shares of which would be held either directly, or indirectly, through another corporation, equally between Dr Albesher and Mr Ryan. (Particulars of claim, paragraph 8)

ii) Between 11 and 13 September 2013 Mr Ryan met Dr Albesher in Casablanca, and stated:

a) that Dr Albesher would have to pay £15 million to Mr Ryan's account with Credit Suisse;

b) that Mr Ryan would deposit the same amount of money, namely £15 million, into that account; and

c) that it was very urgent for the money to be paid to his bank by Dr Albesher as a down payment on the purchase of the Property.

(Paragraph 21 of the particulars of claim, with lettered sub-paragraphs added for convenience).

iii) Mr Ryan's assertion that he would deposit the sum of £15 million into that account was:

a) an express representation of an actual intention to make that deposit; and

b) an implied representation that he had the money immediately available or if not the means to raise the sum of £15 million in order to do so.

(This combined representation, which I have split into lettered sub-paragraphs for convenience, is described in paragraph 22 of the particulars of claim as "Mr Ryan's £15 Million Representation").

iv) Dr Albesher relied upon this representation in the sense that this confirmed his belief that Mr Ryan was in a position to purchase and develop the Property in partnership with himself and that he should continue with his intention to invest. (Particulars of claim, paragraph 22).

v) "Between 22 and 23 September 2013" Mr Ryan visited Dr Albesher again in Casablanca, and told him that if he did not immediately make the payment of £15 million then the Property would go to another buyer from China. (Particulars of claim, paragraph 29).

vi) On 22 September 2013 Mr Ryan signed and emailed to Dr Albesher a letter on Ryan Corp notepaper addressed to Dr Albesher in which he said:

I refer to our joint purchase of [the Property]. I further refer to the position that as soon as I receive the £15,000,000.00 from you these funds will be used to buy the site which I will secure tomorrow in a 50/50 agreement for Dr Al-Besher and Thomas Ryan. This arrangement is a 50/50 agreement as agreed and discussed at our meeting today Sunday September 22^nd at your residence.

(Particulars of claim, paragraphs 29 and 30)

vii) On 23 September 2013, induced by and in reliance upon Mr Ryan's £15 Million Representation along with representations by Credit Suisse, Dr Albesher paid sums totalling £15 million to Mr Ryan's personal account with Credit Suisse. (Particulars of claim, paragraph 38).

viii) On 25 September 2013 Ryan Corp exchanged contracts to purchase the Property for a purchase price of £100 million. Ryan Corp paid a deposit of £10 million to the vendor, and the completion date was 29 October 2013. (Particulars of claim, paragraph 39).

ix) On 30 September 2013 Dr Albesher, Mr Ryan and Mr Eldring met Mr Frederic Olofsson at Mr Olofsson's office in Geneva for the purpose of establishing a Swiss special purpose company, Land & Securities SA. It was proposed by Mr Ryan that shares in Land & Securities SA would be held equally between Dr Albesher and Mr Ryan. Land & Securities SA would in turn own the shares in Ryan Corp, which would own the Property after completion. (Particulars of claim, paragraph 39).

x) Ryan Corp was unable to complete the purchase of the Property by the agreed date of 29 October 2013 because it did not have the funds available. The vendor served a notice to complete on that date. It is to be inferred that Mr Ryan was unable to obtain finance for the remaining sum of £90 million whether from Credit Suisse or any other party. (Particulars of claim, paragraph 43).

xi) On or about 7 November 2013 Mr Ryan represented to Dr Albesher that he required a loan of a further £10.4 million from Dr Albesher, for the specific purpose of extending the contract for the purchase of the Property. (Particulars of claim, paragraph 43).

xii) On 14 November 2013, induced by and in reliance upon certain guarantees allegedly given by Credit Suisse, Dr Albesher transferred the sum of £10.4 million to Mr Ryan's account with Credit Suisse. (Particulars of claim, paragraph 49).

xiii) On 15 November 2013 Ryan Corp entered into a supplemental agreement with the vendor, pursuant to which the completion date was extended to 23 December 2013. Also on 15 November 2013 Ryan Corp paid a further sum of £10 million to the vendor, as well as an "interest payment" in the sum of £405,479.51. (Particulars of claim, paragraph 50).

xiv) Ryan Corp was unable to complete the purchase of the Property by 3 December 2013 or at all. Again its inability to do so was due to its and Mr Ryan's failure to obtain finance. (Particulars of claim, paragraph 52).

xv) Accordingly a deposit of £20 million and interest of £405,479.51 has been paid to the vendor and has been lost. (Particulars of claim, paragraph 53).

xvi) "In the premises" Dr Albesher has paid sums totalling £25.4 million into Mr Ryan's personal account with Credit Suisse and the entire sum has been lost, and "[it] is inferred that Mr Ryan never had any, or any substantial, money of his own to invest in the Property…". (Particulars of claim, paragraph 59).

xvii) The sum of £5 million belonging to Dr Albesher which was paid into Mr Ryan's personal account with Credit Suisse has "disappeared." (Particulars of claim, paragraph 60).

xviii) As to Mr Ryan's £15 Million Representation:

a) it was false and fraudulent;

b) Mr Ryan never had £15 million or anything like that sum available to pay into Mr Ryan's personal account with Credit Suisse on the basis agreed on 18 August 2013 in Casablanca;

c) this fact is inferred from the fact that Mr Ryan never paid £15 million into Mr Ryan's personal account with Credit Suisse;

d) if Mr Ryan had had such funds available then he would have done so because that would have greatly assisted in completing the acquisition of the Property which was a valuable opportunity.

(Particulars of claim at paragraphs 67 and 69, with lettered sub-paragraphs added for convenience).

xix) "In the premises" Mr Ryan, Ryan Corp [see section B4 below] and Credit Suisse [see section B6 below] are liable in damages to be assessed for deceit. Each is liable severally for all of the losses suffered by Dr Albesher, namely the loss of the sum of £25.4 million plus interest thereon. (Particulars of claim, paragraph 73).

B3.3 Primary claim against Mr Ryan: unlawful means conspiracy

11. Paragraph 75 of the particulars of claim asserts that at some time between 19 July 2013 and 25 September 2013 there was an agreement "between Mr Ryan and/or Ryan Corp and/or Mr Eldring for Credit Suisse" that they would seek to induce Dr Albesher "to invest substantial sums… by fraudulently misrepresenting Mr Ryan's financial position and creditworthiness, and his track record in property development, by giving [Dr Albesher] the belief that Mr Ryan was in a financial position to acquire the Property and carry out its development, and had carried out developments of a value of £100 million before."
12. It was asserted in paragraph 74 of the particulars of claim that the particulars given in paragraph 75 were "the best… that can be given" until "disclosure, the taking of a deposition or cross examination". Paragraph 76 added that the misrepresentations were made fraudulently, and in that sense were deliberate and wrongful acts. Each defendant was said to have had "intent to injure" because each knew that Dr Albesher:

was relying upon the representations made in deciding whether to invest and in transmitting substantial sums in reliance thereon, and that he stood to lose those sums invested.

13. Paragraph 78 of the particulars of claim asserted that pursuant to "the above unlawful means conspiracy":

78. … each of Mr Ryan, Ryan Corp and Mr Eldring for and on behalf of Credit Suisse acted as pleaded in paragraphs 6 – 60 above and including the making of fraudulent misrepresentations as pleaded in paragraphs 63 – 73.

14. Paragraph 79 of the particulars of claim then asserted that each of Mr Ryan, Ryan Corp and Credit Suisse was liable "jointly and severally" for all of the losses suffered by Dr Albesher, namely the loss of the sum of £25.4 million plus interest thereon.

B4. The primary claims against Ryan Corp

15. The primary claims against Ryan Corp assert that it, too, is liable for the same £25.4 million as is claimed against Mr Ryan. Again this is put in two ways: deceit and unlawful means conspiracy.
16. As regards the claim of deceit against Ryan Corp, one basis only is set out in the particulars of claim for holding Ryan Corp liable in this regard. It is found in paragraph 2 of the particulars of claim. After asserting that Mr Ryan was at all material times a director of Ryan Corp, and the indirect owner of Ryan Corp, that paragraph states:

At all material times Mr Ryan has acted in his own capacity as an individual and as such is liable for his own conduct, and Ryan Corp is vicariously liable for his conduct.

17. No further explanation is given in the particulars of claim, as regards Ryan Corp's alleged liabilities in deceit and unlawful means conspiracy, for the assertion that Ryan Corp is liable to Dr Albesher. It is not asserted that anything said or done by Mr Ryan or Credit Suisse was done on behalf of Ryan Corp and with Ryan Corp's authority.

B5. Declaratory claim against Ryan Corp

18. As noted in section B1 above, the claim form sought a declaration that Ryan Corp "holds the benefit of any rights as it may have including the right to seek to obtain relief from forfeiture of the deposits paid of £20 million upon trust for [Dr Albesher]".
19. This claim for a declaration is the subject of paragraphs 61 and 62 of the particulars of claim:

61. The contract of sale made between Ryan Corp and the Vendor under which deposits totalling £20 million have been paid, and any beneficial or other equitable interest in that contract or the Property, as may have existed or still exist, are held by Ryan Corp on constructive or alternatively resulting trust for the Claimant, because the entire deposit sum of £20 million as pleaded above has been paid by the Claimant.

62. Accordingly Ryan Corp holds any rights that it may have for example to claim relief from forfeiture of the deposits of £20 million in whole or in part, on constructive or resulting trust, for the Claimant.

B6. The primary claims against Credit Suisse

20. The primary claims made by Dr Albesher against Credit Suisse are also in deceit and for an unlawful means conspiracy. The claim for deceit relies upon five alleged representations by Mr Eldring on behalf of Credit Suisse. Below I summarise each alleged representation, along with the answer given in Credit Suisse's defence:

i) A reference given in July 2013 used words which were said to represent that Credit Suisse confirmed from its own knowledge that Mr Ryan had been dealing with, in the sense of directly or indirectly being a vendor or purchaser, more than one real estate project with individual values exceeding £100 million ("the July Representations"). (Particulars of claim, paragraph 14). As to this, Credit Suisse's defence states at paragraphs 10 to 16 that Mr Eldring, at Mr Ryan's request, wrote a reference dated 19 July 2013 which included the words alleged by Dr Albesher, but it denies that the words used conveyed the meaning asserted in the particulars of claim. The reference was addressed "to whom it may concern", and stated that it was given "without any guarantee or responsibility on the part of Credit Suisse or its officials." Moreover, Mr Eldring in signing and sending the July reference was acting beyond the scope of authority conferred on him by Credit Suisse.

ii) "Between 18 and 19 September 2013" Dr Albesher visited London and met Mr Eldring in his office at Credit Suisse, where Mr Eldring stated to Dr Albesher ("the September Oral Representation") that "he is handling the account of Mr Tom Ryan and Mr Ryan has 100 Million pound credit line." (Particulars of claim, paragraph 23). As to this, Credit Suisse at paragraph 21 of its defence admits that Mr Ryan and Dr Albesher visited Credit Suisse's offices in Canary Wharf on 19 September 2013 to meet with Mr Eldring. Dr Albesher is put to proof as to the existence and content of the alleged September Oral Representation.

iii) In a reference given in September 2013 Mr Eldring and Credit Suisse represented ("the September written representation") that:

a) Credit Suisse had personal knowledge of Mr Ryan's ability to service the kind of obligations normally associated with projects with individual values in excess of £100 million; and

b) Credit Suisse had no reason to consider that Mr Ryan would not be able to meet his obligations to Dr Albesher, and/or the vendor, in connection with the purchase and development of the Property.

(Particulars of claim, paragraph 34). As to this, Credit Suisse's defence at paragraphs 27 to 31 admitted that Mr Eldring, at Mr Ryan's request, wrote the September Reference. Credit Suisse said that it did not have the meaning alleged in the particulars of claim. Moreover, Mr Eldring, in signing and sending the September reference, was acting beyond the scope of the authority conferred on him by Credit Suisse.

iv) On 12 November 2013 Mr Eldring for Credit Suisse stated in an email sent to Dr Albesher's financial advisor and copied to Dr Albesher ("the 12 November guarantee") that Credit Suisse had received "a valid irrevocable and unconditional payment instruction" from Mr Ryan to transfer from his personal account with Credit Suisse £10.4 million "value date 20.11.2013 in your favour". (Particulars of claim, paragraph 45). As to this, Credit Suisse's defence at paragraph 42 admitted that Mr Eldring sent an email attaching a letter which included the wording alleged, denied that Mr Eldring was acting within the scope of his authority in signing and sending this document, and denied that it constituted either a guarantee or an enforceable guarantee.

v) It was implicit that Mr Eldring had a bona fide belief that either Mr Ryan then and there had the sum of £10.4 million on account with Credit Suisse, or that he was in a financial position whereby he would be able to satisfy this obligation, before the due date of 20 November 2013. (Particulars of claim, paragraph 46). As to this, Credit Suisse's defence at paragraph 46 made no admissions as to Mr Eldring's knowledge or belief, denied that such knowledge or belief was implicit from the wording of the document, and asserted that the document did not purport to confirm whether Mr Ryan had money on account at that time or whether it was likely that Mr Ryan would have the money by 20 November 2013.

21. In paragraphs 67, 68 and 70 to 72 of the particulars of claim it was asserted that each of the representations made by Mr Eldring on behalf of Credit Suisse was false and fraudulent. As to what was referred to as "the July Representations" (see item (1) above), paragraph 68 of the particulars of claim stated:

68. The July Representations made by Mr Eldring were false and fraudulent because Credit Suisse was in no position at all to confirm from its own knowledge that Mr Ryan had dealt with more than one real estate project with individual values exceeding £100 million. Until disclosure the best particulars that can be given are that Mr Ryan has now disappeared and enquiries made about him on the Claimant's behalf do not reveal that he had any track record of dealing (in the sense of acting as purchaser or vendor) with at least two developments with values in excess of £100 million.

