COURT FILE NO.: CV-21-00655418-00CL DATE: 20240305
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN: SAKAB SAUDI HOLDING COMPANY, ALPHA STAR AVIATION SERVICES COMPANY, ENMA AL ARED REAL ESTATE INVESTMENT AND DEVELOPMENT COMPANY, KAFA'AT BUSINESS SOLUTIONS COMPANY, SECURITY CONTROL COMPANY, ARMOUR SECURITY INDUSTRIAL MANUFACTURING COMPANY, SAUDI TECHNOLOGY & SECURITY COMPREHENSIVE CONTROL COMPANY, TECHNOLOGY CONTROL COMPANY, and NEW DAWN CONTRACTING COMPANY and SKY PRIME INVESTMENT COMPANY
Plaintiffs
– and –
SAAD KHALID S AL JABRI, DREAMS INTERNATIONAL ADVISORY SERVICES LTD., 1147848 B.C. LTD., NEW EAST (US) INC., NEW EAST 804 805 LLC, NEW EAST BACK BAY LLC, NEW EAST DC LLC, JAALIK CONTRACTING LTD., NADYAH SULAIMAN A AL JABBARI, personally and as litigation guardian for SULAIMAN SAAD KHALID AL JABRI, KHALID SAAD KHALID AL JABRI, MOHAMMED SAAD KH AL JABRI, NAIF SAAD KH AL JABRI, HISSAH SAAD KH AL JABRI, SALEH SAAD KHALID AL JABRI, CANADIAN GROWTH INVESTMENTS LIMITED, GRYPHON SECURE INC., INFOSEC GLOBAL INC., QFIVE GLOBAL INVESTMENT INC., GOLDEN VALLEY MANAGEMENT LTD, NEW SOUTH EAST PTE LTD., TEN LEAVES MANAGEMENT LTD., 2767143 ONTARIO INC., NAGY MOUSTAFA, HSBC TRUSTEE (C.I.) LIMITED, in its capacity as Trustee of the Black Stallion Trust, HSBC PRIVATE BANKING NOMINEE 3 (JERSEY) LIMITED, in its capacity as a Nominee Shareholder of Black Stallion Investments Limited, BLACK STALLION INVESTMENTS LIMITED, NEW EAST FAMILY FOUNDATION, NEW EAST INTERNATIONAL LIMITED, NEW SOUTH EAST ESTABLISHMENT, NCOM INC. and 2701644 ONTARIO INC.
Defendants
Counsel: Munaf Mohamed K.C., Jonathan G. Bell, and Ian W. Thompson for the Plaintiffs Patrick Flaherty, Stuart Svonkin, and Jordana Haar for the Defendant Saad Aljabri Frank Addario and Andrew Max for the Defendant Mohammed Aljabri,
HEARD: October 17, 18, 19, and 20, 2023
CAVANAGH J.
REASONS FOR JUDGMENT
INTRODUCTION
1The plaintiffs are private companies that were established and funded to pursue commercial and counterterrorism activities in the Kingdom of Saudi Arabia (“KSA”).
2The defendant Saad Aljabri (Dr. Aljabri”) is a former high-ranking official of the KSA. The defendant Mohammed Aljabri (“Mohammed”) is the son of Dr. Aljabri.
3In this action, the plaintiffs allege that Dr. Aljabri and other defendants have defrauded them of approximately U.S. $5.36 billion. Dr. Aljabri denies the allegations against him. Dr. Aljabri defends the action against him on the ground that it is an abuse of process of the Ontario court brought at the behest of the Saudi regime to harass, vex, and punish him.
4On January 22, 2021, Gilmore J. granted a Mareva Order (the “Saad Mareva Order”) restraining Dr. Aljabri and anyone else acting on his behalf or in conjunction with him, and any person with knowledge of the injunction, from directly or indirectly dealing with any of Dr. Aljabri’s assets or any assets in which he has any type of interest, wherever situate, including but not limited to specified assets. The Saad Mareva Order applies to all of Dr. Aljabri’s assets whether or not they are in his own name and whether they are solely or jointly owned. The Saad Mareva Order applies to any asset which Dr. Aljabri has the power, directly or indirectly, to dispose of or deal with as if it were his own.
5After the Saad Mareva Order was served, Dr. Aljabri provided a sworn declaration of his assets and he was examined on this declaration. He testified that on June 21, 2017 he was in Turkey when a “coup” happened in the KSA against his former boss, Crown Prince Mohammed bin Nayef. Dr. Aljabri testified that he was fearful for his life. He testified that because of this fear, he gifted all of his assets to his son, Mohammed, so that he could take care of the family if anything were to happen to him.
6In response, in February 2021, the plaintiffs moved to vary the Saad Mareva Order to cover assets purportedly gifted to Mohammed. This motion was adjourned at the request of Mohammed who took the position that the Ontario Court lacked jurisdiction to make an Order against him because he was a non-resident. On June 22, 2021, Gilmore J. dismissed a motion by Mohammed (and other corporate defendants) for an order dismissing the action against them on the basis that the Court lacks jurisdiction.
7On August 9, 2021, Koehnen J. granted a Mareva order freezing all of Mohammed’s worldwide assets (the “Mohammed Mareva Order”). At the hearing, counsel for the plaintiffs advised that the plaintiffs intended to seek a contempt order against Dr. Aljabri and Mohammed.
8By notice of motion dated August 27, 2021, the plaintiffs brought this motion seeking an order finding Dr. Aljabri and Mohammed in contempt of court for allegedly using assets that were frozen under the Saad Mareva Order to pay for legal and living expenses.
9In the plaintiffs’ Amended Notice of Motion, they seek:
a. An order imposing a non-penal sanction against Dr. Aljabri following a further hearing on sanctions if he fails to purge his contempt within five days of any finding of contempt, including: (i) an order precluding Dr. Aljabri from taking any further step in this proceeding until he has complied with the Saad Mareva Order; (ii) an order striking the statement of defence of Dr. Aljabri, and (iii) an order granting judgment against Dr. Aljabri in the amount of USD $3,472,821,045. b. An order imposing a non-penal sanction against Mohammed following a further hearing on sanctions if he fails to purge his contempt within five days of any finding of contempt, including (i) an order precluding Mohammed from taking any further step in this proceeding until he has complied with the Saad Mareva Order, and (ii) an order granting judgment against Mohammed in the amount of USD $544,409,740. c. An order pursuant to Rule 60.12 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194: (i) striking the statement of defence of Dr. Aljabri for non-compliance with the Saad Mareva Order; (ii) granting judgment against Dr. Aljabri in the amount of USD $3,472,821,045; and (ii) granting judgment against Mohammed in the amount of USD $544,409,740.
10Dr. Aljabri and Mohammed oppose the plaintiffs’ motion on the grounds that the plaintiffs have not proven beyond a reasonable doubt that (i) the Saad Mareva Order clearly and unequivocally applies to the assets the plaintiffs allege were dissipated, that is, assets which they maintain were gifted and transferred to Mohammed; (ii) they intentionally and actively participated in conduct that breached the Saad Mareva Order; and (iii) the assets the plaintiffs allege were dissipated – the gifted and transferred assets – were not transferred to Mohammed before the Saad Mareva Order was made.
11For the following reasons, the plaintiffs’ motion is dismissed.
ANALYSIS
12In Carey v. Laiken, 2015 SCC 17, the Supreme Court of Canada, at para. 30, wrote that contempt of court rests on the power of the court to uphold its dignity and process. The rule of law is dependent on the ability of the courts to enforce their process and maintain their dignity and respect.
13Civil contempt has three elements which must be established beyond a reasonable doubt.
a. First, the order alleged to have been breached must state clearly and unequivocally what should and should not be done. This requirement of clarity ensures that a party will not be found in contempt where an order is unclear. An order may be found to be unclear if, for example, it is missing essential details about where, when or to whom it applies; if it incorporates overly broad language; or if external circumstances have obscured its meaning. b. Second, the alleged contemnors must have had knowledge of the order. c. Third, the alleged contemnors must have intentionally done the act that the order prohibits or intentionally failed to do the act that the order compels. However, it is not necessary for the party in breach to have consciously intended to disobey the court order: contumacious intention is not a required element of the offence. See Carey, at paras. 32-35; 38-47.
