Claim No: CFI 034/2022

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

ICICI BANK LIMITED

Claimant

and

MR BAVAGUTHU RAGHURAM SHETTY

Defendant

---

ORDER WITH REASONS OF H.E. CHIEF JUSTICE WAYNE MARTIN

---

UPON the Judgment of H.E. Justice Lord Angus Glennie dated 17 February 2025 (the “Judgment”)

AND UPON the Defendant’s Appeal Notice dated 10 March 2025 seeking permission to appeal the Judgment (the “Application for Permission to Appeal”)

AND UPON the Order with Reasons of H.E. Justice Lord Angus Glennie dated 17 April 2025, refusing the Application for Permission to Appeal and ordering the Appellant to pay the Respondent the costs of the Application

AND UPON the Defendant’s Renewed Application for Permission to Appeal dated 5 May 2025, seeking to appeal the Judgment (the “Renewed Application for Permission to Appeal”)

AND UPON the Order with Reasons of H.E. Justice Lord Angus Glennie dated 6 May 2025, amending the sums in paragraph 2 of the Judgment and awarding the Claimant’s costs and interest

AND UPON the Claimant’s submissions in opposition dated 27 May 2025

IT IS HEREBY ORDERED THAT:

1. The Renewed Application for Permission to Appeal is dismissed.

2. The Defendant shall pay the Claimant’s costs of the Renewed Application for Permission to Appeal.

3. The quantum of the costs to be paid pursuant to the preceding order shall be assessed by H.E. Chief Justice Wayne Martin by the process of immediate assessment.

4. The Claimant shall file a statement of its costs in relation to the Renewed Application for Permission to Appeal by no later than 4pm on Wednesday, 9 July 2025.

5. Within ten (10) days of service of the Claimant’s statement of costs, the Defendant shall serve any submissions relating to the quantum of costs claimed. The quantum to be allowed will thereafter be assessed by H.E. Chief Justice Wayne Martin on the papers.

Issued by:
Delvin Sumo
Assistant Registrar
Date of issue: 26 June 2025
Time: 9am

SCHEDULE OF REASONS

Summary

1. On 17 February 2025, judgment was entered in favour of the Claimant, ICICI Bank Limited (the “Bank”) against the Defendant, Mr Bavaguthu Raghuram Shetty (“Mr Shetty”) in the amount of USD 106,294,108.

2. Mr Shetty applied to the trial judge for permission to appeal that Judgment. That application was refused.

3. Mr Shetty has exercised his right to make a renewed application to the Court of Appeal for permission to appeal. That application must also be refused as none of the grounds of appeal upon which the application is based has any prospect of success, for the reasons which follow.

The decision at first instance

4. Given the tenor and breadth of the grounds of appeal and the tendentious argument provided in support of them, it is appropriate to commence with a review of the decision at first instance, in order that the grounds of appeal can be seen in their proper context.

5. Mr Shetty is the founder of NMC Healthcare LLC (“NMC”) which became a provider of healthcare services in the UAE. NMC and various other companies within the corporate group of which it was a part became subsidiaries of a company listed on the London Stock Exchange. That company, and the corporate group beneath it, collapsed in 2020 in the face of widespread allegations of fraud.

6. The Bank advanced funds to NMC pursuant to the terms of three Facility Agreements which were entered into in 2012, 2013 and 2019, the first two of which were extended from time to time.

7. The Bank also advanced funds to Modular Concepts LLC (“Modular”), a company which had some business connection with NMC but which was not part of the NMC Group.

8. NMC and Modular defaulted in repayment of the funds advanced by the Bank. The Bank asserts that Mr Shetty guaranteed the repayment of those funds and commenced these proceedings to enforce those Guarantees.

9. Until the last business day before the commencement of the Trial, Mr Shetty defended the Bank’s claims on the sole ground that he had not signed the Guarantees and had no knowledge of them. That was clear from the terms of his pleaded Defence and the Statement of Issues which were agreed by the parties for the purposes of a CMC which took place more than a year before the Trial. It was by then clear that at least some of the signatures on the Guarantees had been affixed by printing a copy of a signature on the relevant page, rather than by the manual application of a wet ink signature.

10. The Trial was listed to commence on Monday 23 September 2024. On the preceding Friday, a skeleton argument was filed on behalf of Mr Shetty raising six grounds of defence to which no previous reference had been made. The nature of those grounds will be considered below, but many involved propositions which were said to arise under the laws of Dubai, as opposed to the laws of the DIFC.

11. Predictably enough, at the commencement of the Trial counsel for the Bank objected to the very late attempt to raise these grounds. Counsel for Mr Shetty provided no explanation for the failure to give any prior notice of the new grounds of defence, other than the misconceived assertion, which was in any event wrong, that they were all grounds of law.

