Claim No. CFI 038/2023

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF APPEAL

BETWEEN

ALAWWAL CAPITAL JSC

Claimant/Respondent

and

RASMALA INVESTMENT BANK LIMITED

Defendant/Appellant

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

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UPON the Judgment of H.E. Justice Roger Stewart KC dated 12 June 2025 (the “Judgment”)

AND UPON the Defendant’s Appeal Notice dated 3 July 2025, seeking permission to appeal the Judgment (the “Application”)

AND UPON the Order of H.E. Justice Roger Stewart KC dated 13 August 2025, dismissing the Application

AND UPON the Defendant’s Appeal Notice dated 1 September 2025, seeking renewed permission to appeal the Judgment (the “Renewed Application for Permission” or the “Renewed Application”)

AND UPON the Claimant’s submission in opposition dated 23 September 2025

AND PURSUANT TO the Rules of the DIFC Courts (“RDC”)

IT IS HEREBY ORDERED THAT:

1. The Renewed Application for Permission is dismissed.

2. The Defendant shall pay the Claimant’s costs of the Renewed Application for Permission and the costs of the Stay Application (if any) to be assessed in accordance with the following directions.

3. The Claimant is to file and serve a Statement of Costs and any short submissions in support of the costs claimed within fourteen (14) days of the date of this Order.

4. The Defendant is to provide any submissions in response to the quantum of costs claimed within fourteen (14) days of service of the Statement of Costs.

5. The Claimant is to provide any submissions in reply to the Defendant’s response within seven (7) days of service of that response.

6. The quantum of the costs to be paid by the Defendant to the Claimant will thereafter be assessed by the Chief Justice by way of immediate assessment on the papers.

Issued by:
Hayley Norton
Assistant Registrar
Date of issue: 15 October 2025
At: 12pm

SCHEDULE OF REASONS

Summary

1. The Defendant, Rasmala Investment Bank Limited (“RIBL”) has made a Renewed Application to the Court of Appeal for Permission to Appeal (the “Renewed Application”) from the judgment of the Trial Judge after trial in which he allowed the claim of the Claimant, Alawwal JSC (“Alawwal”) for damages for negligent misrepresentation, RIBL’s Initial Application for Permission to Appeal having been refused by the Trial Judge.

2. For the reasons which follow, RIBL has failed to establish that any ground of appeal would have a real prospect of success or that there is some other compelling reason why its appeal should be heard. The Renewed Application must be dismissed with costs.

Overview of the dispute

3. Alawwal is an investment bank based in Saudi Arabia and licensed by the Saudi Arabian Capital Markets Authority. RIBL is an investment bank registered in the DIFC and regulated by the DFSA.

4. Alawwal invested amounts totalling USD 10,069,885 in the Rasmala Trade Finance Fund (the “Fund”). The Fund was incorporated in the Cayman Islands on 9 October 2013 and is an open ended, exempted company with limited liability. The directors of the Fund are and always have been directors or officers of RIBL and all meetings of the Board of Directors of the Fund take place in the offices of RIBL within the DIFC. The Fund satisfies the requirements of a collective investment scheme for the purposes of the Collective Investment Law of the DIFC. The Fund’s Confidential Private Offering Memorandum dated 7 May 2018 (the “OM”) stated, inter alia:

“The investment objective of the fund is to maximise risk-adjusted returns by investing in Sharia’a compliant Trade Finance Investments that are expected to generate low volatility returns …”

5. In October 2018 Alawwal decided to establish its own multi asset fund (the “Alawwal Fund”) and to invest a large part of the assets of that fund in other Islamic funds that were aligned with Alawwal’s desired risk profile. That risk profile was specified in a meeting of Alawwal’s Business Development Committee on 4 November 2018, the minutes of which record that:

“The CEO noted the importance of establishing the fund with low to medium risks.”

6. From October 2018 onwards, Alawwal began gathering information with respect to Islamic funds in which the assets of the Alawwal Fund might be invested. In the course of those investigations, various meetings were held with representatives of RIBL and documents were exchanged between the representatives of the parties.