14All that is required to establish civil contempt is proof beyond a reasonable doubt of an intentional act or omission that is in fact in breach of a clear order of which the alleged contemnor has notice: Carey, at para. 38.
15The standard of proof for each element of civil contempt is proof beyond a reasonable doubt. Proof beyond a reasonable doubt does not require proof to absolute certainty; nor does it require proof beyond any doubt. Instead, a reasonable doubt must be based on “reason and common sense” and arise “logically from the evidence or from an absence of evidence”. See R. v. Lifchus, [1997] 3 S.C.R. 320, at paras. 25, 31 and 36.
16The plaintiffs submit that the Saad Mareva Order captures assets traceable to funds that Dr. Aljabri misappropriated from the plaintiffs, including assets controlled by Dr. Aljabri but held in the names of others. They contend that they have established beyond a reasonable doubt that the assets used by Dr. Aljabri, Mohammed and Nadyah Aljabri, Dr. Aljabri’s wife, for living and legal expenses are controlled by Dr. Al Jabri.
17Dr. Aljabri defends the contempt motion on the grounds that the plaintiffs have failed to prove beyond a reasonable doubt the first and third elements of civil contempt.
Have the plaintiffs established that the Saad Mareva Order clearly and unequivocally applies to the purportedly gifted and transferred assets?
18The Saad Mareva Order must be interpreted contextually. In Chirico v. Szalas, 2016 ONCA 586, the Court of Appeal for Ontario, at para. 54, addressed the manner in which the conduct of the alleged contemnor should be analyzed in relation to the requirements of the order:
This Court has rejected a formalistic interpretation of the relevant order. It is clear that a party subject to an order must comply with both the letter and the spirit of the order: Cerideien Canada Ltd. v. Azeezodeen, [2014] O.J. No. 4484, 2014 ONCA 656, at para. 8. That party cannot be permitted to “hide behind a restrictive and literal interpretation to circumvent the order and make a mockery of it and the administration of justice”. Boily, at para. 59; Sweda Farms Ltd. v. Ontario Egg Producers, [2011] O.J. No. 3482, 2011 ONSC 3650 (S.C.J.), at para. 21.
19The alleged contemnor is entitled to the most favourable interpretation of the order alleged to have been breached when the order is interpreted in accordance with its ordinary meaning taking into account its context: Fraser Health Authority v. Schmidt, 2015 BCCA 72, at para. 4. Any ambiguity in the text of the order should be resolved in favour of the person accused of contempt: Valoris pour enfants et adultes de Prescott-Russel c. K.R. 2021 CarswellOnt 16701, at para. 29.
20The court must look at the entire record to determine whether or not the impugned term or clause has sufficient clarity such that its breach attracts the quasi-criminal sanctions associated with contempt: Aloe-Gunnell v. Aloe et al., 2015 ONSC 191, at para. 26.
21The Saad Mareva Order identifies that assets covered by the Order in paras. 1 to 3. I reproduce these paragraphs below:
THIS COURT ORDERS that Al Jabri, and his servants, employees, agents, assigns and anyone else acting on his behalf or their behalf or in conjunction with any of them, and any and all persons with notice of this injunction, are restrained from directly or indirectly, by any means whatsoever: (a) selling, removing, disposing of, dissipating, alienating, transferring, assigning, encumbering, or similarly dealing with any of Al Jabri’s assets, or any assets in which he has any type of interest, wherever situate, including but not limited to: (i) Dreams International Advisory Services Ltd., 1147848 B.C. Ltd., New East (U.S.) Inc., New East 804 805 LLC, New East Back Bay LLC, New East DC LLC and Jaalik Contracting Ltd., including any property or assets held directly or indirectly of any of them; and (ii) the accounts and assets listed in Schedule “1”, Schedule “2”, Schedule “3”, Schedule “4”, Schedule “5”, Schedule “6” and Schedule “7” hereto; (b) instructing, requesting, counselling, demanding, or encouraging any other person to do so; and (c) facilitating, assisting in, aiding, abetting, or participating in any acts the effect of which is to do so.
THIS COURT ORDERS that paragraph 1 applies to all of Al Jabri’s assets whether or not they are in his own name and whether they are solely or jointly owned. For the purpose of this Order, Al Jabri’s assets include, but are not limited to: (a) any asset which he has the power, directly or indirectly, to dispose of or deal with as if it were his own. Al Jabri is to be regarded as having such power if a third party holds or controls the assets in accordance with his direct or indirect instructions; (b) anything regarded in law or equity as property or as an interest in property, any right or interest that can be transferred for value from one person to another, any right, including a contingent or future right, to be paid money or receive any other kind of property, and any cause of action in which Al Jabri has any interest; (c) any bank, investment or account of Al Jabri at any bank, financial or other institution; (d) any motor vehicle, trailer, or other vehicle registered to Al Jabri; (e) any real property in which Al Jabri has any interest; (f) any and all other personal property of Al Jabri; and (g) any and all share certificates, negotiable instruments and the like of Al Jabri.
THIS COURT ORDERS that, without limiting the scope of paragraph 1, Al Jabri is further prohibited from dealing with or using in any manner any secured credit, including but not limited to any credit card, loan, or line of credit, for which payment is secured against any personal or real property in which Al Jabri has any interest, pending further order of this Court.
22Dr. Aljabri testified during his asset examination on February 11, 2021 that he transferred most of his assets to Mohammed by way of a gift before the civil action was commenced and the Saad Mareva Order was made. I will refer to the evidence about the purported gift more fully below.
23The plaintiffs submit that the Saad Mareva Order is unambiguous and expressly covers all of Dr. Aljabri’s assets or any assets in which Dr. Aljabri has any type of interest, wherever situate, and that such assets include purportedly “gifted” assets, including but not limited to Dr. Aljabri’s interests in Dreams International Advisory Services Ltd. (“Dreams”) (into which the plaintiffs had traced USD $193 million at the time the Saad Mareva Order was sought) and 1147848 B.C. Ltd., New East (U.S.) Inc., New East 804 805 LLC, New East Back Bay LLC, New East DC LLC and Jaalik Contracting Ltd. (the “U.S. New East Companies”).
24Dr. Aljabri submits that the plaintiffs have failed to prove beyond a reasonable doubt that it was clear and unequivocal that the Saad Mareva Order applied to the assets the plaintiffs allege were dissipated, that is, to the assets that Dr. Aljabri allegedly transferred to Mohammed by a gift before the Saad Mareva Order was made.
25Dr. Aljabri submits that external circumstances – his transfer of assets to Mohammed before the Saad Mareva Order was issued – created a lack of clarity as to whether the Saad Mareva Order, once made, applied to those transferred assets.
26Dr. Aljabri also submits that the positions taken by the plaintiffs with the court support the reasonable conclusion that the plaintiffs, themselves, had determined that it was not clear and unequivocal that the Saad Mareva Order applied to the transferred assets or, at a minimum, the circumstances give rise to a reasonable doubt on this issue. Dr. Aljabri submits that it is not reasonable to conclude that the Court made an unnecessary and redundant order and, if the Saad Mareva Order was clear and unequivocal that the Saad Mareva Order applied to the transferred assets, the Mohammed Mareva Order would have been unnecessary.
27Dr. Aljabri submits, therefore, that the plaintiffs have failed to prove beyond a reasonable doubt that the Saad Mareva Order clearly and unequivocally applied to the assets they allege were dissipated.
28The plaintiffs respond that in granting the Saad Mareva Order, Gilmore J. was necessarily satisfied on the evidence before her that assets identified in the Order including Dr. Aljabri’s interest in (and the corresponding assets held by) Dreams, the U.S. New East Companies, and various bank accounts including HSBC accounts, were Dr. Aljabri’s assets (whether held in his name or not). The plaintiffs rely on the fact that neither Dr. Aljabri nor Mohammed have ever moved to vary the scope of the Saad Mareva Order based on the purported gift or on any other ground.