12. After hearing argument, the Judge concluded that it would be unfair to the Bank to permit Mr Shetty to raise new grounds of defence in these circumstances, given that it was not represented by counsel with expertise in Dubai law and in any event the notice given was quite insufficient to enable the Bank to undertake any meaningful assessment of the impact which the new grounds might have upon the Trial and in particular the ambit of the evidence which might be required in order to meet those grounds. It followed that the proposed grounds of defence could only be allowed if the Trial was adjourned which would delay the resolution of the proceedings and cause the Bank to incur significant costs thrown away in circumstances in which it seemed improbable that Mr Shetty would reimburse those costs. Nevertheless, the Judge offered Mr Shetty the option of an adjournment which would enable the new grounds to be considered on the condition that Mr Shetty provided security for the Bank’s costs in the amount of USD 100,000. Mr Shetty declined that offer. ¹ Consequently, the trial judge refused to entertain any of the proposed new grounds of defence, although as will be seen one of those grounds, relating to the quantification of the claim was in fact addressed by the Judge and another ground which related only to the claim under the Modular Guarantee became irrelevant when that claim was dismissed in any event.

13. After dealing with these procedural issues, the Judge’s reasons commenced with a summary of the Guarantees upon which the Bank’s claim was based.

14. The First Guarantee is dated 20 December 2012 and guarantees repayment of funds advanced by the Bank to NMC under a Master Facility Agreement dated 29 December 2011 (as amended). The Facility was for a total of up to USD 25m. By Letters of Amendment of various dates between 2013 and 2019 the parties agreed to extend the term of that facility. Each extension of the term was accompanied by a letter (“Guarantee Extension Letter”) apparently signed by Mr Shetty extending the validity of the Guarantee for the period of the extension.²

15. The Second Guarantee is dated 24 December 2013 and guarantees the repayment of funds advanced by the Bank to NMC under a Facility Agreement of the same date. The Facility was for an amount of up to USD 30m. As with the 2011 Facility Agreement, the term of the 2013 Facility Agreement was extended by agreements embodied in Letters of Amendment bearing various dates between 2014 and 2019. As with the 2011 Facility Agreement, each extension was accompanied by a Guarantee Extension Letter apparently signed by Mr Shetty extending the validity of his Guarantee for the period of the extension.³

16. The Third Guarantee is dated 27 March 2019 and guarantees the repayment of funds advanced by the Bank to NMC under a facility of the same date. The Facility was for an amount of up to USD 50m.

17. The Modular Guarantee is dated 26 June 2019 and guarantees the repayment of funds advanced by the Bank to Modular under a Facility Agreement of the same date. The Facility was for up to USD 30m.

18. The Judge noted that each of the NMC Facility Agreements expressly provided for the provision of a guarantee by Mr Shetty, from which it followed that if he signed any of those Agreements he was signing a document which confirmed his status as personal guarantor.⁴ However, as the Judge noted, that approach had no application to the Third NMC Guarantee or the Modular Guarantee, because neither the 2019 NMC Facility Agreement nor the Modular Facility Agreement bore Mr Shetty’s signature.

19. The Judge also noted that with one exception, each of the Letters of Amendment extending the duration of the 2011 and 2013 Facility Agreements bore a signature which was apparently that of Mr Shetty, as did all of the Guarantee Extension Letters accompanying the extensions of those Facilities.⁵

20. The Bank adduced evidence from four witnesses – Mr Parekh, Mr Gupta, Mr Juneja, and Mr Sharma. The Judge’s reasons record a careful and attentive review of the evidence given by each.

21. The Judge considered all to be credible and honest witnesses. However, in the case of Mr Parekh, Mr Gupta and Mr Juneja, the Judge found their evidence to be of limited assistance because none had any personal experience of dealing with Mr Shetty (indeed none had met him) nor were they personally involved in the process of procuring executed versions of the Facility and associated security agreements. Essentially, the Judge considered the value of their evidence was limited to a description of the processes which the Bank ordinarily followed when reviewing executed security documents, which essentially involved comparing signatures on those documents to specimen signatures held by the Bank in connection with the relevant account. As the Judge noted, appropriately, that procedure is of no evidentiary significance when the validity of a signature is contested, as the contest must be resolved by the Court on the basis of direct evidence.

22. The Judge did however note that the evidence of these witnesses established a pattern of communication between the Bank and officers of NMC which involved regular communications with respect to the provision and extension of security for the funds advanced by the Bank over many years, in the course of which no issue was ever raised in relation to the validity or authenticity of the Guarantees provided by Mr Shetty. However, he also noted, appropriately, that the lack of any issue being raised with respect to the Guarantees is of no particular significance unless and until circumstances arose which might result in a call upon the Guarantees.

