Lawyer Pawlu Lia has refused to tell a court whether he represented Joseph Muscat in an inquiry concerning the privatization of state hospitals.

The veteran lawyer told a court that he could not give a reply when asked whether he had assisted Muscat in an inquiry into Vitals Global Healthcare, the company that was given the privatisation contract. 

“As a lawyer, I cannot answer yes or no,” Lia told a court while testifying on Monday.

Lia was asked the question by lawyer Jason Azzopardi, who is representing NGO Repubblika in its bid to have Lia’s daughter-in-law, magistrate Nadine Lia, recused from a case involving Pilatus Bank.

Azzopardi claimed that Lia together with lawyer Charlon Gouder had filed an application to assist Muscat in the VGH hospitals inquiry. Madame Justice Audrey Demicoli allowed Azzopardi to ask the witness whether he had assisted Muscat. But the witness declined to reply. 

Repubblika has filed legal action to force police to press charges against top Pilatus Bank officials. That case was assigned to magistrate Lia, prompting the NGO to demand her recusal. 

The NGO wants magistrate Lia off the case due to her family ties to Pawlu Lia, who has represented Joseph Muscat, the Labour Party and other leading Labour figures in court. Lia was also responsible for drafting the terms of reference of the Egrant inquiry, which heavily implicated Pilatus Bank.

“How can Repubblika have faith in the magistrate’s impartiality when her father-in-law was still assisting Joseph Muscat in that (VGH) inquiry,” Azzopardi said in court on Monday. 

Lia told a court that he had only represented Muscat’s right-hand man Keith Schembri in one libel suit and “never in anything else”. 

Asked about the persons mentioned in Repubblika’s application to the police commissioner, Lia stressed that he had never spoken to, nor met nor had any personal knowledge or work relationship with any one of the five Pilatus officials.

Mehmet Tasli, Hamid Ghanbari, Luis Felipe Rivera were "just names" to him, he said, and Pilatus Bank owner Ali Sadr Hasheminejad was simply a person he “had seen on television.”

As for Antoniella Gauci, although a Maltese national, “as far as I know, I never met her, never had anything to do with her whatsoever,” said Lia, denying any connection “in the most absolute manner,” save for perhaps some chance encounter in the course of work. 

The lawyer insisted that he had not seen his daughter-in-law since Repubblika began its recusal case, which was also keeping him away from his grandchildren. 

He gave his own account of an incident in Valletta when he had bumped into Repubblika president Robert Aquilina. 

Lia said he had stopped after Aquilina appeared to “nod” in his direction. He recalled telling the activist: “Are you aware of me ever having done something wrong? Have I ever stolen or acted corruptly?” 

“Your clients harmed Malta,” Lia recalled Aquilina replying. 

Lia said he had never mentioned his daughter-in-law that day, insisting that it was Aquilina who had brought up the subject. 

“‘Let my family be.’ That was the gist. Because I’m aware of the fact that they are suffering simply because I’m Pawlu Lia.”

Earlier in the sitting, the court heard testimony from Aquilina. 

Testifying at length on Monday, Aquilina said the situation had gradually deteriorated as Repubblika’s  bid to have Lia removed from the case grew increasingly hostile. 

He noted how the magistrate had announced, in open court, that she had received an anonymous threat, and how her father-in-law had encountered him on a Valletta street and told him to “let his family be”. 

When cross examining the witness, State Advocate lawyer James D’Agostino pointed out that Repubblika’s request to prosecute mentioned only five former top officials at the now-shuttered bank, among them Ali Sadr. 

But no reference whatsoever was made to Keith Schembri or Joseph Muscat. 

Aquilina rebutted that when filing their original application, they had based themselves on the evidence at hand. 

Moreover, the magistrate handling the Pilatus inquiry had directed further criminal proceedings against “inter alia” (amongst others) the Bank itself, Ali Sadr and five other officials. 

Ali Sadr's bid for Keith Schembri help

Aquilina told the court how in June 2022 he had obtained some “very important” extracts from an inquiry into Pilatus Bank. 

In those extracts, court experts recommended seeking information from the US authorities or US correspondent banks about an alleged $1 million transaction involving Egrant, to see if the transaction took place. They also recommended examining the MFSA and FIAU’s supervision of the bank, Aquilina said. 

“I got those documents because someone felt that things were not being done as they should,” added Aquilina. 

Aquilina told the court of a paper trail showing how Ali Sadr had emailed Keith Schembri in 2016 after the MFSA had blocked his attempt to get approval for Pilatus to open a branch in London. 

The financial regulator had told the Iranian investor that the application would be paused until FIAU investigations into Pilatus were completed. 

In his email to Schembri, Ali Sadr expressed frustration and asked for his help. 

A few months later, Pilatus received a no objection letter to its plans for a UK branch, which it opened the following year. 

At the end of the sitting, the court directed both parties to make written submissions within three weeks. 

Judgment is expected in January. 

Lawyer Isaac Zammit also represented the State Advocate.