Claim No. CFI 082/2024

THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

CAYAN ASSETS INVESTMENTS LLC

Claimant

and

(1) EFS FACILITIES MANAGEMENT LIMITED
(2) LANE INVESTMENTS AND HOLDINGS INC
(3) TAREK TABARI
(4) OMER KHAN

Defendants

ORDER WITH REASONS OF H.E. JUSTICE SIR JEREMY COOKE

UPON the Order of H.E. Justice Sir Jeremy Cooke dated 11 February 2025 consolidating the Second Defendant’s Application No. APP-001-2024 dated 24 December 2024 seeking to discharge the Stop Notice dated 25 October 2024 (the “Discharge Application”) and the Second Defendant’s Application No. CFI-082-2024/1 dated 26 December 2024 seeking to strike out the Part 8 Claim pursuant to RDC 4.16 and/or for immediate judgment pursuant to RDC 24.1 (the “Strike Out Application”)(the “Second Defendant’s Consolidated Applications”)

AND UPON the Consent Orders dated 11, 13, 24 and 27 March 2025 imposing an agreed stay to the Second Defendant’s Consolidated Applications

AND UPON the Claimant’s filling of the amended Claim Form and Amended Particulars of Claim on 25 March 2025

AND UPON hearing counsel for the Claimant and counsel for the Second Defendant at the Consolidated Application Hearing before H.E. Justice Sir Jeremy Cooke on 2 September 2025

IT IS HEREBY ORDERED THAT:

1. The Discharge Application is dismissed.

2. The Strike Out Application is dismissed

3. The Second Defendant’s Application dated 26 December 2024 for immediate judgement on the claims against it is dismissed.

4. The costs of the Second Defendant’s Consolidated Applications are, if not agreed, to be determined in writing by the Court following submissions in accordance with the following timetable:

Issued by:
Hayley Norton
Assistant Registrar
Date of issue: 8 September 2025
At: 4pm

Introduction

1. These are the reasons for the dismissal of the two applications dated 24 and 26 December 2024 made by the Second Defendant (“Lane”) for discharge of the Stop Notice issued ex parte on 25 October 2024 and for striking out and/or reverse immediate judgement in respect of the claims made against it in the Amended Particulars of Claim.

2. There is no dispute as to the principles upon which striking out or immediate judgement applications fall to be determined. For striking out to succeed, it must be shown that, assuming the facts as pleaded to be true, the statement of case must be shown to disclose no reasonable grounds for bringing the claim. In practice this means showing that the claims, as pleaded, cannot succeed as a matter of law. For immediate judgement, it must be shown that there is no realistic prospect of success. No criterion are set out in RDC 46.33 – 46.54 for determining whether a stop notice should be issued or discharged but the basis for a stop notice is the claim of a person to be beneficially entitled to an interest in securities. Similarly, discharge of such a stop notice can be sought by a person claiming to be beneficially entitled in the same way. On an interlocutory basis, although Lane contended that a higher bar should be imposed than that for immediate judgement, it appears to me that the criteria must be the same, pending final determination as to entitlement. Moreover, the effect of the stop notice is merely to prevent EFS from registering any transfer of shares or paying dividends without providing 14 days’ notice (which would enable an application to be made to the Court) and there is no evidence from Lane that it has any intention of disposing of its shares. There is therefore no discretionary reason why the stop notice should not continue until a final resolution of entitlement can be made and every reason why, if there is an arguable case as to Cayan’s beneficial interest in the shares in issue, why a stop notice should be maintained.

3. Lane emphasises the need, in accordance with decided authority, for particulars of dishonesty or fraud to be distinctly given and proved. It relies upon dicta requiring clear pleading and clear proof by convincing evidence of grave allegations, including unlawful means conspiracy, pointing to statements that particulars of facts which are consistent with honesty are insufficient. Nonetheless, for current purposes, Lane accepts the existence of a Share Swap Agreement whereby Cayan would acquire 3% of shares in the First Defendant (“EFS”) and the existence of the Sale and Purchase Agreements with Walnutt International Limited (“Walnutt”) or Bancanada Limited (“Bancanada”) under which no payment was made, with the result that Cayan was entitled to a 3% holding in EFS. It appears to be implicitly accepted that Walnutt and Bancanada did receive the 3% shareholding in EFS. It is what happened thereafter and its effect which is in issue.

