Property investor Glenn Maud and investment company Global Asset Capital Inc have suffered a setback in a complicated legal dispute with Robert Tchenguiz and investment companies Aabar Block SARL and Aabar Investment PJS.
The parties are in dispute over large debts relating to the acquisition of an interest in the Spanish headquarters of lender Santander Banking Group.
In a ruling today, the Court of Appeal dismissed claims brought by Maud and Global against the Aabar companies and Tchenguiz over an alleged contract which could have settled the dispute in Maud’s favour.
The background to the case is complicated.
In September 2008 Maud and business associate Derek Quinlan acquired an interest in the Santander building through a group of companies known a the Marne Group.
According to today’s judgment, the acquisition was financed in part by RBS Group and involved a senior loan of €1.575bn (£1.339bn), a personal loan to Maud and Quinlan of €75m, and a junior loan of €200m to Ramblas Investments, one of the Marne companies. Quinlan and Maude provided a personal guarantee for that loan of up to €40m, the judgment said.
In November 2010 Aabar Block and a company owned and controlled by Robert Tchenguiz, Edgeworth Capital, acquired RBS’s interest in the loan. Maud and Ramblas defaulted on payments, and Aabar and Edgeworth obtained judgments against them totalling more than €600m.
There were further legal tussles over the money. Global and Maud that they made offers to pay, but were “continually thwarted by Mr Tchenguiz”, so attempted to buy the rights directly from Aabar. The judgment says that Global allege that in April 2015 it sent a “without prejudice-subject to contract” letter offering €250m of Abar’s rights.
According to the judgment, Global alleges that in May 2015 the then chief executive of Aabar Investments PJS, Mr Al-Husseiny, spoke on the telephone to Maud and agreed a contract relating to the money.
“Global’s case is that during the course of this telephone conversation, the Alleged Contract was concluded subject to two conditions, namely that Mr Maude (1) ‘resend the Offer Letter in an ”’open and binding form”’ and (2) ‘provide statutory evidence of his ability to fund the transaction’”.
Later that month, according to the judgment, Al-Husseiny rejected the offer. In June, Global issued a claim against Aabar for enforcement of the contract and Aabar issued a claim seeking the dismissal of the Global claim.
In February 2016, High Court Judge Mr Justice Walker ruled that the Global claim could go ahead.
This led to a subsequent appeal, heard last month. However in a ruling today Lord Justices Hamblen and McFarlane reversed the lower court decision. In his ruling Hamblen LJ said that even if Global and Maud could establish that the contract was made, “they have no prospects of establishing that the conditions were satisfied”.
“In my judgment, the appeal should accordingly be allowed and judgment entered for Aabar,” he said.
Global Asset Capital, Glenn Maud v Aabar Block SARL, Aabar Investments PJS, Robert Tchenguiz
Court of Appeal (McFarlane LJ, Hamblen LJ) 1 Feb 2017