23. So, generally speaking, the Judge did not consider the evidence of Mr Parekh, Mr Gupta or Mr Juneja to significantly advance the Bank’s case.

24. The Judge took a different view of the evidence given by Mr Sharma. Between 2016 and 2020, Mr Sharma was closely involved in the relationship between the Bank and NMC and was in regular contact with Mr Shetty and Mr Manghat, the CFO of NMC. He met Mr Shetty at least once a year between 2014 and 2020, usually at the offices of NMC in Abu Dhabi and he had regular telephone conversations with Mr Shetty.

25. Mr Sharma’s evidence, which was accepted by the Judge, was that as a result of his dealings with Mr Shetty over this period, he had no doubt that Mr Shetty was fully aware of the significant loans that had been made by the Bank to NMC, and of the general terms of those loans and the security documentation which had been provided in respect of them.

26. In December 2019, a report was published by Muddy Waters (a short seller) alleging that the NMC Group had been poorly governed and had been significantly under reporting its debts. In February 2020, NMC defaulted in repayments due under the various Facility Agreements, and on 11 February 2020 the Bank issued formal demands for payment to NMC and to Mr Shetty as Guarantor.

27. Mr Sharma sought a meeting with Mr Shetty, which was arranged for 27 February 2020. However, that meeting did not take place because of an illness in Mr Shetty’s family.

28. Another letter of demand under the Guarantee was sent to Mr Shetty at his address in Abu Dhabi on 27 February 2020, but the Bank later became aware that Mr Shetty had returned to India.

29. Mr Sharma eventually met Mr Shetty in the Taj Hotel in Bangalore on about 5 or 6 March 2020.

30. Mr Sharma testified that during the meeting Mr Shetty stated that the Bank would receive the money it was owed by NMC and that Mr Shetty acknowledged he had personally guaranteed the repayment of the funds advanced by the Bank under both the NMC Facility and the Modular Facility and that he would honour his liabilities.

31. The Judge found Mr Sharma to be a credible witness. He considered that his testimony was supported by the inherent likelihood of discussion on the subject of the Guarantees given by Mr Shetty in circumstances in which NMC was in default and it was clear that the Group was under considerable financial pressure following the publication of the Muddy Waters report. In these circumstances, the Judge considered it inherently unlikely that Mr Sharma would not have raised the topic of the Guarantees at the meeting.⁶

32. Mr Shetty was the only witness called in his defence. He provided two witness statements and was cross-examined on both of them. As with the Bank’s witnesses, in his reasons the Judge carefully and attentively reviewed the evidence given by Mr Shetty. The Judge noted many shortcomings in his testimony. Most particularly, the Judge noted that Mr Shetty invariably denied that any document bearing his signature which was put to him had in fact been signed by him, and further denied any knowledge of the document, including the many documents in respect of which both expert handwriting witnesses gave evidence to the effect that in their opinion the document had been manually signed by Mr Shetty. The Judge also noted that Mr Shetty testified that signatures which had been applied electronically looked like somebody was trying to make a copy of his signature when the expert evidence established that the signatures applied electronically were exact copies of other identified signatures. As the expert testimony was to the effect that it is impossible for a human to exactly replicate a signature manually, it necessarily followed that, inconsistently with Mr Shetty’s evidence, the signatures applied digitally were in fact his signature, the only question being whether the signature was applied with his authority.

33. The Judge also noted that Mr Shetty routinely justified his refusal to accept that any signature that appeared to be his was in fact his by a reference to “two crooks in the organization”.⁷

34. Having accepted the evidence of both experts in relation to the documents that were in fact signed by Mr Shetty, the Judge rejected Mr Shetty’s evidence. He did not find him to be a credible witness and refused to accept his evidence unless it was supported by documentary material.⁸

35. Two handwriting experts gave evidence – Ms Radley, who was engaged by the Bank, and Mr Al Bah, who was engaged by Mr Shetty. The Judge reviewed their evidence carefully in his reasons. He noted that the only substantial disagreement on the face of their reports was Mr Al Bah’s assertion that the application of an electronic signature was indicative of fraud or forgery. However, the Judge considered that Mr Al Bah resiled from that position in the course of his testimony and acknowledged that the authorized application of an electronic signature could be entirely lawful and valid, as is of course the fact.⁹ In any event, as the Judge noted, if Mr Al Bah did in fact hold a contrary view, it was outside the scope of his expertise and should not be accepted.

