This article analyses the BVI Court’s 2021 judgment which dealt with issues of res judicata and the enforcement of a foreign oral will over BVI company shares.

As the scope and complexity of trust and family estate disputes increases, more scrutiny is required by the Courts to consider the arguments put forward in light of the particular circumstances. While the Courts have wide-ranging powers, the cases in this series show that it does not necessarily follow that the Courts will automatically exercise its powers and discretion to grant relief.

In the Matter of the Estate of Sheikh Saoud Mohamed Al Thani – BVIHCVAP 2021 / 0001

The BVI Court of Appeal proceedings arose from the findings of the first instance decision of the BVI High Court concerning a challenge to the validity of a foreign oral will. The deceased, who was a Qatari national and domiciled in Qatar at the time of his death, had attended before a judge of the Sharia Court in Qatar to formulate and record his oral will under Qatari law.

The claimants were the deceased’s sister, his niece, and a “former right-hand man”, who were beneficiaries under the deceased’s will.  The defendants were the deceased’s widow, his daughter, and his first son who applied to the Qatari Court contending that the will was not valid and enforceable, and had been revoked by the deceased. These proceedings involved three appeals. Ultimately, the Qatari Court confirmed that the deceased’s oral will was valid and enforceable. The claimants in the BVI case then approached the BVI Court to revoke the BVI grant of letters of administration obtained by the defendants, and to obtain a BVI grant of probate of the oral will.

On application to the BVI High Court, the claimants sought determination, as a preliminary issue, on the question of whether the defendants were estopped from contending that the oral will was invalid or unenforceable by virtue of the Qatari judgment which had upheld the validity of the oral will. The BVI Court determined that the defendants in the BVI case were estopped, and formally recognised the foreign will as valid. The defendants in the BVI proceedings appealed the judgment, with the main issues for the Court’s determination being:

  • whether the defendants were estopped from contending that the will was not valid and enforceable in the BVI, as such issue was not raised before the Court of Appeal in Qatar; and
  • whether section 245 of the BVI’s Business Companies Act established that registered shares in a BVI company are immovable property.

The Findings

In dismissing the defendants’ appeal, the BVI Appeal Court made the following findings:

  • As a general rule, a party is not allowed to re-open litigation in later proceedings on matters that have already been adjudicated upon by a court of competent jurisdiction in earlier proceedings between the same parties or their privies. This is the principle upon which the doctrine of res judicata is founded. There may be an exception to issue estoppel in the special circumstances that there has become available to a party further material relevant to the correct determination of a point involved in the earlier proceedings, whether or not that point was specifically raised or decided, being material which could not by reasonable diligence have been adduced in those proceedings. The exception, however, does not apply in the instant case. The defendants in the BVI case were aware of the existence of the shares in the BVI company which formed part of the deceased’s estate at the time the litigation was taking place in Qatar.
  • BVI law is silent as to the validity and enforceability of foreign wills in the BVI, thus the BVI Court must look to the common law principles for guidance. According to these principles, where a foreign domiciled person dies owning assets in the BVI, BVI law will determine the succession and administration of immovable property located in the BVI and the law of the foreign domicile will determine the succession and administration of movable property located in the BVI.
  • Registered shares in a BVI company are movable property and their distribution on succession must be done in accordance with the law of the deceased testator’s domicile. Pursuant to section 245 of the BVI’s Business Companies Act, the situs of the ownership of shares is in the BVI for the purposes of determining matters relating to title and jurisdiction; it does not extend to other matters such as succession. The finding that shares in the BVI are movable property is also consistent with section 33 of the BVI’s Business Companies Act which provides that a share in a company is personal property. Consequently, the disposition of the shares in the BVI company which form part of the deceased’s estate are subject to the laws of the deceased’s domicile, which is Qatar.

The Key Takeaways

The judgment provides helpful guidance as to the types of arguments that might be pursued in cross-border estate disputes as family estates become more sophisticated, and contains a useful summary of principles of private international law relevant in the context of contested estate matters. Significantly, the BVI judgment helpfully confirms that where a court of domicile has already reached a determination about the estate of the deceased, the BVI Court will hold itself bound by the determination of that court.

Please click here to read Part I of this series.


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