22. Assertions as to the falsity of later representations by Mr Eldring were set out in paragraphs 70 to 72 of the particulars of claim. These were followed by the assertion in paragraph 73, set out at the end of section B3.2 above. As to these allegations of fraud, Credit Suisse's defence at paragraphs 60 to 69 repeated earlier denials that Mr Eldring made the representations alleged, along with earlier denials that Mr Eldring had actual or apparent authority to do so. In addition, Credit Suisse made no admissions as to:

i) allegations against Mr Ryan and Ryan Corp;

ii) the falsity of any representations;

iii) any knowledge by Mr Eldring of such falsity; and

iv) any intention by Mr Eldring that Dr Albesher should act upon such representations.

23. The assertion against Credit Suisse in relation to unlawful means conspiracy has been set out in section B3.3 above. It was supplemented in paragraph 77 by an assertion as follows:

77. Further or alternatively if Mr Eldring was induced by lies told to him by Mr Ryan to make the July Representations, and was not party to the conspiracy to make misrepresentations to the Claimant at the outset, then it will be averred that he joined the conspiracy as between Mr Ryan and Ryan Corp, at some stage prior to 25 September 2013, alternatively later, and his motive in doing so may in part have been, that if he did not assist Mr Ryan in procuring the payment of money from the Claimant, that the acquisition of the Property would fail, and in the aftermath the fact of the July Reference, the September Reference, the payment of the Claimant's money to Mr Ryan's Account, and the Guarantees, would be exposed, and he Mr Eldring would be subject to disciplinary action and possible dismissal by Credit Suisse.

24. Credit Suisse's defence at paragraphs 73 to 78 rejected the conspiracy claim on numerous grounds. Among other things, it put Dr Albesher to proof of the alleged agreement; if there was such an agreement, Credit Suisse denied that Mr Eldring was acting on behalf of Credit Suisse in entering into it. Credit Suisse added that it did not admit Mr Eldring's alleged intent, and further that any such intent could not be imputed to Credit Suisse. It also added that absence of intent to injure could be inferred since, if the required finance had been obtained, Dr Albesher would not have suffered the alleged loss.

B7. The supplemental claims against Credit Suisse

25. Two supplemental claims are made against Credit Suisse. It is said that they arise "further or alternatively" to the primary claims. The first supplemental claim, alleging dishonest assistance in a breach of trust, is at paragraphs 80 to 85 of the particulars of claim. It asserts that because Credit Suisse knew that £15 million had been paid into Mr Ryan's account for the specific purpose of the acquisition of the Property and its development, it was held upon a resulting trust by Mr Ryan. Of this, £10 million was used for the agreed purpose but "the sum of £5 million has disappeared". Mr Eldring had acted dishonestly in permitting Mr Ryan to withdraw the sum of £5 million from his account, and Credit Suisse was "liable… in the alternative to the above in dishonest assistance of a breach of trust and is accountable in equity in the sum of £5 million plus interest.
26. Credit Suisse's defence at paragraphs 79 to 85 denied any liability, either direct or vicarious, for dishonest assistance of a breach of trust. It put Dr Albesher to proof of all elements of such a claim. It repeated an earlier plea that only £14,756,479.77 was paid into Mr Ryan's account in September 2013. It added a denial that Dr Albesher suffered loss as a result of Mr Ryan's alleged breach of trust:

since had the Claimant's monies been applied to the alleged correct purpose they would have been lost in any event.

27. The second supplemental claim is for liability under a guarantee. This liability is asserted at paragraphs 86 and 87 of the particulars of claim. It is said to arise out of a contractual obligation on the part of Credit Suisse, pursuant to a "guarantee" given on 13 November 2013, to pay the sum of £10.4 million to Dr Albesher in the events that have occurred, namely the failure by Mr Ryan "to pay the sum as agreed".
28. Credit Suisse's defence at paragraphs 86 and 87 denied any contractual obligation on its part to Dr Albesher. It repeated earlier denials of Mr Eldring's authority, along with earlier assertions as to the unenforceability of the alleged agreement. It added that Dr Albesher had:

failed to plead what agreement was allegedly made between Mr Ryan and the Claimant or the terms thereof.

C. Procedural history

29. The claim form was issued on 5 March 2015. It gave brief details of the claim as set out in section B1 above. Particulars of claim were subsequently settled by Mr Gregory Mitchell QC and Ms Knight, and were the subject of a statement of truth signed by Dr Albesher on 23 March 2015. The claim form and associated documents were posted to Ryan Corp's registered office in London on 8 April 2015. Service was thus deemed to have taken place on 10 April 2015.
30. As regards service on Mr Ryan and Credit Suisse:

i) The claim form set out Mr Ryan's address in the Republic of Ireland. On 9 April 2015 Ms Emily Kozien-Colyer of Goodman Derrick wrote to the Foreign Process Section ("FPS") of the High Court requesting service in accordance with article 4 of the Service Regulation (CPR 6.40(3)(a)(i) and CPR 6.41). This led to relevant documents being sent to Ireland on 16 April 2015.

ii) Credit Suisse filed an acknowledgement of service on 22 April 2015.

31. Time for filing an acknowledgement of service by Ryan Corp expired on 24 April 2015. No acknowledgement of service was filed by Ryan Corp within that time. A request for a default judgment against Ryan Corp was refused by the court because the relief sought against Ryan Corp included a claim for a declaration. Accordingly under CPR 12.4 an application notice was required. On 22 May 2015 an application notice was issued seeking a default judgment against Ryan Corp. The application notice was served on Ryan Corp at its registered office by post. A hearing of the application for a default judgment was fixed to take place on 2 June 2015.
32. The hearing duly took place on 2 June 2015 before His Honour Judge Waksman QC. Mr Cohen appeared for Ryan Corp, having been instructed for this purpose by Hierons earlier that day. Neither Mr Cohen nor his instructing solicitor had been able to obtain detailed instructions in the time available. Mr Cohen noted that CPR 12.8 governs the position where a claimant applies for a default judgment against one of two or more defendants. He also noted that under CPR 12.8(2)(b), if a claim against the defaulting defendant "cannot be dealt with separately" from the claim against the other defendants, then the court will not enter default judgment. However, his submission that the claim against Ryan Corp fell within this category was rejected by His Honour Judge Waksman. A further submission was made that there should be an extension of time for filing an acknowledgement of service. This submission, too, was rejected.
33. In these circumstances His Honour Judge Waksman entered a default judgment against Ryan Corp. However he granted a stay of execution until 4pm on Tuesday 23 June 2015, which was to continue if Ryan Corp applied within that time to set aside the default judgment.
34. On 8 June 2015 a consent order was made extending time for service of Credit Suisse's defence until 19 June 2015. Credit Suisse's defence was duly served on that day.
35. On 23 June 2015 Ryan Corp issued an application notice seeking to set aside the default judgment. It was accompanied by a first witness statement of Mr Ryan ("Ryan 1"), made on 23 June 2015.
36. Numerous unsuccessful attempts were made by Ms Kozien-Colyer to ascertain the position concerning service on Mr Ryan in Ireland. Eventually on 28 July 2015 the Dublin Circuit Court, as transmitting authority under the Service Regulation, informed Ms Kozien-Colyer that the documents "have gone by way of registered post this day". However Ms Kozien-Colyer was then informed on 17 August 2015 that the postal authorities had returned the documents to the court as "they were not called for". A certificate of non-service was sent to the FPS in this regard.
37. On 6 October 2015 an application notice was issued asking that service of the claim form on Mr Ryan be permitted by an alternative method or at an alternative place. The ground for taking this course was said to be that Mr Ryan had avoided service carried out under methods provided in CPR 6.40(3). The application notice relied upon a witness statement made by Ms Kozien-Colyer on 19 August 2015 ("Kozien-Colyer 1"). In this witness statement Ms Kozien-Colyer recounted the history of her attempts to serve Mr Ryan. She added that Mr Ryan had received notice of the proceedings, and had filed Ryan 1 on behalf of Ryan Corp. She asserted that Mr Ryan was "deliberately avoiding service".
38. Ms Kozien-Colyer made a second witness statement ("Kozien-Colyer 2") on 6 October 2015. In it she recorded that after receiving the certificate of non-service Dr Albesher sought and obtained from this court an extension of time permitting service of the claim form on Mr Ryan no later than 5 December 2015. She described instructing process servers in Ireland, and produced a copy of their report dated 6 October 2015. It stated that a process server had personally attended Mr Ryan's address on seven separate dates between 7 and 28 September 2015 inclusive, on each date at a different time during the day or evening, and had knocked on the front door several times without answer. The porch light was switched on at the property on each occasion. The process server had not observed anybody at the property during any of these visits. On his second attempt at service, he had spoken with two next door neighbours residing on either side of the address. Both had confirmed that Mr Ryan was currently residing there. Ms Kozien-Colyer also recorded that Goodman Derrick had repeatedly invited Gresham Legal to accept service of the proceedings on behalf of Mr Ryan, but that invitation had not been accepted.
39. Also on 6 October 2015 Dr Albesher made a first witness statement ("Albesher 1") in response to Ryan 1. This led to a second witness statement of Mr Ryan ("Ryan 2") made on 15 October 2015.
40. At the hearing on 16 October 2015 there was no attendance on behalf of Mr Ryan. I made an order that service of the proceedings on Ryan Corp should stand as service upon Mr Ryan, taking effect that day. As regards Ryan Corp's application to set aside the default judgment, I heard oral submissions from Mr Cohen in support of the application, from Ms Knight opposing it, and from Mr Cohen in reply.
41. An acknowledgement of service on behalf of Mr Ryan was duly filed by Gresham Legal on 27 October 2015. A defence on behalf of Mr Ryan was filed on 13 November 2015. A reply to the defence was filed on behalf of Dr Albesher on 11 December 2015.
42. On 12 January 2016 I invited counsel to lodge a joint note setting out written submissions in relation to the statements of case filed in November and December 2015. In response to that request I received observations set out in an email dated 14 January 2016.

D. Ryan Corp's answer to the claim

D1. Ryan Corp's answer: general

43. Ryan Corp acknowledges that the default judgment was entered regularly: Ryan Corp's failure to acknowledge service gave rise to an entitlement to enter default judgment under CPR 12. That being so, the judgment can only be set aside if, under CPR 13.3(1), Ryan Corp has a real prospect of successfully defending the claim, or there is some other good reason why the judgment should be set aside. The case advanced by Ryan Corp is that it does indeed have a real prospect of successfully defending the claim. It asserts, and Dr Albesher denies, that the account of events in Ryan 1 is sufficient to show a real prospect of successfully defending the claim.
44. I summarise relevant parts of Ryan 1 in section D2 below. In sections D3 and D4 I summarise relevant parts of the ensuing witness statements, Albesher 1 and Ryan 2. In section D5 I analyse the rival arguments.

D2. Relevant assertions in Ryan 1

D2.1 Ryan 1: general

45. Five main aspects dealt with in Ryan 1 are relevant for present purposes. The first concerns what was said by way of representations, and what agreement was reached, between Mr Ryan and Dr Albesher in relation to the financing of the proposed development of the Property. I deal with this in section D2.2 below. In section D2.3 I deal with Ryan 1's denial of the alleged conspiracy. Section D2.4 summarises what is said in Ryan 1 about Dr Albesher's actual and proposed funding. Section D2.5 deals with what is said in Ryan 1 about Mr Ryan's arrangements for funding. Ryan 1 asserts that a final extension of the time for completing the purchase of the Property was given, which expired on 16 January 2014. In section D2.6 I summarise what is said in Ryan 1 about events after that date.

D2.2 Ryan 1: Representations and agreement on financing

46. Ryan 1 at paragraph 13 states that Dr Albesher's claim of fraudulent misrepresentations "is completely untrue". Paragraph 14 describes an initial meeting between Mr Ryan and Dr Albesher's son. For convenience I shall refer to Dr Albesher's son as "Fahad". According to Ryan 1, Fahad said that his father was keen to invest in property in London and that they wanted to know if Mr Ryan could assist them, and if so, how.
47. Ryan 1 at paragraphs 15 to 18 contains assertions by Mr Ryan that he considered that by obtaining revised planning permission for the Property, "a new luxury residential skyscraper" could generate a profit in the region of £300 million, and that he discussed with Dr Albesher on a visit to him in Saudi Arabia in late July 2013 that an offer of £100 million would be likely to be needed.
48. As to what was said at that initial meeting and subsequently in relation to financing, Ryan 1 stated at paragraphs 19 and 20:

19. It was clear to me at that meeting that the Claimant was very keen to be involved with this opportunity and we talked about structuring a 50:50 investment and profit sharing model between the two of us, if we decided to go forward. That would mean both of us having to invest £50 million, possibly more to account for stamp duty land taxes and other acquisition costs, at the outset in order to purchase Hertsmere.

20. The Claimant's version of events as set out in the Particulars of Claim as to what happened after our initial meeting is materially false in many respects. For example, the Claimant suggests that I (both personally and through or in collaboration with Mr Eldring of Credit Suisse) made representations about my financial means that suggested I would personally match the Claimant's contributions. That simply is not the case.

49. In addition Ryan 1 stated at paragraph 22:

22. The Claimant himself makes several acknowledgments that I indicated I would have the means to raise finance to meet my obligations upon a joint investment. That is precisely what I had told the Claimant and I had been working on that, both before I met him and in earnest after we had come to an agreement in principle to jointly invest and develop the project on an equal basis.