36. The Judge also noted Mr Al Bah’s evidence to the effect that some of the documents which he examined bore the marks of having been stapled and re-stapled more than once, and that in the case of some documents not every page of the document had been printed on the same printer or with the same ink. However, the Judge considered those observations to be of no significance in the circumstances of this case, as they would go only to the question of whether the document had been altered or tampered with following execution. As the Judge noted, Mr Shetty does not suggest that he signed a document which was later tampered with. His case was that he never signed any of the relevant documents at all. If, as Mr Shetty contended, his signatures on the relevant documents were forged, the number of staple marks on the document and differences in printer ink on different pages were simply irrelevant to the question of whether or not he signed the document.

37. The Judge carefully summarized the conclusions to be drawn from the expert evidence starting with the Modular Facility and the Modular Guarantee. The Modular Facility, as already noted, was not signed by Mr Shetty and the Modular Guarantee was not signed in pen and ink, but the signature had been applied by printing with toner. Ms Radley’s view, which the Judge accepted, was that there was “very strong evidence” to support the proposition that Mr Shetty wrote the signature which was applied electronically, but as the Judge noted, the question was whether the signature was applied with his authority. The Judge did not understand Mr Al Bah to disagree with Ms Radley.

38. In relation to the 2011 Facility Agreement, Ms Radley considered that there was “very strong evidence” that Mr Shetty signed the 2011 Agreement, and “strong” evidence that he wrote the signatures on the Supplementary Amendment Agreement dated 24 September 2012.¹⁰ The Judge noted that Mr Al Bah appeared to agree with this. As already noted, it is significant that the Facility Agreement specifically refers to the provision of a personal guarantee by Mr Shetty.

39. The Judge noted that Ms Radley and Mr Al Bah both examined the signatures on three Letters of Amendment relating to the 2011 Facility Agreement. Ms Radley concluded that there was very strong evidence to support the conclusion that Mr Shetty had signed the first, moderate evidence to support the conclusion that one of the signatures on the second document was his, and strong evidence to support the conclusion that the two signatures on the third document were his. Mr Al Bah appeared to agree.¹¹

40. As already noted, it is common ground that the signature in the name of Mr Shetty on the First Guarantee dated 20 December 2012 was applied electronically. Ms Radley opined that there was very strong evidence that Mr Shetty wrote the underlying signature, but of course she could not say anything of the circumstances in which the signature had been transposed onto the Guarantee. Mr Al Bah took no issue with that proposition, although in his report he asserted that the electronic application suggested forgery, a position from which, according to the Judge, he later resiled (appropriately).

41. Significantly, given that the First Guarantee was executed electronically, as noted, Letters of Extension of Guarantee were provided each time the term of Facility was extended. One such letter, dated 25 October 2014, was examined by Mr Radley and Mr Al Bah. It was executed in wet ink. Ms Radley concluded that there was very strong evidence to support the conclusion that the signature is that of Mr Shetty and Mr Al Bah appeared to agree.¹²

42. Ms Radley was not asked to examine the 2013 Facility Agreement. However, she did examine the Guarantee of the same date, which bears two signatures in the name of Mr Shetty, both being written in wet ink. Ms Radley concluded that there was “very strong” evidence that both signatures were written by Mr Shetty and Mr Al Bah appeared to agree.¹³

43. As already noted, there is no suggestion that Mr Shetty signed the Third NMC Facility Agreement of 2019. However, each expert examined the Guarantee dated 27 March 2019 and agreed the three signatures on the document had been applied electronically. According to Ms Radley, the signatures were identical to the signature on another document dated 27 December 2016, which led her to conclude that the underlying signature must have been written on or before that date.

44. After considering the evidence, the Judge summarized the issue in the case as being whether the evidence established that Mr Shetty signed the personal guarantees or any of them with a wet ink signature or, if he did not, whether he applied or approved the application of electronic or copy signatures to the Guarantees.

45. In this context the Judge considered Article 22 of the Electronic Transactions Law (DIFC Law no. 2 of 2017). He observed that the details of that Law were irrelevant to this case because if Mr Shetty had not authorized the application of his signature to q document, he was clearly not liable on that document. Although the Judge did not note this in his reasons, in fact the relevant DIFC Law provides that if an electronic signature is applied with the authority of the signatory it is valid. This helps explain why the Judge considered that the DIFC Law was irrelevant to the issues in the case. That Law embodies the same approach as that which the Judge took without regard to the Law.

46. The Judge then considered the burden of proof and rejected the Bank’s proposition that Mr Shetty carried the burden of proving forgery or fraud. Indeed, he rejected the notion that Mr Shetty had to establish any case of fraud.¹⁴ He concluded that the Bank carried the burden of proving the facts upon which it relied, which included execution of the Guarantees by Mr Shetty.