7. During 2019 the Alawwal Fund commenced litigation in an attempt to recover some of its losses and on 31 March 2020 dealing in the Fund was suspended. Alawwal was able to redeem some of its investment in the Fund but after taking into account those redemptions and dividends which it had received, suffered a loss of USD 4,199,519.22 on its investment in the Fund.

8. Alawwal commenced proceedings against RIBL claiming that it would not have invested in the Fund but for a series of false representations made by RIBL in the course of negotiations which took place between November 2018 and February 2019. Alawwal claimed that the statements were made negligently and in breach of fiduciary duty, although the Trial Judge rejected the claim based on breach of fiduciary duty. Alawwal also claimed that it was entitled to compensation by reason of RIBL’s breach of the duty imposed by Rule 3.2.1 of the Conduct of Business Rules (“COB”) applicable to collective investment schemes under the DIFC Law pertaining to such schemes by failing to take reasonable steps to ensure that its communications with Alawwal were clear, fair and not misleading.

9. Following a trial between 10-18 March 2025, in reasons for judgment published on 12 June 2025 the Trial Judge upheld the claim for negligent misrepresentation and found it unnecessary to deal with the claim for breach of statutory duty. After providing the parties with an opportunity to confer in relation to the relevant figures, on 14 July 2025 the Judge entered judgment against RIBL in the amount of USD 4,199,519.22 and further ordered that RIBL should pay Alawwal pre-judgment and post judgment interest and should also pay Alawwal’s costs of the proceedings, which he assessed at AED 1,446,311.84

The Particulars of Claim

10. Because of the nature of some of the grounds of appeal it is necessary to analyse relevant aspects of Alawwal’s pleaded case as contained in its Amended Particulars of Claim (the “Particulars”).

11. In [12] of the Particulars Alawwal asserted that in about November 2018 representatives of RIBL approached Alawwal with a view to persuading it to become a client of RIBL and to invest in the Fund. Alawwal pleaded that four face to face meetings took place between representatives of the parties to that end – three at the offices of Alawwal in Jeddah on 14 November 2018, 23 January 2019 and 25 February 2019, and one at the offices of RIBL in Dubai (DIFC) on 6 February 2019. By [13] of the Particulars Alawwal pleaded that:

“During the Meetings representatives of Alawwal explained to representatives of RIBL that Alawwal was seeking to invest in Sharia compliant investments with a low risk profile (the “Alawwal investment objectives”). In response, representatives of RIBL repeatedly advised Alawwal that an investment in the Fund was a suitable and appropriate investment for Alawwal, having regard to Alawwal’s investment objective and low appetite for risk.”

12. In [14] of the Particulars Alawwal pleaded that in the course of the meeting on 14 November 2018 Mr Zografos (representing RIBL) made oral representations to Mr AlEbraheem and Mr Alturki (representing Alawwal) in the following terms:

13. In its Particulars Alawwal pleaded the representations that were made during the course of the other meetings identified, and the written communications that were exchanged. Included in those pleadings is an allegation that at the meeting on 23 January 2019 Mr Zografos represented, inter alia, that:

14. In [29] of the Particulars Alawwal asserted that, whether considered separately or together, the various representations which it had pleaded (together the “oral fund risk representations”) included representations with respect to the nature of the clients with whom the Fund dealt, the multi-layered risk mitigation measures used by the Fund and that:

15. In [46] of the Particulars, Alawwal pleaded that “RIBL assumed responsibility for advising Alawwal regarding the suitability for Alawwal’s purposes of an investment in the Fund”. Alawwal further asserted that:

“RIBL’s representatives gave advice and made the written and oral representations pleaded above with the intention that they should be relied upon by Alawwal in deciding whether or not to (a) become a client of RIBL and (b) make an investment in the Fund. In the premises, RIBL’s relationship with Alawwal was fiduciary and it owed fiduciary duties and a duty of care to Alawwal.”

As will be seen, the manner in which this pleading is formulated corresponds to the relevant provisions of the DIFC Law of Obligations.¹

16. In [47] of the Particulars Alawwal asserted that RIBL owed various fiduciary duties to Alawwal and also:

“A duty to advise and carry out its functions with reasonable skill, care and diligence (the “Duty of Care”).”

