Trafalgar Developments Ltd, Instantania Holdings Ltd, Kamara Ltd and Bairiki Incorporated v Dmitry Mazepin, OJSC United Chemical Company Uralchem, Uralchem Holding Plc, Eurotoaz Ltd, Andrey Gennadyevich Babichev, Yulia Bolotnikova, Belport Investments Ltd, Milko Emilov Minkovski, Androula Charilaou, Dmitry Konyaev and Yevgeniy Yakovlevich Sedykin

• Jurisdiction: Ireland
• Judge: Mr. Justice David Barniville
• Judgment Date: 24 March 2022
• Neutral Citation: [2022] IEHC 167
• Docket Number: [2016 No. 9981 P.]
• Court: High Court

(Challenge to Jurisdiction by UCCU Defendants)

Between

Trafalgar Developments Limited, Instantania Holdings Limited, Kamara Limited and Bairiki Incorporated

Plaintiffs

and

Dmitry Mazepin, OJSC United Chemical Company Uralchem, Uralchem Holding Plc, Eurotoaz Limited, Andrey Gennadyevich Babichev, Yulia Bolotnikova, Belport Investments Limited, Milko Emilov Minkovski, Androula Charilaou, Dmitry Konyaev and Yevgeniy Yakovlevich Sedykin

Defendants

[2022] IEHC 167

[2016 No. 9981 P.]

THE HIGH COURT

COMMERCIAL

JUDGMENT of Mr. Justice David Barniville delivered on the 24 ^th day of March, 2022

Index

A. Introduction	3
B. Decision on UCCU Defendants' Application: A Summary	9
C. Structure of Judgment	12
D. The Parties	13
E. Overview/Summary of Essential Elements of Plaintiffs' Case	15
F. Procedural History	21
G. UCCU Defendants' Jurisdiction Application	25
H. Preliminary Objections/Applications	26
I. Jurisdiction re Plaintiffs' Claim against Russian UCCU Defendants: Order 11 RSC	33
(1) General Observations	33
(2) Relevant Provisions of O.11	35
(3) Burden of Proof on Set Aside Application	36
(4) The Relevant Test/Standard of Proof	39
(5) Necessary or Proper Party	51
(6) Good Arguable Case on the Merits	58
(7) Act of State/Related Doctrines	64
(8) O. 11 r. 2 and r. 5: Proper Forum	72
J. Jurisdiction re Plaintiffs' Claim Against Holdings: Art. 8(1) Recast Brussels Regulation	95
(1) Relevant Provisions of Recast Brussels Regulation	96
(2) Parties' Respective Contentions on Art. 8(1) Issue	96
(3) Consideration of and Decision on Art. 8(1) Issue	98
K. Application to Set Aside Service Due to Non-Compliance with Hague Service Convention	114
(1) Summary of UCCU defendants' Position on Hague Service Convention Issue	114
(2) Summary of Plaintiffs' Position on Hague Service Convention Issue	116
(3) Decision on Hague Service Convention Issue	118
(4) Observations on Hague Service Convention Issue	118
(5) The Order of 7 November 2016 and Service on Russian UCCU Defendants	120
(6) Burden of Proof on Hague Service Convention Issue	121
(7) Relevant Provisions of the RSC	121
(8) Reasons for the Decision on Hague Service Convention Issue	122
(9) Order Deeming Service Good: O. 9 r. 15	137
L. Summary of Conclusions	140

A. Introduction

(1) The Application the Subject of this Judgment

1 . This is my judgment on an application brought by five of the defendants in these commercial proceedings (referred to as the “UCCU defendants”) for various different orders on jurisdiction related grounds.