47. The Judge then analysed the evidence which he had summarized and enunciated the reasons for his conclusions, in the course of which he elaborated on his reasons for rejecting Mr Shetty’s evidence. They included the fact that the expert evidence established that although some of the documents upon which the Bank relied had been executed electronically, the expert evidence established that many of the documents which referred to those documents, including the Letters of Amendment and the Extensions of Guarantee, had been signed by Mr Shetty in wet ink, despite his denial of that fact.

48. In this portion of his reasons, the Judge also referred to the significant evidence given by Mr Sharma, and his rejection of the evidence given by Mr Shetty in relation to their meeting at the Taj Hotel.

49. For these reasons, the Judge concluded that he was satisfied that Mr Shetty signed or authorized the signing of the three NMC Guarantees and the other documents relating to NMC to which he had referred in his reasons.

50. However, in relation to the Modular Guarantee the Judge observed that there were no related documents bearing any signature from Mr Shetty, and in particular no wet ink signature. There was little evidence as to the circumstances in which Mr Shetty might have signed a personal guarantee covering Modular’s indebtedness to the Bank, given that Modular was not part of the NMC Group. The Judge was not satisfied that Mr Sharma’s evidence established that the Modular Guarantee was the subject of discussion at the meeting in Bangalore. Accordingly, the Judge was not satisfied that the Bank had established, at least on the balance of probabilities, that Mr Shetty signed the Modular Guarantee and the Bank’s claim in respect of funds advanced under that Guarantee was dismissed.

51. The Judge then addressed the question of quantum. He observed that until the start of the Trial Mr Shetty had not made it clear that quantum was seriously in dispute, although he observed that pursuant to Rule 17.29 of the Rules of the DIFC Courts (“RDC”), a Claimant carries the burden of proving the quantum of any claim unless expressly admitted by the defendant. The Judge noted that the Bank proposed to discharge its burden of proof by relying upon a Claims Admission Notice from the administrators of NMC, in which they admitted that the unsecured claim of the Bank was in the amount of USD 106,294,108. The Judge considered that, in the absence of any other evidence, that was sufficient evidence of the quantum of the principal debt and therefore of the amount due under the Guarantee. Accordingly, judgment was entered in that amount.¹⁵

Permission to appeal – legal principles

52. RDC 44.117 provides:

53. RDC 44.5 requires that an appellant obtain permission to appeal to the Court of Appeal except where the appeal is against a committal order.

54. RDC 44.19 provides:

55. In this case, the Applicant for permission does not contend that there is some other compelling reason why the appeal should be heard. Rather, it is contended that the appeal would have a real prospect of success because the decision of the Judge at first instance was wrong.

56. It is established that “real” in the context of an assessment of the prospects of success means realistic rather than fanciful, applying the same test as is applied in an application for immediate judgment.¹²

57. It is also established that a real prospect of success does not mean a probability of success, but more than mere arguability.¹⁷

58. Accordingly, in order to obtain the grant of permission a prospective appellant needs to establish more than the proposition that the proposed appeal is reasonably arguable – rather, it must be established that there is a real prospect of success.¹⁸

59. Particular principles apply to applications for permission to appeal against case management decisions and multi factorial assessments undertaken by a Judge at first instance.

60. It is well established in this and other comparable commercial courts that Courts of Appeal are generally reluctant to interfere with case management decisions made in the exercise of the broad discretion conferred upon Case Managers by rules of court, including the rules of this Court. Generally speaking, appellate intervention will only be justified if the case management decision is so outside the range of a sound discretionary judgment as to manifest error and if the consequence of the decision would be to cause substantial and irremediable injustice.

61. There are features of this application for permission to appeal which significantly diminish the prospect of appellate intervention in accordance with legal principles which are well established in this and other commercial courts. First, one, or perhaps more, of the grounds of appeal challenge the decision of the Judge to refuse to allow Mr Shetty to advance grounds of defence which were not pleaded. This was a case management decision. It is well established that appellate courts will only intervene with case management decisions in very limited circumstances. For reasons which will be developed, none of those circumstances are present in this case.

62. Second, the only substantive issue in the case as pleaded (apart from quantum) was the question of whether the Bank had established, on the balance of probabilities, that Mr Shetty signed the Guarantees upon which the Bank’s claims depended. Most of the grounds of appeal are, in substance, a challenge to the Judge’s finding of fact in relation to three of the four Guarantees which were the subject of the Bank’s claim, the claim under the fourth having been dismissed.

63. While it is of course possible to challenge findings of fact on appeal, it is well established that when considering such challenges the appellate court will give considerable weight to the advantages enjoyed by the trial Judge who has seen and heard all the witnesses and who has been immersed in the documentary evidence to a greater extent than is likely at appellate level. The restraint which this consideration imposes upon appellate intervention with respect to findings of fact has been formulated in different terms in different courts. In this case it is unnecessary to analyse the differing verbal formulations of this principle because, for reasons which will be developed, there is no substance to any of the challenges to the Judge’s finding of fact.