17. In [66] of the Particulars, Alawwal pleaded that the various representations pleaded earlier:

“Were false and were made negligently and/or in breach of the Duties and/or in breach of RIBL’s statutory duty to ensure that communications with RIBL were clear, fair and not misleading and/or were made with the degree of care and diligence that a reasonable person would exercise if he were in the fund manager’s position.”

18. In [72] of the Particulars, Alawwal pleaded that if the various representations pleaded earlier had not been made and/or Alawwal had been told the truth about the matters the subject of those representations, Alawwal would not have invested in the Fund. Instead, Alawwal would have invested the monies it invested in the Fund in safer investments. Again, this formulation conforms to the provisions of the DIFC Law of Obligations.²

The DIFC Law of Obligations

19. It appears to be common ground that in its dealings with Alawwal, RIBL was subject to the DIFC Law of Obligations (the “Law”).³

20. Article 10 of the Law deals with causation and provides:

“(1) To establish liability under this Law, a claimant must show that, but for the defendant’s conduct, he would not have suffered loss, and that the defendant’s conduct was a substantial cause of his loss.”

In other words, the “but for test” determines issues of causation for the purposes of the Law. Presumably that is why Alawwal’s case on causation is pleaded in terms of allegations that if the untrue representations had not been made, Alawwal would not have entered into the investment. Of course it is implicit in such a plea that Alawwal relied upon the representations when deciding to invest.

21. Article 18 of the Law provides that subject to provisions not relevant to this case, a defendant owes a duty of care to a claimant where:

22. However, the more general provisions of Article 18 are qualified in the case of claims for pure economic loss, to which Article 20 applies:

The Judge’s reasons

23. In the introductory portion of his reasons the Judge referred to the nature of the dispute and the witnesses who were called at trial. In that context, he observed:

24. It is significant to some of the grounds of appeal that, in this passage, the Judge made it clear that he would be relying principally upon the contemporaneous documents rather than the oral testimony. That approach is entirely orthodox in contemporary commercial cases.

25. As the Judge’s findings with respect to:

are not challenged, it is sufficient to summarise the Judge’s conclusions on those topics.

26. As to the Fund’s financial position, after surveying the evidence the Judge concluded that despite the steady reported profits of the Fund since its inception in 2014, by the end of 2018 there were substantial “baked in” problems.⁵ In particular, the Judge found that:

27. The Judge concluded that the valuation of over USD 72.7m of the Fund’s assets was impaired, representing just under 25% of the total assets of the Fund, but no provision had been made in the accounts in respect of these matters.

28. In this context the Judge rejected RIBL’s contention that the Covid epidemic was the cause of the Fund’s problems.⁶

29. The Judge also found that the Directors of the Fund and RIBL, as the Investment Manager of the Fund were unwilling to make provision for possible bad debts or delays in receipt of funds even where funds were well overdue for the most likely reason that if provisions were made they would substantially imperil the long term steady performance of the Fund and deter investors.⁷ The Judge also concluded that by the end of 2018 the Fund’s assets were over-valued and if the Fund were to be faced with calls for substantial redemptions without other investors coming in, substantial difficulties might be experienced. The Judge also concluded that RIBL was aware of at least the majority of the issues he had identified. He accepted that it may not have been aware of the frauds which were apparently perpetrated on the Fund but found that it was aware of the existence of failures to pay and legal proceedings which called into question the recovery of substantial parts of the relevant assets.⁸

30. As noted, the grounds of appeal do not challenge any of these findings.

31. As to the alleged representations, the Judge found that Alawwal was interested in investing in one or more funds which were Sharia compliant and which had a good history of steady performance which could be expected to be maintained into the future.⁹

32. In his reasons the Judge referred in some detail to the representations contained within the OM issued by the Fund together with other documents produced by the Fund encouraging investment.¹⁰

33. The Judge also referred to the evidence given by Mr AlEbraheem in relation to discussions at the meeting on 14 November 2018. He noted that Mr AlEbraheem asserted that at the meeting he told Mr Zografos of Alawwal’s plans to launch its own fund with investments in other funds and that it was required that those funds meet Alawwal’s profile, which was Sharia compliant investments with a low risk profile.¹¹

