JSC VTB Bank (a Company Incorporated in Russia) v Pavel Valerjevich Skurikhin and Others
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Gloster, DBE,Mrs Justice Gloster |
| Judgment Date | 08 November 2012 |
| Neutral Citation | [2012] EWHC 3116 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: 2012 Folio 1105 |
| Date | 08 November 2012 |
[2012] EWHC 3116 (Comm)
Mrs Justice Gloster, DBE
Case No: 2012 Folio 1105
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Rolls Building
7 Rolls Buildings, London EC4A 1NL
Tim Penny Esq (instructed by PCB Litigation LLP) for the Claimant
Adam Tolley Esq (instructed by Wedlake Bell LLP) for the First Defendant
Ms. Elizabeth Weaver (instructed by Charles Russell LLP) for the Second and Third Defendants
Hearing dates: 3 rd and 4 th October 2012
Approved Judgment
Introduction
On these applications, the claimant bank, JSC VTB Bank ("VTB"), seeks the following relief against the three defendants to the action, respectively the First Defendant, Pavel Valerjevich Skurikhin ("Mr. Skurikhin"), the Second Defendant, Pikeville Investments LLP ("Pikeville"), and the Third Defendant, Perchwell Holdings LLP ("Perchwell") (collectively, "the Defendants"):
i) by an application notice dated 5 September 2012, the disclosure by each of Mr. Skurikhin, Pikeville and Perchwell of the further information and documentation, as set out in schedule C to the draft order annexed to the application notice ("Schedule C"), in relation to their asset disclosure made pursuant to a without notice injunction granted by Hamblen J on 16 August 2012;
ii) by an application notice dated 12 September 2012 permission to enforce the freezing order injunction granted by Hamblen J (and continued thereafter as set out below) against the assets of Pikeville in Italy.
VTB also issued an application against Perchwell dated 21 September 2012 for permission to enforce the freezing order injunction granted against Perchwell in respect of assets which it held in Cyprus. Perchwell ultimately agreed that this application should be dealt with at the hearing on 3 October 2012. Thus, it was for the Court to decide what was to happen to that application.
The parties
VTB is a state-owned bank registered under the laws of Russia, and, according to the evidence, is the second largest bank in Russia.
The First Defendant, Mr. Skurikhin, is a Russian national who is resident in Russia. He is the founder and apparent controller of a group of companies called the Siberian Agrarian Holding Group ("SAHO"), which he established approximately 12 years ago. SAHO is a large group with a complex corporate structure. It operates in a variety of agricultural businesses including: pesticide production, grain production and processing, bread baking in sales, and the manufacture of bread-making machinery.
Between 2007 and 2009 VTB made a number of substantial loans to various SAHO group companies. The evidence shows that the loans were guaranteed personally by Mr. Skurikhin. His guarantees were first given in 2009 and replaced with fresh guarantees in March 2010. Other companies within the group also provided guarantees and security. In the action VTB contends that there have been defaults in relation to at least 18 of the loans.
Between December 2011 and February 2012, VTB brought proceedings in Russia against the borrowers and corporate guarantors in respect of 18 of the loans. The total sum claimed was equivalent to approximately £12.7 million. To date, judgments had been obtained against various borrowers in respect of certain of the 18 loan agreements; according to VTB's evidence, none of these judgments has been satisfied. Between 18 May 2011 and 7 November 2011, VTB gave notice of demand to Mr. Skurikhin in respect of 18 of his personal guarantees. On 7 July 2012, and thereafter, VTB started proceedings in Russia against Mr. Skurikhin in respect of certain of the guarantees. On 20 September 2012 judgment was obtained in Russia against Mr. Skurikhin on one of the guarantee claims in a sum equivalent to approximately £600,000. However, as at the date of the hearing before me, no reasons had been given by the Russian court. The Russian law evidence before me was to the effect that the judgment was not enforceable, pending a 30 day period for an appeal and, in the event of an appeal, pending the outcome of the appeal. Mr. Skurikhin apparently intends to appeal the judgment.
The Second Defendant, Pikeville, is a limited liability partnership ("LLP") which was incorporated in England and Wales on 10 December 2002. The Third Defendant, Perchwell, is an LLP which was incorporated in England and Wales on 8 May 2007. Their designated members are a Mr. Meier and a Mr. Lerch (two Swiss individuals resident in Switzerland) and their other member is a limited company incorporated in Hong Kong (and apparently connected with Messrs Meier and Lerch) called Crown Capital Holdings Limited ("Crown"). VTB claims that Mr. Skurikhin is the ultimate beneficial owner of, or at least has a controlling interest in, Pikeville, Perchwell and Crown.