50. At paragraph 24 Ryan 1 noted that the letter dated 22 September 2013 and signed by Mr Ryan on Ryan Corp notepaper, relied upon in the particulars of claim at paragraph 30 (see item (6) in section B3.2 above), "recorded the 50:50 arrangement we had agreed". Ryan 1 added at paragraph 25:

25. Again, so far as the Claimant alleges that I told him I would match his initial payment of £15 million into the account with Credit Suisse, that simply is untrue. That was never my intention, nor did I ever tell him that. All of my funding was to be provided through debt finance and I made that clear to the Claimant from the very beginning.

51. When explaining why Dr Albesher's initial £15 million was paid into Mr Ryan's personal account with Credit Suisse, Ryan 1 at paragraph 26 said that this was because:

the agreed plan was for our intended joint investment company (which we agreed should be incorporated in Switzerland) to have its own bank account in Switzerland and, in due course, all funds would be paid into that company's account. …

52. In paragraph 28, when dealing with the visit to Geneva described in paragraph 29 of the particulars of claim (see item (9) of section B3.2 above) to meet Mr Olofsson, Ryan 1 said that Mr Olofsson:

… was going to assist us with incorporating a Swiss company, Land & Securities SA, that we would jointly own and which would become the holding company of the Second Defendant. This was to reflect the equal participation that the Claimant and I would have in the investment project in all respects, including in relation to funding to acquisition and related costs.

53. At pages 6 to 39 of the exhibit to Ryan 1 Mr Ryan produced what were described in paragraph 28 of Ryan 1 as "copies of documents confirming the agreement I had with the Claimant that Land & Securities SA would be jointly owned". These comprised:

i) An email dated 26 September 2013 from Mr Ryan to Dr Albesher forwarding articles of incorporation sent by Mr Olofsson, and stating:

The Agreement is between Dr Mohammed A Al-Besher and Thomas Ryan in relation to our 50/50 ownership of LAND SECURITIES.

ii) An email dated 29 September 2013 from Mr Ryan to Dr Albesher attaching a "draft working document"; the attachment, headed "Draft working document" was "to be incorporated in articles of Land Securities". After setting out that Land Securities was owned by Dr Albesher and Mr Ryan on a 50/50 basis and that profits "will be 50/50 between both parties", the document included the following, among other, additional statements, with numbering in square brackets added for convenience:

[6] The purpose of Land Securities will be to act as a fund to collect and hold funds for property development which will be handled through its development Company – Ryan CORP. In other words it will be the bank to Ryan CORP.

[7] The purpose of the company will also to be the holder of profits for both parties.

[8] The purpose of the company will be to act as the 'bank' to Ryan CORP the development company. For the reason of existing brand awareness (this means that the market already knows Ryan CORP and the financial institutions already know Ryan CORP) and for further brand development Ryan CORP will be used as the brand to purchase and develop the property projects in London, Saudi Arabia, Morocco and what ever other countries both parties agree on.

[9] It is a special condition agreed in to the articles of incorporation that Land Securities also has a charge on all properties held in Ryan CORP therefore the owners of Ryan CORP as above Dr. Mohammed A. Al Besher and Tom Ryan are through this condition the only owners of Ryan CORP.

[10] Any profits, funds or properties held in Ryan CORP are ultimately the owned 50/50 by both parties.

[11] This is to avoid any confusion if Ryan CORP has to keep any asset/property in its company – it is still owned by both parties and the 50% interest will be held in trust by Tom Ryan for Dr. Mohammed A. Al Besher.

…

iii) A notary's letter dated 7 November 2013 to Mr Olofsson enclosing a certified extract from the Geneva Registry of Commerce stating that Land & Securities SA had been inscribed on 5 November 2013.

iv) An email timed at 20:27 on 13 November 2013 from Mr Ryan to Dr Albesher ("Mr Ryan's 13 November "funding is 50:50" email") stating:

I wish to confirm the following,

Hertsmere is owned 50 50 by you and I.

The funding is 50 50 between you and I.

You have transferred GBP 15 million to me.

We plan to build this out it sell in advance (which ever decision the 2 of us make) and we will share the profits 50 50.

v) An exchange of emails between Dr Albesher and Mr Ryan on 14 November agreeing to meet in Geneva the following week.

vi) An email from Mr Olofsson to Dr Albesher and Mr Ryan dated 20 November 2013 enclosing a draft shareholders agreement "to be discussed this morning".

vii) A share certificate dated 20 November 2013 in the name of Mr Ryan, recording him as the owner of 50 out of 100 issued shares in Land & Securities SA.

54. After describing a visit to China, and a meeting with Dr Albesher in Dubai in October 2013, Mr Ryan stated in paragraphs 31 and 32 that the raising of finance both on his part and on Dr Albesher's part was "delayed". Paragraph 33 of Ryan 1 stated that "[t]herefore, the originally planned completion date of 29 October 2013 was pushed back to 3 December 2013." As to the assertion in paragraph 43 of the particulars of claim that completion did not take place on 29 October 2013 because he was "unable to obtain finance for the remaining sum of £90 million" (see item (10) at section B3.2 above), Mr Ryan stated at paragraph 34 of Ryan 1:

That is a complete fabrication, not only because he was also unable to organise the necessary finance to cover his own obligations (as I have explained above), but also, it was never the intention that I and/or the Second Defendant would pay 90% of the purchase price.

55. In paragraphs 35 to 38 of Ryan 1 Mr Ryan rejected Dr Albesher's assertion that the further sum of £10.4 million had been provided as a "loan"; I deal with this in sections D2.3 and D2.4 below. Paragraphs 39 and 40 of Ryan 1 dealt with certain aspects of Mr Ryan's arrangements for funding, which I deal with in section D2.5 below. For present purposes it is relevant to note that, when dealing with the period 13 to 21 November 2013, paragraph 41 of Ryan 1 stated:

41. The financing I was seeking around this time was higher than I had originally envisaged since I knew the Claimant was himself seeking bank finance for the balance of his contribution, but was having difficulties in securing funding.

56. In paragraphs 42 to 45 of Ryan 1 Mr Ryan described further funding arrangements which are summarised in sections D2.4 and D2.5 below; for present purposes I need only note that Mr Ryan asserted that by 3 December 2013 he had secured sufficient funding to ensure completion of the purchase provided that Dr Albesher raised "approximately £10-15 million". Paragraph 46 of Ryan 1 asserted that a further short extension of completion to 16 January 2014 was "agreed" as Dr Albesher believed this to be "sufficient time for him to raise additional funds to allow us to pay the balance of the purchase price." In paragraphs 47 to 50 of Ryan 1 Mr Ryan asserted that he had visited Dr Albesher in Casablanca during the first week of January 2014 to explain that he needed urgently to pay at least £12 million so that they could complete the purchase, that Dr Albesher arranged that payment, and that when the funds were paid they were frozen by Credit Suisse. It was said by Mr Ryan that it was Dr Albesher's failure to provide his agreed level of funding that caused the deal to collapse, that Dr Albesher's account was "full of material falsehoods", and that Dr Albesher's allegations of fraudulent misrepresentation and conspiracy were strongly and categorically denied.

D2.3 Ryan 1: Denial of conspiracy

57. Paragraphs 13 and 50 of Ryan 1 (see section D2.2 above) contained express denials by Mr Ryan of Dr Albesher's allegations of conspiracy. Paragraph 49 added that, so far as Mr Ryan and Ryan Corp were concerned, Dr Albesher's account of events was "an attempt to completely rewrite the story in an effort to try to recover the monies he lost".
58. Passages in Ryan 1 which may have relevance to the conspiracy allegations include:

i) Paragraph 5 referred to Mr Ryan's "offices in central London from which I operate my property development business".

ii) Paragraph 7 stated:

Over the past couple of years, I have been involved in some extremely significant property development opportunities, mainly in London, …

iii) Paragraph 20 (see section D2.2 above) denied collaboration with Mr Eldring of Credit Suisse as regards representations about Mr Ryan's financial means.

iv) In relation to the £10.4 million paid by Dr Albesher in November 2013, paragraph 38 of Ryan 1 stated:

38. I cannot comment on the Claimant's request for a guarantee or why Credit Suisse agreed to provide one. I have no recollection of seeing the letter which the Claimant refers to as "the 12 November Guarantee."

D2.4 Ryan 1: Dr Albesher's actual and proposed funding

59. As to the funding to be provided by Dr Albesher, paragraph 19 of Ryan 1 (see section D2.2 above) asserted that at the initial meeting in July 2013 Dr Albesher and Mr Ryan "talked about structuring a 50:50 investment" which would mean "both of us having to invest £50 million, possibly more…".
60. The circumstances in which Dr Albesher made payments into Mr Ryan's personal account with Credit Suisse were described in this way in paragraphs 23 and 24 of Ryan 1:

23. So far as I made requests to the Claimant to make payments into the nominated bank account, it was necessary for me to be sure that he would perform in the way that he said he would. This was for my own satisfaction and comfort, but also to demonstrate to the vendor that we were serious and would be able to move forward to completion quickly.

24. As time went on, competition for the site was growing and so it was important that the vendor could see that we should be treated as a preferred bidder. I agreed with the Claimant that his funds would be needed to pay the initial deposit. …

61. At this point paragraph 24 of Ryan 1 referred to the letter of 22 September 2013, with its express confirmation that Dr Albesher's funds would be used to "buy the site" (see item (6) of section B3.2 above). Paragraph 24 of Ryan 1 added:

There was no breakdown of how sums would be split, but the Claimant was well aware that his funds would be used to pay the deposit. …

62. It was in this context that Ryan 1 at paragraph 25 denied any representation that Mr Ryan would "match" a payment into the account with Credit Suisse (see section D2.2 above).
63. After describing the use of Dr Albesher's money to pay the £10 million deposit, with his agreement, Ryan 1 at paragraph 27 recorded the exchange of contracts on 25 September 2013 for the purchase by Ryan Corp of the Property. As to funding arrangements for completion, then due to take place on 29 October 2013, after describing a "slight delay" in arranging his own funding Mr Ryan continued at paragraph 32 of Ryan 1:

32. However, the Claimant was also looking to raise finance from institutional lenders for the balance of the funds he was to invest, and he too was delayed. We had discussed that we would refinance within around 6 months of completion and so he was seeking bridging finance for the period until we would refinance. …

64. Paragraph 32 of Ryan 1 then made reference to pages 40 to 50 of Mr Ryan's exhibit, described as being copies of:

emails involving the Claimant and third party financiers, such as Standard Chartered Private Bank and MCIFA (a specialist prime property financier company), which show that the Claimant was seeking to arrange bridging finance in late October and early November 2013. …

65. The exhibit at pages 40 to 50 included emails passing between Dr Albesher and Standard Chartered Bank, and mentioning Havilland Bank, between the period 26 to 28 October 2013 inclusive. It also included a chain of emails starting at 16:22 on 7 November 2013, when Mr Ryan, in an email copied to Dr Albesher, told Mr Rahul Shah of MCIFA Property Finance "to stop any representations on our behalf, That is on behalf of Dr Mohammed A Al Besher and I whom are partners in this project." This email complained that Mr Shah had not cooperated with required guidelines and structures, adding that:

Even today when the Ambassador asked you could you be certain about funds next week you were not able to confirm same.

…

66. Emails in response from Mr Shah at 16:53 on 7 November and at 11:56 on 8 November, addressed to both Mr Ryan and Dr Albesher, among others, referred to a "funding package" being "almost there", and identified certain items which were requested in order to "deliver the money within the required timescales".
67. Paragraph 32 of Ryan 1 concluded in relation to Dr Albesher:

However, he was having difficulty securing finance, not least because he is technically a "politically exposed person" for the purposes of banks' compliance regulations and that makes things more difficult and complicated.

68. In relation to the £10.4 million paid in November 2013, I have set out in section D2.3 what was said in paragraph 38 of Ryan 1 in relation to "the 12 November Guarantee". This was preceded by paragraphs 35 to 37 as follows:

35. In the same paragraph, the Claimant alleges that I requested a "loan" of £10.4 million from him on or around 7 November 2013 in order to extend the contract. Again, this is a complete lie. The Claimant had agreed to fund 50% of the purchase price and related costs and the additional funding was part of his funding obligation. His own claim acknowledges that this was agreed to be a joint and equal investment opportunity.

36. It is the case that we had to pay this additional sum of £10.4 million to the vendor to delay the completion, but on the basis the Claimant was to have paid an additional £35 million at least over and above his initial payment of £15 million, the request for additional funds at that time should have come as no surprise to him. That additional £10.4 million was paid by the Claimant on or about 14 November 2013.

37. The £10.4 million was in turn paid to the vendor on 15 November 2013 in return for an agreement to extend the completion date to 3 December 2013.

69. I noted in section D2.2 above that paragraphs 39 to 43 of Ryan 1 described arrangements being made by Mr Ryan under which he would obtain a higher amount of finance than originally envisaged because of difficulties that Dr Albesher was having in securing funding. Paragraph 44 of Ryan 1 stated that by 3 December Dr Albesher needed only to raise "approximately £10-15 million to ensure we could complete". Mr Ryan added:

… although I would have preferred that he invested the balance of his fully committed funding of £50 million.

70. Paragraphs 45 to 48 of Ryan 1 stated:

45. Around that time, I was speaking with the Claimant on a daily basis and sometimes several times a day to find out what the position was in relation to his efforts to raise finance. He told me that he was having difficulties, but remained optimistic of being able to secure the necessary finance for us to complete the deal.