29The plaintiffs submit that the clear intention of the Court in making the Saad Mareva Order was to cover all assets flowing from the funds that Dr. Aljabri allegedly misappropriated from the plaintiffs, including such funds received by Dreams and the U.S. New East Companies and other assets claimed to have been “gifted” by Dr. Aljabri to Mohammed. They submit that if the Saad Mareva Order did not capture the purported gift, it would be practically meaningless.
30I disagree. The Saad Mareva Order is, at least to a substantial extent, a proprietary injunction because it was granted to preserve assets which the plaintiffs say belong to them. See [Canadian Imperial Bank of Commerce v. Credit Valley Institute of Business and Technology, 2003). There is no question that the Saad Mareva Order expressly, clearly, and unequivocally applies to all of Dr. Aljabri’s assets including any assets in which he has any type of interest, wherever situate, and including any interest he has in Dreams, the U.S. New East Companies, or the specified accounts. However, the Saad Mareva Order does not expressly, clearly and unequivocally cover all assets over which the plaintiffs assert a proprietary claim but are not owned by Dr. Aljabri and in respect of which he has no right or interest of any type, and over which he has no power, directly or indirectly, to dispose of or deal with as if they were his own.
31The evidence that Dr. Aljabri gifted and transferred his assets to Mohammed before the Saad Mareva Order was made is evidence of an external circumstance that was not before Gilmore J. and is not addressed in the text of the Saad Mareva Order. The circumstance of the purported gift and transfers of assets, when considered with the text of the Saad Mareva Order, introduces ambiguity and raises a reasonable doubt as to whether the Saad Mareva Order clearly and unequivocally applies to any assets gifted and transferred by Dr. Aljabri to Mohammed in respect of which Dr. Aljabri retained no interest of any type and over which he had no control.
32In February 2021, the plaintiffs brought a motion seeking to extend and vary the Saad Mareva Order so that it restrained Mohammed from dealing with any assets purportedly gifted to him by Dr. Aljabri. Dr. Aljabri relies on the plaintiffs’ notice of motion in which they assert as a ground for the motion that there is a real risk that Mohammed will permanently abscond with these funds (received by Dreams from the plaintiffs) and “may further dissipate the assets transferred to him by Dr. Aljabri”. Dr. Aljabri relies on the plaintiffs’ factum for this motion in which they submit that “[i]t is necessary to vary the Saad Mareva Order to ensure that Mohammed is expressly enjoined from dealing with any of the assets ‘gifted’ to him by his father”.
33The plaintiffs’ motion was adjourned by Gilmore J. in an endorsement dated February 20, 2021 at the request of Mohammed who asserted that the court has no jurisdiction to make an order against him as he does not live in Canada. On March 11, 2021, Gilmore J. released an endorsement that, among other things, continued the Saad Mareva Order until further variation or order of the court. This endorsement provides that in the event the plaintiffs seek additional orders against Mohammed in their February 2021 motion to vary the Saad Mareva Order, a motion with respect to whether the court has jurisdiction to make those orders shall be scheduled.
34In June 2021, the plaintiffs brought a motion seeking a variation of the Saad Mareva Order and a free-standing Mareva order against Mohammed, both of which were aimed at freezing the assets that Dr. Aljabri allegedly transferred to Mohammed. Dr. Aljabri relies on the plaintiffs’ June 30, 2021 notice of motion for this motion in which they assert as a ground for the motion that a stand-alone Mareva order against Mohammed is needed to ensure the defendants do not dissipate their assets while the plaintiffs pursue their claims against them.
35The plaintiffs submit that the fact that they were forced to bring a motion for a Mareva order against Mohammed to stop the Aljabris from spending frozen assets and they subsequently obtained such an Order does not make the Saad Mareva Order any less clear.
36I accept that the plaintiffs, by seeking a variation of the Saad Mareva Order and then seeking and obtaining the Mohammed Mareva order to expressly capture the purportedly transferred assets, acted reasonably in response to the position taken by Dr. Aljabri that the “gifted” assets were not captured by the Saad Mareva Order. In their notice of motion seeking to vary the Saad Mareva Order, the plaintiffs sought an order to “confirm” that the “gifted” assets are captured by the Saad Mareva Order. In their factum in support of their motion for the Mohammed Mareva Order, the plaintiffs noted the risk of irreparable harm through Mohammed’s dissipation of assets intended to be frozen by the Saad Mareva Order. The evidence does not support an inference that the plaintiffs, by bringing these motions, accepted that the Saad Mareva Order does not clearly and unequivocally apply to the purportedly gifted assets.
37The evidence that a separate order was sought and obtained to expressly capture the gifted assets is, however, evidence of circumstances that supports a finding that there is reasonable doubt as to whether the Saad Mareva Order clearly and unequivocally applies to any assets that were gifted by Dr. Aljabri such that he retained no interest of any kind in them and no power or control over them. This is so because if the Saad Mareva Order was clear and unambiguous in this respect when the plaintiffs’ motion was before Gilmore J. on February 20, 2021 and March 11, 2021, no additional order would be needed to cover assets purportedly gifted and transferred by Dr. Aljabri to Mohammed.
38The plaintiffs submit that given that the assets purportedly gifted to Mohammed are captured by the Saad Mareva Order, it is not necessary for me to rule on the legal validity of the “gift” to make a finding of contempt.
39I conclude that the plaintiffs have failed to prove beyond a reasonable doubt that the Saad Mareva Order clearly and unequivocally applies to all assets received by Dr. Aljabri from the plaintiffs in respect of which they make a proprietary claim, including assets that were allegedly gifted and transferred by Dr. Aljabri to Mohammed and in respect of which he retained no interest and no power, directly or indirectly, to dispose of or deal with as if they were his own.
40Given this conclusion, it is necessary for me to address Dr. Aljabri’s defence that the plaintiffs have not proven beyond a reasonable doubt that the “gifted” assets were not validly transferred.
Have the plaintiffs established that the assets were not transferred and are, in reality, Dr. Aljabri’s assets?
41The plaintiffs submit that the evidence firmly establishes beyond a reasonable doubt that the “gift” was a fiction designed to conceal Dr. Aljabri’s true ownership of the assets and that the gifted assets are, in reality, Dr. Aljabri’s assets. The plaintiffs rely on badges of fraud established by the evidence regarding the purported gift which, they contend, establish beyond a reasonable doubt that the purportedly gifted assets are owned by Dr. Aljabri and, directly or indirectly, are within his control. The plaintiffs submit that the evidence does not allow a plausible conclusion to the contrary.
42Proof of civil contempt may be based on circumstantial evidence and reasonable inferences from that evidence, direct evidence, or a combination thereof. Findings of civil contempt will frequently be based on inferences from circumstantial evidence. In those circumstances, the inference of guilt or an essential element of the offence should be the only reasonable inference to be drawn from the evidence as a whole. See R. v. Villaroman, 2016 SCC 33, at paras. 37 and 40-41.
43In Villaroman, the Supreme Court of Canada addressed the relationship between circumstantial evidence and proof beyond a reasonable doubt and, at para. 26, explained the special concern inherent in the inferential reasoning from circumstantial evidence “that the jury may unconsciously ‘fill in the blanks’ or bridge gaps in the evidence to support the inference that the Crown invites it to draw”. The Court, at para. 37, held that when assessing circumstantial evidence, the trier of fact should consider other plausible theories and other reasonable possibilities which are inconsistent with guilt. These must be based on logic and experience applied to the evidence or the absence of evidence, not on speculation. The Court held, at paras. 40-41, that where a conviction is based on circumstantial evidence, the evidence should be such that it excludes any other reasonable alternative, and that this is “a helpful way of describing the line between plausible theories and speculation”.
44To support a finding of guilt based entirely or substantially on circumstantial evidence, the circumstantial evidence, taken as a whole, and assessed in light of human experience, must exclude any other reasonable alternatives. The prosecution is not required to negative every possible conjecture or every possible alternative explanation that might be consistent with innocence. See R. v. Okojie, 2021 ONCA 773, at paras. 137-139. The evidence is to be considered as a whole to determine whether the alleged contemnors are guilty. See R. v. Morin, at para. 40.
