The Court of Appeal has strongly criticised Mr Justice Peter Smith over a ‘disgraceful’ and ‘worrying’ letter he sent to Blackstone Chambers – but dismissed allegations of bias.

The High Court judge, who last year had to recuse himself from a case against British Airways after he got into a dispute with the airline over lost luggage, had been accused of apparent bias for sending a letter to Blackstone Chambers following an article by Lord Pannick QC criticising the judge’s conduct.

But although the court ruled there was no apparent bias, it granted the appeal in Harb v Aziz on three separate grounds due to ‘serious’ shortcomings in the way the judge dealt with evidential issues.

The Court of Appeal also heavily criticised Smith (pictured) for his letter to Blackstone, saying it was ‘difficult to believe that any judge, still less a High Court judge’, could have written such a letter.

The letter, addressed to Anthony Peto QC, co-head of Blackstone, warned that Pannick’s article was ‘extremely damaging’ to the chambers within the Chancery Division, and said it was obvious that the chambers ‘takes but does not give’.

The letter emerged in an appeal against a judgment by Smith in which he awarded Janan Harb, the alleged ‘secret wife’ of the late King Fahd of Saudi Arabia, £25m after accepting her claim that Prince Abdul Aziz, Fahd’s son, had agreed a huge payout.

Master of the rolls Lord Dyson said it was a ‘shocking’ and ‘disgraceful’ letter to write. ‘It shows a deeply worrying and fundamental lack of understanding of the proper role of a judge. What makes it worse is that it comes on the heels of the baggage affair.’

The Court of Appeal also said the comments made in Pannick’s article, which said that the reputation of the legal system was damaged by Smith’s behaviour in the BA case, was justified.

Dyson said: ‘We greatly regret to have to criticise a judge in these strong terms, but our duty requires us to do so. But it does not follow from the fact that he acted in this deplorable way that the allegation of bias must succeed.’

The Court of Appeal said it was prepared to assume that a fair-minded observer would conclude, having seen the letter, that there was a real possibility the judge was biased against all 100 members of Blackstone Chambers, at least for a short period after Pannick’s article.

But it said that the fair-minded observer would not conclude that this would affect the judge’s determination of issues in a case where a party was represented by a member of Blackstone.

The court ruled that it was ‘unrealistic’ to suggest that Smith was motivated by bias against the prince, and said it was ‘fanciful’ to suggest that the judge would have made major changes to the assessment of the evidence simply as a reaction to the article, which was published after he heard the evidence.

But the court allowed the appeal on three separate grounds, concluding that Smith had not dealt fully with the evidence or explained how he had reached his conclusions. It ordered that the case be tried before a different judge. 

A spokesman for the Judicial Conduct Investigations Office said: ‘The JCIO investigation into the BA matter is continuing. If there is a finding against any judicial office-holder, a statement is published on the JCIO website.

‘Legal proceedings are separate from the JCIO process, but a matter connected to this appeal is under investigation by the JCIO.’