4. The essential basis for Lane’s applications is that there is no realistic prospect of the Claimant (“Cayan”) establishing that Lane received shares in EFS from Walnutt or Bancanada and that Cayan does not have any beneficial interest in those shares. This would mean that the claims for declarations, proprietary remedies, tracing, knowing receipt, dishonest assistance, equitable compensation and damages cannot succeed. Furthermore, it is said that without establishing the receipt of such shares the claim in unlawful means conspiracy cannot succeed because no other unlawful means have been pleaded against Lane as actions which it effected. It is also said that no particulars are pleaded as to why any acts by individuals should be attributed to Lane, whether or not such individuals were directors of it or shareholders/Ultimate Beneficial Owners

Receipt of the shares in EFS by Lane

5. In paragraphs 46 of the Amended Particulars of Claim, Cayan alleges that Lane received shares in EFS from Walnutt and Bancanada that had been wrongly transferred to it by the Fourth Defendant, the nominee under what is accepted, at least for today’s purposes, as a Share Swap agreement under which Cayan was to receive shares in EFS in exchange for transferring its shares in a Jebel Ali company known as EMCOR to EFS. Cayan claims that the nominee, in breach of trust, transferred such shares to Walnutt and Bancanada which are shown as shareholders in an extract of the EFS’ Shareholders Register as at 25 April 2019 but not in an extract as at 24 September 2019. At paragraph 47 of the same pleading, Cayan pleaded that it had been informed in early 2021 by Mr Ghoubar, the EFS General Counsel and Mr Chauhan, the EFS Group CEO, that the shares held by Walnutt and Bancanada were gifted to Lane. Alternatively, at paragraph 48 it was alleged that on or about 10 September 2019 Walnutt and Bancanada transferred the shares, because various documents appear to show that between 14 May 2019 and 10 September 2019 they had been shareholders but by the latter date had ceased to be such.

6. Counsel for Lane relied on documents which were produced by Mr Tarek Tabari with his two witness statements which included the extracts from the EFS Shareholder Register referred to in the previous paragraph. He sought to demonstrate by reference to the shareholding of Lane on these dates that there was no scope for any receipt by Lane of the Walnutt and Bancanada Holdings in EFS. What is plain however on the materials made available to this Court is that only two extracts of the Shareholders register have been supplied which were five months apart and, despite requests made by Cayan’s lawyers of EFS as the First Defendant, Mr Khan as the Fourth Defendant and Lane as the Second Defendant, the complete record as set out in the Shareholder Register in respect of the relevant period had not been made available.

7. In consequence there was no way of saying whether or not the shares issued to Walnutt and Bancanada had been received by Lane and had been transferred elsewhere in that five month period or had been transferred to some other SPV or nominee for Lane. Nor is there any way of saying what occurred before or afterwards. As pointed out by Counsel for Cayan, EFS was obliged under article 44(1) of the DIFC Company Law to maintain a register which recorded all such transactions and which Mr Tarek Tabari, a director of Walnutt, Bancanada, Lane and EFS could readily have produced. His witness statements did not say that he had done so and appeared to be carefully phrased to argue there was no scope for receipt of the shares because of the two extracts which were produced. It is clear that some other share transfers took place between 25 April 2019 and 24 September 2019, apart from those detailed by Mr Tarek Tabari, by reference to those extracts but no explanation for the difference between them has been produced save for the reference to a sale of part of Lane’s shareholding (3.44%) to Akrima Afani. Some of those transfers involved companies associated with the Tabaris. No details or supporting documents have been produced save these two extracts from the Register, and an undated and unstamped subscription form which EFS appears to have accepted in allocating a small further holding of shares to Lane. As pointed out to Counsel for Lane, there is a dearth of evidence which could readily have been produced by Mr Tarek Tabari and what has been produced does not demonstrate that Lane did not receive the shares in its own name or beneficially through a nominee and/or transfer them elsewhere.

8. If that did occur, then it is trite law that, if the shares were transferred by Mr Khan in breach of trust and those involved in the transactions on the part of Walnutt, Bancanada and Lane were aware of such matters, proprietary remedies are open to Cayan in relation to mistake, constructive trust, knowing receipt, dishonest assistance and unjust enrichment with tracing into any proceeds and with the benefit of the assumption that a trustee or constructive trustee, when disposing of mixed assets, disposes of those not held on trust first. A flaw in Lane’s submissions is that the varying quantity of shares held by Lane does not render any of the shares identifiable as to source and tracing into a mixed category is possible in law. They are not specifically designated when transferred out in any event, with the resulting assumption that what remains is what was held in trust.

9. Whilst therefore the evidence available to this Court does not establish to the Court’s satisfaction that Lane did receive the shares from Walnutt and Bancanada and the evidence relied on by Cayan is essentially limited to the hearsay evidence of Mr Alhatti at paragraph 11 of his witness statement and the absence of any full explanation from any of the Defendants who could have produced it, there is a case to be answered, particularly as none of the Defendants have adduced evidence from either Mr Ghoubar, the EFS General Counsel or Mr Chauhan, the CEO, despite denial in the Defence of the statements allegedly made by them. There is enough evidence for it to be said that Cayan has a good arguable case on the materials put before the Court.