45The plaintiffs point to Dr. Aljabri’s initial cross-examination on his asset declaration held on February 11, 2021 in which, after testifying that he had gifted his worldwide assets to Mohammed, he testified that he had prepared and executed a written Gift Deed on June 21, 2017 to give his assets to Mohammed (apart from his personal bank accounts). He testified that he wrote the Gift Deed himself and he undertook to provide a copy to the plaintiffs. Dr. Aljabri described the gift as a “landmark in my life”.
46By letter dated February 14, 2021 from Dr. Aljabri’s counsel to counsel for the plaintiffs, Dr. Aljabri attached the “deed of gift” and advised that the formal date of the transfer was January 10, 2019.
47On April 19, 2021, Dr. Aljabri provided an answer to an undertaking in which he responded by way of correction to a question and answer on his cross-examination. The corrected answer states that Dr. Aljabri wishes to clarify that the gift of all of his assets (save his personal bank accounts) to his son Mohammed was made by way of verbal instructions on June 21, 2017 in Bodrum, Turkey, in accordance with customary Islamic law. Dr. Aljabri states in this corrected answer that in 2018 at the time the statutory declaration provided in response to a question on his February 14, 2021 letter was made, and for the purpose of documenting the fact that Mohammed was the ultimate beneficial owner of those assets for tax purposes, Dr. Aljabri memorialized the gift in written form and he provided a copy of that document. Dr. Aljabri states that he then typed out his affirmation at that time, and that typed version is provided with his counsel’s February 14, 2021 letter.
48The plaintiffs submit that this new account does not withstand even cursory scrutiny.
49The plaintiffs submit that although Dr. Aljabri testified that he made the oral gift to Mohammed while they were sitting at their local Mosque in Turkey, Mohammed testified that the oral gift was made while at the family’s summer home. In his affidavit, Mohammed deposes that the family had a summer home in Bodrum, Turkey where they would spend Ramadan together and he went to the summer home in June 2017. His father was there. This is the occasion for the alleged discussion about the gift. Mohammed does not say that the discussion with his father about the gift did not take place at the mosque but at the summer home. He does not specify where the discussion took place. There is no contradiction in the evidence in this respect.
50The plaintiffs note that Dr. Aljabri did not obtain legal or tax advice prior to making the gift and, instead, apparently decided to transfer hundreds of millions of dollars of assets, in multiple different jurisdictions, without investigating the legal, financial and practical implications of doing so. The plaintiffs submit that given the deference Dr. Aljabri had previously shown to his legal and financial advisors, this would be a striking change in behaviour.
51The plaintiffs point out another feature of the alleged oral gift which is that there was, apparently, next to no discussion or agreement on the specifics of the assets to be gifted. Mohammed testified that he discussed the assets subject to the gift with his father, including Dr. Aljabri’s intention to exclude certain unspecified personal bank accounts and an unspecified amount of funds for a contemplated family trust, which subsequently became the Black Stallion Trust. However, Mohammed could not identify the specific assets included in the gift or their value. Dr. Aljabri testified that he had little knowledge of the nature of his former assets subject to the gift. He could not describe the specific assets or explain how the subject matter of the gift was determinable as of June 21, 2017, if he had yet to determine how much would be reserved for the Black Stallion Trust. Following the alleged oral gift, Dr. Aljabri never prepared a list of his assets for Mohammed.
52The plaintiffs point to what they say is the languid pace at which Dr. Aljabri and Mohammed purported to implement that the alleged gift. They note that Dr. Aljabri and Mohammed took no steps to transfer any assets until October 2017 (some four months after the alleged oral gift and after Dr. Aljabri had relocated to Toronto) when Dr. Aljabri’s interest in the U.S. New East Companies and New South East PTE were apparently transferred to Mohammed. In the same period of time, Mohammed gave evidence that he prepared instructions to HSBC (Suisse) respecting transfers of funds and his father executed them (since he continued to be shown as the beneficial owner on the bank’s records). Mohammed gave evidence that transfers were made from the Dreams account to his father’s HSBC (Suisse account) which he controlled through a power of attorney and managed without his father’s involvement.
53The plaintiffs note that from their perspective, even more inexplicably, Dr. Aljabri did nothing to transfer his interest in Dreams to Mohammed until January 10, 2019 (19 months after the alleged oral gift and 15 months after Dr. Aljabri’s relocation to Canada) when he wrote to HSBC. Dr. Aljabri’s HSBC bank accounts (holding approximately USD $15.89 million) were not transferred to Mohammed until September 3, 2019 (26 months after the alleged oral gift and 20 months after Dr. Aljabri’s relocation to Canada).
54The plaintiffs rely on the evidence that no one from HSBC (which held the Dreams share in trust for Dr. Aljabri) was told about the gift until January 10, 2019 when Dr. Aljabri wrote to HSBC stating that he has given the ownership of Dreams to Mohammed and requesting that the transfer of ownership be reflected in its records. Dr. Aljabri wrote again to HSBC on October 28, 2019 in which he wrote that his previous attempt to notify HSBC of the transfer of the beneficial ownership of his interest in Dreams to Mohammed was addressed to the wrong entity.
55The plaintiffs submit that Dr. Aljabri and Mohammed swore self-serving and false affidavits which materially misrepresented the circumstances in which Dr. Aljabri purported to gift his interest in Dreams to Mohammed. Mohammed swore an affidavit on December 20, 2019 in which he states that on June 21, 2017, by letter in writing and by way of an oral declaration, his father declared a trust over the share in Dreams in his favour. Dr. Aljabri swore an affidavit dated October 28, 2019 in which he makes the same statements, including that he declared a trust over the share in Dreams in favour of Mohammed on June 21, 2017 by letter in writing and by way of oral declaration.
56The plaintiffs rely on evidence that the purported transfer of the share in Dreams only became effective on November 11, 2020, when HSBC apparently transferred “beneficial owner status” from Dr. Aljabri to Mohammed. They contend that there is no credible explanation for the delay in implementing an oral gift made with purported urgency more than three years earlier.
57The plaintiffs rely on evidence that in the period before the share in Dreams was “formally” transferred, Mohammed claims to have controlled Dr. Aljabri’s personal HSBC bank accounts under a one-page, standard form power of attorney, executed before the “gift” was made. With respect to Dreams, and other accounts, Dr. Aljabri executed directions authorizing the transactions.
58The plaintiffs contend that this arrangement is fundamentally inconsistent with any notion that Mohammed was the legitimate legal and beneficial owner of the gifted assets. They contend that Dr. Aljabri maintained full legal and beneficial ownership of all of the gifted assets and controlled the distribution of funds from these assets. The plaintiffs assert that Dr. Aljabri and Mohammed represented to HSBC that Dr. Aljabri, not Mohammed, was the ultimate owner of Dreams and its associated assets, before swearing false affidavits to nominally effect the transfer of Dreams to Mohammed. The plaintiffs say that this arrangement was used for years. They rely on Dr. Aljabri’s evidence that these steps could have been avoided if he had not waited years to write a short letter ultimately used to “formally” transfer Dreams and the HSBC accounts to Mohammed. The plaintiffs contend that this evidence conclusively undermines Dr. Aljabri’s contentions about the validity of the “gift”.
59The plaintiffs point to Mohammed’s evidence that managing his assets is his “full-time job” and he is responsible for all investment decisions, acquisitions and structures. The plaintiffs submit that the suggestion that Mohammed owns the “gifted” assets is belied by Mohammed’s inability to recall basic details about the assets. They rely, in particular, on the following evidence:
a. Mohammed could not identify with any specificity the assets held by New East International Limited (“NEIL”) (the parent company of the U.S. New East Companies gifted by Dr. Aljabri that hold valuable real estate assets in the United States). Mohammed also testified that he had last received a statement of assets from NEIL’s asset manager in 2019, some two years earlier. b. Mohammed could not identify (or even give an approximation of) the quantum of rental income generated from the properties owned by the U.S. New East Companies. c. Mohammed testified that he did not have any access to information regarding an investment portfolio held with an investment company called “The Family Office”, and had last received an updated 2019, some two years earlier. He could not provide even a rough estimate of the value of the investment portfolio. Nor could he identify the investments held in the portfolio. He was unsure whether other investment portfolios with the company had been closed. d. Mohammed admitted that he did not receive any regular, periodic report or update on his worldwide assets - notwithstanding that his “full-time job” was managing the assets and knowing that simply asking for a report or update would get him one.
