02Aug
By: Tom On: August 2, 2018 In: Evidence Taking, In Court, International Litigation Comments: 0
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Is cross-examination under the HEC possible?

In March of 2018, a court of appeals in the United Kingdom (UK) issued an opinion concerning cross-examination within the context of the Hague Evidence Convention (HEC).[1] Perhaps because this opinion marked the “latest episode in the long running litigation” of BTA Bank v Khrapunov [2018] EWCA Civ 819, Lord Justice Sales’ opinion assumes that the reader is familiar with all of the nuances of the HEC. Because this assumption is unlikely to be valid, the case is worth further review.

Reviewing BTA Bank v Khrapunov

At issue in this case is the theft and concealment of large sums of money from BTA Bank (“Bank”) by Mukhtar Ablayzov who was the Bank’s former manager. In 2015, a “worldwide freezing order”[2] was imposed on Ablayzov’s assets. “One of the alleged associates of Mr Ablyazov is [Ilyas Khrapunov], who is Mr Ablyazov’s son-in-law.” The Bank sought to take evidence from Khrapunov, but Khrapunov — who was living in Switzerland at the time — was not interested in returning to the UK.[3]

As a compromise, Khrapunov signaled that he would be willing to provide testimony by a “remote video-link” to the UK court pursuant to HEC Articles 17[4] and 21.[5] Briefly, Khrapunov was stating that after the UK court appointed a commissioner and had secured the permission of the Swiss Central Authority,[6] he would provide testimony provided no coercion was used

The Bank of course recognized that testimony given subject to its being voluntary and free of coercion would severely limit its ability to cross-examine Khrapunov. The trial court agreed and issued an order that Khrapunov was to be examined in London. Khrapunov then appealed this ruling.

The UK court of appeals observed that in the Bank’s opinion,

the proposed process of cross-examination of the appellant in Switzerland will not be as effective as direct cross-examination of him before the High Court in London. There is force in this. [The Bank] submits that, in light of the strong grounds for suspecting that [Khrapunov] has lied thus far in the disclosure he has given [regarding] the freezing order, which are the grounds justifying the order for cross-examination in the first place, the court should require the cross-examination to occur under conditions which involve the most serious threat of adverse repercussions for the appellant if he does not answer or lies in his replies to questioning. Only then will there be any real chance of extracting more information from the appellant of any practical utility to assist in enforcement of the freezing order. To that end, [the Bank] submits that even if there is a risk of detention of [Khrapunov] in the United Kingdom and a risk of his extradition to Ukraine, these are risks which in the circumstances of this case it is not unjust to require him to face. In that regard, Mr. Smith cites the decision of Neuberger J (as he then was) in The Canada Trust Company v Stolzenberg [1997] WL 1102707, decision of 3 October 1997.

Accordingly, the UK court of appeals held,

the just result in this case is to continue to require [Khrapunov] to attend for cross-examination at the High Court in London. The alternative which he proposes, of cross-examination in Switzerland, is unlikely to be an effective means of obtaining useful information from the appellant which could assist in the enforcement of the freezing order. There is a significantly greater prospect of achieving that if he is cross-examined here.

Cross-Examination under the HEC

Structurally, the HEC is composed of three Chapters: Chapter I, Letters of Request (Articles 1-14); Chapter II (Articles 15-22); and Chapter III, General (Administrative) Clauses (Articles 23-24). With the exception of Article 23 (which limits certain types of documentary evidence), Chapter III has no direct impact on taking evidence and will not be discussed further.

The BTA Bank case focuses attention on the taking of evidence pursuant to Chapter II of the HEC. This Chapter describes the procedure for taking testimonial evidence by commission and contemplates that testimony will be taken at a consulate. Article 15, which is the keystone of Chapter II, is very clear that Chapter II examinations are to be “without compulsion,” i.e., without coercion.

A key benefit to Article 15’s “without compulsion” requirement is that Central Authority permission to take testimony under Chapter II is more readily granted.[7] Countries are reluctant to interfere with another country’s judicial proceedings when a witness will voluntarily provide testimony. On the other hand, as the BTA Bank court made clear, cross-examination under Chapter II of the HEC is largely ineffectual (and direct testimony may be compromised by non-responsive or otherwise evasive answers).

