Alexander Gorbachev v Andrey Grigoryevich Guriev
| Jurisdiction | England & Wales |
| Judge | Mr Justice Jacobs |
| Judgment Date | 20 July 2022 |
| Neutral Citation | [2022] EWHC 1907 (Comm) |
| Docket Number | Case No: CL-2020-000358 |
| Court | Queen's Bench Division (Commercial Court) |
| Year | 2022 |
and
[2022] EWHC 1907 (Comm)
Mr Justice Jacobs
Case No: CL-2020-000358
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Paul Stanley QC and Mark Belshaw (instructed by CMS Cameron McKenna Nabarro Olswang LLP) for the Claimant
Richard Dew (instructed by Forsters LLP) for the 1 st Respondent
Sam O'Leary (instructed by Enyo Law LLP) for the 2 nd and 3 rd Respondents
Hearing date: Wednesday 6 July 2022
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
A: Introduction
The Claimant in these proceedings wishes to obtain, pursuant to CPR 31.17, third party disclosure of certain documents which are held by the First Respondent, Forsters LLP (“Forsters”), a firm of English solicitors. Forsters allege that the documents are held on behalf of the Second and Third Respondents (“the Trustees”), that the Trustees were the only proper parties to the application under CPR 31.17, and that it would therefore be inappropriate to require Forsters to give disclosure.
By an order made on 11 April 2022 (“the Order”), HHJ Pelling QC granted permission to the Claimant, pursuant to CPR Practice Direction 6B, to serve the application for third party disclosure out of the jurisdiction. The basis of the Claimant's application was “gateway” (20) in Practice Direction 6B paragraph 3.1 (20). This provides:
“(20) A claim is made –
(a) under an enactment which allows proceedings to be brought and those proceedings are not covered by any of the other grounds referred to in this paragraph.”
HHJ Pelling QC also granted permission for the application to be served by alternative means pursuant to CPR 6.15, namely by delivery to Forsters' offices within the jurisdiction and by email to two addresses specified in the Order. Service was duly effected by those means on 12 April 2022.
The Trustees now apply to set aside the Order. The application gives rise to a number of issues.
Firstly, does an application under s.34 of the Senior Courts Act 1981 (the “SCA”) and CPR 31.17 fall within Practice Direction 6B, Gateway (20) or does the court have no ability to permit service of such an application outside the jurisdiction? Section 34 of the SCA is the statutory provision which enables a party to apply for disclosure from third parties within the context of existing proceedings, and CPR 31.17 contains the rules of court made in order to give effect to that provision.
Secondly, if the court does have jurisdiction, is this case one in which it is appropriate for the court to exercise its discretion to serve out?
Thirdly, was it appropriate to order service by alternative means?
The first question was recently considered by Cockerill J in Nix v Emerdata Ltd [2022] EWHC 718 (Comm) (“ Nix”). She concluded that the court had no jurisdiction. The Claimant contends that I should not follow the decision of Cockerill J in that regard and that the decision proceeded in the absence of relevant argument and citation of relevant authority.
The second question also arose in Nix, and Cockerill J's firm view was that, even if the court did have jurisdiction, applications for third party disclosure against overseas non-parties should follow the route of a letter of request to the relevant overseas court, rather than by way of a direct application served on the overseas party pursuant to CPR Part 6. The Claimant accepts that in many cases the letter of request route would be the appropriate route to follow. However, he contends that this is not an exclusive route, and that a direct application is appropriate in the present case bearing in mind, in particular, that the relevant documents are physically within the jurisdiction of the court in the hands of English solicitors, Forsters.
B: The factual background
The application arises out of a dispute between the Claimant and the Defendant (“Mr Guriev”), in respect of their interests in a valuable fertiliser business based in Russia and called PJSC PhosAgro (“PhosAgro”). That dispute is listed for a six-week trial commencing in January 2023.
Among the issues in the trial will be how and why Mr Gorbachev was financially supported (between 2004 and 2012) through two Cyprus Trusts which were created for his benefit and which are alleged to have been operated by Mr Guriev's close associates. Those trusts are the Gamini Trust (of which the Second Respondent is the trustee) and the Goaliva Trust (of which the Third Respondent is the trustee).