60Mohammed responds by pointing to his list of assets as disclosed on his asset disclosure statement showing close to forty bank accounts, nine apartments in the United States, a number of properties in Malta and Turkey, many companies, and other assets. He submits that it is not surprising that Mohammed was not able to provide details about these assets on his cross-examination for the jurisdiction motion or that he would rely on wealth managers to look after his assets.
61The plaintiffs submit that the Mohammed Mareva Order is derivative of the Saad Mareva Order, as is the Aljabri Family Mareva Order. They refer to the finding of Koehnen J., who granted the Mohammed Mareva Order, that he was satisfied that the purported gift of worldwide assets to Mohammed for no consideration had sufficient badges of fraud associated with it so as to justify a Mareva injunction against Mohammed. The plaintiffs argue that the alleged impetus for the oral gift, that is, the sudden change in the political circumstances in the KSA including “a crack-down on corruption by public officials”, reflects several badges of fraud in that the “gift” was made in haste and in the face of contemplated criminal proceedings against Dr. Aljabri. The evidence cited for the submission that there was such a “crackdown” is evidence given by Mohammed about the detention of his siblings, evidence given by Dr. Aljabri about the “coup” against his former boss, and Dr. Aljabri’s evidence that there was a shift in the political landscape in Saudi Arabia on June 21, 2017.
62The plaintiffs submit that the finding by Gilmore J. that the Deloitte report [used as evidence on the motion for the Saad Mareva Order] establishes a strong prima facie case to justify tracing the plaintiffs’ funds into the hands of Dr. Aljabri applies to allow the same tracing remedy of assets into the hands of Mohammed.
63The plaintiffs submit that based on this evidence, they have proven beyond a reasonable doubt that Dr. Aljabri retains control over the “gifted” assets which were used for his benefit following the gift. The contend that the use of the assets in this matter further demonstrates that the gift was a fiction designed to conceal Dr. Aljabri’s true ownership of the assets.
64Dr. Aljabri submits that the plaintiffs have failed to prove beyond a reasonable doubt that the gift or transfer of assets from Dr. Al Jabri to Mohammed was a fiction, fraud, or otherwise invalid.
65In Indcondo v. Sloan, 2014 ONSC 4018, a civil action to set aside certain transfers of property as having been made to defeat or hinder creditors, Penny J. noted, at paras. 51-53, that in most cases a finding concerning the necessary intention to defeat creditors cannot be made except by drawing an inference from the circumstances. Penny J. identified from the jurisprudence a number of “badges of fraud” which represent evidentiary rules developed over time which, when considered with all of the circumstances, may enable the court to make a finding unless the proponents of the transaction can discharge the evidentiary burden that shifts to them, once the plaintiff has proven one or more of the badges of fraud, to explain away the suspicious circumstances.
66Dr. Aljabri submits that the plaintiffs cannot rely on the civil standard of proof and a rebuttable presumption arising from proof of “badges of fraud” on a balance of probabilities.
67I agree that the legal framework that is applied in a civil case in which a party seeks to have a transfer of assets declared void under the Fraudulent Conveyances Act, R.S.O. 1990, c. F.29, including through a rebuttable presumption arising from proof of badges of fraud on a balance of probabilities, does not apply in a criminal or quasi-criminal proceeding where there is a presumption of innocence and the standard of proof is beyond a reasonable doubt. The burden of proof does not shift to a defendant in a criminal or quasi-criminal proceeding, such as a motion for an order for civil contempt, to rebut a presumption raised by findings on a civil standard of proof. The finding by Koehnen J. on a civil standard of proof that there were badges of fraud associated with the alleged transfer of assets by Dr. Aljabri to Mohammed has no evidentiary weight on this motion.
68Dr. Aljabri submits that the plaintiffs’ allegations that the purported gift of his assets by Dr. Aljabri to Mohammed is a fiction or a fraud are based entirely on circumstantial evidence and that this evidence is insufficient for the plaintiffs to meet their burden of proof.
69The plaintiffs dispute Dr. Aljabri’s contention that the case against him is based only on circumstantial evidence. The plaintiffs point to the Court’s finding that the plaintiffs had shown a strong prima facie case that Dr. Aljabri’s assets had been stolen from the plaintiffs, and it issued an Order freezing them. The plaintiffs rely on Dr. Aljabri’s evidence that he knew about this Order. The plaintiffs rely on evidence that Dr. Aljabri knew that funds which were purportedly gifted to Mohammed which, they say, were frozen, were used for living and legal expenses. The plaintiffs submit that the case against Dr. Aljabri is based on proven and undisputed facts, and there are no inferences that this court needs to draw to find Dr. Aljabri in contempt of the Saad Mareva order.
70Although the plaintiffs refer to the decision of Gilmore J. on the jurisdiction motion dated June 22, 2021 in which she states her agreement with the plaintiffs that “there is substantial evidence that points to the entire gift being a ruse” and her finding for the purposes of the motion before her that “the Gift Deed is a ruse”, this finding, and other findings of fact made in prior decisions decided on the civil standard of proof, are not admissible as evidence on this motion to prove that the purported gift is invalid. This is in accordance with my ruling in a decision released on November 19, 2021: Sakab Saudi Holding Company et al. v. Al Jabri et al., 2021 ONSC 7681, at paras. 146-148.
71I disagree that the case against Dr. Aljabri is based only on direct evidence. Given my conclusion that the Saad Mareva Order does not clearly and unambiguously apply to all assets in respect of which the plaintiffs make a proprietary claim, the plaintiffs must prove beyond a reasonable doubt that Dr. Aljabri intentionally used frozen funds in contravention of the Saad Mareva Order. To do so, they must prove that the purported gift was a fiction or a fraud, or that Dr. Aljabri retained an interest in or control over the purportedly gifted and transferred assets. There is no direct evidence from Dr. Aljabri or from Mohammed that the purported gift was a fiction or a fraud or that Dr. Aljabri retained control over the purportedly gifted and transferred assets. Their evidence is to the contrary. For the plaintiffs to prove this element, they must rely on an inference from circumstantial evidence.
72Dr. Aljabri’s evidence and Mohammed’s evidence with respect to the purported gift were put into the record for this motion by the plaintiffs through the affidavit of Abdulaziz Alnowaiser, a senior executive of the plaintiffs. This evidence includes the transcript of Dr. Aljabri’s cross-examination on his statement of assets held in February 11, 2021, answers to undertakings given on that examination, transcripts of the further cross-examinations of Dr. Aljabri held on August 3, 4 and 5, 2021, correspondence from his counsel with answers to undertakings, the affidavit and reply affidavit of Mohammed affirmed April 23, 2021 and May 11, 2021, respectively, the transcript of Mohammed’s cross-examination held on May 14, 2021, and answers to undertakings from that examination.
73When Dr. Aljabri was cross-examined on his asset declaration on February 11, 2021, he testified that he made a gift of his assets to Mohammed when he was in Turkey on June 21, 2017, the day, he said, a coup happened in Saudi Arabia against his former boss, Crown Prince Mohammed bin Nayef. Dr. Aljabri testified that he was “under serious threat” and Mohammed bin Salman was trying to get him to come back to Saudi Arabia. Dr. Aljabri testified that he feared for his life and told his children that he will gift everything he has to Mohammed and he, Mohammed, will take care of the finances for the family. That, he testified, was the main reason for the gift. Dr. Aljabri was cross-examined again on August 3, 2021. He testified that the Deed of Gift was a memorialization of the oral gift he made in 2017.
74Mohammed’s evidence was also put into the record by the plaintiffs. In his affidavit affirmed on April 23, 2021, Mohammed gave evidence about the circumstances of the gift. Mohammed deposes that on June 21, 2017, he viewed a text message from Mohammed bin Nayef to his father telling his father not to return to Saudi Arabia no matter what. Mohammed deposes that his father told him to call his siblings Omar and Sarah and tell them to leave the country right away. Mohammed deposes that Omar told him by telephone that he and his sister were unable to leave the country because a travel ban had been added to their passports. He deposes that the “coup” in which Mohammed bin Nayef was replaced by Mohammed bin Salman had just happened minutes earlier.