46. On 19 December 2013, we agreed a further short extension of the completion date to 16 January 2014, which the Claimant believed was sufficient time for him to raise additional funds to allow us to pay the balance of the purchase price. However, there continued to be delays.

47. I visited the Claimant in Casablanca during the first week of January 2014 to discuss the situation. I explained to him that he urgently needed to pay at least the balance of the purchase price plus associated costs (approximately £12 million) so that we could complete the purchase. I told him that the vendor had received other serious offers from buyers who were ready and able to step in, and so the vendor would not agree to further extend the completion date.

48. On or around 7 January 2014, the Claimant arranged a payment of £12 million to my account with Credit Suisse (221-222), but the funds were frozen by Credit Suisse. I arranged an urgent meeting with Credit Suisse, who assured me that these additional funds would be released the following day. However, they did not do so and the funds were not released until 2-3 months later, when Credit Suisse returned the monies to the Claimant.

D2.5 Ryan 1: Mr Ryan's arrangements for funding

71. In relation to the period in July 2013 when he had his initial meeting with Dr Albesher, Mr Ryan stated in paragraph 21 of Ryan 1:

21. I had been speaking with various financial institutions and investors about the project, both before and after I met the Claimant and it was always my intention to arrange finance for my contribution, and based on the discussions I had had up to that point, was very confident that I would secure funding.

72. Further arrangements for funding were described in paragraph 29 of Ryan 1, dealing with the position following the meeting in Geneva in late September 2013:

29. Thereafter, I travelled to China, where I knew other potential investors who might be interested in the development. At that stage, I had not finalized my side of the funding and was negotiating with several different parties about their possible involvement in the project. Since we had secured the site through payment of the deposit, it helped in those discussions, as the financiers could see that the project was very real. I spoke with the Claimant several times when I was in China to let him know about my meetings and the very good prospects for securing investment into the project. One funder (Touchstone) in particular was very keen to finance the project and had given indicative heads of terms during my visit.

73. As to the position by mid October 2013, Ryan 1 stated at paragraphs 30 and 31:

30. The Claimant requested that I visit him in Dubai on my return to London, which I did on or about 16 October 2013. The Claimant refers to this meeting as though I instigated it to provide him with reassurance, but that was not the case. I was very confident by that time that the necessary finance would be obtained now that we had secured the site and I had repeatedly told the Claimant that.

31. It is true that there was a slight delay in finalizing the funding that I was arranging. Touchstone, while very keen to be involved, were moving quite slowly. Therefore, I was involved in discussions with several potential funders.

74. After describing the payment by Dr Albesher of £10.4 million on 14 November 2013, and its transfer to the vendor on 15 November 2013, Ryan 1 stated at paragraph 39:

39. By that stage, I was very close to finalising funding through Och-Ziff Capital Management Group LLC (Och-Ziff), a major US institutional investor, and was certain we would be able to complete the acquisition through our joint funding of the project. …

75. At pages 51 to 53 of his exhibit Mr Ryan produced a copy of a draft dated 13 November 2013 of a document entitled:

OCH-ZIFF INDICATIVE Outline

Please note that this document aims to provide some of the key potential financing terms of the loan facility. If these terms are of interest Och-Ziff proposes discussing next steps. Please note that these terms are not credit approved and should be viewed as an initial indicative high level overview of a potential financing.

…

76. The "potential financing" envisaged by this document was a "senior term loan facility in a maximum principal amount equal of £69,000,000" subject to certain conditions.
77. At paragraph 40 of Ryan 1 Mr Ryan stated that Och-Ziff provided a further "Indicative Outline" on 21 November 2013, confirming their willingness to lend £66 million. At pages 54 to 56 of the exhibit Mr Ryan produced a copy of that document.
78. Paragraphs 41 and 42 of Ryan 1 stated:

41. The financing I was seeking around this time was higher than I had originally envisaged since I knew the Claimant was himself seeking bank finance for the balance of his contribution, but was having difficulties in securing funding.

42. By late November 2013, Och-Ziff had confirmed their willingness to lend £66 million to the Second Defendant. At pages 57-58 is an email from Sidley Austin LLP dated 29 November 2013 (being Och-Ziff's lawyers), which attached the final form of Facility Agreement between the Second Defendant (as borrower) and Sculptor Finance (MD) Ireland Limited and Sculptor Finance (CO) Ireland Limited (as lenders) (pages 59-206), pursuant to which the lenders would provide a facility of £66 million to the Second Defendant. The lenders were vehicles of Och-Ziff.

79. The material described by Mr Ryan in paragraph 42 of Ryan 1 was produced at pages 57 to 206 of the exhibit. It included a covering email dated 1 December 2013 from Mr Ryan to Dr Albesher, forwarding the email dated 29 November 2013 from Sidley Austin LLP ("Sidley Austin") and its attachments. The covering email stated:

For your reading, finally a copy of the financial agreement from the hedge fund that I have signed now signed.

The funds are been released with security of the site and a Guarantee against my Switzerland Trust in Credit Suisse.

I have also signed a personal guarantee with legal sworn legal statutory declaration in relation to my trust.

I think everything is looking very good, thank God.

80. The proposed final form of facility agreement emailed by Sidley Austin identified Ryan Corp as the borrower. It was emailed by Sidley Austin not only to Mr Ryan, but also to four individuals at Miller Rosenfalck LLP ("Millers"), who acted on behalf of Ryan Corp.
81. At pages 207 to 220 of the exhibit Mr Ryan produced a copy of email exchanges between Millers and Sidley Austin for the purpose of enabling the advance of £66 million to be drawn down. Ryan 1 stated at paragraphs 44 and 45:

44. On 3 December 2013, the Och-Ziff funding arrangement was finalized (pages 207-220). However, the acquisition of [the Property] could not complete without the Claimant's agreed funding. Again, since I had secured a higher amount of financing than I had originally planned, the Claimant needed by then to only raise approximately £10-15 million to ensure we could complete, although I would have preferred that he invested the balance of his fully committed funding of £50 million.

45. Around that time, I was speaking with the Claimant on a daily basis and sometimes several times a day to find out what the position was in relation to his efforts to raise finance. He told me that he was having difficulties, but remained optimistic of being able to secure the necessary finance for us to complete the deal.

D2.6 Ryan 1: Events after 16 January 2014

82. As to events after the revised date for completion had come and gone, Ryan 1 noted at paragraph 10 that on 5 June 2015 Goodman Derrick had provided a copy of a letter which they said was sent to Mr Ryan in May 2014. It appeared from this copy that the letter was dated 13 May 2014 and was addressed to Mr Ryan at Ryan Corp's "Corporate Headquarters" in Portman Square in London. The letter stated:

As you will be aware, we act for Dr Mohammed Albesher in relation to the financial dealings which he has had with you in respect of the prospective purchase of Hertsmere Tower, Canary Wharf. We understand that you have withdrawn your instructions to Miller Rosenfalck LLP and we are therefore writing to you direct.

We must ask you to accept this letter as our client's formal demand for the return to him of the outstanding loans which he has made to you in the total sum of £25,400,000. We refer in this respect to the email from Mr Hugh Barrett of Miller Rosenfalck to our Mr Mapstone timed at 15:04 on 7 March 2014 confirming the indebtedness.

We must advise you that if payment in full is not received through this office to our firm's client account, details of which are below, by 4.00pm on Tuesday 20 May 2014 then enforcement proceedings will be initiated against you without further reference to you.

...

83. Mr Ryan stated at paragraph 10 of Ryan 1 that he did not remember receiving this letter. He noted that the letter demanded the return of £25.4 million, specifically referred to as "outstanding loans". Mr Ryan asserted that the letter was "incorrect in referring to the monies as loans", and added that the demand was materially inconsistent with the claim now presented by Dr Albesher to the court.
84. Paragraph 51 of Ryan 1 noted the allegation in paragraph 68 of the particulars of claim (see section B6 above) that Mr Ryan had "disappeared". As to this, Mr Ryan said:

51. … I do not understand that allegation. I have continued about my business in the usual way and am not aware of any efforts by the Claimant to contact me. In fact, I have spoken with the Claimant by telephone several times during the past 12 months. In November 2014, the Claimant agreed to meet with me, but just two hours later changed his mind and the meeting did not take place.

85. As to the position immediately following the issue of the present proceedings, paragraph 4 of Ryan 1 acknowledged that the claim form and related documents were sent to Ryan Corp's registered office in London. It explained that the address of this registered office was in fact the office of Ryan Corp's accountants ("Brebners"). Paragraphs 5 to 7 of Ryan 1 stated:

5. Whilst I am ordinarily resident in Ireland, I do have offices in central London from which I operate my property development business. However, I had arranged for the registered office of the Second Defendant and other group companies be at the accountants' offices since I am often travelling and wanted to avoid the possibility that important documents intended for the company might not been seen for any extended period and that routine filing reminders would promptly be attended to by the accountants.

6. I do not remember precisely when I received a copy of the claim documents, but I believe it would have been some time around mid-late April when I attended a meeting at Brebners regarding other business matters.

7. Over the past couple of years, I have been involved in some extremely significant property development opportunities, mainly in London, that have put serious demands on my time. I must confess that I did not immediately read the documents that were given to me. I put them into my briefcase thinking I would review them later. However, given the other business matters I was dealing with at the time, including two major developments that were completely dominating my time (and continue to do so), I must acknowledge that I overlooked doing so and then simply forgot about the fact that I had even received the documents. Of course, I can now see that the documents were extremely important, but not having read them when first handed to me, I had not appreciated that at the time.

86. Ryan 1 then turned to the position at the end of May and the beginning of June 2015. Paragraphs 8 and 9 of Ryan 1 stated:

8. On Tuesday, 26 May 2015, Brebners sent to me by email a copy of the Claimant's solicitors' letter dated 22 May 2015, enclosing the Claimant's application for judgment in default. I then spoke with Brebners on the Thursday or Friday immediately following. They confirmed they would help me to find a solicitor to assist with the claim.

9. I spoke again with Brebners about the application on 2 June, and on their recommendation, I instructed Messrs Hierons on behalf of the Second Defendant (albeit by then it was around midday) and they attended the hearing at 2pm that day with counsel to oppose the Claimant's application. However, I was unable in the time available before the hearing to provide them with any detailed instructions about the Claimant's claim and the substantive grounds upon which both I (as the First Defendant) and the Second Defendant would be able to defend the claim. The claims against me personally and the Second Defendant are inextricably linked and in turn are also closely linked with the claim against the Third Defendant.

87. Paragraph 11 of Ryan 1 stated:

11. I again acknowledge, with regret, that the delay in responding to the claim is down to me. However, I believe it would be very unfair for the Second Defendant not to be permitted to defend the claim, particularly given the very serious allegations that are made by the Claimant and the significant amount involved.

88. Ryan 1 dealt with Mr Ryan's own position in paragraph 52. This stated:

52. As at the date of this witness statement, I have yet to be personally served with the Claim Form and related documents. My solicitors tell me that they have ascertained from the Claimant's solicitors that they had made arrangements to serve the documents upon me at my usual home address in Ireland, but as yet, they have not been served. Therefore, the Second Defendant's delay in entering an Acknowledgment of Service and the subsequent entering of Judgment will not have delayed the proceedings.

89. The final paragraph of Ryan 1 was paragraph 54. In paragraph 54 Mr Ryan stated:

54. Lastly, and without any admission of liability, I confirm that the Second Defendant and I are prepared to provide all reasonable assistance to the Claimant, so far as we are able to do so, to obtain relief from forfeiture of the deposit monies, subject to agreement on any costs that may be incurred in doing so.

D3. Assertions in Albesher 1

D3.1 Assertions in Albesher 1: general

90. In paragraph 2 of Albesher 1, Dr Albesher described Mr Ryan as a "fraudster" and said that Ryan 1 was "untrue in almost all material respects". After summarising what he described as Ryan Corp's "putative grounds of defence", Dr Albesher added:

I am very surprised that, despite the passage of time, the Second Defendant has not as yet served a draft Defence.

91. I summarise the substantive content of Albesher 1 below by reference to the five topics identified in section D2.1 above.

D3.2 Albesher 1: financing representations/agreement

92. In paragraph 3 Dr Albesher said that:

… as suggested by Mr Ryan, we agreed to purchase and develop the Property utilising the vehicle of Mr Ryan's existing company, Ryan Corporation (UK) Limited, the Second Defendant. Mr Ryan suggested, and I agreed, that in order to ensure equality of ownership of the development, Ryan Corporation (UK) Limited would in turn be owned by a jointly owned newly incorporated Swiss registered company, Land & Securities SA. The profits arising from the development would therefore be shared equally between Mr Ryan and me.

93. The first part of paragraph 4 of Albesher 1 responded to Mr Ryan's assertion that he and Dr Albesher discussed a model under which both of them would have to invest £50 million, possibly more, at the outset:

4. It is quite simply untrue to suggest that I agreed to be personally responsible for an investment of circa £50 million in the Hertsmere Project. Mr Ryan has failed to exhibit a single document to support this contention. All the documents which he has exhibited to his statement evidence that the funding for the project was to be by way of a secured loan to the Second Defendant. The emails in early November 2013 from Mr Ryan at pages 1 to 10 only evidence that he was reporting to me on his efforts to secure third party funding for Second Defendant. …

94. As regards the financing position in November 2013, Dr Albesher exhibited copies of a number of documents. The first was a memo from Mr Ryan to Dr Albesher, dated Sunday 3 November 2013. This memo included the following, with numbers added in square brackets for convenience:

[1] I wanted to update you on progress at the end of the week

[2] In Relation to the Closing and Bridge.