The grounds of appeal

64. The grounds of appeal take the form of headings in a lengthy skeleton argument. No attempt has been made to comply with the requirements of RDC 44.31 which provides:

Rather, the Court is left to attempt to winkle out the matters specified in RDC 44.31 from prolix argument expressed in rhetorical and tendentious terms.

65. The skeleton argument served in support of the Renewed Application for Permission to Appeal commences with argument directed to the proposition that the trial Judge applied the wrong standard when refusing the first Application for Permission to Appeal. Those contentions misconceive the nature of the appellate process. A renewed application to the Court of Appeal for permission to appeal following the refusal of permission by a trial Judge is not an appeal from the refusal of the first application, in the sense that it is necessary to demonstrate error on the part of the trial Judge when refusing the application for permission. Rather, the renewed application requires the Court of Appeal to consider the matter afresh and make its own determination of whether permission to appeal should be granted. That determination might differ from that of the trial Judge because the appellate court might take a different view of the prospects of success of the appeal without it being established that the trial Judge erred in his or her assessment of such prospects.

66. In some cases, the assessment of the prospects of success of an appeal will be a qualitative process, depending to some extent upon impressions and value judgments based upon experience in the practice of appellate courts. Sometimes such impressionistic views will be incapable of expression with precision or mathematical certainty. In such cases different judges might form different views with respect to an appeal’s prospects of success without either being in error.

67. However, this is not such a case because, for reasons which will be developed, no judge could reasonably form the view that this appeal has any prospect of success.

Ground 1

68. Ground 1 challenges the Judge’s decision to refuse Mr Shetty permission to advance grounds of defence which had not been pleaded, and of which no notice had been given until the last business day before the commencement of the Trial.

69. The argument in support of this ground relies upon authorities dealing with amendments to pleadings, including Quah Su-Ling v Goldman Sachs International¹⁹ and Oman Insurance Company PSC v Globemed Gulf Healthcare Solutions LLC.²⁰ Those authorities deal with such issues as the requirement to properly plead a cause of action or ground of defence which discloses a real prospect of success and the need to strike a balance between injustice to the applicant if the amendment is refused and injustice or prejudice to the other party if the amendment is allowed.

70. Those authorities are well known and are not controversial. However, they have no application to this case because Mr Shetty never applied to amend his Defence to advance the grounds of defence which were advanced for the first time in his skeleton argument. Accordingly, there is no way in which Mr Shetty can satisfy the first requirement established by the authorities upon which he relies – namely, that the grounds of defence have been properly pleaded.

71. In this context, it is significant to note that the trial Judge invited counsel for Mr Shetty to apply for an adjournment in order to formulate appropriate amendments to the Defence on condition that security was posted for the Bank’s costs thrown away – an invitation which Mr Shetty refused.

72. The argument advanced in support of this ground does not directly address the question of whether the proposed grounds of defence had to be pleaded. It is asserted that the proposed grounds dealt solely with questions of law and the factual basis for the propositions of law was before the Court. That assertion is not correct. Although most of the proposed grounds raised questions of UAE Law, none were solely questions of law and all involved questions of mixed law and fact. It is impossible to know what facts were appropriately established in relation to the legal issues raised unless and until the proposed defences were properly enunciated in a pleading. That never occurred.

73. At Trial, counsel for Mr Shetty sought to justify his position by the proposition that all of the issues were solely questions of law, and therefore did not need to be pleaded. There are terms in the skeleton served in support of this ground which suggest the possibility of a similar proposition. If so, the proposition is incorrect, as the issues all raise questions of mixed law and fact. But even if the issues were solely issues of law, the proposition is wrong. The RDC specifically requires all Statements of Case (pleadings) to identify any legislative provision on which an allegation is based (RDC 17.44) and to identify any principle of foreign law or foreign legislative provision on which a party’s case is based (RDC 17.45) and to give details of the expiry of any limitation period relied on (RDC 17.32).

74. The argument advanced at Trial and in support of this ground on appeal ignores the fundamental purpose of pleadings. Pleadings are one of the means by which a court can ensure that procedural fairness is provided to all parties.

75. Procedural fairness requires that a party be made aware of the case which has to be met and is given a fair opportunity to meet that case. It is unnecessary to speculate as to the forensic purpose or strategy which motivated Mr Shetty to reveal, without explanation or justification, these new and unpleaded grounds of defence in a skeleton served on the eve of Trial. That is because, whatever its purpose, its effect would have been to deprive the Bank of its entitlement to procedural fairness if the Judge had allowed the unpleaded grounds to be advanced. As the Judge noted:

76. In these circumstances, the Judge was plainly correct to refuse leave to Mr Shetty to advance the proposed grounds of defence. Indeed, that was the only course reasonably open to the trial Judge after Mr Shetty refused to post security for the Bank’s costs thrown away if the case was adjourned. Accordingly, this is not one of those cases in which it is necessary to invoke reliance upon appellate restraint with respect to case management decisions. That is because, in this case there was only one course reasonably open to the Judge, which is the course which he took.

