Vatican’s £124m property case to be heard in UK in ‘trial of the century’ (original) (raw)
Court of Appeal has ruled the tiny sovereign state should face trial in the English courts for the first time in its 2,000-year history
Home Affairs Editor
06 August 2022 7:00pm BST
The Vatican should face trial in the English courts for the first time in its 2,000-year history, the Court of Appeal has ruled.
Lawyers for the tiny sovereign state have failed in an attempt to prevent English judges from examining a major London property deal at the centre of the Vatican’s “trial of the century”.
The Vatican tried to argue that English courts should not rule on its £124 million investment in the property at 60 Sloane Avenue, a former Harrods warehouse in Chelsea that was earmarked for development into luxury apartments.
The Vatican claims Raffaele Mincione, a British financier, committed fraud by inflating the price when his companies sold the property in 2018. Prosecutors in the Vatican have charged Mr Mincione and 10 others with offences of fraud, embezzlement and abuse of office.
However, the businessman maintains he did not do anything wrong and that the property valuation by independent experts was appropriate. Mr Mincione claims that the Vatican has never disclosed evidence to show it lost money nor of his alleged wrongdoing.
He is seeking to bring the civil action in the UK courts as a “counterblast” to the publicity and to protect his reputation after suffering “prejudice” as a result of the allegations, according to the documents.
Vatican lawyers told the Court of Appeal that a UK hearing would interfere with the criminal investigation and with “legitimate acts of a foreign state” and would serve “no useful purpose”.
However, the financier has now won a landmark victory in the Court of Appeal, which has agreed the British courts have the right to examine the property transaction and rule whether or not he and his company WRM operated in “good faith”.
Raffaele Mincione, a British financier, claims that the Vatican has never disclosed evidence to show it lost money nor of his alleged wrongdoing relating to the property deal Credit: Getty Images Europe
The judgment, handed down by Lord Justice Jackson, Lord Justice Males and Lord Justice Birss, recognised that Mr Mincione had a “genuine wish to obtain public vindication” and agreed that he had a “justiciable” claim in the UK courts.
It is thought the case will be the first where the Vatican will appear before the UK courts. The Catholic enclave, which spans 121 acres in the centre of Rome, often avoids legal action in foreign jurisdictions by claiming state immunity.
Last year, the European Court of Human Rights ruled the Vatican was protected from claims by clergy sexual abuse victims because it cannot be held liable for the actions of priests and bishops around the world.
The defence of sovereign immunity is, however, not available to the Vatican in the case of 60 Sloane Avenue because the dispute relates to a commercial transaction.
The saga began in 2014 with a complex London property deal involving Swiss banks, investment funds based in Luxembourg and, allegedly, millions of pounds donated by Catholics in the annual Peter’s Pence collection for good causes.
In the case of 60 Sloane Avenue, the Vatican worked through Credit Suisse. Mr Mincione was to take a minority stake in the property. By 2016, planning consent for luxury flats had been granted.
Two years later, Vatican officials bought the building outright from Mr Mincione’s Luxembourg-based company. The Vatican claims to have lost millions on the deal and has pursued those involved through the courts, including Mr Mincione and Cardinal Giovanni Becciu, the Pope’s former adviser. It has sold the property to a US investment fund.
It is not yet clear who the witnesses would be at an eventual trial but it could include senior figures in the Vatican.
The Vatican has pursued those involved in the property through the courts, including Cardinal Giovanni Becciu, the Pope’s former adviser Credit: AP
Earlier this month, it was claimed Pope Francis authorised secret wiretaps during the criminal investigation that targeted officials, including Cardinal Becciu. Investigators were allowed to bug phones, intercept emails and arrest anyone without seeking prior approval from a judge.
The Pope is said to have taken a close interest in the case and, according to the court documents, described the property transaction as a “scandal”.
Mr Mincione’s victory in the Court of Appeal is the latest blow to a prosecution. When examining the evidence, an earlier Vatican tribunal agreed the defendants’ rights had been “completely violated” and ordered prosecutors to drop the charges. They were later re-charged.
In the UK, Vatican investigators also tried to freeze bank accounts belonging to one of the alleged co-conspirators, which led a British judge to examine the evidence.
In a highly critical judgment, Judge Tony Baumgartner of Southwark Crown Court found Vatican investigators’ “non-disclosures and misrepresentation” were “so appalling” that he released the defendant’s funds.
Mincione granted right to obtain ‘declaratory relief’
In its judgment the Court of Appeal granted Mr Mincione the right to obtain “declaratory relief” over the business deal and ordered the Secretariat, a branch of the Vatican, to pay his legal costs. The legal team was led by QC Charles Samek.
“Clearly there is a dispute between the [the Vatican] and Mr Mincione as to whether he engaged in criminal conduct, including in relation to the transaction,” said the judgment.
“That dispute is the subject of the criminal proceedings in the Vatican City Court.
“However, the existence of that dispute does not preclude the existence of a dispute between [Mr Mincione] and [the Vatican] as to whether [Mr Mincione is] under any civil liability to [the Vatican], for example to pay compensation, as a result of entering into the transaction.
“In those circumstances, it seems to me that far from there being a compelling reason to stay the present claim, there is every reason why it should be permitted to proceed. It is a claim which the judge found to be justiciable, over which the English court has exclusive jurisdiction.”
Following the judgment, the Vatican will have to divulge documents relating to how it entered into the transaction and how it financed it.
A Vatican spokesman said: “The legitimacy of the investigations and the correspondence of the Vatican judiciary system to the principles of fair trial has been recognised by various foreign courts.”