…

[4] I have paid our fees and costs to the insurance company in the amount of GBP250,000.00

[5] This instrument is for the amount of GBP 150,000,000.00 and we are now trying to secure a bridge against this for GBP 108,000,000.00

[6] Last week, I had numerous meetings with potential Bridger's and we have narrowed it down to a small number,

…

[8] We are also in discussion with another group represented by Credit Suisse whom I will meet on Tuesday morning.

[9] We are also in discussion with one of the Chinese Groups whom are very interested but they may need more time, they have already offered an equity investment of GBP 130,000,000.00 but I think they will need a couple of weeks to put their paperwork in place.

[10] While I have had numerous discussions with Mr Rahul and provided him with numerous documents he is very slow and he has to find the funds from other parties, he is doing his best.

[11] It seems to me the quickest way to get the bridge will be to deal with private individuals or equity groups.

…

[16] I was concerned on exactly what we would pay for the bridging but after Fridays meeting my emphasis now is simply just to get the bridging in place this week and get the purchase closed. If we pay a percentage or 2 more now it makes no difference to our profit, do you agree.

[17] The profit now is going to be in hundreds of millions wither way and we can use this profit to do other projects both in London and Saudi.

[18] I will work out the new figures and GDV over the next couple of days and send them to you.

[19] My emphasis now is to instruct the Architects to commence the new drawings and plans for the higher tower and get this in place as soon as possible. Once I have finished with the bridging and finance issues over the next couple of days I will immediately start the process with Architects and engineers and designers for the extra height, …

95. The second document exhibited was a copy of Mr Ryan's email of 7 November 2013 to Mr Rahul: see section D2.4 above.
96. Also dated 7 November 2013 were an email and memo from Mr Ryan to Dr Albesher concerning "a number of offers now interested in completing the bridge". An email and memo dated 8 November from Mr Ryan to Dr Albesher concerned:

… confirmation from the 3 groups I spoke to you about last night.

97. An email from Mr Ryan to Dr Albesher dated 11 November 2013 forwarded proposed offer terms from one of the three groups. This was followed, it seems on the same day, by a further email in which Mr Ryan described to Dr Albesher certain features of what Och Ziff was at that stage willing to do. This further email included the following, with numbers added in square brackets for convenience:

[7] It is still going to take a week or 10 days to complete the paperwork and put funds in place. I have had talks today with the owners as they are getting a bit worried.

[8] I have an idea which I think would give us more time and take the pressure off a little bit and give us time to finish the paperwork and get the funds in place.

[9] We give another 10% deposit plus the interest to date, that will come off the balance anyhow so whether we pay it today or next week does not make any difference.

[10] I am working so hard to move it quickly but everything seems to take so long.

…

98. The exhibit then set out chains of emails covering the period 12 to 14 November 2013 inclusive. The earliest was an email timed at 17:10 on 12 November 2013 from Mr Hugh Barrett of Millers to Mr Mapstone of Goodman Derrick. Mr Barrett explained that Millers acted for Mr Ryan and Ryan Corp in connection with the purchase of the Property. He continued:

Ryan Corporation (UK) Limited has exchanged contracts for the purchase of the site but due to some time slippage in the final mobilisation of funds, the client has found it necessary to enter into a supplemental agreement with the Vendor to extend the time available for completion by a further three weeks.

It is agreed that a further 10% deposit of £10m will be paid to the Vendors on account of the price plus certain interest payments in consideration of this extension.

I have been asked to confirm these details at the request of your client Dr. Mohammed Al-Besher.

99. Mr Mapstone replied at 17:16 on the same day, asking to see "the two agreements". He added that he was meeting with Fahad the following day. His email also asked:

… is there any agreement in writing between our respective clients?

100. The next email produced by Dr Albesher was from Mr Barrett to Mr Mapstone, timed at 14:35 on 13 November 2013. It attached copies of "the purchase contract and the signed Supplemental (extension) Agreement, which is awaiting exchange…". Mr Mapstone replied asking:

Many thanks indeed. What documentation is in place please re the joint venture and the fact that I believe my clients have already paid the deposit of £10m plus I recall a further £5m…

101. Mr Barrett responded at 17:30 on 13 November stating that he was taking instructions and would revert. As to Mr Barrett's request for instructions, it appears from an email sent by Mr Ryan to Mr Barrett and Dr Albesher at 17:33 that day that Mr Barrett had sent an email to Mr Ryan at 17:09 ("Mr Barrett's 13 November "inference" email") as follows:

Could I please have detailed reply on this:

The inference in Goodman Derrick's email is that:

1. The original deposit monies (and now possibly the further deposit) were not your monies as we were informed (and on which basis we have our compliance has been conducted with input from Credit Suisse.

2. Those monies may have been obtained from Dr Mahomad Al-Bishar on some basis without his knowledge or approval.

In the latter case, Goodman Derrick will clearly take action to intervene in the transaction. This is extremely serious.

We will need to obtain confirmation from Goodman Derrick right away that neither 1 nor 2 applies.

How is the position to be clarified?

102. The email from Mr Ryan timed at 17:33 and addressed to Mr Barrett and Dr Albesher (which I shall refer to as "Mr Ryan's 13 November "total confusion" email") stated:

Hugh,

We are getting in to total confusion now.

First Dr Mohammed and I are doing business together and we have an agreement that we will funds projects 50/50 together.

The first funds were mine in an agreement between Dr Mohammed and I. How Dr Mohammed and I conduct our business is of no interest to Mr Simon.

The second deposit which is been transferred to you is coming from me as a separate agreement between Dr Mohammed and I and further I am actually repaying him back 10.4m next week as my funds are not freed up quickly enough which can be confirmed by Credit Suisse.

In relation to number 2 of course the monies were obtained with his knowledge, Who is asking this, how is God could this happen. We are doing projects together.

In actual fact the financial structure of this transaction is I will be paying 90m and Dr Mohammed will be paying 10m.

It seems to me there is total confusion with Mr Simon and I think I should ask Dr Mohemmed to tell him to stop creating confusion.

103. At page 16 of the exhibit was a version of Mr Ryan's 13 November "funding is 50:50" email (see item (4) in section D2.2 above), but with the date and time in Arabic script. On page 17 was a further email from Mr Ryan to Dr Albesher, again with the date and time in Arabic script:

Dear Mohamed,

I further confirm I have received GBP 10.4m which will be re paid next week ,

Kind regards

Tom

104. Pages 18 and 19 of Dr Albesher's exhibit then set out the exchange of emails on 14 November agreeing to meet in Geneva the following week (see item (5) in section D2.2 above), with the addition of a further email from Mr Ryan to Dr Albesher, stating, among other things:

I confirm I have received the 10.4M for our joint project (50/50%) Hertsmere Tower and has been forwarded to the sellers.

105. In this regard, paragraph 7 of Albesher 1 stated:

7. In order to illustrate the extent of Mr Ryan's mendacity in stark terms, I am producing at page 12 of the exhibit a copy of an email sent by Mr Ryan (and copied to me) to his solicitor, Mr Hugh Barrett of Miller Rosenfalck LLP, on 13 November 2013. The email was responding to an explanation requested by Mr Barrett to a request from my solicitor, Mr Simon Mapstone of Goodman Derrick LLP, for copies of the documentation reflecting the agreed terms for the payment of £15 million which I had made to Mr Ryan as at that date. The email chain between Mr Hugh Barrett and Mr Simon Mapstone is at pages 13 to 15. As will be apparent, in order to satisfy the money laundering requirements, Mr Ryan had told Mr Barrett that the £10 million received by Miller Rosenfalck LLP had come from his own resources. This was false. Mr Ryan volunteered the information to Mr Barrett that he would be repaying me £10.4 million "next week". He then reported to Mr Barrett that:

"In actual fact the financial structure of this transaction is I will be paying 90m and Dr Mohammed will be paying 10m."

It is difficult not to conclude that Mr Ryan had spun his web of deception so wide that he was prepared to say whatever he thought would most quickly satisfy Mr Barrett's perfectly proper enquiry however far removed it might be from the truth. I fear that he is engaged in a similar activity in seeking to support this application.

106. Dr Albesher added at paragraph 8:

8. At paragraphs 35 and 36 of his statement Mr Ryan states that the loan of £10.4 million which I had made to him on 14 November "is a complete lie". I refer again to Mr Ryan's email of 13 November 2013 in which he confirms the loan. I also refer to Mr Ryan's email of 14 November 2013 at page 17, in which he told me that the loan of £10.4 million would be "re paid next week".

D3.3 Albesher 1: conspiracy

107. Paragraph 10 of Albesher 1, when referring to the position immediately prior to issue of proceedings, referred to a:

conspiracy between … Mr Ryan and an employee of the Third Defendant …

108. Albesher 1 did not otherwise specifically refer to the allegations in the particulars of claim concerning conspiracy, nor to what had been said in Ryan 1 about them. Passages cited in sections D3.1 and D3.2 above, and D3.4 to D3.6 below, may nevertheless have relevance to those allegations.

D3.4 Albesher 1: Dr Albesher's actual and proposed funding

109. In relation to the position in early November 2013, Albesher 1 stated in paragraph 4:

Mr Ryan claims that I was having difficulty securing finance because I was a "politically exposed person" which "makes things more difficult and complicated". Notwithstanding the fact that I was not, in any event, seeking financial backing in a personal capacity, this assertion is entirely untrue. I was merely seeking to open a bank account with Credit Suisse. Due to my employment as a diplomat I am a politically exposed person, or 'PEP', as is every diplomat, government minister, senior civil servant or member of judiciary in every country in the world. Being a 'PEP' is merely an aspect of the process which everyone has to go through when opening a bank account. The necessary compliance regulations are far from arduous …

110. The first part of paragraph 5 of Albesher 1 stated:

To suggest that I was looking for funding to cover my alleged contribution to the purchase price is nonsense. I provided £37.4m the cash funding by way of deposits to secure the Property (of which £12m was frozen by the Third Defendant and returned to me in January 2014 when it became aware of Mr Eldring's activities), and it was my belief and understanding that my contribution was to be matched by Mr Ryan. …

111. Dr Albesher then turned in paragraph 6 to what happened to that part of his payment in September 2013 which was not used in order to fund the deposit:

6. Moreover, £5m of the funds which I transferred to Mr Ryan's bank account with the Third Defendant never found its way to the solicitors acting for the vendor of the Property. To this day, I am ignorant of the use to which it was put, and Mr Ryan's witness statement offers no explanation, still less a potential defence, to this significant issue. This is a question which needs to be answered by either Mr Ryan or Mr Eldring of Credit Suisse. I am sure that one or both of them will be able to give me an answer.

112. Paragraphs 7 and 8 then dealt with the payment of £10 million in November: see section D3.2 above.
113. Paragraphs 9 and 10 of Albesher 1 dealt with events after the extended date for completion on 16 January 2014. In paragraph 11 Dr Albesher returned to the position in early January 2014:

11. In the interests of completeness, I confirm that I did, indeed, make a further payment of £12m to Mr Ryan by way of a transfer to his account with Credit Suisse on 7 January 2014. It is also true that this payment was "frozen" by Credit Suisse, and the funds returned to me on 7 February 2014. The decision to freeze Mr Ryan's account was taken by Credit Suisse without reference to me. I assume this is because other matters had come to their attention in relation to either Mr Ryan or Mr Eldring, or both. In any event, I had made available a total of £37.4 million towards the transaction while Mr Ryan had contributed nothing. If I had been called upon to make a further payment of £12.6 million in order to protect my investment then arrangements could have been made to that effect, albeit extremely reluctantly.

D3.5 Albesher 1: Mr Ryan's arrangements for funding

114. As noted in section D3.2 above, paragraph 4 of Albesher 1 included assertions that:

i) documents exhibited to Ryan 1 evidenced that funding for the project was to be by way of a secured loan to Ryan Corp; and

ii) emails in early November 2013 from Mr Ryan evidenced that "he was reporting to me on his efforts to secure third party funding for" Ryan Corp.

115. In paragraph 5 of Albesher 1, after commenting that he had provided £37.4m of "cash funding by way of deposits to secure the Property", Dr Albesher added:

… it was my belief and understanding that my contribution was to be matched by Mr Ryan. Of course, not one penny of that promised contribution ever materialised. Indeed, despite the repeated assertions in Mr Ryan's witness statement that the Second Defendant was obtaining funding, he has not exhibited any documentary evidence of any signed funding agreement save for an 'indicative offer' . It is plain that at the time each of my transfers was made, the Second Defendant had neither contributed any money, nor obtained any funding.

116. Dr Albesher's observations concerning what Mr Ryan had said in November 2013 about what had come from Mr Ryan's own resources were set out in paragraph 7 of Albesher 1: see section D3.2 above.

D3.6 Albesher 1: events after 16 January 2014

117. Dr Albesher exhibited copies of a number of emails and email chains during the period 25 January to 17 April 2014 inclusive. An email he said was dated 25 January 2014 (p. 20 of his exhibit) included what was described as a "memo" of 24 January 2014 from Mr Ryan to Dr Albesher. With numbers added in square brackets for convenience, it stated:

[1] RE – Purchase of Hertsmere Tower by Dr. Mohammed A. Al Besher and Tom Ryan (in a personal capacity)

[2] I refer to the transfer of the amount of GBP25,400,000.00 from Dr. Al Besher towards the purchase of Hertsmere Tower, purchase price GBP100,000,000.00 (113,000,000.00 including land tax, stamp tax and costs. (These funds which you sent to my account)

[3] I wish to confirm if for any reason the above purchase does not go ahead, I am personally responsible for the total refund and return of the amount of 25,400,000.00 to Dr. Mohammed A. Al Besher.