77. For the sake of completeness, I note that one of the grounds, relating to quantification of the claim was addressed by the Judge in any event, and another, relating to a limitation defence with respect to the claim on the Modular Guarantee falls away because the Bank’s claim on that Guarantee was dismissed.

78. Proposed ground 1 has no prospect of success.

Ground 2

79. Ground 2 asserts that the Judge failed to determine one of the new grounds raised, for the first time, in the skeleton served on the eve of Trial, being the ground relating to the validity of electronic signatures. As such, the ground is no more than a subset of the first ground, and must fail for the same reasons.

80. Nevertheless, for the sake of completeness, some observations are appropriate. It is asserted that “the presence of electronic signatures on the disputed personal guarantees emerged only at a late stage in the proceedings”.²¹ That is not correct. As already noted, the expert evidence establishing the existence of electronic signatures on some of the Guarantees was served more than a year before the Trial, yet Mr Shetty took no point in relation to the validity of electronic signatures until the last business day before Trial.

81. Further, the trial Judge did refer, albeit briefly, to the DIFC Law dealing with electronic signatures. The terms of that law focus attention upon the question of whether the application of the electronic signature was authorised by the signatory. That is precisely the question which the trial Judge addressed in relation to the electronic signatures. Mr Shetty does not submit that UAE Law is any different.

82. Put another way, this ground of appeal complains only of the Judge’s failure to specifically address the issue by reference to DIFC and UAE Law. It is not contended that if, after finding as a fact that Mr Shetty authorized the application of the electronic signatures on the relevant Guarantees he had gone on to consider DIFC Law or UAE Law on the subject, he must necessarily have concluded that the signatures were invalid. It follows that even if all the other impediments to this ground of appeal could be overcome, it could not result in the judgment being set aside.

83. Ground 2 has no prospect of success.

Ground 3

84. It is difficult to enunciate appeal ground 3 with any clarity or precision, as that has not been done in either of the skeleton arguments provided in support of the applications for permission to appeal. It seems to be a challenge to the findings which the Judge made based upon his analysis of the expert evidence. The argument includes reference to the possibility that the documents were tampered with despite the Judge correctly observing that such evidence was irrelevant to the issues in this case, as there was no suggestion that a document signed by Mr Shetty was later altered. Rather, the case is that Mr Shetty never signed the document.

85. As the Judge observed, leaving aside Mr Al Bah’s reference to the possibility that the documents may have been altered or amended after execution, which is irrelevant, and the assertion in his report to the effect that the application of an electronic signature was indicative of fraud or forgery, from which he later resiled, there was no material difference between the handwriting experts in relation to the execution of the documents.

86. In his reasons, the Judge carefully identified the documents which the experts concluded had been signed by Mr Shetty in wet ink. Many of those documents expressly referred to personal guarantees from Mr Shetty, including the Letter Amendments and Extension Letters. The Judge inferred from this evidence that Mr Shetty was well aware of the security package which supported the facilities provided by the Bank and which included his personal guarantees. This was among the facts upon which the Judge relied in order to conclude that it was more likely than not that the electronic signatures on the Guarantees were applied with Mr Shetty’s authority. That conclusion was reinforced by his rejection of Mr Shetty’s evidence to the contrary, for reasons which he enunciated, and his acceptance of Mr Sharma’s evidence to the effect that Mr Shetty acknowledged that he was a guarantor during their meeting in Bangalore.

87. The argument advanced in support of this ground does not suggest any flaw or error in the process of fact finding and reasoning undertaken by the Judge.

88. This ground has no prospect of success.

Ground 4

89. Ground 4 asserts that the Judge erred by failing to consider the lack of documentary and witness evidence linking Mr Shetty to the personal guarantees. The ground is somewhat undermined by the opening sentence of the argument in support of it, which refers to the Judge’s acknowledgement of the paucity of factual evidence tying Mr Shetty to the underlying transactions or the personal guarantees. In his analysis of the evidence given by the Bank’s witnesses, the Judge specifically identified the fact that the evidence of three of those witnesses did not establish any direct connection between Mr Shetty and the execution of the security documents and Guarantees. This is the reason why he expressly said that he did not find a great deal of support for the Bank’s case in the evidence of those witnesses, other than their evidence of the general context in which the transactions were undertaken.