From 2006 onwards, the Trustees were advised by Forsters, a firm of English solicitors. As a result, Forsters have possession in this jurisdiction of documents which, on the Claimant's case, are likely to be relevant to those issues.
In 2021, the Claimant's solicitors (“CMS”) wrote to Forsters seeking disclosure of relevant documents. Negotiations continued between CMS and Forsters, while Forsters reviewed the documents in its files within the jurisdiction in order to determine whether it would be possible to provide the requested disclosure “with the agreement of our client”, said to be Ms Areti Charidemou as trustee of the Cyprus Trusts. Ms Charidemou has apparently instructed Forsters in relation to this issue at all relevant times. That agreement was not forthcoming and in August 2021 Mr Gorbachev issued an application seeking non-party disclosure from Forsters under CPR 31.17 and s.34 of the SCA (the “Original Application”).
The Original Application was listed for a hearing before HHJ Pelling QC on 11 April 2022 (the “11 April Hearing”). One point taken by Forsters was that no order could be made against them, because they held the documents on behalf of their clients, the Trustees. At the start of the hearing, the Judge invited the Claimant to consider joining the Trustees to the Original Application. The Claimant's primary position was that joinder of the Trustees was unnecessary and that Forsters remained the correct respondent. The joinder of the Trustees would, however, make argument on that point redundant. In response to the Judge's invitation, the Claimant applied orally and without notice for an order joining the Trustees to the Original Application (the “Amended Application”) and for permission to serve the Original Application and the Amended Application (together, the “Claimant's Applications”) on the Trustees out of the jurisdiction and by alternative means. That oral application was granted on the terms of the order and Mr Gorbachev issued an application notice on the same day.
On 12 April 2022, Mr Gorbachev served a copy of the Claimant's Applications and the Order on the Trustees: (i) by delivering them to Forsters' offices within the jurisdiction in accordance with paragraph 3(1) of the Order; and (ii) by email at the email addresses specified in paragraph 3(2) of the Order.
There have thereafter been various procedural debates. The upshot of them is that I am presently concerned only with the Trustees' jurisdictional objections, which have been advanced in writing and through the oral submissions of Mr O'Leary. The Claimant's principal argument, namely that the application can be made against Forsters in any event, has yet to be determined. Whatever the outcome of the present application, directions will need to be given for the future conduct of the substance of the CPR 31.17 application, whether against Forsters alone or against all respondents.
C: The legal framework
Section 34 SCA provides for applications by a party to proceedings (such as the Claimant in the present case) against a non-party. It provides:
“On the application, in accordance with rules of court, of a party to any proceedings, the High Court shall, in such circumstances as may be specified in the rules, have power to order a person who is not a party to the proceedings and who appears to the court to be likely to have in his possession, custody or power any documents which are relevant to an issue arising out of the said claim–
(a) to disclose whether those documents are in his possession, custody or power; and
(b) to produce such of those documents as are in his possession, custody or power to the applicant or, on such conditions as may be specified in the order…”
An earlier section of the SCA, section 33, provides for applications for pre-action disclosure against a prospective party to litigation, in circumstances where substantive proceedings have not yet been issued. Section 33, and its interplay with “gateway” (20) under Practice Direction 6B, was considered by Catherine Newman QC, sitting as a deputy judge, in ED&F Man Capital Markets LLP v Obex Securities LLC [2017] EWHC 2965 (Ch) (“ Obex”). That decision was referred to in the parties' arguments. It was also referred to, briefly, in Cockerill J's decision in Nix. Obex and Nix are the only authorities which have directly considered sections 33 and 34 and their interplay with gateway (20).
The rules of court which were contemplated by Section 34 SCA are contained in CPR 31.17. These provide:
“(1) This rule applies where an application is made to the court under any Act for disclosure by a person who is not a party to the proceedings.
(2) The application must be supported by evidence.
(3) The court may make an order under this rule only where –
(a) the documents of which disclosure is sought are likely to support the case of the applicant or adversely affect the case of one of the other parties to the proceedings; and
(b) disclosure is...
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