By Andrew Alderson12:01AM BST 14 May 2006
Once their long working day is over, the rival teams of British lawyers play golf, tennis and badminton in the palatial surroundings of their five-star hotel.
After exercising, they can swim in one of the Empire Hotel and Country Club’s eight luxurious pools.
Each morning, at around 8.15am, the 10 barristers and solicitors, together with three appeal court judges, have been taken by a fleet of chauffeur-driven black BMWs and Mercedes from their hotel, nestling beside the South China Sea, to Brunei’s High Court of Justice 15 minutes away.
It is there, sitting in camera and with three uniformed guards on the door of the spacious courtroom, that Sir Derek Cons, the president of the appeal court, yesterday brought down the curtain on the latest round in a bitter legal battle.
The hearing, which began two weeks ago, was the result of a feud involving two royal brothers which has caused untold embarrassment to Brunei, the sultanate the size of Norfolk that lies north of Borneo.
Since 1998, rival lawyers have represented the Brunei Investment Agency (BIA), the investment wing of the Sultan of Brunei’s autocratic government, and Prince Jefri, his younger brother, who has been accused of siphoning off £8 billion from the state that once provided him with a standard of living most people only dream about.
The details that have emerged of profligacy and decadent lifestyles would make uncomfortable reading for the ruler of any country.
For the royal family of staunchly Muslim Brunei, which once prided itself on its discretion, the events have proved cataclysmic.
The legal dispute has uncovered the playboy antics of Prince Jefri, aged 52, who is alleged to have spent more than £1.5 billion on himself in his final 10 years as finance minister, before he was stripped of the job in 1997.
Much of the money allegedly went on a succession of “toys”: some 2,000 cars, including Ferraris, Rolls-Royces and Aston Martins; 17 aircraft, including a Commanche attack helicopter; and a 180ft yacht, the less-than-tastefully named SS Tits.
As well as having two speedboats on board – Nipple I and Nipple II – the yacht had 24-carat gold-plated fittings and lifts between the decks. Other stories emerged of his fondness for women with lifestyles as fast as his cars.
Prince Jefri had channelled much of Brunei’s oil and gas wealth into an investment company, Amedeo. His problems began when Amedeo, damaged by the economic crisis in Asia in 1997, collapsed, forcing the Brunei government to bail it out.
As part of the Prince’s out-of-court settlement with the BIA in 2000, he agreed to hand over £3 billion in assets, and 10,000 lots – from 16,000 tons of Italian marble to Mercedes-Benz fire engines – were sold at an auction in a “sale of the century”.
At one point, the Prince looked as if he might face contempt charges, but such moves have been dropped.
The lifestyle of the Sandhurst-educated Sultan, a friend of the British Royal Family, is hardly frugal either. He lives in a 1,788-room palace, with corridors of gilt and marble.
He has a love of polo and shares his brother’s fondness for top-of-the-range cars. Indeed, at one point in the 1990s, it was claimed that the Brunei royal family accounted for half of the sales of Rolls-Royces worldwide.
The Sultan, who, with an estimated fortune of £60 billion in 1990, was regarded as the world’s wealthiest person, does not hold back on gifts or parties: one of his daughters received an Airbus for her 18th birthday, while he hired Michael Jackson to perform at his own 50th birthday party 10 years ago.
Over the past fortnight, other cases in the appeal court had been cleared to allow the hearing to go ahead unhindered.
Rumours abound that the Sultan wanted the legal action out of the way before July 15, so that it did not tarnish his 60th birthday celebrations.
His Majesty Sultan Haji Hassanal Bolkiah is the 29th of his line, which dates back to the 14th century. He has ruled since 1967 and his current titles include prime minister, defence minister and finance minister.
Yet few pretend the Sultan, who is married with four sons and six daughters, is anything other than an absolute ruler in a country with a population of 350,000.
For the past two weeks, neither the Sultan nor his brother, who have not spoken for two years, were in court.
The judges, normally based in Hong Kong, sat beneath a giant photograph of the Sultan as they listened to evidence relating to Prince Jefri’s appeal against two earlier judgments from the chief justice of Brunei.
The first appeal was against a ruling last year that refused to allow Prince Jefri to have his case heard in a foreign court. His lawyers, led by James Lewis QC, argued that the legal system in Brunei was not sufficiently independent of the Sultan to allow the Prince a fair hearing.
In a second appeal, Prince Jefri’s lawyers were trying to overturn a ruling made earlier this year entitling the BIA to issue orders against Prince Jefri to enforce the terms of the settlement agreement he signed in May 2000, including the transfer of £3 billion of his assets to the BIA.
By the time it is over, the legal battle promises to be one of the most costly ever. Aides to Prince Jefri have estimated that the BIA’s legal fees, including those of Freshfields Bruckhaus Deringer, the Sultan’s London solicitors, could reach £200 million – a figure said to be “ridiculously high” by an adviser to the royal family. However, the final cost of the eight-year dispute could end up at between £250 million and £500 million.
Each side sees the dispute differently. Prince Jefri’s camp tries to portray the legal action as a vindictive act by the Sultan against his younger brother.
The Prince’s lawyers had earlier argued that the transfer of acquisitions from the BIA was lawful and undertaken with the approval of the Sultan.
The Sultan’s lawyers, however, claim he is personally detached from the dispute and that the legal action was forced on the BIA by Prince Jefri’s refusal to honour the settlement made six years ago.
“This is not simply a spat between warring brothers,” said an adviser to the royal family. “Prince Jefri has lost every substantive case and hearing since 1998 and his last hurrah is to say, ‘I can’t get a fair trial anyway’.”
The rulings from the appeal court are expected next month. Meanwhile, the royal family is fearful of the repercussions that the continued negative publicity surrounding the case will have on its allies in the West and its own people.
The US State Department, in its review of Brunei published in March, noted that there were “problems in the government’s human rights record, particularly in the area of civil liberties”.
Its concerns centred on the lack of democracy, arbitrary detention, discrimination against women and foreign workers, and constraints on freedom of speech.
The Sultan knows that he must retain the support of his people. In 1962, a full-scale rebellion in Brunei had to be suppressed by British troops.
The intervention, which led to a “state of emergency” that is ongoing, was before independence from Britain in 1984. If anything were to prompt a second revolt, the Sultan’s position would be even more precarious.