10. There is, therefore, in my judgement, no basis upon which Lane can properly say that there is no realistic prospect of success for Cayan’s case that the shares were received by Lane and no basis for discharge of the Stop Notice which itself was based upon the claim that Lane had received such shares. The factual issues which arise will have to be explored with the benefit of full disclosure of all transactions relating to shares in EFS in the relevant period. This is not appropriate for a mini-trial where allegations of dishonesty by inference from contested facts will fall to be determined.

Unlawful means conspiracy

11. Counsel for Lane submitted that there was no unlawful act alleged on the part of Lane other than the receipt of the shares and therefore there was no good case against Lane for the tort of unlawful means conspiracy. This reveals a misunderstanding of the nature of unlawful means conspiracy which centres upon a combination or agreement between the conspirators that one or more of them will carry out some unlawful act with the agreed intention of harming the Claimant. The unlawful acts alleged in this case are of a breach of trust by Mr Khan and the wrongful inducement of him to transfer shares in EFS to Walnutt and Bancanada when they should have been transferred to Cayan and the further transfer to Lane. It is trite law that there is no need for each of the conspirators to carry out the unlawful acts which are part of the subject of the conspiracy.

12. The Claim in unlawful means conspiracy is set out at paragraphs 111 – 115 of the Amended Particulars of Claim. From the facts previously alleged, involving the Share Swap Agreement, the absence of any actual transfer document of the shares to EFS (leaving to one side the Shareholders Resolution of 29 April 2018), the Sale and Purchase Agreements between Cayan, Walnutt and Bancanada, the failure of Walnutt and Bancanada to pay the purchase price and the absence of any passing of title or share transfer to Walnutt and Bancanada, Cayan pleaded that it was to be inferred that EFS, Lane and/or the Tabaris (defined at paragraph 4 of the Amended Particulars of Claim), including Tarek Tabari had entered into an agreement or combination in which they knew that none of Walnutt, Bancanada or Lane was entitled to receive the shares in EFS to which Cayan was entitled under the Share Swap Agreement. Nonetheless, they procured approved and colluded in the transfer of the shares in EFS to Walnutt and Bancanada and then to Lane instead of Cayan. Similarly, at paragraph 114.1 they are alleged to have assisted and facilitated Mr Khan’s breach of duties as trustee in transferring the shares to Walnutt and Bancanada instead of to Cayan, whilst at paragraph 114.2, Lane is alleged to have received and retained the shares knowing that they had been transferred by mistake.

13. It is therefore not only the receipt of the shares by Lane that constitutes the unlawful act but the transfer to Walnutt and Bancanada and the other matters pleaded, as set out above which deprived Cyan of the shares to which it was entitled. Apart from any argument about receipt of the shares in, which requires factual investigation and disclosure, Lane is alleged to have participated in the conspiracy in these other ways with resultant damage to Cayan.

14. As to the arguments relating to attribution of acts by individuals to Lane, Lane’s case ignores paragraph 4 – 6 of the Amended Particulars of Claim in which it is pleaded that Mr Khaldoun Tabari and/or members of his family, including his daughter Zeina, the Third Defendant Tarek Tabari, and other family members, were the ultimate beneficial owners and controllers of Lane. Ms Farzhal in her third witness statement at paragraph 30 sets out a series of links between the individuals and the companies, none of which has been controverted. Mr Khaldoun Tabari was a director of Lane prior to September 2019 and its current directors include the Third Defendant (Tarek Tabari) and other members of the family. Zeina Tabari signed documents on behalf of Lane in her capacity as managing director. Cayan infers that the Lane Directors act on the instructions of Mr Khaldoun and/or Zeina Tabari. Mr Tarek Tabari is a director of Lane and EFS and was a director of Walnutt and Bancanada until their dissolution in 2024. The interconnection of all these individuals and companies is further spelt out in paragraphs 16 and 20 and provides a basis for inferring Lane’s involvement in the alleged conspiracy, particularly in the light of the offer made on its behalf for the purchase of the shares from Cayan prior to the supersession of such offer by the Walnutt/Bancanada Share Sale and Purchase Agreements.

15. The claim for damages for unlawful means conspiracy therefore has realistic prospects of success and is not liable to be struck out or the subject of reverse immediate judgment.

Conclusion

16. In these circumstances both of Lane’s applications must fail and absent special circumstances of which I am unaware, costs would follow the event. I was asked not to determine such matters and agreed to set a timetable for determination of them in the absence of any agreement between the parties. I therefore direct: