Keith Schembri, the Prime Minister’s chief of staff, avoided cross-examination about the once-secret offshore company 17 Black on Monday, as he dropped libel proceedings he had instituted against former Opposition leader Simon Busuttil.
In two hours of legal wrangling, Mr Schembri's lawyers first asked for Magistrate Victor Axiaq to recuse himself on the grounds that he had once represented him and his financial advisors Nexia BT.
When that request was turned down, Mr Schembri then asked not to give testimony on Monday, as the subject was already being probed in a separate magisterial inquiry.
When the court ordered that he would indeed face cross examination, Mr Schembri dropped the case from the witness stand.
17 Black was identified in a leaked e-mail authored by Mr Schembri’s financial advisers as the main source of income for Tillgate, his once-secret Panama company.
What was the libel suit about?
The libel suit concerned a speech Dr Busuttil had given during a protest rally in March 2016, shortly after blogger Daphne Caruana Galizia had revealed that both Mr Schembri and minister Konrad Mizzi had set up secretive offshore structures while in office.
In that speech, Dr Busuttil had told a crowd that people in their positions only set up such structures if they were corrupt.
'I'm not scared at all' - Schembri
Following his court appearance on Monday, Mr Schembri was taken by car to the Office of the Prime Minister in Castille, where he told waiting journalists that he was "not scared at all".
"I took legal advice and will say what I have to say in the magisterial inquiry," he said.
Mr Schembri subsequently issued a statement in which he said that the libel case was "is no way" tied to 17 Black and that he had withdrawn the case reluctantly as he did not want to risk prejudicing his own rights in separate magisterial inquiries.
In a statement, the Nationalist Party said that Mr Schembri should resign or be fired immediately.
Civil society group Repubblika also called for him to quit, saying that "while every citizen has the right to refuse to testify to avoid self-incrimination, a political figure who chooses to do so must resign immediately".
MP Simon Busuttil - the man Mr Schembri was suing - was unequivocal.
"This country cannot continue being run by a corrupt gang which has now even admitted that it is corrupt," he told Times of Malta.
The Labour Party, on the other hand, said that it was ironic how PN MPs who were so quick to attack the judiciary had been so keen to appear in court.
Blog: As it happened
Schembri withdraws the libel case
11:05am: As the lawyers agree that the case can continue, Dr Gatt interrupts the magistrate before he has a chance to rebuke Mr Schembri. The lawyer says since his client’s fundamental rights are being prejudiced and since he is still collaborating with judicial authorities in separate proceedings involving connected issues, at this stage he wants to avoid that magisterial inquiries be conducted here and is formally withdrawing his libel.
What's the statement all about?
10:59am: If you're wondering what the DOI statement Dr Azzopardi is referring to is all about, you can read it here. Back in 2018, Mr Schembri had said 17 Black and another company MacBridge were part of "draft business plans for my business group as potential clients".
Another brief adjournment
10:56am: Magistrate Axiaq was just about to hand down a ruling on the matter as Dr Gatt requests a short suspension for lawyers to consult. The court grants an adjournment, “but no later than 11:00am”.
Schembri ordered to answer questions or else
10:53am: Magistrate Axiaq orders Mr Schmebri to answer the question, however he again refuses. The magistrate then tells him that unless he answers, he will face sanctions. Dr Gatt chimes in saying this line of questioning touches upon the ongoing inquiry. And, Magistrate Axiaq again insists that Mr Schembri must answer, but the chief of staff says that he will follow his lawyer’s advice.
'Why did you issue this press release?'
10:49am: Dr Azzopardi asks Mr Schembri why he had issued the 17 Black statement to which the PM’s right hand man says: “I have advice from lawyers not to answer any questions linked to ongoing inquiries”.
Schembri won't incriminate himself
10:47am: Mr Schembri is shown a copy of the DOI press release, and Dr Lia tells the court that Mr Schembri will not answer any questions linked to any ongoing inquiries. The magistrate intervenes and says the questions should be put to him and then he may choose not to answer if he wishes. Dr Lia, however, argues that this too would be tantamount to giving away incriminating information.
Jason Azzopardi asks first question
10:39am: Lawyer and Opposition MP Jason Azzopardi is first to ask questions of Mr Schembri. He refers to an official government press release issued by Mr Schembri on the matter of 17 Black. This prompts an immediate objection from Prime Minister Joseph Muscat’s lawyer Paul Lia, who says this is not proper procedure. The objection is turned down.
A short pause
10:38am: A brief pause in proceedings as Magistrate Axiaq is handling a whopping 19 libel suits filed by businessman Silvio Debono against the late journalist Daphne Caruana Galizia. These were meant to be heard at 10am today but have had to be adjourned.
Schembri takes the stand
10:34am: Mr Schembri has taken the witness stand to face cross-examination. He tells the court that he will answer questions without prejudicing his rights and any other proceedings. Magistrate Axiaq warns that this is a court of law. “I don’t want political meetings in here," he says.
