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The Panama judgment

One dominant thought after reading the Panama judgments – both the April 20 one and the final judgment on July 28 – is that the Supreme Court must resist the temptation of being the court of first instance. All courts are prone to misreading the record and making errors which can be corrected in appeal. But not when no appeal is available.

Starting with the celebrated (minority) judgment by Justice Khosa, which was delivered in April this year and which disqualified the prime minister outright without the need for the JIT, one notes a misreading of record which would be corrected 10 out of 10 times by his lordship himself, if he were sitting in appeal. Justice Khosa was fundamentally interested in whether the explanations offered by the PM and his children were honest, on the face of it, and concluded based on certain inconsistencies that this was not so. The following inconsistencies were pointed out.

His lordship notes that in his first address to the nation the PM stated that the proceeds of the factory in Jeddah in June 2005 had been utilised for the ‘setting up’ of his sons’ business. He questions whether the PM was “being honest when he said that his sons set up their business in the year 2005” considering that one of them (Hassan) admitted to having set up his business in London earlier than that. Justice Khosa quotes the following translation of the PM’s speech: “The steel factory near Makkah was sold after a few years along with all its assets. Those resources were utilised by my sons Hassan Nawaz and Hussain Nawaz for setting up their business.” The speech however was in Urdu (and is reproduced in the opinion) and it said: “Aur yeh vasail mere beiton…ne apne naye karobar ke liye istamal kiye”.

The PM never said that these funds were used by his sons for ‘for setting up their business’. He said ‘these resources my sons…utilised for their new business’. Supposing he had said that these funds were utilised by his sons in the old business: would that mean that the old business was started with these funds?

Justice Khosa notes that the speeches made by the PM spoke of “purchase” of the properties in London whereas the statement from Qatar spoke of transfer as a result of “settlement” in the backdrop of an earlier investment. He assumes that purchase cannot include settlement, whereas ordinary dictionaries define ‘purchase’ as: “To acquire property (legally) other than inheritance.” This shows that settlement on account of earlier investment is included in the ordinary meaning of ‘purchase’.

Justice Khosa refers to Maryam Nawaz’s interview with Sana Bucha in 2011 and notes that “she categorically denied knowledge of any property of her brothers or sister in London [whereas] her stance before this court is that her brother Hussain Nawaz Sharif owns the relevant four properties in Central London since 2006 and she is a trustee of those properties for the said brother since 2006.” It is worth inquiring what she said. A PTI politician had presented a list of properties in central London and alleged that six of them were owned by Nawaz Sharif, six by Maryam, four by Hamza, three by Hassan and three by Kulsoom Nawaz Sharif. Maryam called in to say (in Urdu): “Leave aside London, I do not even own any property in Pakistan, and I don’t know from where they have come up with these properties belonging to me, my mother, and my brothers and sister. … By that token the whole of central London should belong to us.” As far as I can tell, while she categorically denied holding property in London herself, she did not go so far as to say that her brothers also did not own any in London. An inference to this effect if made by a lower court would be corrected in appeal.

Justice Khosa then refers to Hussain’s interview in Capital Talk on January 19, 2016 that “sale of the factory in Jeddah had fetched good money and through that money he had acquired three properties there through “mortgages” for which payments were still being made.” Justice Khosa concludes that “the story about mortgage was a totally new story and completely contradictory to the other stories based upon purchase or settlement in Qatar.” And it would be if Hussain was referring to the flats revealed in the Panama Papers as the ones acquired through mortgage. But it turns out that upon being asked to react to an allegation by Imran, he clearly mentioned owning properties in London in addition to those flats, which were acquired through mortgage (and partly through funds from Jeddah). It seems that his lordship may not have been provided an accurate transcript of the interview.

Justice Khosa mentions that Hassan Nawaz “had admitted in an interview with Tim Sebastian in November 1999, about seven years prior to the stated acquisition of the properties in London, that he was a student with no earnings of his own, he did not own those properties but he was living in the same on rent and the money for his living in those properties came from Pakistan on a quarterly basis.” He notes that this was “contradicted by statements of the gentleman from Qatar who maintained that permissive possession of the flats had been given to the family of Mian Muhammad Sharif with no charge.” But the letter from Qatar, which too is reproduced in the judgment, notes: “On account of relationship between the families, Mr Mian Muhammad Sharif and his family used the properties whilst bearing all expenses relating to the Properties, including the ground rent and service charges.” According to this letter, ground rent and service charges were paid by the Sharif family!

Justice Khosa notes that the PM mentioned setting up a steel factory near Makkah but later referred to the factory in Jeddah. Only because Justice Khosa mentions this more than once, it is worth mentioning that the two are only 45 miles apart, and the PM only mentioned a factory near Makkah.

The above discussion pertains to Justice Khosa’s minority opinion delivered in April. Coming next to the more recent judgment, which too now disqualifies the prime minister, there is no cavil with the ruling that the matter needs to be investigated further for which it has rightly been referred to NAB. But the court goes on to disqualify the PM for the following reason: “It has not been denied that respondent No 1 being Chairman of the Board of Capital FZE was entitled to salary, therefore, the statement that he did not withdraw the salary would not prevent the un-withdrawn salary from being receivable, hence an asset. When the un-withdrawn salary as being receivable is an asset it was required to be disclosed by respondent No 1 in his nomination papers… Where respondent No 1 did not disclose his aforesaid assets, it would amount to furnishing a false declaration on solemn affirmation in violation of the law mentioned above, therefore, he is not honest in terms of Section 99(1)(f) of the ROPA and Article 62(1)(f) of the Constitution of the Islamic Republic of Pakistan.”

The problem is that for a finding of dishonesty to be rendered, two things are essential. A violation of ROPA, which has been noted by the majority (even if a highly technical one), but also mens rea – namely, the intention of wrongdoing (as opposed to the action or conduct which falls foul of the law). To illustrate, the offence of murder is not complete simply on account of a person being killed. It must also be accompanied by the intent to kill or to cause grievous bodily harm. The majority opinion casually assumes that just because the actus reus of the offence was committed, there was also the necessary dishonest intent. If their lordships considered mens rea relevant, the fact that Nawaz Sharif did not actually draw the salary would be a compelling reason to conclude that the non-disclosure may not have been with dishonest intent. There is absolutely no discussion on that in the opinion, which seems a major departure from the jurisprudence practised by our courts.

Not that the Supreme Court, even when sitting in appeal, is able to correct all errors. The Bhutto case is a glaring example. But we note that the errors become more numerous (and costly even, as Pakistan may soon find out in the Reko Diq arbitration) when the Supreme Court assumes jurisdiction under Article 184. My suggestion, therefore, is that the Supreme Court should rarely act as the court of first instance – and where it absolutely must, the right of appeal should be made available through constitutional amendment. Uncorrected errors are likely to impact the prestige of the Supreme Court.

The writer is a Lahore-based lawyer.

Email: salmanchima@gmail.com

This article is part of a new series aimed at encouraging informed debate on the Panama case. Respected members of the legal community are invited to join in with their views.

Salman K Chima, "The Panama judgment," The News. 2017-08-03.
Keywords: Political sciences , Political issues , Supreme court , Panama leaks , Panama judgments , Corruption , Accountability , Politician , Hassan Nawaz , Hussain Nawaz , JIT , PTI