34. The Judge accepted the tenor of this evidence, while expressing some hesitation in relation to the question of whether Mr AlEbraheem would have used the words “low risk”, although he was satisfied that Mr AlEbraheem would have made it clear that Alawwal was looking to invest in a Sharia compliant fund with low volatility where a cautious approach to investment was taken. He was also satisfied that Mr AlEbraheem made it clear that unless the Fund matched those objectives, Alawwal would not invest in it.¹²

35. The Judge also referred to Mr AlEbraheem’s evidence to the effect that Mr Zografos represented:

36. The Judge held that Mr Zografos did make statements in accordance with the first and third representations immediately above. He considered that such statements were inherently likely to have been made. However, he rejected the evidence that Mr Zografos said that there was a 0% possibility of losses because of the inherent unlikelihood of such a statement having been made. The Judge also noted that Mr AlEbraheem appeared to resile from his evidence to the effect that this statement was made on 14 November, and accepted that such a statement would be very unusual.¹⁴

37. In this context the Judge noted that RIBL did not call Mr Zografos to give evidence. He rejected Alawwal’s submission that an adverse inference should be drawn from the lack of evidence from Mr Zografos, but observed that the consequence of his absence was that Mr AlEbraheem’s evidence with respect to statements made at meetings which he attended was uncontradicted. Nevertheless, as has been seen, the Judge rejected an aspect of that evidence on the ground that it was inherently unlikely.

38. The Judge placed reliance upon minutes of the meeting between the parties in Jeddah on 22 January 2019 which were prepared by Alawwal as part of a draft recommendation for investment approval. Those minutes record that Mr Zografos was asked why the Fund’s return was less than average, to which he replied by identifying several reasons, namely:

The Judge accepted the minutes as an accurate record of what was said. In his view they were evidence of what he considered to be a constant theme – namely, the emphasis on low risk and volatility even at the expense of possibly greater profits.

39. The Judge referred to the evidence relating to the meeting which took place in RIBL’s offices in the DIFC in Dubai on 6 February 2019. That meeting was attended by Mr Malakiah, who is Mr AlEbraheem’s superior. Although the Judge expressed reservations about the extent of Mr Malaikah’s recollection of the meeting, he was “quite certain that Mr Malaikah was assured that the Fund met Alawwal’s own investment objectives which were, by then, well known to RIBL.”¹⁶

40. The Judge noted that the minutes of a meeting of Alawwal’s business development committee held on 24 February 2025 recorded that the committee had resolved to invest in the “lower risk funds” that were under consideration, which were the Fund and another fund.¹⁷

41. The Judge set out the framework by which he proposed to analyse the claim in the following portion of his reasons:

42. The Judge concluded that some of the representations upon which Alawwal relied had not been established.¹⁹ He considered the critical representation to be the representation that the Fund was a suitable investment for Alawwal having regard to the Alawwal Investment Objectives. In that context he reiterated his finding “that Alawwal made clear to RIBL’s representatives that Alawwal was looking to invest in a Sharia compliant fund with low volatility where a cautious approach to investment was taken”.²⁰

43. In the Judge’s view representations which had been described as “the oral client representations”, the “oral lower growth representation” and the alleged statement that the Fund’s risk was adequately covered by risk mitigation measures were statements going towards the question of the suitability of the Fund as an investment for Alawwal. He expressed doubts as to whether those representations themselves would sustain a course of action, but considered that they were overall aspects of the way in which it was said by RIBL that the Fund was a suitable investment for Alawwal.²¹

44. The Judge went on to observe:

45. The Judge addressed the question of causation/reliance in the following passage:

“93. I am in no doubt that Alawwal relied on this representation when investing in the Fund. It was important to Alawwal that they meet and discuss their objectives and the suitability of the Fund to meet those objectives directly with RIBL. After Mr AlEbraheem’s initial meetings it was important to Alawwal that Mr Malakiah travelled to the DIFC and met directly with senior representatives of RIBL. It is clear that Alawwal eschewed investing in other Funds with apparently greater returns because of the supposed safety of the Fund. It is further clear that the misrepresentation was an effective cause of the losses suffered. Alawwal bought into the Fund at an overvalue and then became trapped in the Fund when the problems which were already substantially in existence at the time of their investments came to fruition. I reject the suggestion that a settled conclusion had been made to invest in the Fund by 2 January 2019.”²³

