The claimant disponent owners of a vessel chartered it to a charterer whose ultimate parent company, the defendant, guaranteed its obligations under a guarantee governed by English law and which provided that any dispute arising from it was subject to the exclusive jurisdiction of the English courts. All three parties were based in the People’s Republic of China. The charterer defaulted in making payments of hire under the charterparty and after the claimant made a demand for payment under the guarantee which the defendant declined to pay, the claimant brought proceedings in the Commercial Court against the defendant for damages. Before the proceedings commenced the defendant amended its defence to claim that the guarantee was unenforceable on the ground that the charterparty had been procured by the payment of bribes by or on behalf of the claimant to a senior employee of the charterer, relying solely on confessions made by two of the claimant’s employees, and by the senior employee’s son, whilst each was detained during a criminal investigation undertaken by the Chinese Public Security Bureau. The claimant alleged that the confession evidence had been obtained by torture and was therefore inadmissible in legal proceedings. At trial the judge stated that whilst he could not rule out the possibility of torture, he did not need to decide that question because the other surrounding circumstances led him to conclude that in fact no bribe had been paid. He accordingly held that the defendant was liable to pay the claimant under the guarantee. On the defendant’s appeal, the Court of Appeal held that the judge’s decision could not stand and fell to be remitted for reconsideration, in that he should have first considered the question of torture and, unless then proven on the balance of probabilities, to disregard any possibility that the evidence had been obtained by torture.
On appeal by the claimant—
Held, appeal allowed. Where a defendant to a civil claim sought to rely on evidence contained in a confession made by a person in the course of a criminal investigation but which the claimant sought to impugn as having been obtained by torture, it was open to the judge to refrain from reaching a conclusion on the balance of probabilities as to the torture allegation but instead to admit the confession de bene esse before then reaching a decision on the facts in issue in the proceedings. How and in what order questions concerning the admissibility and weight of evidence were dealt with was very much a matter for the trial judge. A requirement to discharge the legal burden of proof only applied to facts in issue at a trial: here, the failure to pay the sums under the charterparty and whether a bribe had been paid. It did not apply to facts which made a fact in issue more or less probable. It followed that in the present case the judge had been entitled to rely, as he did, on his finding that torture could not be ruled out as providing further support for the conclusion he had already reached that there had been no bribe paid (paras 57–60, 65, 94–95, 99, 106, 108, 112).
Lord Pannick QC, Caroline Pounds and Tom Richards (instructed by HFW llp) for Shagang.
Edward Brown, Jessica Boyd and Isabel Buchanan (instructed by Hogan Lovells International llp) for HNA Group.
Ben Jaffey QC, George Molyneaux and Natasha Simonsen for Liberty, intervening.