118. An email from Mr Barrett of Millers to Mr Mapstone of Goodman Derrick dated 7 March 2014 (p. 27 of the exhibit) stated, with sub-paragraph numbers and additional paragraph numbers added in square brackets for convenience:

Further to your email of the 3^rd March, we have taken instructions and the can respond accordingly on some of the points that you have raised:

1. [1.1] We have in the matter of Hertsmere House been acting solely for Mr Tom Ryan and his company Ryan Corporation (UK) Limited ("Ryan Corp"), of which he is the sole shareholder. We are now instructed by Mr Ryan that your client Dr. Mohammed A Al Basher has invested the sum of £25.4m pounds towards the Hertsmere House project by payment to Mr Ryan towards the purchase and development of the site.

[1.2] We are informed that a company, Land & Securities SA, which is owned by Mr Tom Ryan and Dr Al-Basher equally, has been established in Switzerland and that it is their intention that this company should become the parent company of Ryan Corporation (UK) Limited.

2. [2.1] The present position with regard to the purchase of Hertsmere House is that the original contractual arrangements came to an end on the 20 December 2013 since which date Mr Ryan tells us that he has maintained his relationship with the seller, GMV Ten, which he is informed has entered into contractual arrangements with another party albeit this is in the nature of a 'lock out' agreement linked to a sum somewhat below that originally proposed by Ryan Corp and from which GMV can withdraw.

[2.2] The intention is that Ryan Corp will pay a reduced purchase price which affords substantial credit for the sums already paid and that GMV Ten should then withdraw from the lock out agreement and immediately complete the sale of the property to Ryan Corp.

[3] I trust that this helps and please let me know if you require anything further.

[4] It was confirmed to us by Credit-Suisse that all monies received by us were paid through Mr Ryan's own account and this enquiry did of course form part of our compliance process.

119. On 11 March an exchange of emails occurred. It began with questions posed by Mr Mapstone (p. 30 of the exhibit), numbered for convenience in square brackets below:

[1] How much money has your client invested so far?

[2] Would you please be kind enough to let me have copies of all subsequent Agreements following the Agreement dated 25^th September 2013.

[3] If the registered proprietor exchanges with the other party would you please confirm that my client's funds will be returned in full.

[4] Would you please be kind enough to confirm which firm is holding the £25.4m and in what capacity and on what terms.

[5] Do you agree that you are in effect acting and have been acting for Mr Ryan and our client as the owners of Land & Securities S.A. – the parent company of Ryan Corporation (UK) Limited.

[6] I know that you will understand that my client is anxious about the status of the substantial monies that he has invested.

120. The response from Mr Barrett (p. 29 of the exhibit), also with numbers added in square brackets for convenience:

[1] Thank you for your email and the following may clarify some points.

[2] Taking your penultimate point first, we have been acting in the Hertsmere House transaction for Ryan Corporation (UK) Limited under letters of engagement to which Mr. Ryan, as director and sole shareholder, is also a party. The client was introduced to us in late September 2013 by an associated firm in Ireland which is a member of the Warwick Legal network to which we belong.

[3] We have had no certain knowledge of any role of Dr Al-Basher or financial investment in this transaction until you raised this with us in your email of the 3^rd March 2014.

[4] We were instructed by Mr Ryan following your email to us of the 13 November 2013 last year that it was not actually the case that your client had made a payment towards the deposits paid, or to be paid, at that stage and that a misunderstanding on this point had occurred. As previously mentioned, the sums that were sent to us for the transaction, being the first and second deposits, some interest and a sum towards our fees, were received from Credit Suisse under "introducer certificates" provided by them for compliance purposes and on the basis that the payments were made through Mr Ryan's personal account at the Bank.

[5] We were aware that Mr Ryan and your client had a cooperative relationship from our earlier email exchange, but have had no precise details.

[6] We have asked Mr Ryan for details of, and the custody and any application of, the funds which you say have been provided by your client towards the overall transaction.

[7] Ryan Corporation (UK) Limited is not to our knowledge presently a subsidiary of Land & Securities S.A. We are informed by Mr Ryan that it is intended that it should become so but we do not at this stage have any instructions in connection with the necessary formalities. A Swiss lawyer evidently dealt with the formation of Land & Securities SA.

[8] We are referring to Mr Ryan with regard to arrangements for the return of your client's funds under the circumstances to which you refer but have no present instructions on this issue. We were not aware of the Agreement of the 4^th January 2014 until this was enclosed with your email of the 3^rd March 2014.

[9] We are both clearly dependent on further clarification by our respective clients on these matters.

121. On 14 March 2014 (p. 31 of the exhibit) Mr Mapstone asked Mr Barrett for further information about the misunderstanding referred to at paragraph [4] of Mr Barrett's email of 11 March, and sought confirmation of the investment made by Mr Ryan, along with a breakdown of the £25.4 million that had been paid by Dr Albesher. This led to a response from Mr Barrett on 20 March 2014 (p. 31 of the exhibit) emphasising that Millers had not been involved in the arrangements between Mr Ryan and Dr Albesher, and had received all monies towards the transaction, being sums totalling less than £25.4 million, on the assurance of Credit Suisse that payment was made from Mr Ryan's personal account at the bank. Mr Barrett added that urgent instructions had been sought on the points raised by Mr Mapstone.
122. A chasing email was sent by Mr Mapstone on 25 March 2014 (p. 33 of the exhibit).
123. In an email which Dr Albesher said was dated 28 March (pp. 21-22 of the exhibit) Mr Ryan stated to Dr Albesher:

I attach copies of the contracts for the purchase of the Hertsmere. I think you may already have them as I sent them to you in January.

To update you in relation to Hertsmere, I have 2 offers which are under consideration,

1 – a total buy out payment of 120m pounds

2 – A smaller purchase price of aprox 108m pounds with a share of the profits.

In relation to your worry about the monies already sent by you of 25.4 m if at any stage the deal does not go ahead, obviously these funds will then be returned to your account in standard Charter by myself.

124. Also on 28 March 2014, according to Dr Albesher, Mr Ryan sent Dr Albesher an email (pp. 23 -24 of the exhibit) attaching a spreadsheet with revised figures showing that "even at a purchase value of 150 million pounds, there is a profit of 209 million pounds…".
125. An email apparently timed at 03:22 on 31 March 2014 (page 28 of the exhibit) from Dr Albesher to Mr Ryan stated:

I can not understand why your lawyer not answer the questions and I am sure if you want he can answer in one day

126. A further exchange occurred (page 26 of the exhibit), apparently on 31 March 2014, beginning with an email from Mr Ryan to Dr Albesher. This email stated, with numbers in square brackets added for convenience:

[1] I understand he has answered the question and I attach a letter from my lawyer to your lawyer of, March 7, confirming that you sent to me the amount of 25.4 million pounds for Hertsmere investment.

[2] Your lawyer also has copies of the contracts and I also have sent you same last Thursday and some weeks ago.

[3] My Investment in the Project is 64 Million Pounds and your investment will be returned to you if we do not proceed with Hertsmere as the funds were for this project.

[4] I do not understand how there can be any confusion.

[5] To be honest I am trying to keep my lawyer focused purely on all the matters around the closure and I am conscious of not introducing any compliance issues at this stage, if you understand what I mean, We can talk further in the afternoon.

[6] There is another letter from your lawyer to my lawyer on this past Friday and I will talk to my lawyer about this if you wish but to be honest I think it is the same questions.

[7] If we can talk in detail later in the evening, I think this would be helpful.

127. This led to a response from Dr Albesher to Mr Ryan:

I read the questions for you and you said this email I do not know about it the email in 11^th March I am sure your lawyer know about it any way I will ask my lawyer to send it again and you can kindly follow with your lawyer

128. Also apparently on 31 March 2014 Mr Ryan responded to Dr Albesher saying:

Yes, I will look further in to it.

129. On 2 April 2014 Mr Barrett (page 33 of the exhibit) emailed Mr Mapstone apologising for "the slight delay" in replying, and adding that Millers were "enquiring further" and would let Mr Mapstone know as soon as they had definite instructions.
130. On 10 April 2014 (p. 25 of the exhibit) Dr Albesher emailed Mr Ryan:

Dear tom my patient start to be lost I can not understand what you say

And confirm verbal you do not send it through your solicitor any way I will wait until the time you promised fahad

131. In an email (p. 25 of the exhibit) which Dr Albesher said was sent to him on 10 April, Mr Ryan replied:

Mr Dear Mohammed,

I understand, of course , you are running out of patience.

I am doing my best to conclude all matters as quickly as possible.

In relation to the solicitor, he has written many times to confirm the money is yours and I have also written to your solicitor to confirm thay.

I have also confirmed if we do not go ahead with the transaction , I will be sending you back all these funds.

I will telephone you tomorrow and update you.

kind regards

Tom

132. On 17 April 2014 (p. 34 of the exhibit) Mr Barrett emailed Goodman Derrick stating that Millers had ceased to act for Mr Ryan and Ryan Corp.
133. Dr Albesher dealt with these matters in paragraph 9 of Albesher 1:

9. On 25 January 2014 Mr Ryan sent me an email in which he assured me that my investment of £25.4 million would be returned to me in the event that the project did not complete. A copy is at page 20. It is inconceivable that he would have written to me in those terms if the account of events in his statement were true. Indeed, his account of events between November 2013 and the sending of that email are bald assertion, and nothing more. Mr Ryan continued to write in respect of the project as an ongoing opportunity on 28 March 2014 (at pages 21 to 24), and 10 April 2014 (at page 25), despite the fact that exchange of contracts on the sale of the Property to Greenland Holding Group Overseas Investment Company Limited had taken place on 27 January 2014. My solicitors were in touch with Mr Barrett throughout March and April 2014, as it became increasingly apparent that I had been defrauded. Mr Ryan protested his innocence throughout this exchange, which can be seen at pages 26 to 36.

134. Turning to the position in May 2014, Dr Albesher said in paragraph 10 of Albesher 1:

10. At paragraph 10 of his statement Mr Ryan refers to my solicitor's letter of 13 May 2014 demanding payment of the debt of £25.4 million. This demand was made for the reasons set out in paragraphs 2 to 9 above. As I have been the victim of fraudulent misrepresentations made by Mr Ryan and the Second Defendant and conspiracy between the Mr Ryan and an employee of the Third Defendant, I have engaged in the appropriate pre-action protocol only with the Third Defendant.

135. I have set out paragraph 11 of Albesher 1 in section D3.4 above. In paragraph 12 Dr Albesher made reference to a lack of persuasive explanation for Ryan Corp's failure to respond to the claim, to delay in making the application to set aside, to absence of any explanation for that delay, and to failure to file a draft defence. Dr Albesher added:

In my view, if there was any merit in the putative grounds of defence alleged in Mr Ryan's witness statement, a draft Defence would have been prepared in the four weeks between Second Defendant finding out about the hearing on 2 June, and making the application to set aside the judgment.

136. Paragraphs 13 and 14 of Albesher 1 noted, and commented upon, an assertion in paragraph 52 of Ryan 1, where Mr Ryan said that because he had not yet been served with the claim Ryan Corp's failure to acknowledge service would not have delayed matters. As to this, Dr Albesher said it was misleading to make this assertion when the only reason service had not been effected against Mr Ryan was his own deliberate evasion.

D4. Assertions in Ryan 2

D4.1 Assertions in Ryan 2: general

137. At the outset of Ryan 2 Mr Ryan rejected the description of him as a "fraudster" and the assertions that his previous statement had been untrue. He added that he had not had adequate time in which to provide full instructions to Gresham Legal or to locate further documents that might be of relevance.

D4.2 Ryan 2: Representations and agreement on financing

138. Ryan 2 at paragraphs 3 to 5:

i) noted that paragraphs 8 and 16 of the particulars of claim had referred to equal investment (in paragraph 8) and equal sharing of profits (in both paragraphs), and had at no time suggested that Dr Albesher was to make anything less than an equal investment in return for an equal share of the profits;

ii) asserted that, contrary to Dr Albesher's claims in Albesher 1, documents exhibited to Ryan 1 confirmed the 50/50 nature of the project, both in respect of investment and profit share;

iii) noted that at no time, in the particulars of claim or his statement, did Dr Albesher identify how much he claimed he was to invest to receive 50% of the profits;

iv) added that, if nothing else, common sense dictated that 50% of the profits demands 50% of the risk, and that was what he and Dr Albesher had agreed;

v) asserted that documents exhibited in Ryan 1 showed that Dr Albesher was not merely seeking to open a bank account with Credit Suisse, but clearly showed he was seeking to raise finance from a range of sources in which Credit Suisse was not mentioned.

139. As to what was represented and agreed in November 2013, Ryan 2 at paragraphs 8 to 10:

i) made an accusation that Dr Albesher had distorted the content of Mr Ryan's 13 November "total confusion" email (see section D3.2 above);

ii) in support of that accusation claimed that the reason that Mr Ryan had not told Mr Barrett the source of the initial £15 million or the expected £10.4 million was because Dr Albesher had not wanted his involvement in the project to become public;

iii) said that it was for this reason that the structure of the transaction did not have Dr Albesher directly investing in Ryan Corp, but had him investing indirectly through a Swiss incorporated company;

iv) accused Dr Albesher of ignoring the statement in the second paragraph of the email of 13 November 2013 referring to Mr Ryan and Dr Albesher having "an agreement that we will fund projects 50/50 together";

v) said that the reference to Mr Ryan paying £90m and Dr Albesher £10m arose because it appeared that Dr Albesher was now reneging on his agreement to provide 50% of the investment costs, that accordingly it would be necessary for Mr Ryan to repay the £10.4m, and that Mr Ryan would then have been left to fund 90% of the total cost;

vi) accused Dr Albesher of ignoring the fact that following that email he and Mr Ryan spoke by telephone and re-affirmed their 50/50 arrangement – the Property to be owned 50/50, the funding to be provided 50/50 and the profits to be split 50/50 – as confirmed in the email timed at 20:27 on 13 November 2013.

