KembaraXtra - Case Law - Kuwait Airways Corporation v Iraq Airways Co and Another [2010] 

​Core Issue

• Whether a judge erred in reconsidering and not imposing a restraining order, passport order, and Tipstaff order against the Director General of Iraqi Airways Company (IAC), Captain Kifah, in support of a disclosure order related to unpaid judgment debts.

II. Background

• Kuwait Airways Corporation (KAC) seeks to enforce judgment debts (approximately $1.2 billion) against IAC stemming from the 1991 Iraqi invasion of Kuwait and theft of KAC's fleet.
• IAC has a history of "perjured and forged" conduct throughout litigation, including findings of perjury, fraud, and forgery.
• New London/Baghdad flights prompted KAC to seek a worldwide freezing order and disclosure orders from IAC, and Captain Kifah, aiming to secure IAC's assets potentially deposited at Gatwick.
• Freezing orders were previously in place but were superseded by a UN Security Council resolution freezing Iraqi assets.

III. Initial Court Order (Andrew Smith J)

• Judge initially granted a worldwide freezing order and disclosure orders.
• Restraint order: preventing Captain Kifah from leaving the jurisdiction.
• Passport order: requiring surrender of passport.
• Tipstaff order: empowering Tipstaff with arrest and entry/seizure powers to enforce the passport order.
• The judge acknowledged that the orders were "unprecedented" against a non-resident non-party and emphasized the need for caution and proportionality.

IV. Judge's Reconsideration

• The judge withheld service of the orders for reconsideration, expressing concerns about the Tipstaff order's powers of entry and seizure.
• The judge ultimately decided to withhold approval for the restraint, passport, and Tipstaff orders due to concerns:
  • Captain Kifah was acting as a witness.
  • The court should not circumvent the restrictions of CPR Pt 71.
  • Orders should not be "empty of content" if unlikely to be complied with.
  • The Tipstaff order could lead to arrest without proper safeguards.
  • Potential for "disorder" and "political and media scrutiny."

V. Appellant's (KAC) Arguments

1. Inconsistency: The judge's change of mind was unjustified; no new information warranted revocation.
2. Contempt Considerations: The judge wrongly considered constraints on committal for contempt because the original orders were to encourage compliance, not punish breach.
3. Tipstaff Order Powers: The judge could have modified the Tipstaff order to address concerns (e.g., removing arrest power, providing translators).

VI. Court of Appeal Ruling (Rix LJ)

• Appeal allowed: The court considered the judge erred in principle in his discretion.
• Acknowledged the application was "difficult" and "unprecedented."
• Weighed the need to support court orders against the infringement on the respondent's liberty.
• Considered the exceptional nature of the IAC litigation.
• Believed that the judge did not appear to acknowledge that his disclosure order remains unprotected and potentially futile.

VII. Wilson LJ's Concurrence

• The judge wrongly approached the matter from the wrong end.
• The judge took fright at the Tipstaff order.
• The judge could of course have ordered that no arrest be made without service upon the captain not only of the order in English but also of a translation thereof into Arabic or, perhaps more practicably, without service thereof upon him in the presence of an interpreter.
• The result of approaching matters in that way was to leave the disclosure order against the captain hanging limply.
• The attempt to serve the disclosure order demonstrates it would be futile without sanctions.

VIII. Sir David Keene's Concurrence

• The judge did not properly recognize the full implications of what he was doing.
• Recognized the authority to order to provide information about the company's means under Pt 71 of the CPR.
• Stated that if the court was not prepared to do something for the first time, the law would never develop.

IX. Key Takeaways

• Balance between enforcing court orders and protecting individual liberties.
• The court can seek to exercise its powers to ensure its orders are enforced.
• The extent to which a court can issue ancillary orders against non-parties to facilitate compliance with disclosure orders.
• Factors influencing the exercise of discretion in granting injunctive relief, especially in unique circumstances.
• The importance of exceptional cases requiring exceptional relief.