75Mohammed’s evidence is that in light of these circumstances, his father told him that he feared for his life and he was going to gift him everything he owned, excluding the cash in his bank accounts and funds he intended to use to fund a family trust that was to be established, and that he was to own and manage the gifted assets in order to take care of all members of the family. He deposes that that same day or shortly after, his father spoke to all of his adult male children, as is an Islamic custom, and told them of his decision to gift assets to Mohammed. Mohammed deposes that after the gift was made, his father retained no beneficial interest in the gifted assets nor control over them except as his participation was required to formally transfer them to Mohammed or to the trust that he settled for the family. Mohmmed’s evidence is that at the time of the gift, to his knowledge, there were no investigations or accusations against his father.
76When he was cross-examined, Mohammed confirmed that Dr. Aljabri gifted his assets to Mohammed to ensure that his family was taken care of. He confirmed that only he and Dr. Aljabri were present for the gift discussion.
77Dr. Aljabri submits that the plaintiffs have failed to prove that the only reasonable inference from the circumstantial evidence is that the gift is a fiction or that he gifted his assets to Mohammed to defeat the plaintiffs’ claims and that no reasonable inference may be drawn that the transfer of assets was made with another intention that is consistent with compliance with the Saad Mareva Order.
78Dr. Aljabri submits that there is substantial evidence that supports a finding that Dr. Aljabri decided to transfer assets to Mohammed, and did transfer those assets, in the years before the Saad Mareva Order was made, for a proper purpose, that is, because he was afraid that he might be “disappeared” or killed by agents of the Saudi regime, and he wanted to ensure that Mohammed had control over those assets and could use them, in that event, to support the members of the Aljabri family.
79Dr. Aljabri relies on the following evidence:
a. A General Power of Attorney dated June 20, 2017 that he provided to HSBC in July 2017 in which Dr. Aljabri authorized Mohammed as his attorney “to make all operations to the account (to make withdrawals, to give instructions to the Bank, to pledge assets, including in favour of third parties, to take out loans, to sign any management agreement, and assign confirmation of account statements, to close the, etc.). b. A letter from Dr. Aljabri to AF Trustees Ltd. dated October 19, 2017 requesting the transfer of Dr. Aljabri’s beneficial interest in the shares of New South PTE Ltd. to Mohammed. c. A letter from Dr. Aljabri to Allied Finance Trust AG (“AFT”) dated December 6, 2018 in which Dr. Aljabri instructed AFT to transfer the ultimate beneficial ownership of New South East Establishment Ltd. to Mohammed. d. An October 31, 2017 letter from Dr. Aljabri and Nadyah to CT Secretaries Ltd. assigning and transferring their beneficial interest in New East International Limited (“NEIL”) to Mohammed. e. A Declaration of Trust dated November 8, 2017 in which the Trustee (CT Nominees Limited) acknowledged that it held the shares of NEIL in trust for Mohammed. f. A resolution of the directors of NEIL dated June 1, 2018 in which NEIL accepted the transfer of the shareholder loan owing to the previous beneficial owners of the company to Mohammed as the current beneficial owner of the company. g. Dr. Aljabri’s January 10, 2019 letter to HSBC in which he declared that he had given his ownership in Dreams to Mohammed in June 2017 and requested that HSBC reflect that transfer in the company’s records. h. Dr. Aljabri’s October 28, 2019 letter to HSBC directing the legal/nominee owner of the share in Dreams to hold that share as nominee for Mohammed. i. A December 20, 2019 signature card for Dreams’ bank account at HSBC, which is in Mohammed’s name, not Dr. Aljabri’s. j. A November 11, 2020 resolution of the Board of Directors of Dreams acknowledging and confirming the transfer of beneficial ownership of the company from Dr. Aljabri to Mohammed. k. A November 11, 2020 Deed of Novation and Assignment under which the shareholder loan relating to Dreams was transferred from Dr. Aljabri (the former beneficial owner of the company) to Mohammed (the current beneficial owner of the company). l. A November 11, 2020 Declaration of Trust under which a nominee was designated to hold the share of Dreams in trust for Mohammed as beneficiary. m. A Private Investment Company Service Agreement dated November 11, 2024 for Dreams, made with HSBC International Trustee Limited, that lists Mohammed (not Dr. Aljabri) as the client. n. An HSBC File Note regarding Dreams dated May 19, 2020 which lists Mohammed (not Dr. Aljabri) as the “client owner” of Dreams. In this document, HSBC noted the following with regard to Mohammed’s assets: “[Mohammed’s] Source of Wealth derives from his father SKA in the form of gifts and donations” and that Mohammed “plans to set up a Family Office, in order for him to represent and manage all of the family’s assets around the world”. o. Mohammed’s affidavit evidence, which he provided support of a jurisdiction motion that he and certain corporate defendants brought in the civil action in 2021, that starting in June 2017 he exercised sole management and control over the transferred assets. In this affidavit, Mohammed deposes that his father is in no way involved in management decisions in respect of any investments he holds, which are his sole responsibility. p. Mohammed’s testimony in his cross-examination on the jurisdiction motion that: i. he covered most if not all of Dr. Aljabri’s living and legal expenses after the Saad Mareva Order was made (up to the date of that examination); ii. he received a portfolio of assets from Dr. Aljabri that included the assets of NEIL, New South East Establishment Limited, and New South East PTE; iii. between June 2017 and January 2019 (between the time of the gift and the transfer of Dreams to Mohammed) he was directing transfers from Dreams’ bank account without any involvement by his father; iv. Dr. Aljabri retained no beneficial interest in the gifted assets once they were given to Mohammed. q. Dr. Aljabri’s testimony during his examination on his declaration of assets concerning the gift of assets to Mohammed.
80I have considered the evidence as a whole, including the changes in Dr. Aljabri’s evidence about the gift after his initial examination on his statement of assets, the dates, months after the alleged gift, of documents said to have been made to give effect to the gift, Mohammed’s knowledge of the assets said to be under his ownership and management and his inability to give details of these assets, the absence of specificity about the assets to be gifted (valued at hundreds of millions of dollars) at the time of the alleged gift, the involvement by Dr. Aljabri after the alleged gift in transfers money to his personal account, directions given to financial institutions by Dr. Aljabri about the assets, and apparent gifts to family members of gifted assets. I accept that the evidence is sufficient to give rise to a reasonable inference that Dr. Aljabri retained control over the purportedly gifted assets, such that they were frozen under the Saad Mareva Order.
81However, I must also consider whether the evidence with respect to the purported gift and alleged transfers of assets, including substantial circumstantial evidence, excludes other reasonable inferences inconsistent with a finding that Dr. Aljabri retained an interest in or control of the purportedly gifted assets or inconsistent with a finding that Dr. Aljabri intended to defeat the claims of the plaintiffs when he made the purported gift and later transferred assets to Mohammed.
82The plaintiffs contend that the evidence from Dr. Aljabri and Mohammed about the purported gift, which would be known only to them, is self-serving and false, when considered in light of other evidence cited by the plaintiffs, and does not allow me to draw a plausible inference that the purported gift is not a fiction or that Dr. Aljabri does not own or control the purportedly gifted assets. The plaintiffs submit that when the evidence is considered as a whole, it does not give rise to reasonable doubt that Dr. Aljabri has an interest in the purportedly gifted assets, including by ownership or control, that was frozen by the Saad Mareva Order.
83I consider the evidence from Dr. Aljabri and Mohammed together with the documents upon which they rely in the context of all of the evidence, including the evidence which the plaintiffs submit entirely undermines the evidence given by Dr. Aljabri and Mohammed about the purported gift. It has not been shown that the political events in the KSA in June 2017 which, Dr. Aljabri says, gave rise to a fear for his life and safety and were the reason for the gift of his assets, did not happen. The plaintiffs have not shown that on the day of the alleged gift, Dr. Aljabri’s two children were not suddenly detained when they tried to leave the KSA. The plaintiffs have not shown that when the gift was allegedly made, Dr. Aljabri was not under any threat that plausibly justified his fear. The plaintiffs have not proven that the documents upon which Dr. Aljabri relies to support his evidence that he transferred his assets to Mohammed are not authentic. These documents are evidence that Dr. Aljabri took steps, albeit months after the date of the purported oral gift, to transfer his interest in his assets, including Dreams, to Mohammed.
