Jet getters

Iraq and Kuwait have moved off the battlefield and into the courtroom. Jon Robins reports on fourteen years of legal wranglings, armed raids and ditched lawyers

“One of the things they never teach you at law school is how to explain to your 10-year-old son why there’s a man in overalls standing in your bushes measuring angles of fire,” says Chris Gooding, a partner at London firm Howard Kennedy.

Gooding is reflecting on the considerable amount of time he has spent over the last 14 years battling with the Iraqi Airways Company (IAC) on behalf of his client Kuwait Airways Corporation (KAC). Iraqi troops invaded Kuwait on 3 August 1990 and immediately snatched part of the KAC fleet. Gooding was instructed the following day.

Since then the legal action against the pariah state and its airline is reckoned to have become the longest commercial case in the High Court in the last century. It has featured a run of high-profile judgments in the Commercial Court, the Court of Appeal and the House of Lords. But there has also been much excitement outside the courts, including threats against the legal team and an armed raid on a farm in Fallujah, outside Baghdad, led by the Kuwaitis.

“I’ve always believed we would succeed eventually, and frankly it’s taken a lot of belief over the years to keep on going,” says Gooding. Three years ago the Iraqis paid out $160m (£82.5m) in relation to aircraft taken to Iran. “That’s perhaps $160m more than we thought we’d get,” he says. “We’re amassing judgments and, until the cash is on the table, we keep on litigating; and somebody, someday is going to have to face up to them.”

To recap, KAC first brought its claim against IAC in January 1991 following the seizure of 10 aircraft belonging to KAC from Kuwait International Airport. Four aircraft were flown to Mosul in the north of Iraq and were destroyed in coalition bombing raids in early 1991 (the Mosul Four). The remaining six planes were sent to Baghdad and later to Iran. Then there is another action in respect of spare parts. In 2003, the KAC’s project director led an armed raid on a house in Baghdad and a farm in Fallujah shortly after coalition forces began their attack against Iraq. “We always felt in our guts that the spares and the supporting documents were out there but we were never able to prove it until then,” Gooding recounts. “In the early days of the coalition invasion they went in to Iraq and got photos and video evidence with some help from the US army.”

Case: Kuwait Airways Corporation v Iraqi Airways Company.

Solicitors: For KAC, Chris Gooding, Howard Kennedy; for IAC, Jack Rabinowicz, Teacher Stern Selby.

Counsel: For KAC, Joe Smouha QC, Professor Christopher Greenwood QC, Essex Court Chambers; for IAC, Robert Hildyard QC, 4 Stone Buildings, Stephen Nathan QC, Blackstone Chambers, Max Mallin, 11 Stone Buildings.

Trial date: 28 February 2005 (but could be pushed back to the beginning of March).

Judge: Mr Justice David Steel

Last July Howard Kennedy won damages of $148.5m (£78.4m) on behalf of KAC in that action, amounting to roughly half of the $285m (£150.4m) claimed by KAC.

This month Mr Justice Steel will return to the action in respect of KAC’s aircraft. Litigation partner Jack Rabinowicz of Teacher Stern Selby, who is advising KAC’s opponent IAC, believes that this latest trial, which is due to start today (28 February), is not so much “a clash of the titans” (as suggested last month by The Lawyer), but rather “a B-movie-style” clash between two tyrannosaurus rex “fighting each other to death”. The London firm picked up IAC as a client in November after the Iraqis dropped Kendall Freeman, which handled two separate actions last year on behalf of the Iraqis. Rabinowicz and his team were given three months to prepare for a three-week commercial trial. An application for a postponement was rejected and the lawyers have had to prepare witness statements, expert reports and “a number of other interlocutory matters the other side have thrown at us” from scratch, he says. “Both parties are feeling fairly war-weary and it’s a question of who gives up first,” Rabinowicz reckons.

The forthcoming trial has been dubbed ‘Perjury Two’. KAC alleges that a critical 1995 House of Lords judgment was obtained by perjury. The claim concerns the Mosul Four and is a compensation claim in the region of $450m (£237.5m). A year ago in ‘Perjury One’, Judge Steel ruled that the claimant had produced fresh evidence which meant it became apparent that two of the defendant’s officers had given perjured evidence. As a result of this ruling, the start date of any protection afforded by sovereign immunity claimed by IAC should be moved back from 16 September to 9 August 1990, effectively overturning a ruling by the Law Lords.

“The English courts have bent over backwards to play cricket with the Iraqis,” comments Gooding. “There’s a tendency when the English courts are faced with a sovereign power to show the world that British justice is fair and equal. But unfortunately the Iraqis have just taken one look at them and decided to treat them as suckers.”

“This in many ways is war being carried on by two parties in another name,” comments Rabinowicz. “The Iraqis and the Kuwaitis have been litigating in absence of being able to physically fight with each other. It would be sensible to try to resolve the dispute so the Iraqis can start commercial flying again.”