James Cutress KC and Daniel Carall-Green represented Dr George Bitar in two successful claims against Lebanese banks for the return of deposits held by those banks. James and Daniel were instructed by Danielle Carr at Rosenblatt.
In 2019, Lebanon entered a severe financial crisis, one of the results of which has been that Lebanese banks have imposed serious restrictions on the payment of customers’ money outside the Lebanese territory. Money held by Lebanese banks has thus become trapped in the Lebanese banking system. A large proportion of that trapped money is in US dollars, which have now become known as “lollars”, and which are now worth at best around 15% of normal dollars.
Dr Bitar, who is a UK national and lives in London, instructed the Lebanese banks where he held deposits, Bank of Beirut and Banque Libano-Française, to repay his deposits to him in England, but neither complied. He therefore issued (separate) proceedings against each bank, and obtained orders for alternative service out of the jurisdiction.
As against each bank, Dr Bitar claimed first that the terms of his agreements with them gave him a right to an international transfer of funds, second that he had such a right under Lebanese banking custom and practice, and third that he was entitled to his money as a matter of debt. As regards the first and second elements of the claims, Dr Bitar relied on the judgment of Picken J in Manoukian v SGBL and Bank Audi.
Banque Libano-Française first applied to have the order for alternative service on it set aside. Master Cook rejected that application.
Banque Libano-Française then challenged the English court’s jurisdiction. Dr Bitar relied on the new post-Brexit consumer jurisdiction provisions in the Civil Jurisdiction and Judgments Act 1982. Michael Kent KC, sitting as a deputy judge of the High Court, decided in Dr Bitar’s favour (giving the first reported judgment on the new provisions). Permission to appeal was rejected by the judge and the Court of Appeal.
The claim against Bank of Beirut went to trial in July 2022. In August 2022, Freedman J gave judgment in Dr Bitar’s favour on the first and second elements of the claim, and found that he did not need to decide on the third element. He ordered specific performance of Dr Bitar’s international transfer instructions, and ordered the bank to pay Dr Bitar interest at the Lebanese rate of 9%.
The claim against Banque Libano-Française went to trial in November 2022. Later that month, Kerr J (following what Picken J had done in Manoukian) took the unusual course of convening a special hearing to make an order in Dr Bitar’s favour before giving a reasoned judgment. Like Freedman J, he ordered specific performance of Dr Bitar’s international transfer instructions, and ordered the bank to pay Dr Bitar interest at the Lebanese rate of 9%. The judgment is yet to be handed down.