JSC BTA Bank v Mukhtar Ablyazov
| Jurisdiction | England & Wales |
| Judge | Mr. Justice Teare |
| Judgment Date | 21 June 2011 |
| Neutral Citation | [2011] EWHC 1522 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: 2009 Folio 1099 |
| Date | 21 June 2011 |
[2011] EWHC 1522 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr. Justice Teare
Case No: 2009 Folio 1099
Stephen Smith QC and Tim Akkouh (instructed by Hogan Lovells International LLP) for the Claimant
Duncan Matthews QC, Nicholas PurnellQC, Thomas Grantand George Hayman (instructed by Stephenson Harwood) for the Defendant
Hearing date: 10 June 2011
On 16 May 2011 the Claimant ("the Bank") issued an application seeking the committal of the Defendant ("Mr. Ablyazov") for contempt of court. This application was made in the context of the series of claims which the Bank has brought against Mr. Ablyazov. 1 The application notice cited some 35 allegations of contempt.
Pursuant to a suggestion made by me on 24 May 2011 that the allegations would have to be limited in number for case management reasons the Bank has reduced the number of allegations of contempt which it requests to be heard, in the first instance, to 23.
On 10 June the Bank sought directions for the hearing of the contempt application. In particular, the Bank sought an order that the 23 allegations be heard in late September/early October 2011 over a period of 8 days. It was submitted on behalf of Mr. Ablyazov that the contempt allegations could not be heard until after the trial of the Drey, Chysopa and Granton actions which have been fixed for a long hearing commencing in November 2012 and the trials of the AAA Proceedings and the Paveletskaya Proceedings. Several points were made in support of this submission.
They included: a contempt hearing would prevent Mr. Ablyazov from being able to prepare for the trial of the action, the credibility of Mr. Ablyazov will be at issue on the contempt application and it is better that it be assessed at the trial of the actions, and the contempt application raises issues which will also arise in the trial of the actions which should be determined at trial and not on a contempt application.Although I was only asked to give directions for the hearing of the contempt application the directions hearing lasted a whole day and counsel referred me to several authorities. A more formal judgment is therefore required than would be usual on a directions hearing but in view of the need to make my decisions known to the parties as soon as possible I shall express my views shortly. I have however endeavoured to consider all of the matters mentioned to me by counsel in their written and oral submissions
The number of allegations to be tried and when
Where allegations are made that a freezing order has been breached the claimant may bring a contempt application as a means of putting pressure on the defendant to comply with the freezing order; see Dadourian Group International Inc. v Simms [2007] 1 WLR 2967 paras.16–18 and 38. For that reason it will usually be appropriate to determine the contempt application promptly and before the trial of the underlying action, though the interests of fairness might sometimes require that it be determined after the trial; see para.25.
In the present case directions have been given for the trial of the Drey, Chrysopa and Granton actions to commence in November 2012. Those directions (set out in an order of some 8 pages) were given after a CMC lasting two days and involving several other parties not involved in the contempt application. It would be undesirable to disrupt those directions by ordering that a long contempt hearing involving many allegations should take place during the period when the parties should be preparing for the trial of the actions. Furthermore, although Mr. Ablyazov has, as has been demonstrated by the number of leading counsel instructed on his behalf, no shortage of funds he is a personal defendant who, I am told, speaks no or very little English. In order to take instructions from him documents must be translated into Russian and his instructions must be given through an interpreter. There are many matters arising from the several actions which have been commenced against him which require his attention and I am mindful that the burden of dealing with those many matters should not be such that he may not receive a fair trial either of the contempt application or of the actions themselves or both. It was for this reason that I suggested that the number of allegations of contempt should be limited.
At the hearing on 10 June I suggested that the contempt hearing should be restricted to 3 allegations; one of a failure to disclose, one of a failure to tell the truth on oath and one of a wrongful dealing with assets. In response the Bank suggested that, if the number of allegations should be further reduced from 23, the contempt hearing might be limited to 7 allegations.
If the purpose of bringing an application for contempt of a freezing order is to bring pressure on the defendant to comply with the freezing order it seems to me that that pressure will be brought by an application limited to 3 allegations as much as by one which extends to 7 or 23 allegations. The pressure is the threat of a prison sentence of up to two years. The Bank said that I must bear in mind that relief other than a committal for contempt is also sought and for that reason the number of allegations could not be cut down in the manner I suggested. However, if further injunctive relief is required to enforce the freezing order such relief can be sought by a further application pursuant to section 37 of the Senior Courts Act 1981. Such relief does not necessarily require a contempt application.
I therefore...
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