Arbitral tribunals – Beneficial ownership – Islamic law – Real property

Bhatti v Bhatti: Ch D (Sir Edward Evans-Lombe): 26 November 2009

The executor applied for summary judgment on a claim brought by the deceased (X) for the beneficial ownership of a number of properties held by the respondent (Y).

X was Y’s father and both were members of a Muslim community in the UK. That community had a quasi-judicial body (the board) for the resolution of disputes. The parties became embroiled in a dispute concerning the beneficial ownership of a number of properties owned between them. X petitioned the board for an order that Y relinquish the title deeds to five properties and certain monies held by him in various accounts. Y consented to the matter being determined by the board and agreed to fully accept and act upon its decision. The board determined that X was entitled to the title documents of the five properties in question. Y appealed against that decision to the second-tier board (the appeal board). X widened his claim, requesting that Y relinquish title deeds to a further four properties. The appeal board dismissed Y’s appeal and found in favour of X, requiring Y to relinquish the title deeds to the nine properties then in dispute. Subsequent appeals to higher boards failed and Y was required to transfer the title deeds to X. Consequently, the supreme leader of the parties’ community in the UK wrote to the parties, allowing them to take the dispute to the civil courts on the basis of the inherent complications in the law of the land and staying the board’s determination pending resolution of the issues. Y submitted that: (1) the board’s decision was vitiated by the fact that it allowed X to expand its claim constituting a breach of the board’s rules and vitiating its award; (2) the supreme leader of the community had suspended enforcement of the board’s decision with the result that enforcement of that award could no longer take place.

Held: (1) The court had not been shown any rules that had been breached by the board’s decision to allow X to expand his claim. If the case had proceeded equivalently in the UK courts, what was done by the appeal board in allowing X to expand his case would be possible in an exceptional case and there was no reason to suspect that the rules of the board did not also so provide.

(2) The supreme leader’s letter merely permitted the parties to pursue their dispute in the civil courts; it did not actively seek to suspend the board’s decision indeterminately. Accordingly, there was no reasonable prospect that Y could successfully defend proceedings to avoid the award promulgated by the board.

(3) (Obiter) The nature of the instant claim concerned the enforcement of an arbitration contract between parties who had submitted a dispute for determination to the board, acting as arbitrator, by consent. Whether such contracts for reference to arbitration existed was a matter for English law. If awards which emerged from the board’s considerations were enforceable then they fell to be held as if they were awards of an arbitral body and, as such, enforceable.

Application granted.

James Holmes (instructed by Milner) for the applicant; David Holland (instructed by Dakers Green Brett) for the respondent.