Abu Dhabi royals sue former estate manager for ‘tens of millions’ in damages

The former manager of the UK real estate empire of the Abu Dhabi royal family are being sued for “tens of millions of pounds” in damages. The claim has been brought by a number of companies which own a portfolio of properties – including the Berkeley Square estate – that are ultimately beneficially owned by Sheikh Khalifa bin Zayed bin Sultan Al Nahyan, emir of Abu Dhabi and president of the United Arab Emirates. They accuse Lancer Property Asset Management, which was fired as manager of the estate in 2017 after 16 years of service, of dishonesty and fraud. Lancer and its directors vigorously deny the allegations and are defending the action. In addition, they are pursuing a counterclaim for payment of £12m they say is due for services rendered under their asset management agreement. Details of the action emerged at a case management conference at the high court in London, where David Quest QC, representing the claimants, told deputy judge John Male QC that his clients accuse Lancer of a “fraudulent scheme” to siphon off funds. He alleged that there was a “dishonest arrangement” between Lancer and engineer Dr Mubarak Saad Al Ahbabi, who was the chairman of Sheikh Khalifa’s private office, the Department of the President’s Affairs and was, until 2015, the claimants’ representative in relation to the properties. Quest said that, under the arrangement: “Dr Al Ahbabi agreed to inflate the management fees that were paid to Lancer for the purpose of funding payments back to him.” He added that £32m had been paid to Al Ahbabi’s companies. Lancer and its directors maintain that these arrangements were entirely proper and authorised by Sheikh Khalifa. They say that the payments to Al Ahbabi represent a normal market value for the services he provided in relation to the property portfolio. Their lawyer, David Wolfson QC, said: “The claim is not only defended, but we say it is misconceived.” Lancer managing director John Kevill added: “The claims made against us are fundamentally misconceived. We regard them as malicious and vexatious and we are defending them vigorously.” During the hearing, the deputy judge resolved a number of minor disputes over pre-trial disclosure of evidence, including relating to allegations made by the Lancer defendants that Sheikh Khalifa has been “incapacitated” since suffering a stroke in January 2014, and that other family members are in control of his affairs. Wolfson said this is an “open secret in the Gulf” and that the state of Sheikh Khalifa’s health “goes to the heart” of the defence. He said that it explains why the case is now being brought when, as his clients maintain, “Sheikh Khalifa knew what was going on” and had authorised the payments. However, Quest said that the allegations about Sheikh Khalifa’s health were not accepted. The deputy judge agreed this would be a “key issue” in the case. In addition, the parties and deputy judge agreed a timetable that will see the case go to trial after 1 May 2021, with a length of 18 days.   To send feedback, e-mail jess.harrold@egi.co.uk or tweet @estatesgazette