46. In the remainder of his reasons the Judge dealt with other aspects of Alawwal’s claims, including the statutory claims, some of which he rejected and others of which he considered to be coterminous with the liability which he had found. He also rejected Alawwal’s claim for damages in respect of the lost opportunity to invest in another fund

Permission to appeal – legal principles

47. RDC 44.117 provides:

48. 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.

49. RDC 44.19 provides:

50. RDC 44.19 provides that permission to appeal may only be given where the appeal would have a real prospect of success or there is some other compelling reason why the appeal should be heard.

51. In the context of an assessment of the prospects of success “real” means realistic rather than fanciful and involves the same test as is applied in applications for immediate judgment.²⁴

52. A real prospect of success does not mean a probability of success, but more than mere arguability.²⁵

53. “Some other compelling reason why the appeal should be heard” may include the public interest in clarifying the meaning and scope of relevant practice and provisions of DIFC and wider UAE law.²⁶

54. 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.²⁷

55. 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.²⁸

56. Particular principles apply to applications for permission to appeal against case management decisions and multi factorial assessments undertaken by a Judge at first instance, given the hurdles which must be overcome to obtain appellate intervention in such cases.²⁹ However, as this case does not involve either an application to appeal against a procedural or case management decision, nor against a multi factorial assessment by the Trial Judge, it is unnecessary to essay the relevant principles in these reasons.

57. Similarly, it is well established that particular considerations apply to:

58. It is well established in this and other common law jurisdictions that an appellate court will be reluctant to overturn a finding of fact made by a judge at first instance which involves the assessment of the credibility of witnesses because of the obvious advantage which a Trial Judge enjoys as compared to the Court of Appeal. Accordingly, the Court of Appeal will defer to the decision of the Judge at First Instance unless it is clear that the Judge has misused the advantage which he or she enjoys.

59. In Gate Mena DMCC v Tabarak Investment Capital Limited³⁰ the DIFC Court of Appeal confirmed that the principles applied by the UK Courts with respect to appeals against findings of fact would be applied in this Court. Those principles are conveniently enunciated in Henderson v Foxworth Investments Limited.³¹ In accordance with those principles an appellate court will only interfere with the finding of fact where it is satisfied that the Trial Judge has gone “plainly wrong”. In this context the word “plainly” does not refer to the degree of confidence felt by the appellate court that it would have reached a different conclusion – rather, it refers to the criterion by which error must be established, sometimes expressed as whether the decision is one that no reasonable Judge could have reached, in other cases as “being outside the generous ambit where reasonable decision-makers may disagree”,³² or some times that the decision “cannot reasonably be explained or justified”.³³

60. This is not to say that findings of fact cannot be set aside on the ground of some other identifiable error such as a material error of law, making a critical finding of fact which has no basis in the evidence, a demonstrable misunderstanding of relevant evidence, or a demonstrable failure to consider relevant evidence.³⁴ However, in this context it is also well established that the mere fact that a Judge does not mention a specific piece of evidence does not mean that he or she has overlooked that evidence – rather, in the absence of some reason to the contrary, an appeal court will assume that the Trial Judge has taken the whole of the evidence under consideration.

61. In this case, both parties accept that these principles apply to any appeal against the findings of fact made by the Trial Judge. As will be seen, there is one such ground.

The grounds of appeal

Ground 1

62. Ground 1 asserts that the Judge erred in finding RIBL liable in misrepresentation on an unpleaded and unargued basis. RIBL contends that Alawwal’s case was to the effect that the representation to the effect that investment in the Fund was consistent with Alawwal’s objectives was a representation of fact, rather than a representation of opinion. RIBL complains that although the Judge rejected the case advanced on that basis, he nevertheless upheld the claim on the basis that Alawwal had established that there were no reasonable grounds for the expression of that opinion. RIBL contends that upon analysis the Judge, in effect, concluded that the representation of opinion carried an implied representation to the effect that there were reasonable grounds for the expression of the opinion, and the implied representation was false. RIBL contends that part of the judgment was not open on the pleadings.

