Akcine Bendoré Bankas Snoras (in Bankruptcy) v (1) Mr Vladimir Alexandrovich Antonov (2) Mrs Olga Yampolskaya (Defendant/Applicant)

A. Introduction

There is before the court today an application for relief against sanctions made by Mrs. Olga Yampolskaya ("the applicant") pursuant to CPR rule 3.9.

The sanction imposed was the striking out of her appeal against the registration of two judgments (of 20 ^th March 2014 and 19 ^th June 2014) obtained in the courts of Lithuania against her. These judgments are for sums of approximately £10 million plus interest and costs, and were made in favour of AB Bankas Snoras ("the respondent").

B. The judgments Regulation: Council Regulation 44/2001

The respondent has attempted to register these judgments under the terms of Council Regulation 44/2001 ("the Judgments Regulation"). This Regulation applies to judgments given before 10 ^th January 2015.

There are three provisions of the Judgments Regulation of particular relevance to the facts of the present case.Article 33(1) of the Judgments Regulation states:

"A judgment given in a Member State shall be recognised in the other Member States without any special procedure being required."

Article 36 addresses the power and jurisdiction of the foreign court to review the merits of the court delivering the judgment in issue. It provides as follows:

"Under no circumstances may a foreign judgment be reviewed as to its substance."

Article 34 defines circumstances where a judgment shall not be recognised, and in particular Article 34(1) states:

"A judgment shall not be recognised:

1. if such recognition is manifestly contrary to public policy in the Member State in which recognition is sought;

Subparagraph 2 provides that a judgment shall not be recognised where it was given in default of appearance. That provision then goes on to elaborate upon what is meant by "in default of appearance".

Recitals 16 and 17 of the Judgments Regulation explain the policy and purpose underlying the recognition provisions. Recital 16 emphasises that:

"Mutual trust in the administration of justice in the [European] Community justifies judgments given in a Member State being recognised automatically without the need for any procedure except in cases of dispute."

Recital 17 makes an important point about the efficiency of the recognition procedure that should apply. It states as follows:

"By virtue of the same principle of mutual trust, the procedure for making enforceable in one Member State a judgment given in another must be efficient and rapid. To that end, the declaration that a judgment is enforceable should be issued virtually automatically after purely formal checks of the documents supplied, without there being any possibility for the court to raise of its own motion any of the grounds for non-enforcement provided for by this Regulation."

It is an important principle relevant to the facts of the present case that this court is required under EU law to trust the courts of Lithuania. The practical effect of this is that, prima facie, I have no power to go behind the findings of the Lithuanian courts.

C. The judgments sought to be registered

In the present case there are two judgments of Lithuanian Courts which are sought to be registered. I need to say a little about the first set of proceedings in particular. On 20 ^th March 2014, the Lithuanian Court entered judgment against the applicant. However, the applicant now says that the hearing leading to this judgment occurred without her knowledge and presence, and without her involvement. She says that she was not represented. She appealed that judgment and on 6 ^th May 2015 the Vilnius Regional Court rejected the appeal relying upon two mandates said to establish that the applicant gave authority to lawyers to act on her behalf in the court below. I have seen a full translation of the judgment, which treats those mandates as valid and effective. The applicant's application, therefore, to set aside the first judgment failed. I now understand that the applicant has appealed yet again the judgment of the Vilnius Regional Court of May 2015, alleging the mandates in question to be forgeries. She refers to a ruling of a court in Russia, which has found that mandates ostensibly signed by her were, in fact, forgeries. No one before me has been able to provide details of the latest appeal in Lithuania, or when it will be heard or decided.

I should add, for the sake of completeness, that the applicant makes a similar complaint about the second Lithuanian judgment of 19 ^th June 2014. However, she has not appealed that judgment.

D. A summary of the background facts

The applicant is married to Mr. Vladimir Antonov. He was a former director and shareholder of the respondent bank. It is said by the respondent that he was one of a small number of individuals who exercised effective control over the bank. In November 2011 Mr. Antonov was arrested in London by the Metropolitan Police. I am informed that this was at the request of the authorities in Lithuania. They alleged serious financial irregularities at the bank. In December 2011 the bank was put into the bankruptcy process by the Lithuanian Court.

The English High Court in May 2012 granted to the administrator of the bank a worldwide freezing injunction against Mr. Antonov, the relevant sum was in the order of €482 million.

In January 2014 Magistrates at Westminster Magistrates' Court ordered the extradition of Mr. Antonov to Lithuania. He now stands accused in the Lithuanian courts of various counts of fraud. Proceedings have been commenced in the High Court (Commercial Court) by the respondent's bank, through its administrator, against Mr. Antonov and his business partners. These are now stayed pending determination of extradition proceedings. It is apparent from the evidence before me that the applicant still seeks the advice and assistance of her husband, Mr. Antonov, in relation to matters concerning litigation.

I turn now to the specific judgments in issue in these proceedings. I have already observed that in March and June 2014 the Lithuanian Court delivered two judgments against Mr. Antonov, the applicant and various others for sums approximating to €10 million plus interest and costs, and that the court has subsequently rejected arguments on behalf of the applicant as to the effectiveness of the authority she gave to the relevant lawyers acting for her in these proceedings. Both of these judgments were the subject of a registration order on the part of the High Court on 12 ^th December 2014. An interim charging order was made over property belonging to the applicant on 19 ^th December 2014. The registration order was served on the applicant on 23 ^rd December 2014 which gave the applicant until 23 ^rd January 2015 to lodge an appeal. However, on 19 ^th January 2015, Mishcon de Reya (acting for the applicant) contacted Linklaters (acting for the bank) contending that service had not been properly effected. The bank agreed to make an appointment on the evening on 22 ^nd January 2015 to re-serve the registration order. Subsequently, the applicant filed her appeal on 6 ^th February 2015. Evidence before the court in the form of a letter from HMCTS required the applicant to file her appeal bundle by 16 ^th March 2015. As I understand matters at this stage the applicant was acting as a litigant in person.

On 13 ^th February 2015, the bank's solicitors, Linklaters, wrote to the applicant. In that letter Linklaters set out reasons why, in their view, her appeal was misconceived. However, they suggested to the applicant that she consult a Citizens Advice Bureau; they also gave a website reference for the organisation. She was directed to her email box where she would find official guide books for litigants in person. There is no dispute between the parties but that contained within such documentation are the usual exhortations to litigants in person to be aware of and comply with court timetables. Nonetheless, the applicant failed to file a bundle by 16 ^th March 2015 as required. An 'unless' order was made on 26 ^th March 2015 requiring the filing of a bundle by 1 ^st April 2015. She failed to comply.

The applicant, in a second witness statement, has explained what occurred at that point. In paras. 11 and 12 of her statement the applicant says as follows:

"11. My first witness statement, in particular paragraphs 14 to 16 thereof, explains the confusion which led to my failing to lodge an Appeal Bundle in time and, therefore, my appeal being struck out. By way of further explanation and clarification, I recall that I received a voicemail message that day on my mobile telephone from the Court about lodging a bundle by 4.00 pm that day. Having re-listened to the message for the purpose of producing this statement, it is now clear to me what is being said. However, at the time, I knew nothing about an obligation to lodge a bundle as I had not read the letter from the Court of 6 February 2015 but had just passed it to my husband. I understand from him that he too had overlooked the need to lodge a bundle. In any case, I knew that the hearing relating to the Interim Charging Order had, at one...