Mohammed Sarwar v Bilal Sarwar: High Court dismisses unfair prejudice petition over hotel business split

The High Court has dismissed an unfair prejudice petition brought by the parents and sister of a hotel businessman, ruling that documents purporting to divide the family's hospitality empire between the generations were genuine, and offering significant guidance on when a party may put a positive case of forgery at trial.

In Mohammed Sarwar & Ors v Bilal Sarwar & Anor [2026] EWHC 2104 (Ch), His Honour Judge Stephen Davies, sitting as a judge of the High Court in Manchester, considered a dispute over the Cambridge Hotel in Huddersfield and the Ibis Hotel in Bradford, businesses built up over decades by Mohammed Sarwar and his wife Robina. Their younger son, Bilal, had worked in the business almost continuously since leaving school and became, the judge found, the only realistic successor capable of running it. His siblings' involvement was more limited, one having struggled with addiction and the other having left to run a separate guest house.

The petition centred on events of 11 August 2025, when Bilal says his father finally agreed, after years of mounting pressure, to divide the business: Bilal would take full ownership of the company running the Cambridge Hotel, while his parents would take full ownership of the company holding the Ibis Hotel. Bilal relied on a signed Share Swap Agreement, a stock transfer form and board minutes as recording that agreement. His parents denied any such agreement had been reached and, after what the judge found was intense pressure from their other children once they learned what had happened, brought proceedings alleging Bilal had wrongfully appropriated their shares and excluded them from the business.

A significant portion of the judgement addressed a procedural dispute over how the authenticity of the documents could be challenged. The parents had not pleaded a positive case that their signatures were forged or that the documents had been fraudulently produced after the event, merely declining to admit their authenticity. When they sought, on the first day of trial, to amend their case to allege the signatures had been electronically copied and pasted, the judge refused permission, citing the lateness of the application and the prejudice to Bilal in preparing to meet it. Drawing on the reasoning in Lemos v Church Bay Trust Company Limited and Redstone Mortgages Ltd v B Legal Ltd, the judge held that a party cannot advance an unpleaded case of forgery through the back door of simply declining to admit a document's genuineness, and that doing so deprives the opposing party of a fair opportunity to respond.

Having ruled out forgery as an available finding, and having also carried out a full evidential assessment in case that ruling was wrong, the judge concluded on the balance of probabilities that the documents were authentic, describing the more plausible explanation as being that the parents had signed the agreement under pressure but subsequently, influenced by their other children, persuaded themselves it had never happened. Expert handwriting evidence provided moderate support for the genuineness of the signatures, while IT evidence proved inconclusive.

The judge also dismissed a separate claim by the sister for the return of a 25 per cent shareholding she had transferred to Bilal's wife in 2022, finding no evidence her transfer had been agreed as temporary or that any legal basis existed for reversing it. The petition was accordingly dismissed in its entirety, with Bilal entitled to declaratory relief confirming the validity of the share transfers.