Request denied, cross-examination to go ahead
10:31am Magistrate Axiaq walks back into the room and says that at this stage the court has denied Mr Schembri’s request. Cross-examination will go ahead. The magistrate urges all the parties involved to inform the court as to any constitutional cases. Dr Gatt had earlier informed the Court that Mr Schembri would be seeking Constitutional measures to protect his rights.
A brief adjournment
10:14am: Magisrate Axiaq has retired to his chambers for a few minutes to consider the arguments made.
Schembri wants to appeal order to testify
10:07am: Dr Gatt tells the court room that he wishes to appeal the magistrate's decision, insisting his client should be given leave to appeal from the decree. Mr Schembri should be free to fight for his right to refuse cross-examination and not to risk possible self-incrimination in other ongoing inquiries.
Schembri's request to suspend cross-examination is denied
10:03am: The court denies Mr Schembri’s request not to be cross-examined today, with Magistrate Axiaq saying a similar request had been made earlier on in these proceedings and it had been turned down by a previous magistrate back in 2018.
Those inquiries are secret, says Busuttil
9:59am: Dr Fenech argues that the magisterial inquiries were secret, and Dr Busuttil has no control on Mr Schembri’s testimony in that inquiry, or any other witness, for that matter.
He says that today’s libel case has been pending for three years, put off for cross-examination for over one year.
Schembri has not testified before all inquiring magistrates yet
9:55am: Dr Gatt says that three magisterial inquiries are looking into the subject matter of today’s proceedings. Mr Schembri has already testified in some of these inquiries but not in all of them. He insists that he had been the one who had filed the libel case being heard today and he has every intention of seeing it through.
Schembri asks not to testify today
9:48am: Dr Gatt asks that his client does not undergo cross-examination today. He says that as decreed by other courts, a party has a right not to testify pending other ongoing proceedings. This right is also safeguarded in the Constitution, he says. In a nutshell: Mr Schembri is asking that he first be allowed to testify in another ongoing inquiry into the same subject matter.
Magistrate turns down recusal request
9:45am: Magistrate Axiaq tells the court room that in light of the reasons already mentioned, and past declarations by the Chief Justice on these matters, he has denied the request for him to stop hearing this case and orders its "immediate continuation". The Chief Justice had said, at the start of this forensic year, that a judge or magistrate is to decide upon a case and not abstain, unless valid reasons to do so are presented.
Legal services do not concern this case
9:44am: The magistrate says that the legal services which he had given to Kasco Ltd and accountancy firm mentioned by Dr Gatt had been given before 2010 and did not in any way concern the subject matter of this case.
Busuttil wants police commissioner informed
9:36am: Dr Fenech tells the court that whatever the decision taken by the magistrate, the court should report the "undue influence" placed on it, as it is obliged to do. Responding to this, the magistrate says that hours after receiving the recusal request, he had flagged the matter to President George Vella. Dr Fenech says it should also be reported to the police commissioner.
Schembri wants magistrate to step down
9:32am: Edward Gatt, Mr Schembri's lawyer, feels the magistrate ought to step down. He tells the court that back when he was a practicing lawyer, Dr Axiaq had represented Mr Schembri's financial advisors Nexia BT. Some of the questions to be put in this case concern the company's alleged involvement.
Busuttil has no objections to magistrate, Schembri consults lawyers
9:23am: Peter Fenech, assisting Dr Busuttil, thanks the magistrate for raising the issue and declares that he has no objection for the case to continue before him. Mr Schembri’s lawyers say that they will briefly consult their client before pronouncing themselves and leave the court room to discuss it. Silence hangs over the packed court room.
Magistrate asks parties to weigh in
9.20am: Magistrate Axiaq tells the court that he feels the parties to the case should pronounce themselves on the matter.
A request for the magistrate to step down from the case
9.17am: Magistrate Axiaq tells the court that he had recently been approached by a "third party" on behalf of one of the parties in the case, who asked the magistrate to recuse himself as he had once represented Mr Schembri when he was still a practicing lawyer.
And we're off
9.15am: Magistrate Axiaq has entered the room and the session is brought to order.
Schembri enters the room
9.05am: Keith Schembri has entered the packed court room, along with his lawyers Edward Gatt and Mark Vassallo. Simon Busuttil, assisted by lawyers Peter Fenech and Jason Azzopardi, is also in the court room as both parties wait for magistrate Victor Axiaq to get proceedings underway.
What is 17 Black?
The company had been named in leaked e-mails as one of two companies that would pay $2 million to Mr Schembri's and Konrad Mizzi's Panama companies.
A joint investigation by Times of Malta and Reuters revealed that 17 Black is owned by power station investor Yorgen Fenech.
Mr Schembri has acknowledged in an official government statement that he had "draft business plans" with the company.
Mr Schembri had tried to dodge cross-examination about 17 Black, arguing that the Dubai company was not in the public domain at the time Dr Busuttil made an allegedly libelous speech about Panama Papers corruption.
Here's everything that has happened in the 17 Black saga so far.