Saad vs Algosaibi in New York – No way
requirements of US justice demand dollar be not reduced to its intrinsic value and SAMA continues pegging riyal to dollar
The Financial Times reported last week that Saudi conglomerate Algosaibi had filed a lawsuit in New York against the chief executive of the Saad Group conglomerate. (1)
Reuters says that Saudi firms sometimes file lawsuits abroad because there is no consistent application of law, and verdicts in its domestic courts vary widely. The courts are based on an austere interpretation of Islam and overseen by clerics. (2)
Does Reuters think the American judges are that stupid?
How could the American judges possibly have jurisdiction? How could the American taxpayer be forced to pay for the resolution of this dispute between two Saudi conglomerates?
And if that question be answered, what system of law should the American judges apply?
US law?
No,
the rules of conflict of laws are that part of the private law of a country which deals with cases having a foreign element. (3)
The fact that the law of an enemy country is being applied in time of war demonstrates that these rules do not result from the comity between nations but from the requirements of justice. (4)
Or is it because Saad Group’s debts to Algosaibi are denominated in Saudi riyal
and that the riyal is pegged to the US dollar,
that the US courts have jurisdiction?
Banks used to have the right to issue receipts for the gold they held in reserve in warehouse.
This right was taken away from them by the institution of central banks. (5)
The next step is now to grant the US jurisdiction in Algosaibi vs Saad Group
because the Saudi Arabian Monetary Authority (SAMA), the central bank of the Kingdom of Saudi Arabia, is pegging the Saudi riyal to the US dollar.
Of course, Saad Group is still denying that the lawsuit has been filed (in New York and/or London). (6)
But the US requirements of justice or the requirements of US justice demand that the US dollar be not reduced to its intrinsic value and that the SAMA continues pegging its riyal to the US dollar.
Ivo Cerckel
honestmoney@maktoob.com
http://twitter.com/ivocerckel/
NOTES
(1)
dollar-regime thievery in New York court
Posted by Ivo Cerckel on July 17th, 2009
http://bphouse.com/honest_money/2009/07/17/dollar-regime-thievery-in-new-york-court/
[If the link does not work try to copy it and to paste it in your browser]
(2)
RPT-Saad debt tussle, family row sour investors
LONDON, Reuters, Fri Jul 17, 2009 1:17pm EDT
By Douwe Miedema
http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSLH28528420090717
SNIP
Saudi firms sometimes file lawsuits abroad because there is no consistent application of law, and verdicts in its domestic courts vary widely. The courts are based on an austere interpretation of Islam and overseen by clerics.
“Rulings between courts often differ sometimes to the point that it embarrasses the government which wants to overhaul the legislation,” said a western diplomat in Riyadh. King Abdullah has tried to reform the legal system as part of plans to open up the country for investment. He removed two hardline clerics in a cabinet reshuffle in February, among them the president of the supreme court.
(3)
JHC Morris, “The Conflict of Laws”, London, Stevens & Son, 1984, 3rd ed., p. 3
(4)
JHC Morris, op. cit., p. 6
(5)
Roland Leuschel and Claus Vogt, “Das Greenspan Dossier, Wie die US-Notenbank das Weltwährungssystem gefährdet. Oder: Inflation um jeden Preis”, www.finanzbuchverlag.de, 2006, 3rd ed., p. 299
(6)
Saad Group ‘making progress’ with debt restructuring
(AP) By Vicky Kapur on Sunday, July 19, 2009
http://www.business24-7.ae/Articles/2009/7/Pages/18072009/07192009_f0eae5c1f2354e2e994344e1889242ec.aspx
SNIP
Saudi Arabia’s troubled Saad Group is making headway in restructuring its debt portfolio and is in talks with affected parties, Emirates Business has learnt.
“Saad is making progress with its restructuring programme and will make further announcements on this as appropriate,” a London-based spokesperson of the group told this newspaper in an e-mailed statement.
The spokesperson also denied knowledge of the recent reports in media that its owner, Maan Al Sanea, has been sued by the other troubled Saudi conglomerate, the Algosaibi group through the Ahmed Hamad Algosaibi and Brothers Company (Ahab).
“We [have] not seen or been served with this claim, although it appears from reports to be a repetition of claims previously presented extensively to the press and elsewhere and which are baseless,” said the statement.
“If we are served with such a claim, we will respond to it vigorously through specialist counsel, confident in both the true facts and the judicial process,” the group said.