However, this does not mean that cross-examination is not possible under the HEC. Cross-examination is possible under Chapter I of the HEC. Still, there is a big caveat to Chapter I cross-examinations: such examinations must be requested.

This is especially true in civil law countries where taking evidence is largely a judicial function and in the case of China an exclusive monopolistic right of the judiciary. In civil law countries, while the concept of cross-examination is not entirely unheard of, in practice cross-examination is nowhere near as robust as it exists in the United States. Accordingly, cross-examination must be requested in the special methods section of the Letter of Request (LOR).

There are two methods to obtain cross-examination via the LOR. First there is the direct method: the LOR can simply request the opposing counsel “be permitted to cross-examine this witness.”[8] As we have discussed elsewhere, such a direct request of an overseas court is unlikely to be executed.

The better method is for opposing counsel to have the cross-examination questions included in the LOR along with a request that the witness be examined on the topics of veracity and foundation of the witness’ answer.[9]

The best way to ensure that a LOR is properly issued is to work with professionals well-versed in evidence taking abroad. At LLS, we have years of experience in taking testimony and document production from reluctant witnesses located abroad, and we can assist you in drafting a well-written LOR. For more information or to speak with a representative, contact us today.

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Notes

[1] Convention of 18 March 1970 on the Taking of Evidence Abroad in Civil and Commercial Matters.

[2] “A worldwide freezing order is an injunction granted by the English courts to restrain individuals or businesses from disposing of or dealing with assets on a worldwide basis.” David Kavanagh: The Risks Associated With Worldwide Freezing Orders. April 24, 2017; “A freezing order is highly restrictive, and, given the serious obligations that often result from such an order, persons affected by one must act with the utmost care in ensuring its terms are observed. The drastic consequences resulting from a freezing order prompted a leading member of the English judiciary to describe it as “one of the law’s […] nuclear weapons.” Id. citing Bank Mellat v. Nikpour [1985] F.S.R. 87.

[3] Khrapunov feared that traveling to the UK would result in his extradition to Kazakhstan or the Ukraine where criminal charges were pending against him.

[4] In its entirety Article 17 states: “In a civil or commercial matter, a person duly appointed as a commissioner for the purpose may, without compulsion, take evidence in the territory of a Contracting State in aid of proceedings commenced in the courts of another Contracting State if – a)  a competent authority designated by the State where the evidence is to be taken has given its permission either generally or in the particular case; and  b)  he complies with the conditions which the competent authority has specified in the permission. A Contracting State may declare that evidence may be taken under this Article without its prior permission.

[5] In its entirety Article 21 states: “Where a diplomatic officer, consular agent or commissioner is authorized under Articles 15, 16 or 17 to take evidence – a)  he may take all kinds of evidence which are not incompatible with the law of the State where the evidence is taken or contrary to any permission granted pursuant to the above Articles, and shall have power within such limits to administer an oath or take an affirmation; b)  a request to a person to appear or to give evidence shall, unless the recipient is a national of the State where the action is pending, be drawn up in the language of the place where the evidence is taken or be accompanied by a translation into such language; c)  the request shall inform the person that he may be legally represented and, in any State that has not filed a declaration under Article 18, shall also inform him that he is not compelled to appear or to give evidence; d)  the evidence may be taken in the manner provided by the law applicable to the court in which the action is pending provided that such manner is not forbidden by the law of the State where the evidence is taken; e)  a person requested to give evidence may invoke the privileges and duties to refuse to give the evidence contained in Article 11.”

[6] From a practical point of view, Switzerland’s declarations and reservations to the HEC mandate that Swiss Central Authority (SCA) has oversight for all requests to take evidence in Switzerland from abroad. Failure to obtain the SCA’s permission to take evidence in Switzerland is a criminal act. See Swiss Criminal Code Article 271.

[7] This is especially true in France.

[8] BladeROOM Group Limited v. Facebook, Case No. 15-cv-01370 EJD Dist. Court, ND California April 17, 2017.

[9] Id.


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