D4.3 Ryan 2: Denial of conspiracy

140. Ryan 2 did not specifically refer to the conspiracy allegation.

D4.4 Ryan 2: Dr Albesher's actual and proposed funding

141. As to the funding provided by Dr Albesher, I have referred in section D4.2 above to what was said in Ryan 2 about the funding that was provided in November 2013. In relation to funding provided in September 2013, paragraph 7 of Ryan 2 stated:

7. As regards the £5 million of the first £15 million (£14,756,479.77 to be exact) that the Claimant did produce that was not used for the deposit, this was utilised for general expenses of the project. I have not now to hand a detailed breakdown of how that was used but it covered such expenses as bank, insurance, accountants and solicitor's fees. Payment of £250,000 is specifically mentioned in my memo to the Claimant of 3 November 2013 exhibited as page 1 of MAAA1. The Claimant was aware as the transaction went along that expenses were being incurred and met. He raised no concerns when he provided the £10.4 million in November 2013 used to extend the completion date or the £12 million in January 2014 that Credit Suisse "froze".

D4.5 Ryan 2: Mr Ryan's arrangements for funding

142. Mr Ryan stated in paragraph 6 of Ryan 2:

6. In respect of my investment in the project, the Claimant complains that I have not exhibited to my first statement "any documentary evidence of any signed funding agreement save for an "indicative offer"". At pages 59 to 206 of TGFR1 is an unsigned copy of the Facility Agreement between the Second Defendant and Och-Ziff's lender vehicles. I did not retain a copy of the signed Agreement, but in my email to the Claimant of 1 December 2013 (page 57 of TGFR1) sending him a copy of the Agreement, mentioned that I had signed not only the Facility Agreement, but also a personal guarantee. The facility was not drawn upon simply because the Claimant failed to provide the full amount of his investment.

D4.6 Ryan 2: Events after 16 January 2014

143. Ryan 2 accepted that in the email exchanges up to 17 April 2014 Mr Ryan had said that if the project did not complete, he would refund Dr Albesher's investment. Mr Ryan pointed out that he had not said that Ryan Corp would make this refund, nor had he referred to a refund of any loan.
144. The explanation given in paragraph 11 of Ryan 2 was that:

… even after the Claimant failed to provide the £12 million in January 2014 to enable completion of the purchase to take place, I attempted to keep the project alive, if not for the Claimant's benefit, then for my own. It was in the context of trying to rescue the project that I wrote to the Claimant as I did. Had I succeeded in rescuing the project, with replacement investors, the Claimant would have been repaid.

145. As to other complaints by Dr Albesher, paragraph 12 of Ryan 2 stated:

12. The Claimant complains at the alleged lack of a persuasive explanation for the Second Defendant's failure to respond to the claim. In my first statement, I have set out the honest reasons for that, and was not prepared to mislead the court. He also complains at alleged delay in making the application to set aside. This ignores the fact that the Judgment it is sought to set aside contains a stay of execution specifically to enable an application to be made. The application was made within the time allowed by the stay.

146. An observation concerning Dr Albesher's claim was then made by Mr Ryan in paragraph 13 of Ryan 2:

13. The Claimant has been highly critical of me in both the Particulars of Claim and his statement. I do not wish to respond in the same way, but I would point out that the Claimant's position is constantly changing. Even now he seems unable to decide whether the £25.4 million was his investment in the project, whether all of it represented loans to me personally, or whether part of it represented such loans.

147. In relation to his own position Mr Ryan said at paragraph 14 of Ryan 2:

14. I do believe it is important to mention that at the time with which these proceedings are concerned, I was engaged full time on often complex and pressured negotiations in relation to the project, not only with the Claimant but with numerous banks, financiers, insurance companies, potential investors and so on. I was constantly flying around the world. This all made it impossible to retain well-organised and readily accessible records. Of course, the Claimant did not have such matters to concern him.

148. In paragraphs 15 to 18 of Ryan 2 Mr Ryan denied that he had been deliberately evading service on him of the claim form. The assertions he made in that regard were:

i) on the dates identified by the process servers, he had not been at home, nor even in Dublin;

ii) he doubted whether he had spent more than three or four days at home in Dublin in the whole of this year, such had been the demands of his business commitments;

iii) the porch light came on automatically when visitors approached the property, and was not indicative of who, if anyone, might be within the property;

iv) the confirmation from the neighbours that he currently resided at the property was not a confirmation that he was within it at any particular time;

v) the process server had not suggested that he was deliberately evading service.

D5. Ryan Corp's answer: argument and analysis

149. As noted in section D1 above, Ryan Corp acknowledges that its application can only succeed if it has a real prospect of defending the claim, and thus satisfies CPR 13.3(1). Dr Albesher relies upon the Court of Appeal decision in ED & F Man Liquid Products Ltd v Patel [2003] EWCA Civ 472, [2003] CP Rep 51 in order to advance propositions that:

i) the court must, as with an application for summary judgment, consider whether there is a "realistic" as opposed to a fanciful prospect of success;

ii) the burden of proof lies on the defaulting defendant, in this case Ryan Corp; and

iii) that while the assessment of whether a defence has a real prospect of success is not a mini trial:

that does not mean that the court has to accept without analysis everything said by a party in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporary documents.

150. Ryan Corp does not dispute these three propositions. In broad terms it submits that:

i) In Ryan 1, Mr Ryan has specifically, among other things:

a) denied the fraudulent misrepresentation and conspiracy claims against him;

b) denied that the failure to complete the purchase of the Property resulted from his being unable to fund his part of the investment;

c) asserted that his discussions with Dr Albesher were on the basis of a 50:50 investment and profit share;

d) asserted that he never represented that he would personally match Dr Albesher's contributions: instead what he told Dr Albesher was that he would have the means to raise finance to meet his obligations upon a joint investment;

e) accepted that he agreed with Dr Albesher that Dr Albesher's funds would be needed to pay the initial deposit, but denied that he ever told Dr Albesher that he would match Dr Albesher's initial payment of £15 million: on the contrary, he made it clear to Dr Albesher that all of his funding was to be provided through debt finance; and

f) asserted that the payment of the initial £15 million from Dr Albesher in to Mr Ryan's personal account at Credit Suisse was pending the opening of an account for his and Dr Albesher's joint investment company.

ii) As Dr Albesher alleges that Ryan 1 is untrue in almost all material respects, where the truth lies can only properly be determined after a full trial with oral evidence from the protagonists, not least because the principal allegation against Ryan Corp is that of an oral misrepresentation alleged to have been made by Mr Ryan. A forensic analysis of selective documents without such oral evidence cannot produce any reliable conclusion as to who is telling the truth.

151. The response by Dr Albesher places at the forefront a contention which I shall call "the false factual assertions" contention. This was that it is clear that there is no real substance in factual assertions made by Mr Ryan.
152. Oral submissions for Dr Albesher identified various ways in which Mr Ryan was alleged to have been caught out in making false factual assertions. The first way concerned things said by Mr Ryan when dealing with the payment of £10.4 million in November 2013. Ryan 1 at paragraphs 34 and 35 said that the £10.4 million payment was part of Dr Albesher's funding obligation, and said Dr Albesher was lying when he said that Mr Ryan requested a loan of the £10.4 million. However the emails of 13 and 14 November 2013 produced by Dr Albesher showed, it was submitted, that Mr Ryan had not told his own lawyer the truth about where the money was coming from, had said that he would be paying £90 million, and had said that Dr Albesher's loan would be repaid the following week.
153. As to that, however, in Ryan 2 Mr Ryan states (see section D4.2 above) that:

i) He did not tell his lawyers earlier about Dr Albesher's involvement because Dr Albesher did not want his involvement in the project to become public;

ii) As to references to his paying £90 million, and repaying Dr Albesher £10.4 million, they arose because it appeared that Dr Albesher was now reneging on his agreement to provide fifty percent of the investment costs.

154. I am not in a position to say that these explanations by Mr Ryan are incapable of belief. It is not implausible that Dr Albesher wished his involvement to be kept private. The material before me is consistent with a position in which it is only when Dr Albesher's solicitors became involved that Mr Ryan revealed to Millers what had happened. Moreover, as noted in section D4.2 above, Mr Ryan makes an observation that Dr Albesher has ignored references in the emails to arrangements for the transaction proceeding on the basis that funding would be provided 50:50. There appears, at first sight at any rate, to be some force in that observation.
155. The second way in which Mr Ryan was said in oral submissions to have been caught out in making false factual assertions relied on things said by Mr Ryan after 16 January 2014. He had assured Dr Albesher that Dr Albesher's investment of £25.4 million would be returned in the event that the project did not complete, and he continued to write in respect of the project as an ongoing opportunity despite the vendor having exchanged contracts with a different purchaser.
156. As to that, however, Mr Ryan states in Ryan 2 (see section D4.6 above) that it was in the course of trying to rescue the project that he wrote to Dr Albesher as he did. In that regard I note that an exchange of contracts for sale by the vendor with another party would not necessarily, at least until completion had taken place, preclude an attempt by Mr Ryan to "rescue" the project.
157. It was then submitted that Ryan 2 had said that Dr Albesher had failed to provide the £12 million needed in January 2014 to enable completion to take place. By contrast, it was submitted, Ryan 1 had accepted that the £12 million had been provided, but had been frozen by Credit Suisse. For my part, I see no inconsistency: Mr Ryan's point in Ryan 2 is that the £12 million was not in the event available to be used for completion.
158. The next submission focused on the reference in paragraph 8 of Ryan 2 to "the expected £10.4m". It was pointed out that the £10.4 million had been paid. However, I do not detect a falsehood in this regard: Mr Ryan's reference in Ryan 2 to an "expected £10.4 million" was a reference to the position at the time that he was talking to Mr Barrett, no doubt before the £10.4 million was paid.
159. It was then submitted that it was "absurd and fanciful" to say there was concern about making public Dr Albesher's name, when the enquiry had come from Dr Albesher's solicitors. This misunderstands the point which Ryan 2 was making, namely that it was prior to the enquiry by Dr Albesher's solicitors that Dr Albesher had not wanted his involvement to be public.
160. The next topic on which Mr Ryan was said to have been caught out in a falsehood concerned his evidence as to his own funding. The documents he had produced in that regard, it was said, were all unsigned. However, at least two documents produced by Mr Ryan were signed, and covering emails were consistent with other documents being agreed. In circumstances where completion did not in fact go ahead it does not seem to me impossible that the documents remained unsigned. Dr Albesher observes that an email from Mr Ryan on 1 December 2013 referred to him having signed a personal guarantee which has not been produced. The fact that it has not been included in a 222 page exhibit does not, to my mind, demonstrate that it was not signed.
161. Complaint was made at the lack of any correspondence from Mr Ryan asking Dr Albesher when the remaining funds would arrive. The complaint seems to me misconceived: the £12 million had arrived, but had been frozen. It would not necessarily be surprising if discussions about this took place orally rather than in writing.
162. Mr Ryan's evidence was then said to involve falsehoods in relation to allegations that Dr Albesher was seeking to borrow money. It was said that the bridging finance claimed to have been sought on behalf of Dr Albesher was offered to Ryan Corp. If so, it does not seem to me that this would be inconsistent with the arrangements described by Mr Ryan: Ryan Corp was the named purchaser of the Property, and it was to be owned by a joint vehicle of Mr Ryan and Dr Albesher in the form of Land & Securities SA.
163. It was also noted orally that in an email of 31 March 2014 Mr Ryan had said that his investment in the project was £64 million. As I understand it, the point being made is that this differs from the £66 million which Mr Ryan had arranged, with the benefit of finance from Och-Ziff, to invest in December. I do not consider that this difference enables me to conclude that Mr Ryan was lying.
164. The oral submissions added that reliance was also placed upon points that had been made in Dr Albesher's skeleton argument. As I understand it, the additional points were those at sub-paragraphs (d) to (f) of paragraph 23 of the skeleton argument, those at (a) to (c) having been repeated in the oral submissions. In this regard:

i) The point at paragraph 23(d) concerned lack of evidence of communications referred to in paragraphs 25, 32, 45 and 51 of Ryan 1. As to this, paragraph 25 is set out in section D3.2 above: it asserts that Mr Ryan made it clear to Dr Albesher from the very beginning that all his funding would be provided through debt finance, but it does not say that this was made clear in any written communication. Paragraph 32 is set out in section D2.4 above: it made reference to exhibited correspondence as set out in that section. Paragraph 45 is quoted at the end of section D2.5 above, and plainly refers to oral discussions and not written communications. Paragraph 51 is quoted in section D2.6 above and plainly refers to telephone conversations rather than written communications.

ii) Paragraph 23(e) of the skeleton argument complained that documents pertaining to the underlying transaction had not been provided to the court, and that Ryan 1 had not given "any information regarding Mr Ryan's relationship with Mr Eldring". As to the underlying transaction, neither the particulars of claim nor Albesher 1 said that there was a relevant document which was not made available to Dr Albesher. As to Mr Ryan's relationship with Mr Eldring, it is right that Ryan 1 says nothing about it. As against that, however, it does not seem to me that this gives rise to any inference that anything said by Mr Ryan in Ryan 1 is untrue. The claim in deceit does not assert that Mr Ryan was a direct participant in the making by Mr Eldring of the representations which are said to have been fraudulent on Mr Eldring's part. The case advanced in the particulars of claim that there was a conspiracy would require the court to draw a number of inferences. I do not consider that the proposed inferences are so strong that Mr Ryan was required to go into details of his relationship with Mr Eldring in order to buttress his denial of the alleged conspiracy.

iii) Paragraph 23(f) complained that Ryan 1 gave "absolutely no explanation" for the £5 million forming the balance of the £15 million after payment of £10 million by way of deposit to the vendor. As to that, this complaint would have more force if there had been evidence of prior concern on the part of Dr Albesher to have information about the utilization of that balance, or indeed of any request prior to Mr Ryan's witness statement seeking information about it. In the event, some information in that regard was provided in Ryan 2 (see section D4.4 above). I am not able to conclude that the absence of detailed information in this regard can justify an assertion that Mr Ryan is lying.