63. In support of its contentions RIBL relies upon provisions of the RDC which require a party to specifically set out its statement of case, the matters upon which the party wishes to rely, including details of any misrepresentation³⁵ and to identify the facts relied upon to establish the falsity of any pleaded representation. RIBL further relies upon authorities relating to the extent to which a court can decide a case on an unpleaded basis.³⁶

64. RIBL further contends that because Alawwal did not plead the lack of reasonable grounds for making the representation it was denied the opportunity of leading expert evidence as to the Fund’s true financial position at the time the representations were made, including as to the correct and appropriate valuation of the Fund’s assets, or the appropriate provisions to be made in the Fund’s financial statements. RIBL goes so far as to assert that expert evidence on that subject was essential to any finding by the Judge. RIBL further contends that it was denied the opportunity of addressing the Judge on the question of whether there were reasonable grounds for the expression of an opinion because that assertion had not been pleaded.

65. Alawwal contends that the Law does not differentiate between statements of fact and statements of opinion for the purposes of liability for misrepresentation and also relies upon English authority³⁷ for the proposition that a claim for negligent misrepresentation can be made out if it is established that a statement of opinion is false but without it necessarily being established that there were no reasonable grounds for the expression of the opinion. However, that is not the way in which the Judge approached the case. Accordingly, Alawwal’s submission is a matter which could be the subject of a Notice of Contention if leave were granted to appeal on this ground, but it is not a basis for refusing leave.

66. Dealing firstly with RIBL’s points drawing upon the RDC, there is no arguable case of failure to comply with the relevant provisions. Part 17 requires a party to plead the material facts upon which that party’s case depends, consistently with common law principles of pleading. Alawwal has discharged that obligation, by pleading the representations upon which it relies, the facts which give rise to a duty of care and the falsity of the representation which was said to constitute a breach of the duty of care, together with the causal consequences of that breach.

67. The question of whether a particular representation is a representation of fact or a representation of opinion is a matter of law. Alawwal’s case to the effect that the suitability representation was a representation of fact necessarily put squarely in issue the question of whether an investment in the Fund was consistent with Alawwal’s objectives. RIBL had every opportunity to lead evidence to establish the truth of a representation to the effect that an investment in the Fund was consistent with Alawwal’s objectives. However, it did not take that course. Rather, its defence was mounted on the basis that the representation was not made and in fact Alawwal was advised that an investment would be high risk. It can be inferred that it would have been inconsistent with that forensic strategy to lead evidence to the effect that an investment in the Fund was a low risk.

68. RIBL’s contention that the course taken by the Judge took it by surprise cannot be accepted. In its written closing submission RIBL contended that the representation was a statement of opinion because it necessarily involved a subject value judgment as to what was suitable. In that context, RIBL asserted that in order to prove the representation was false “Alawwal would need to prove it was dishonestly made or there were no reasonable grounds”.³⁸ RIBL asserted that Alawwal could not do so on the evidence. RIBL do not contend it was not open to Alawwal to establish its case in this matter. To the contrary, it joined issue with the case found by the Judge.

69. The expert evidence which RIBL suggests would have been led if a lack of reasonable grounds for the expression of an opinion had been pleaded is directly relevant to the question of whether an investment in the Fund was consistent with Alawwal’s objectives. RIBL knew that Alawwal’s case was to the effect that an investment in the Fund was not consistent with its objectives. Its decision not to lead evidence to establish that the Fund was financially solid and that an investment was low risk cannot be attributed to the lack of a pleaded case with respect to reasonable grounds. Put another way, in the circumstances of this case, there is no material difference between the evidence relevant to the question of whether an investment in the Fund was in fact consistent with Alawwal’s objectives and the evidence relevant to the question of whether there were reasonable grounds for a representation to the effect that an investment in the Fund was consistent with Alawwal’s objectives.