90. The question which the Judge addressed was whether, notwithstanding the lack of any direct evidence of the execution of the Guarantees by Mr Shetty, the evidence of the expert witnesses and the evidence of Mr Sharma to the effect that Mr Shetty acknowledged that he had guaranteed the Bank’s debt were sufficient to establish, on the balance of probabilities, that Mr Shetty had in fact signed the Guarantees or authorized his electronic signature to be applied to the Guarantees.

91. Contrary to the argument advanced in support of this ground, the lack of first hand evidence of the execution of a document does not prevent the fact of execution being established by other evidence.

92. This ground has no prospect of success.

Ground 5

93. Ground 5 asserts that Mr Sharma’s evidence was unreliable. However, the assessment of the credibility of Mr Sharma’s evidence was a matter for the trial Judge and none of the matters raised in support of this ground, such as the lack of any documentary record of the conversation in Bangalore precluded the Judge from accepting Mr Sharma’s testimony.

94. The Judge’s reasons explain clearly why he accepted the testimony given by Mr Sharma and in those circumstances, there is no prospect that an appellate court would interfere with such a finding. Contrary to the argument advanced in support of this ground, the finding that Mr Shetty acknowledged to Mr Sharma that he had guaranteed NMC’s debt to the Bank is a significant fact which provided considerable support for the Judge’s finding that Mr Shetty signed the NMC Guarantees or authorized the application of his electronic signature to those Guarantees.

95. Ground 5 has no prospect of success.

Ground 6

96. Ground 6 is another ground which it is difficult to enunciate with clarity and precision, because that has not been done in any of the skeleton arguments filed in support of the application for permission to appeal. It also another ground which relies on a defence which was never pleaded, and is therefore a subset of ground 1 which fails for the reasons already given in relation to that ground,

97. It seems that the proposition is that the Bank owed a duty of care to Mr Shetty in relation to his execution of the Guarantees, and that the Bank breached that duty. However, such a duty would only arise if in fact Mr Shetty signed the Guarantees, which was the central issue in the case.

98. Accordingly, even if the Bank was under such a duty to Mr Shetty (and no authority is cited in support of the proposition that the Bank was under such a duty) no occasion for the performance of the duty would have arisen on Mr Shetty’s case, because he had no knowledge of the security documents and did not sign any of the Guarantees. Of course, Mr Shetty could not assert, and did not assert, that if he had signed the guarantees he did not understand their effect.

99. This ground of appeal is irrelevant to the issues in the case and has no prospect of success.

Ground 7

100. This ground asserts that the Judge should have used his failure to find that the Bank had established that Mr Shetty had signed the Modular Guarantee to conclude that the Bank had failed to establish that Mr Shetty had signed the NMC Guarantees.

101. The fatal flaw in this ground is evident in its enunciation, which relies upon the dismissal of the claim under the Modular Guarantee to support findings of fraud/forgery. The Judge did not find that the Modular Guarantee was executed in the performance of some fraud or conspiracy. Rather, he found that in the absence of all the extrinsic evidence relating to Mr Shetty’s involvement in the NMC transactions and his execution of the documents integral to those transactions, the Judge was not satisfied on the balance of probabilities that he had executed the Modular Guarantee. That conclusion sheds no light whatever on the issues relating to the NMC Guarantees.

102. Ground 7 has no prospect of success.

Ground 8

103. Ground 8 challenges the Judge’s finding in relation to the quantum of the debt owed by the principal debtor and which had been guaranteed by Mr Shetty. As noted, the Judge relied upon documentary evidence of an admission of the quantum of the debt from the administrators of the principal debtor and concluded that in the absence of evidence to the contrary that evidence was sufficient to establish the quantum of the debt due under the Guarantees.

104. No error has been demonstrated in the approach taken by the Judge in this respect.

105. Ground 8 has no prospect of success.

Ground 9

106. Ground 9 asserts that the Judge failed to consider and find the fraud perpetrated in the case.

107. This ground must fail for at least the following reasons. First, as the Judge noted, the question was not whether Mr Shetty had established whether there was a fraudulent conspiracy which involved the forged execution of documents. Rather, the question was whether the Bank had established, on the balance of probabilities, that Mr Shetty signed the relevant Guarantees. The Judge was under no obligation to consider an irrelevant issue.

108. Second, apart from sweeping and unsubstantiated allegations made by Mr Shetty, there was no evidence of fraud or forgery relating to the transactions between the Bank and NMC and therefore no basis upon which the Judge could have made any findings on that subject.

Conclusion

109. None of the grounds of appeal has any prospect of success. The Renewed Application for Permission to Appeal must be dismissed and Mr Shetty must pay the Bank’s costs to be assessed in accordance with the Orders made.