Fortior Law represents the successful respondents in the High Court in London against Bank GPB International S.A., a subsidiary of Moscow’s Gazprombank (the “Bank”), in the Bank’s application for summary judgment. Judgment was handed down by Mrs Justice Moulder on 24 March 2022 in the case Integral Petroleum S.A. & Ors v Dun & Ors [2022] EWHC 659 (Comm).
Background
A dispute arose under and in terms of an Uncommitted Commodity Finance Facility (the “Facility Letter”) for the maximum amount of US$35,000,000 entered into by the Bank and Integral Petroleum S.A., the First Claimant in this case (“Integral”). Integral’s obligations thereunder were guaranteed by several agreements (the “Guarantees”), signed by each of the Second to Sixth Claimants.
GPB sought payment from Integral of around US$ 25 million in respect of what it claimed were outstanding debts under the Facility Letter. It also claimed the same from the Second to Sixth Claimants under their respective Guarantees.
Integral opposed payment for various reasons, among them that (i) the Bank committed fraud and unlawful means conspiracy by taking several steps in its attempts to destroy and appropriate Integral’s business for itself, and (ii) the Bank had agreed an extended repayment plan which meant that Integral had not defaulted on the Facility Letter.
The Bank filed an application for summary judgment on 9 June 2021 (the “Application”), asserting that Integral was already in default when the alleged conspiracy took place. The main issue for the purposes of the Application was therefore whether an agreement on the extended repayment plan had been reached, though the respondents to the Application (i.e. the Claimants) also raised various other defences such as the right to set-off any debts allegedly due to the Bank against damages suffered by them as a result of the Bank’s conduct, and the principle that the bank could not rely on its own wrong-doing in order to pursue its counterclaim (known under English law as the prevention principle).
The Relevant Test
In order for the Application to succeed, the Bank had to prove that:
i. the Claimants had no real prospect of succeeding on the claim or issue or that the Claimants had no real prospect of successfully defending the claim or issue; and
ii. that there was no compelling reason why the case or issue should be disposed of at a trial.
Judgment
Dismissing the Application, Moulder J referred to Easyair v Opal [2009] EWHC 339 (Ch), which set out the requirements for the relevant test to be met in greater detail and which itself referred to further existing authority. In brief, her learned view was that:
i. the factual and witness evidence before the Court for the purposes of determining the Application was inconclusive and contradictory, and cross-examination of the witnesses would serve to clarify matters and establish the true position;
ii. there was evidence that the Bank chased Integral for repayments in accordance with the repayment schedule which the Claimants said was agreed, which did not support the bank’s position, and therefore the Claimants’ position was not ‘fanciful’;
iii. there was a realistic prospect of the Claimants establishing that there was a representation by the Bank that the amendment to the Facility Agreement was valid notwithstanding its informality; and
iv. as the Bank had failed to establish that the Claimants had no reasonable prospect of succeeding on their defence to the counterclaim based on the foregoing, the Court did not need to examine the Claimants’ alternative defences concerning set off and the prevention principle.
The respondents were represented by Christopher Hancock QC and Angharad Parry of Twenty Essex Chambers (instructed by solicitors from Fortior Law and Thomas Miller Law), while the Bank’s legal counsels were Michael McLaren QC and Gillian Hughes of Fountain Court Chambers (instructed by Sherrards Solicitors).