84Based on the evidence as a whole, I am unable to find that the circumstantial evidence upon which the plaintiffs rely excludes any plausible or reasonable inference that Dr. Aljabri feared for his life and safety in June 2017 and decided to gift his assets to Mohammed so that he could take care of the family should anything happen to him. I am unable to find that the circumstantial evidence upon which the plaintiffs rely excludes as a plausible inference that Dr. Aljabri transferred his interests in his assets, including Dreams, to Mohammed before the Saad Mareva Order for the reasons he says he did. The evidence is sufficient to raise a reasonable doubt as to whether Dr. Aljabri had in interest in or control of the purportedly gifted assets when the Saad Mareva Order was made.
85The plaintiffs’ failure to tender evidence that excludes any inference inconsistent with guilt means that they have not proven to the requisite standard of proof that the Saad Mareva Order was breached because they have not proven beyond a reasonable doubt that the purportedly gifted and transferred assets that were used to fund Dr. Aljabri’s living and legal expenses were frozen under the Saad Mareva Order.
Does the evidence given by the expert witness called by Dr. Aljabri support the plaintiffs’ motion?
86At the hearing of this motion, I heard evidence tendered by Dr. Aljabri from Professor Mohammed Hassan Fadel who had sworn an affidavit on October 8, 2023. Professor Fadel is a professor of law at the University of Toronto Law School. He was previously the Canada Research Chair in Law and Economics at the U of T law school. Professor Fadel was qualified to give opinion evidence on Islamic law and, in particular, on gifts and wills under Islamic law. In his affidavit, Professor Fadel gave evidence that Islamic law includes mandatory provisions that prevent a testator from making a will that leaves assets to one son and not to his other children and that Islamic law does not recognize as valid a testator’s testamentary disposition to any person who is a statutory heir of the testator unless the statutory heirs, after the testator’s death, approve and ratify the testamentary disposition in favour of the heir. Professor Fadel’s evidence in his affidavit was that Islamic law permits an inter vivos gift by a parent to one of his children to the exclusion of the other children, provided that the conditions of the gift are satisfied and there are no circumstances that render the gift invalid.
87The plaintiffs submit that Professor Fadel’s evidence does nothing to substantiate the validity of the purported gift for various reasons including that the validity of the gift is governed by Ontario law, not Islamic law, because the Gift Deed was executed by Dr. Aljabri and accepted by Mohammed in Ontario. The plaintiffs rely on evidence given by Professor Fadel on cross-examination that it is contrary to Islamic law for a person to steal and if a person steals money and gifts the money to someone else, the gift is ineffective against the true owner who has a cause of action to recover the stolen funds. Professor Fadel testified that such a gift would be prima facie valid until the true owner establishes a superior right.
88The plaintiffs rely on evidence given by Professor Fadel when he was cross-examined that where a person is bankrupt or insolvent rendering him or her impecunious, a gift can be revoked. The plaintiffs submit that Dr. Aljabri was rendered impecunious by the Saad Mareva Order and that he regained control of the gifted assets because it was within his rights to revoke the gift.
89The plaintiffs do not contend that the validity of the purported gift is to be determined by Islamic law. They say Ontario law applies. Dr. Aljabri says, through counsel, that he does not take the position that Islamic law applies to determine the validity of the gift. If Islamic law does not apply to the validity of the gift, Professor Fadel’s evidence in this respect is not relevant.
90In addition, Professor Fadel testified that whether a father can retract or revoke a gift to a child will vary depending on different schools of law and such determination is quite complicated and depends on the circumstances. He did not give an opinion that the purported gift by Dr. Aljabri to Mohammed was revocable under Islamic law.
91The evidence given by Professor Fadel does not prove beyond a reasonable doubt that the purported gift by Dr. Aljabri to Mohammed was revocable such that Dr. Aljabri regained control over the purportedly gifted and transferred assets upon the Saad Mareva Order having been made.
Have the Plaintiffs established that Dr. Aljabri intentionally engaged in conduct that breached the Saad Mareva Order?
92The plaintiffs must prove beyond a reasonable doubt that Dr. Aljabri intentionally did the act that the Saad Mareva Order prohibits or intentionally failed to do the act that the Saad Mareva order requires. To satisfy this element of civil contempt, the plaintiffs must prove both actus reus and mens rea beyond a reasonable doubt: [Rogacki v. Belz, 2003).
93The mens rea element of civil contempt does not require an intention to breach the order. It requires an intention to do something prohibited by the order or not to do something required by the order: Carey, at paras. 38-46. The disobedience must be deliberate, willfully blind, indifferent or reckless: Thrive Capital Management Ltd. v. Michael Hyman et al., 2020 ONSC 4921, at para. 19.
94Given my conclusion that the plaintiffs have failed to prove beyond a reasonable doubt that the Saad Mareva Order was breached, it is not necessary for me to decide whether, if I had concluded otherwise, the plaintiffs have proven beyond a reasonable doubt that Dr. Aljabri intentionally engaged in conduct that breached the Saad Mareva Order. Nevertheless, I go on to address whether the plaintiffs have proven beyond a reasonable doubt that Dr. Aljabri intentionally used assets gifted and transferred to Mohammed to pay for living expenses and legal expenses after the Saad Mareva Order was served.
95The plaintiffs rely on evidence given by both Dr. Aljabri and Mohammed that Mohammed paid for Dr. Aljabri’s living and legal expenses from January 24, 2021 (the date the Saad Mareva Order was served) until at least June 22, 2021 (the date that Gilmore J. issued her decision finding that, for purposes of the jurisdiction motion before her, the Gift Deed was a “ruse”). These expenses were significant. The expenses were paid from purportedly gifted assets.
96The plaintiffs have proven that expenses were paid from purportedly gifted assets at least up until June 22, 2021 by, among other evidence, the evidence that after the decision of Gilmore J. on June 22, 2021, counsel for Mohammed advised that Mohammed and the corporate defendants would no longer be able to pay for legal fees in light of Justice Gilmore’s finding, and requested that the plaintiffs agree to a carveout that would allow them to continue to act for these parties. I accept that the evidence establishes that Mohammed and the corporate defendants had been paying legal fees from assets purportedly gifted by Dr. Aljabri to Mohammed.
97The plaintiffs rely on Dr. Aljabri’s evidence that after Gilmore J. released her June 22, 2021 decision, Nadyah began covering the family’s living and legal expenses out of an account at Safra Bank in the U.S. Nadyah testified that on June 27, 2017, USD $16.3 million was transferred from Dr. Aljabri’s HSBC account to Nadyah Aljabri’s HSBC account. USD $1 million was transferred from her HSBC account to her Safra account. She then transferred funds from her Safra account to a TD Bank account and a Scotiabank account between July and October 2021 to fund family living expenses.
98When Nadya Aljabri was examined on her declaration of assets on February 10, 2022, she testified that the money in the TD Bank account she opened in Canada was transferred into that account directly from her husband, Dr. Aljabri. She testified that the source of the money in her Safra account was from her HSBC account. She testified that the original source of the money that was in the HSBC account in Switzerland was a transfer of just over $16 million U.S. in June of 2017. Dr. Aljabri’s position is that this money is not subject to the Saad Mareva Order. The plaintiffs rely on evidence that shows that the USD 16.3 million transfer from Dr. Aljabri’s HSBC account was originally funded by Dreams after the purported gift and they contend that all of the money in Dreams was stolen from the plaintiffs.
99I accept that the plaintiffs have established that the money used by Nadyah to pay for living expenses and legal expenses after June 22, 2021 is money over which the plaintiffs make a proprietary claim.
