Mr. Ilya Zubarev v Ms. Ratna Singh

HEARING 23 July 2025

Judgment handed down remotely by sending to the parties and the National Archives at 10.00 on 3 September 2025

On 21 December 2022, following a trial before Mr Nigel Cooper KC sitting as a judge of the High Court in the London Circuit Commercial Court, King's Bench Division, judgment was entered for the claimants against the defendants for damages for fraudulent misrepresentation and for breach of warranty. The claims related to investments made by the claimants in Integrated Health Partners Limited (IHPL) by way of a subscription for shares. It was adjudged that the defendants should pay the first claimant US$632,001.00 and the second claimant US$948,000.00. An order of costs was made against the defendants on the indemnity basis. At the ‘consequentials’ hearing on 1 February 2023 the defendants were ordered to pay pre-judgment interest of US$110,271.19 in respect of the first claimant, US$142,037.62 in respect of the second claimant and further sums for post-judgment interest and an interim payment on account of costs of £506,571.14. The defendants' application to the trial judge for permission to appeal and a stay was refused. Permission to appeal was refused by Males LJ on 17 March 2023.

On 12 October 2023 ICC Judge Prentis struck out a petition brought by the defendants as petitioners under section 994 of the Companies Act 2006 and ordered that the defendants pay the claimants' costs (as respondents to the petition). On 14 December 2023 the defendants were ordered to pay £274,837.63 on account of the liability for costs.

On 10 April 2024 ICC Judge Burton dismissed an application made by the defendants to set aside a statutory demand and ordered the defendants to pay costs of £23,224.

The claimants took steps to enforce the judgment obtained in the London Circuit Commercial Court first by way of examination of the defendants pursuant to CPR rule 71 and subsequently, based upon the information obtained at the examinations, by way of third party debt orders (“TPDOs”) pursuant to CPR rule 72. The provisions of CPR rule 72 and Practice Direction 72, so far as material, are set out in an appendix.

On 10 July 2024 the claimants applied in form N349 (having slightly adapted the prescribed form) against the respondents Mattioli Woods PLC and Phoenix Life Limited which are both pension providers. Both defendants held a pension with Mattioli Woods PLC and the second defendant held a pension with Phoenix Life Limited (Phoenix). The terms of the second defendant's pension are governed by Standard Life Assurance Limited's rules because both Phoenix and Standard Life are subsidiaries of Phoenix Group Holdings PLC.

Paragraph 3 of each application stated:

“The third party is within England and Wales and owes money to (or holds money to the credit of) the judgment debtors or will owe money to the judgment debtors subject to an auxiliary order of the court.” [The words in italics are not in the prescribed version of Form N349.]

The applications were supported by a witness statement of Matthew Bunting (in materially the same form in the case of each third party) from the claimants' solicitors. The witness statement makes it clear that in addition to TPDOs the claimants were seeking an order “that the Defendants are to take any necessary steps to draw such benefit from the Third Party as they are entitled and/or for the solicitors for the Claimants to have authority to exercise those steps.” The power to make such an order arises under section 37 of the Senior Courts Act 1971 which provides that the court has power to “grant an injunction or appoint a receiver in all cases in which it appears to the court to be just and convenient to do so.”

The witness statement in the case of Mattioli Woods PLC referred to information obtained from the defendants' examination:

“10. The documents produced at the CPR Part 71 Hearings included valuation reports for pensions held with the third party, showing a portfolio of £142,383.99 as of 31 March 2024 for the First Defendant and a portfolio of £153,880.65 as of 31 March 2024 for the Second Defendant.

11. The documents further included Retirement Options Guidance Booklets dated July 2021 which respectively confirm that “benefits may be taken from your pension arrangements from age 55” and that “You can decide to draw the remaining fund out as one taxable lump sum… as much or as little as you like”, which crystallises the fund.

12. Consequently, I view it as likely that on the Defendants notifying the third party, a debt would arise between the third party and the Defendants.”

The wording of the witness statement supporting the application in respect of Phoenix Life Limited is similar:

“10. The documents produced at the CPR Part 71 Hearings included a valuation report for a pension held by the judgment debtor with the third party, showing a portfolio of £178,576.00 as of 29 February 2024.

11. The documents further included a letter from Standard Life Assurance Limited dated March 2022 which makes it clear that the judgment debtor has a right to draw down on all of the moneys within this pension, subject to any necessary applicable tax, and a letter from Standard Life Assurance Limited dated June 2023, which indicates that the pension was to be transferred to Phoenix Life Limited, indicating that these are the terms that apply to the present pension.

12. Consequently, I view it as likely that on the judgment debtor notifying the third party, a debt would arise between the third party and the judgment debtor.”

In view of the fact the claimants were seeking both a TPDO and what was described as an “auxiliary order” pursuant to section 37 of the Senior Courts Act 1981 (“section 37”), Master Davison listed the applications for an oral hearing on 4 October 2024. (In fact, in the case of Mattioli Woods, an order was made in error on the papers on 23 July 2024 and the application was heard de novo on 4 October 2024.)

Mr Digby, who appeared before me, represented the claimants and the defendants appeared in person. Their wide-ranging objections to the court making orders were dismissed with Master Davison describing their allegation of fraud or conspiracy involving court staff as “wild and implausible”. He granted interim TPDOs and the auxiliary orders which were served on the third parties. The hearing to consider whether the interim orders should be made final came back before Master Davison on 17 January 2025.

The orders made by Master Davison on 4 October 2024 relating to the Third Parties are in the same form. The order recites that:

“AND UPON the court having considered that it would be just and convenient to require the judgment debtor to take any and all necessary steps and execute any and all necessary documents to draw such benefit from the third party as the judgment debtor is entitled and that would give rise to a debt from the third party to the judgment debtor”

The operative terms of the order, so far as material, provides that:

“2. Until [the further] hearing the third party must not, unless the court orders otherwise, pay to the judgment debtor, or to any other person, any sum of money due or accruing due by the third party to the judgment debtor.

3. Subject to paragraph 4 below, not before 14 days and not later than 28 days from the date of this order, the judgment debtor shall take any and all necessary steps and execute any and all necessary documents to draw such benefit from the third party as the judgment debtor is entitled and would give rise to a debt from the third party to the judgment debtor.

4. Nothing in this order shall require the third party to act in breach of its regulatory obligations arising from its management and/or administration of the judgment debtor's pension scheme.

5. The solicitors for the judgment creditors are authorised to execute any necessary documents on behalf of the judgment debtor for the purposes of giving effect to and/or carrying out paragraph 3 of this Order.”

At the further hearing on 17 January 2025 the defendants appeared in person again and made an application for Master Davison to recuse himself which was dismissed. Mr Digby who again appeared for the claimants, in accordance with his duty to the court, drew attention to the decision of the Court of Appeal handed down on 15 November 2024 in Manolete Partners Plc v White [2025] 1 WLR 1065. Master Davison considered that the decision in Manolete v White was potentially relevant and directed that “the Applications” be transferred to the Chancery Division of the High Court and listed to be heard before Chief Master Shuman or such Master or judge as Chief Master Shuman nominated for consideration of the following issues:

Issue 1 — Whether each of the pensions held by the Defendants with the Third Parties is an occupational pension scheme within the meaning of s. 1 of the Pension Schemes Act 1993;

Issue 2 — Whether and to what extent, if any, the court ought to consider the protection afforded by s. 91(1) and (2) of the Pensions Act 1995 to occupational pension schemes when exercising its discretion over whether to grant a final interim third party debt order in respect of a personal pension scheme within the meaning of s. 1 of the...