165. I stress that I am not by any means saying that Ryan Corp's defence is bound to succeed. For the reasons given in the above analysis, however, the "false factual assertions" contention is not a contention which can be established on the documents alone.
166. I add two further observations in relation to the "false factual assertions" contention. First, on behalf of Dr Albesher comparisons were made between the present case and other cases in which factual assertions were shown to have no real prospect of success. None of these comparisons assisted Dr Albesher: the question whether there is a real prospect of success turns on the particular circumstances of the individual case. Second, in so far as Dr Albesher identified assertions by Mr Ryan which were said to be inconsistent with other evidence, the assertions in question did not go to the heart of the allegations as formulated in the particulars of claim. Even if I were satisfied that Mr Ryan had made false assertions in relation to other matters, it would not necessarily follow that Mr Ryan's protestations that he did not make the oral representation which was said to have been fraudulent, and that he did not enter into any conspiracy with Mr Eldring, were untrue.
167. I turn to other aspects of the question whether Ryan Corp's defence has a real prospect of success. The first is that in the ordinary course the court would expect to see a draft statement of case on behalf of the defaulting defendant, setting out precisely what would be said if the default judgment were set aside. It is not said by Dr Albesher that there is a formal requirement to produce such a document. Dr Albesher asserts, however, that the failure to produce such a document shows that Mr Ryan is lying. I do not agree. I accept that the failure to produce a draft statement of case is something which I should take account of when considering the exercise of my discretion (see section E below). As to whether I should infer that Mr Ryan is lying, however, it seems to me that Ryan 1 has given the court much more information than could have been expected in a statement of case, and has done so in a way which gives a clear indication of the factual assertions that Ryan Corp relies upon. There may well be legal assertions to be made in the draft statement of case which would assist Ryan Corp. A possible example may be the question whether Ryan Corp is indeed vicariously liable for what was done by Mr Ryan. There is no reason to think, however, that the failure to identify legal points which might arise by way of defence is something which in any way indicates "mendacity" on the part of either Mr Ryan or Ryan Corp.
168. Second, there is a claim against Ryan Corp for a declaration that it holds certain rights on trust for Dr Albesher. The rights in question appear to be those arising from the payment of £20 million to the vendor of the Property for a transaction which did not proceed. It was submitted on behalf of Ryan Corp that the claim in this regard begs questions as to the basis upon which sums were paid, and as to who was responsible for the transaction not proceeding. It was submitted at the outset of oral submissions on behalf of Dr Albesher that he should be entitled to retain the default judgment so as to continue to have the benefit of the declaration of trust made in the default judgment in this regard. For the reasons given on behalf of Ryan Corp, however, it seems to me that there is a real prospect that such entitlement, if any, as Dr Albesher may have to claim against Ryan Corp in this regard is not an entitlement of the kind which is the subject of the declaration.

E. Discretion

169. My conclusion in section D above has the consequence that the court has a discretion to set aside the default judgment. As to the exercise of that discretion, Dr Albesher advanced propositions that:

i) the express provisions of CPR 13.3(2) emphasise the importance of having regard to whether the person seeking to set aside the default judgment made an application to do so promptly; and

ii) although CPR 13.3 does not expressly say so, considerations under CPR 3.9 are relevant, with the consequence that the court should apply principles concerning relief from sanction set out in Denton v TH White Ltd [2014] EWCA Civ 906, [2014] 1 WLR 3926.

170. Ryan Corp accepted both these propositions. In the remainder of this section I shall begin by considering whether Ryan Corp made its application promptly. I then discuss other factors said to have relevance to the exercise of my discretion, before turning to apply the Denton principles.
171. As to promptness, the express words of CPR 13.3(2) state:

In considering whether to set aside or vary [a default judgment], the matters to which the court must have regard include whether the person seeking to set aside the judgment made an application to do so promptly.

172. Oral submissions on behalf of Dr Albesher treated these words as if they covered the entire period from the date when the claim form was served through to the issue of an application to set aside the default judgment. This, as it seems to me, was too broad an approach. The particular factor which is expressly identified in CPR 13.3(2) is whether the application to set aside was made promptly. It cannot be made until after the default judgment has been entered. That is not to say that what happened prior to entry of the default judgment is irrelevant: on the contrary, it has relevance and I will consider it separately. My point only is that the specific factor identified in CPR 13.3(2) concerns the question whether, in the period between the grant of the default judgment and the application to set it aside, the defendant has made that application promptly.
173. Ryan Corp asserted that in the present case the answer to that question must be yes. Ryan Corp was represented at the hearing in the course of which the default judgment was granted. At that hearing Ryan Corp advanced a submission that there should be a stay of execution for a period sufficient to enable Ryan Corp to make an application to set aside the default judgment. His Honour Judge Waksman acceded to that submission and granted a period until 23 June 2015 for that purpose. Ryan Corp submitted at the hearing before me that it had made the application within the time allowed by His Honour Judge Waksman, and therefore it must follow that the application was made "promptly".
174. The submissions for Dr Albesher did not distinctly grapple with this contention on behalf of Ryan Corp. Reference was made to Mr Ryan having become aware of the application for default judgment no later than 26 May 2015. I deal with that below, but for present purposes I observe that it does not engage with the observation that Ryan Corp took no longer to make its application than the judge had allowed. It seems to me that if there had been some factor which had the consequence that Ryan Corp could have made its application more speedily than the judge had envisaged, then it would have been open to Dr Albesher to submit that mere compliance with the time allowed would not demonstrate that the application had been made "promptly". However no such factor is suggested. The preparation of the application required a considerable amount of work. I have no reason to consider that this work was done any less speedily than could have been expected, and in those circumstances I accept that the application was made "promptly" within the meaning of CPR 13.3(2).
175. Accordingly I turn to other factors. There are, as it seems to me, three relevant periods prior to the grant of the default judgment. The first concerns the period between Ryan Corp becoming aware of the claim form and expiry of the time allowed for filing an acknowledgement of service. As to that, as noted in section D2.6 above, Mr Ryan gave an account of receiving the claim documents "around mid-late April" when attending a meeting regarding other business matters, of being involved in extremely significant property development opportunities which put serious demands on his time, of not immediately reading the documents that were given to him, but putting them into his briefcase thinking that he would review them later, of other business matters "completely dominating my time" and overlooking the fact that he had put the documents in his briefcase for review, and then simply forgetting about the fact that he had received the documents. He accepts that the documents were extremely important, but says that not having read them when first handed to him he had not appreciated that at the time.
176. Dr Albesher submits that being busy is no excuse for overlooking the claim form. Ryan Corp does not suggest that it is. It is not said that there is any good reason for the failure to acknowledge service: the limit of Ryan Corp's contention is that during the period prior to expiry of the time allowed for filing an acknowledgement of service there was no deliberate decision on its part to ignore a deadline. It is submitted by Dr Albesher that the importance of the documents must have been apparent to Mr Ryan. As it seems to me, the importance of the documents ought to have been apparent to Mr Ryan, but I am not in a position to say that it was in fact apparent to him.
177. The next relevant period, as it seems to me, is the period between expiry of the time within which an acknowledgement of service ought to have been filed and the date when Ryan Corp realised that it had failed to do what it should have done. In the present case that period ended on 26 May 2015, when Mr Ryan received from Brebners the letter from Goodman Derrick warning of the application to enter default judgment. Ryan Corp's position during this period appears to me to be materially identical to its position during the first period.
178. The third period began on 26 May 2015 when Mr Ryan received notice of the hearing and ended on 2 June 2015 when the order for a default judgment was made. Dr Albesher criticised Mr Ryan in that regard: he had received notice of the hearing and yet did nothing for another two or three days. He instructed lawyers only on the day of the hearing. I consider that this is a fair criticism, but it is a criticism which arises in relation to a relatively short period of time. Moreover, there is no suggestion that if Mr Ryan had acted more promptly the outcome of the hearing before His Honour Judge Waksman would have been any different.
179. I noted earlier that it is appropriate to consider whether the exercise of my discretion should be affected by the failure of Ryan Corp to submit a draft statement of case answering the particulars of claim. As indicated earlier, in the ordinary course I would expect to see such a document, so that the court can know precisely what answer is given to the allegations against Ryan Corp. When I raised this at the hearing two submissions were made in answer. The first was that Ryan 1 dealt fully with all matters of fact that could be expected to be dealt with in a draft statement of case, and indeed went beyond this. For the reasons given earlier, I accept that submission. The second submission was that it would save costs for a single statement of case to be prepared dealing with the defences of both Mr Ryan and Ryan Corp. This assumed that instructions would be given for the production of such a document. If, however, there had been any failure in Ryan 1 to deal with the facts that could have been expected to be dealt with in a defence, then it seems to me that this submission would provide no answer to the complaint.
180. In these circumstances it seems to me that, in the exceptional circumstances of the present case, the court is not hampered by the lack of a draft defence. For that reason I do not give substantial adverse weight to Ryan Corp's failure to provide such a document.
181. A further aspect dealt with in submissions concerned the fact that Ryan Corp is but one of three defendants. I noted in section C above Mr Cohen's contention at the hearing on 2 June 2015 in relation to CPR 12.8. Reliance on CPR 12.8 was repeated in Ryan Corp's application notice, but the point was rightly not pursued at the hearing before me. The fact that there are other defendants does not, in the circumstances of the present case, bar entry of a default judgment.
182. It was nevertheless relied on by Ryan Corp as relevant to discretion in two ways. First, it was said that because service on Mr Ryan had not been effected, Ryan Corp's failure to act had not delayed the proceedings. Dr Albesher asserted that this was misleading, as Mr Ryan had deliberately evaded service. It seems to me that the position is that Mr Ryan, who is Ryan Corp's effective owner, has deliberately not facilitated service. This in my view disentitles Ryan Corp from relying on the resultant delay during the period up to and including service of Dr Albesher's reply to Mr Ryan's defence. In any event, as its seems to me, Ryan Corp's failure to acknowledge service has resulted in unnecessary proceedings and wasted time and expense comprising, at least, the application to enter default judgment, the hearing of that application, the issue of Ryan Corp's application notice, and the preparation by Ryan Corp and consideration by Dr Albesher of Ryan 1.
183. Second, it was said that the claim against Ryan Corp was inextricably linked to the claims against Mr Ryan and Credit Suisse. I do not consider that the link is "inextricable". It is nevertheless true that almost all factual matters said to give rise to Ryan Corp's liability will be matters that fall to be determined in the proceedings against Mr Ryan and Credit Suisse. It follows that setting aside the default judgment will not add significantly to the time required to resolve the claim.
184. In these circumstances I turn to apply the Denton principles:

i) The first stage of the Denton principles requires me to identify and assess the seriousness and significance of the failure to file an acknowledgement of service. If that failure were neither significant nor serious, then little time may be needed when turning to stages two and three. I cannot say that the failure to file an acknowledgement of service falls into that category. It is significant, and it had serious consequences as set out above.

ii) The second stage is to consider why the default occurred. It is not suggested that there was good reason for the default, but on the other hand the default was not deliberate. Moreover it is a relevant mitigating factor that Ryan Corp had no relevant warning of the proceedings. No allegation of deceit or fraudulent conspiracy was made at the time of relevant events. There was no letter before action. It seems that in May 2014 a letter had been sent threatening proceedings for failure to repay a loan of £25.4m – but that was very different from the present claim, and it was not pursued.

iii) At the third stage all the circumstances are to be considered. Particular weight should be given to the need for litigation to be conducted efficiently and at proportionate cost and to the need to enforce compliance with rules, practice directions and orders. Here the delay and wasted expense identified above weighs against Ryan Corp, as does the fact that it failed to comply with the time limit for acknowledging service. As against that, however, Ryan Corp has since 2 June 2015 acted promptly, and it has shown that there is a real prospect of successfully defending grave accusations against it in circumstances where, although there has now been a delay of several months, the time required in future in order to deal with the claim against Ryan Corp will not add significantly to the time required in order to deal with the claim against other defendants.

185. Weighing all these factors it is my view that the balance falls strongly in favour of setting aside the default judgment. I will exercise my discretion accordingly, and order that the default judgment be set aside.

F. Additional observations and conclusion

186. I noted earlier that a defence has now been filed by Mr Ryan, that a reply to that defence has been filed by Dr Albesher, and that at my request the parties have made written observations in that regard. I have considered those observations. In the light of my conclusions in sections D and E above it does not seem to me that those observations materially advance either side in relation to the outcome of the present application.
187. It was submitted by Dr Albesher that any order permitting the default judgment to be set aside should impose a condition that Ryan Corp pay Dr Albesher the full costs of the application. I do, not, however, consider that Ryan Corp's case is so dubious as to make this appropriate. The setting aside of the default judgment will not be conditional.
188. For the reasons given above I grant Ryan Corp's application to set aside the default judgment.