70. It follows that RIBL has failed to establish any prejudice arising from the manner in which the Judge determined the case and in particular has failed to establish that it would have conducted its case any differently if there had been an express plea, in the alternative, of a representation of opinion made without reasonable grounds. Alawwal discharged the obligation of pleading all the facts upon which it relied for the elements of the cause of action identified in the Law, including the cause of action found by the Judge to be based upon a representation of opinion.

71. For these reasons this ground of appeal has no real prospect of success. RIBL’s contention in the alternative to the effect that there is some other compelling reason for an appeal on this ground to be heard lacks any substance. The ground would raise no question of general principle and would turn peculiarly upon the specific circumstances of this case.

Ground 2

72. Ground 2 asserts the Judge erred in confining his analysis of whether RIBL had acted negligently in making the representation as to the suitability of the investment to the question of whether RIBL had reasonable grounds to make the representation. RIBL contends that under the Law Alawwal was obliged to prove that RIBL had breached a duty of care owed to Alawwal, and the Judge made no finding to that effect but instead equated a finding that there were no reasonable grounds to support the representation with a finding of negligence. RIBL contends that if the Judge had expressly dealt with the question of whether it had breached a duty of care, he would necessarily have turned his mind to the question of the care which a person of ordinary care and skill engaged in RIBL’s business activity would have exercised.

73. This ground of appeal misconstrues the Judge’s reasons read in light of the specific provisions of the Law. In [78] of those reasons, which is set out above, the Judge specifically addressed the question of whether the Defendant owed a duty of care to the Claimant by reason of the matters specified in Article 20 of the Law, being that RIBL know or ought to have known that the representations would be communicated to Alawwal for the purpose for which the statement was made and intended Alawwal to so act. The Judge expressly found, and there was no contention otherwise, that the representations were made for the purpose of inducing Alawwal to invest in the Fund and that Alawwal relied upon the representations in making its investment decision. Those findings gave rise to the duty of care in accordance with the Judge’s enunciation of the duty in [78].

74. The Judge also found that the representation was false and that RIBL was aware of the matters which rendered it false, being the various matters which impaired the value of the Fund’s assets without any provision having been made in respect of such value. In those circumstances the Judge’s finding that there were no reasonable grounds for making the representation was obviously a finding of a breach of the duty of care which was also established by the facts which he found.

75. When the Judge’s reasons are read in the light of the provisions of the Law to which he referred, it is clear that this ground is nothing more than a semantic complaint that the Judge did not use specific headings in his reasons such as “duty of care” and “breach of duty of care”. However, the Judge clearly made findings on those matters, for the reasons which he enunciated.

76. For these reasons ground 2 has no real prospect of success. As with ground 1, RIBL’s contention that there is some other compelling reason for an appeal on this ground to be heard lacks any substance. The ground would raise no question of principle because it proceeds upon a misconstruction of the Judge’s reasons.

Ground 3

77. Ground 3 contends that the Judge erred by finding that Alawwal relied upon the suitability representation. RIBL contends that in making his finding of reliance the Judge did not take into account five specific matters which will be considered below. This ground engages the principles relating to appeals from findings of fact referred to above.

78. It is appropriate to put the matters relied upon in their legal context, and in the context of the findings made by the Trial Judge.

79. First, this ground could only have a real prospect of success if one or more of the matters relied upon is capable of persuading the Court of Appeal that the Judge’s finding of reliance is a finding that no reasonable Judge could have made.

80. Second, that question must be addressed in a context in which the Judge found that:

81. It is of considerable significance that there is no challenge to the Judge’s findings in relation to these matters. That is significant because the matters set out above provide compelling support for the Judge’s finding of reliance upon the representation made for the purpose of encouraging Alawwal to rely upon it.

82. Turning now to the matters relied in support of this ground, the first is evidence by Mr AlEbraheem in cross-examination to the effect that Alawwal did its own due diligence and performed its own internal analysis on the merits and risks of any investment. The obvious problem with this submission is that it is not inconsistent with the Judge’s finding that Alawwal relied upon the suitability representation. The fact that a prospective investor does its own due diligence does not mean that it places no reliance upon representations made with respect to the prospective investment.