100Dr. Aljabri testified that after the gift, transfers of funds from his personal account were effected by Mohammed preparing a letter authorizing the transfers and sending the letter to him for signature and return. Dr. Aljabri also testified that Mohammed held a power of attorney over his personal account to transfer money out. The plaintiffs submit that the evidence that Mohammed transferred funds from Dr. Aljabri’s account to Nadyah, as opposed to Dr. Aljabri doing so, is untenable.
101The plaintiffs submit that they need only prove that Dr. Aljabri engaged in acts that breached the Saad Mareva Order and that the precise mechanism by which he did so is irrelevant. They submit that there is no evidence that Dr. Aljabri did not actively participate in paying expenses and no evidence upon which an inference that he did not do so can reasonably be drawn. The plaintiffs submit that a finding that Mohammed transferred funds to Dr. Aljabri’s legal counsel for funding of legal expenses, without involvement by Dr. Aljabri, is beyond the realm of possibility. They submit that it is similarly outside the realm of possibility that after June 22, 2021, Nadyah funded expenses for Dr. Aljabri’s house, where Mohammed did not live, without involvement from Dr. Aljabri.
102Dr. Aljabri submits that with respect to the actus reus requirement, active participation in a breach of a court order is needed for a court to make a finding of contempt. Passive acquiescence in a breach committed by another person is insufficient. Dr. Aljabri relies on Hagel v. Fortin, 2018 ONSC 5507 (Div. Ct.), at paras. 25-27. In Hagel, the defendants, a husband and wife, were ordered to permanently refrain from posting signs on their property. The motion judge found that both the husband and wife were in contempt of court by placing a clown in their front yard. On appeal, the Divisional Court allowed the wife’s appeal of the contempt order on the basis that there was no evidence that she participated in placing the clown on their front lawn. The Divisional Court held that the wife could not be found in contempt of court by permitting the clown to be where it was because there was no positive obligation on her not to permit signage on the property, only to refrain from posting it.
103Dr. Aljabri submits that the plaintiffs have failed to adduce evidence that Dr. Aljabri actively participated in the dissipation of any assets frozen under the Saad Mareva Order. Dr. Aljabri relies on the following evidence:
a. Dr. Aljabri’s evidence that once the Saad Mareva Order was made on January 22, 2021, he did not actively participate in the funding or payment of any of his or the Aljabri family’s living or legal expenses. b. Dr. Aljabri’s evidence that from January 22, 2021 (when the Aljabri Mareva Order was made) until June 22, 2021 (when Justice Gilmore’s jurisdictional decision was issued) his living expenses, and those of other members of the Aljabri family, were funded by Mohammed, not him. Dr. Aljabri’s evidence is that after June 22, 2021, Nadya funded family expenses out of her Safra bank account. c. Mohammed’s testimony that between the time of the Aljabri Mareva Order and the date he was being examined (May 14, 2021), he used funds that Dr. Aljabri had transferred to him prior to 2020 to pay at least most of Dr. Aljabri’s ongoing living expenses. Mohammed testified that during the same period (January 24, 2021 to May 14, 2021), he covered most of Dr. Aljabri’s legal expenses in Canada, the United States, United Kingdom, and the Channel Islands. d. Dr. Aljabri’s testimony that he was not involved in paying the Jenner Block law firm. He testified that Mohammed paid the fees charged by this firm in the United Kingdom up to June 2021 and that he (Dr. Aljabri) did not know what if any fees were paid after that time. Dr. Aljabri testified that Mohammed managed all the funds used to support the Aljabri family, including those transferred from Dreams starting in June 2017. e. Dr. Aljabri’s testimony that he has no information about any removal of funds from accounts managed by The Family Office, including from any accounts belonging to Dreams or New East, because those accounts were “managed by Mohammed”. f. Dr. Aljabri’s testimony that the law firm that previously acted for him and some other defendants in the civil action, received funds in trust from Mohammed, and that those funds were used to pay for Dr. Aljabri’s Canadian litigation expenses until Justice Gilmore’s June 22, 2021 ruling on jurisdiction was made. g. Dr. Aljabri’s testimony that he does not know the source of the funds that Mohammed used to pay for various international legal proceedings. h. Nadya Aljabri’s testimony that she was, at the time of her cross-examination on February 10, 2022, responsible for paying household and family living expenses, and that she assumed responsibility for meeting those expenses “when Mohammed’s account was froze[n]”. i. Nadya Aljabri’s evidence that once the Aljabri Mareva Order was made, Mohammed started paying the family’s living expenses. j. Nadya Aljabri’s evidence that Dr. Aljabri does not have access to her Canadian bank accounts, which she used in the period after June 22, 2021 to pay family living expenses. k. Nadya Aljabri’s evidence that, as far she knows, Mohammed does not take instructions from anyone with respect to assets or investment accounts that were acquired with funds transferred from her HSBC bank account to Mohammed’s account in 2018 and 2019.
104The plaintiffs have proven beyond a reasonable doubt that Dr. Aljabri knew that purportedly gifted assets were being used to fund his living and legal expenses. By receiving the benefit of living expenses funded by purportedly gifted assets, and by receiving legal representation that was paid for by the use of such assets, Dr. Aljabri actively participated in the use of such assets for these purposes. I am satisfied that the evidence does not support a plausible inference to the contrary.
105The evidence on the motion before me differs from the facts in Hagel where there was no finding that the wife more than passively acquiesced in the presence of the clown in her yard.
106If I had concluded that the plaintiffs had proven beyond a reasonable doubt that Dr. Aljabri had an interest in the purportedly gifted assets or some power of control over them, such that these assets were frozen by the Saad Mareva Order, I would conclude that the plaintiffs have proven beyond a reasonable doubt that Dr. Aljabri intentionally participated in the use of purportedly gifted assets for living and legal expenses after he received notice of the Saad Mareva Order and before the Mohammed Mareva Order.
Should the Court exercise its discretion to decline to make a finding of contempt?
107In Carey, the Supreme Court of Canada, at para. 37, left open the possibility that a judge may properly exercise his or her discretion to decline to impose a contempt finding where it would work an injustice in the circumstances of the case.
108Dr. Aljabri submits that there is evidence that the plaintiffs failed to comply with their obligations to make disclosure as required by R. v. Stinchcombe, [1991] 3 S.C.R. 326. The plaintiffs submit that this is a basis for the Court to exercise discretion to decline to make a finding of contempt if it finds that a contempt case has been proven.
109Given my finding that the plaintiffs have failed to prove beyond a reasonable doubt that the purportedly gifted assets that were used to fund Dr. Aljabri’s living and legal expenses were frozen under the Saad Mareva Order, it is not necessary for me to consider whether I should decline to make a finding of contempt for the reasons advanced by Dr. Aljabri.
110At the hearing of this motion, in addition to the submissions made by his counsel, Mohammed adopted the submissions made on behalf of Dr. Aljabri. Mohammed’s position is that there is no evidence that he paid for legal or living expenses for Dr. Aljabri after the decision of Gilmore J. on the jurisdiction motion. Mohammed submits that the Saad Mareva Order does not clearly and unequivocally apply to the purportedly gifted assets. He submits that the plaintiffs have failed to prove beyond a reasonable doubt that Dr. Aljabri had in interest in the purportedly gifted assets or controlled such assets after the Saad Mareva order was made.
111I conclude that the plaintiffs have failed to prove beyond a reasonable doubt that the Saad Mareva Order clearly and unambiguously applies to all assets over which they make proprietary claims against Dr. Aljabri, whether or not he retains any type of interest in or control of such assets. I conclude that the plaintiffs have failed to prove beyond a reasonable doubt that Dr. Aljabri or Mohammed breached the Saad Mareva Order by intentionally using frozen assets because they have failed to prove beyond a reasonable doubt that Dr. Aljabri retained an interest in or control over the purportedly gifted and transferred assets that were used to fund Dr. Aljabri’s living and legal expenses between the time of service of the Saad Mareva Order and the Mohammed Mareva Order.
DISPOSITION
112For these reasons, the plaintiffs’ motion for an order against Dr. Aljabri and Mohammed finding them in contempt of the Saad Mareva Order is dismissed.
113If the parties are unable to resolve costs, I may be spoken to.
Cavanagh J.
Released: March 5, 2024