In the Media

Company in contempt needs leave to appeal

PUBLISHED November 30, 2011

Masri v Consolidated Contractors International Co SAL and Others

Before Lord Justice Maurice Kay, Lady Justice Hallett and Lord Justice Toulson

Judgment July 27, 2011

A company found in contempt of court could not appeal the findings of contempt as of right but required the permission of the judge or the Court of Appeal.

The Court of Appeal so stated when dismissing the appeal of Consolidated Contractors International Company SAL and Consolidated Contractors (Oil and Gas) Company SAL against a decision of Mr Justice Christopher Clarke in the Commercial Court ([2011] EWHC 1024 (Comm)) whereby he found them to be in contempt of court. Mr Munib Masri had obtained judgment for $75 million against the companies and against Mr Wael Khoury, an alleged shadow director of the companies. He initiated contempt proceedings when they failed to satisfy the judgment.

Mr Michael Brindle, QC and Mr Ben Brandon for the companies; Mr Gavin Kealey, QC and Mr Colin West for Mr Masri.

LORD JUSTICE MAURICE KAY said that it was common ground that an individual who had been committed to prison for contempt of court, whether criminal or civil, could appeal as of right by virtue of section 13(1) of the Administration of Justice Act 1960. At the time of the 1960 Act, there had been no general requirement for permission to appeal to the Court of Appeal Civil Division.

The innovation came in section 54 of the Access to Justice Act 1999. Pursuant to that provision, rule 52.3(1)(a) of the Civil Procedure Rules provided that an appellant or respondent required permission to appeal from a decision of the High Court, except where the appeal was against, inter alia, a committal order.

Mr Brindle contended for an expansive construction of ?committal order? in rule 52.3(1)(a). He submitted that, properly construed, it meant any order in relation to a contemnor which was part of the process leading to punishment for contempt.

It mattered not that a corporate contemnor could not be committed to prison. It had, and was intended to have, the same protection as that enjoyed by individuals whose liberty was at stake.

The earlier authorities all pointed in a consistent direction. They demonstrated that the purpose behind the wording of rule 52.3(1)(a) was related to personal liberty. That was apparent not only from the report of Sir Jeffrey Bowman, Review of the Court of Appeal (Civil Division) (September 1997), but also from the drafting which specified three exceptions to the requirement for permission, the singular theme of which was interference with, or deprivation of, liberty.

His Lordship appreciated that a financial penalty might impact harshly on a contemnor but the considerations which underlay the impact of a deprivation of liberty were absent. Apart from S-C v H-C; S-C (Children) ([2010] EWCA Civ 21) the post-Civil Procedure Rule authorities all pointed away from an expansive construction of ?committal order?.

For all those reasons, his Lordship was satisfied that the companies did not have an unqualified right of appeal to the Court of Appeal. They could only appeal with permission.

Lady Justice Hallett and Lord Justice Toulson agreed.

Solicitors: SC Andrew LLP; Simmons & Simmons LLP