83. The second matter relied upon is evidence given by Mr AlEbraheem in cross- examination to the effect that in the meeting of 14 November 2018 he only relied upon what Mr Zografos was telling him when it matched what he was seeing in the fact sheet and the presentation. The first hurdle which this submission must overcome is the Judge’s reliance upon documentary evidence in preference to the oral testimony of the witnesses given six years after the event. The documentary evidence of reliance upon the representation is strong – in the form of the minutes of the meeting of 23 January 2019 which formed part of a draft recommendation for investment, and the terms of the decision of the relevant committee to recommend the investment by reference to “lower risk”.

84. Another hurdle which this submission must overcome is the fact that the suitability representation was not made only at the meeting on 14 November 2018, but was also made at the meetings on 23 January 2019, and the meeting on 6 February 2019 at which Mr AlEbraheem was not present. Further, as the Judge found, the representation was supported by representations made at other meetings in relation to risk mitigation, reputability of clients and so on.

85. The third matter relied upon is a risk assessment report dated 25 March 2019 prepared by Alawwal which referred to the final assessment of risk level as being “moderate risk”. However, the Judge found that Alawwal had decided to proceed with the investment in the Fund before this form was prepared and the documents record that the decision was made on the basis that it was “low” or “lower” risk.

86. The fourth matter relied upon is Mr AlEbraheem’s evidence to the effect that he read some of the notes to the Fund’s financial statements for the year ending 31 December 2017. However, there is no suggestion that those notes could have alerted Mr AlEbraheem to the fact that almost 25% of the Fund’s assets were impaired.

87. The fifth matter relied upon is an assertion that the subscription order forms signed on behalf of each of Alawwal’s investments in the Fund confirmed that Alawwal had read and understood the OM, which referred to risks and included disclaimers. However, as with the first matter relied upon, confirmation that the OM had been read is not inconsistent with reliance upon the representations which were repeatedly made as to the suitability of the investment from Alawwal’s perspective.

88. None of the matters relied upon in support of this ground either individually or collectively, cast any substantial doubt upon the decision made by the Trial Judge with respect to reliance, which was amply justified by findings which he made which are not challenged. There is no basis upon which the matters relied upon, either individually or collectively, could persuade a Court of Appeal to conclude that the decision made by the Trial Judge with respect to reliance was so unreasonable that no reasonable Judge could have made it.

89. For these reasons ground 3 has no real prospect of success.

Ground 4

90. Ground 4 asserts that insofar as the Judge found that it was reasonable for Alawwal to rely upon the suitability representation he erred in doing so. The submissions in support of this ground come down to the proposition that there is no express finding that it was reasonable for Alawwal to rely upon the suitability representation. Alternatively, RIBL submits that if the Judge did make such a finding, he erred by doing so based upon two of the matters relied upon in support of the preceding ground, and Alawwal’s terms and conditions for its Fund, which provided that investors in that Fund would be treated as having relied solely upon the information contained in the terms and conditions.

91. Dealing firstly with the complaint that the Judge made no finding of reliance, this contention also relies upon a misconstruction of the Judge’s reasons which explicitly referred to the requirement that the reliance be reasonable in [78] of his reasons. Further, the Judge’s reasons for concluding that there was actual reliance³⁹ clearly sustain a finding that the reliance was reasonable, given his findings as to Alawwal’s objectives.

92. Turning now to the challenge to the finding of reasonable reliance, the two matters relied upon which were also relied upon in support of ground 3, go no distance to establishing that actual reliance by Alawwal was unreasonable. The third matter relied upon, namely the terms upon which Alawwal solicits investments in the Alawwal Fund is irrelevant to the reasonableness of Alawwal’s reliance upon the representations made by RIBL

93. For these reasons this ground has no prospect of success.

Grounds 5 and 6

94. Grounds 5 and 6 depend upon the success of one or more of grounds 1-4. As those grounds have no real prospect of success, it follows that grounds 5 and 6 have no real prospect of success.

Summary and conclusion

95. The unchallenged findings made by the Trial Judge compel the conclusion at which he arrived in relation to RIBL’s liability. None of the proposed grounds of appeal has any real prospect of success. The Renewed Application for Permission must be dismissed with costs. It follows that the Stay Application must also be dismissed, with costs (if any).