The evidence established that Pikeville owns a number of Italian properties registered in the Bologna Land Registry ("the Italian Properties") and that Perchwell is the registered holder of 100% of the issued share capital of Tunnelson Holdings Ltd ("Tunnelson"), a company incorporated under the laws of Cyprus, and that Tunnelson, in turn, was the holding Company some of the companies in the SAHO group.
The procedural background to these applications
On 16 August 2012, on a without notice application, Hamblen J granted the following relief pursuant to section 25 ("s25") of the Civil Jurisdiction and Judgments Act 1982 ("the Act") in support of the substantive proceedings between VTB and Mr. Skurikhin in Russia:
i) a freezing injunction restraining Mr. Skurikhin from removing from England and Wales, or in any way disposing of, dealing with, or diminishing the value of, any of his assets in England and Wales up to the value of £10 million; the injunction applied to all of his assets whether or not they were in his own name, and whether they were solely or jointly owned by him, and whether he was interested in them legally, beneficially or otherwise; such assets included "any asset which he has the power, directly or indirectly, to dispose of or deal with as if it were his own" and that he was to be regarded "as having such power if the third party holds all controls the asset in accordance with his direct or indirect instructions"; the injunction expressly included:
a) his "interest and/or rights in [Pikeville] and [Perchwell]"; and
b) any and all indebtedness due to him by Pikeville.
ii) worldwide freezing injunctions against Pikeville and Perchwell respectively restraining them from disposing of, dealing with or diminishing the value of any of their assets wherever held, up to the value of £10 million; the injunctions expressly applied to Pikeville's interest in the Italian Properties and Perchwell's "shareholding in Tunnelson"; the order included a similar definition of "assets" as that applying to Mr. Skurikhin as set out above;
iii) disclosure orders requiring:
a) Mr. Skurikhin to disclose his assets within this jurisdiction, "whether in his own name or not and whether solely or jointly owned, giving the value, location and details of all such assets";
b) Pikeville and Perchwell to disclose their assets worldwide in similar terms;
c) Pikeville to provide the identity of the creditor referred to in its financial statements for the year ended 31 December 2010 as being due the sum of approximately €19 million; and
d) all three defendants to provide the identity of "… the person or persons who they contend exercise ultimate beneficial control over [Pikeville] [and Perchwell]".
The order included standard provisions for living expenses and enabling Pikeville and Perchwell to deal with, or dispose of, their assets in the ordinary and proper course of business, subject to an obligation to inform VTB's solicitors in respect of the disposal of, or dealing with, assets in excess of £15,000 in value.
I was informed by Mr. Tim Penny, counsel for VTB, that the basis on which VTB obtained the injunctions from Hamblen J was that there was at least a good arguable case that Mr. Skurikhin was the beneficial owner and controller of Pikeville and Perchwell and that, accordingly, any judgment which VTB might obtain against Mr. Skurikhin in Russia would be enforceable (save possibly for any 'penalty' element of such judgments) "… against Mr. Skurikhin's interest in Pikeville and Perchwell and thereby against the assets of both Pikeville and Perchwell."
On 16 August 2012, Hamblen J also gave permission to serve Mr. Skurikhin outside the jurisdiction in Russia and made provisions for alternative service on Mr. Skurikhin. The Claim Form and other documentation were served on Mr. Skurikhin, Pikeville and Perchwell on 22 August 2012. Wedlake Bell LLP, solicitors ("WB"), were instructed on behalf of Mr. Skurikhin and Charles Russell LLP, solicitors ("CR"), were instructed on behalf of Pikeville and Perchwell. At all material times, PCB Litigation LLP, solicitors ("PCB"), were the solicitors instructed by VTB.
Pursuant to Hamblen J's order, the Defendants served disclosure information by letters from each of WB (for Mr. Skurikhin) and CR (for Pikeville and Perchwell) dated 29 August 2012. By letters dated 30 August 2012 to both WB and CR, PCB sought further disclosure of material information and documentation from the Defendants in connection with the responses to the asset disclosure information. On 5 September 2012, the Defendants served affidavits verifying their asset disclosure. Certain further...
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