2 . The orders sought are as follows. First, an order under O. 12, r. 26 (a) discharging an order made by the High Court (McDermott J.) on 7 November 2016 which gave liberty to the plaintiffs to issue and serve notice of the proceedings on a number of the defendants, including the first, second, sixth and tenth defendants (the “Russian UCCU defendants”) at various addresses in Russia and by various different methods and (b) setting aside service of the notice of the proceedings on those defendants, on the grounds that the plaintiffs' claim does not fall within O.11, r.1(h) and that the case is not a proper one for service out of the jurisdiction. Second, an order pursuant to O. 12, r. 26 RSC setting aside service of the proceedings on the third defendant, Uralchem Holding Plc (“Holdings”), a Cypriot company, which is one of the UCCU defendants, on the ground that the court does not have jurisdiction to hear and determine the plaintiffs' claim against that defendant under the terms of Art. 8(1) of Regulation (EU) No. 1215/2012 of the European Parliament and of the Council of 12 December 2012 (the “Recast Brussels Regulation”). Third, an order dismissing the proceedings on the grounds that the court does not have jurisdiction to hear and determine the plaintiffs' claim against the UCCU defendants. Fourth, an order setting aside the order of 7 November 2016 and service of notice of the proceedings on the Russian UCCU defendants on the grounds that the court ought not to have permitted service other than in accordance with the Hague Convention on the service abroad of judicial and extrajudicial documents in civil or commercial matters (15 November 1965) (the “Hague Service Convention” or the “Convention”), that the purported service of notice of the proceedings on the Russian UCCU defendants in Russia was not in compliance with the Convention and that the order, and such service, should be set aside on that basis.

(2) The Proceedings: Brief Overview

3 . The UCCU defendants' application is made in proceedings which were commenced by the plaintiffs in the High Court in November 2016 against eleven defendants, five of whom have brought the application the subject of this judgment. The Russian UCCU defendants are individuals based in Russia and a Russian company. The other UCCU defendant is Holdings, a Cypriot company. The other defendants in the proceedings include the fourth defendant, Eurotoaz Limited (“Eurotoaz”), an Irish company and the fifth defendant, Mr. Babichev who is a director of Eurotoaz who resides in Russia. The remaining defendants include two other individuals based in Russia: the sixth defendant, Ms. Bolotnikova, and the eleventh defendant, Mr. Sedykin. The seventh defendant, Belport Investments Limited (“Belport”), is a British Virgin Islands company (“BVI”). The eighth defendant, Mr. Minkovski, is based in Bulgaria. The ninth defendant, Ms. Charilaou, is based in Cyprus.

4 . The plaintiffs are all companies incorporated in various different jurisdictions in the Caribbean. Two of the plaintiffs, the first and fourth plaintiffs, Trafalgar Developments Limited (“Trafalgar”) and Bairiki Incorporated (“Bairiki”) have purported to re-domicile themselves from one Caribbean jurisdiction to another in the course of the proceedings. The plaintiffs have sought to amend the proceedings to reflect those developments. I heard the plaintiffs' amendment application in February 2021. On 30 July 2021, I informed the parties that I had decided to grant the plaintiffs' application on terms that the plaintiffs produced a more detailed and fully pleaded Second Amended Statement of Claim to plead more fully the steps taken in the re-domiciliation process relied upon by the plaintiffs.

5 . Very briefly stated for the purpose of this introduction, the proceedings concern an alleged scheme in which the plaintiffs claim the defendants are co-conspirators and which it is alleged is intended wrongly to divest the plaintiffs of their shares, or the benefit of their shares, in a company incorporated in the Russian Federation called OJSC Togliattiazot (“ToAZ”) for the benefit of the first defendant, Mr. Mazepin. The plaintiffs claim that ToAZ is the largest producer of trade ammonia in Russia and one of the largest producers and exporters of ammonia in the world. The plaintiffs claim that as of the date of the commencement of the proceedings, they owned in excess of 70% of the shares in ToAZ. Mr. Mazepin is alleged to be the ultimate beneficial owner and controller of the second defendant, OJSC United Chemical Company Uralchem (“UCCU”), another company incorporated in Russia, whose business is the production and sale of chemical products, including ammonia and ammonia-based products. It is alleged that UCCU is a direct competitor of ToAZ, that it acquired a minority shareholding in ToAZ in 2008 and that, as of the commencement of the proceedings, it held approximately 9.9% of the issued share capital of ToAZ.

6 . The plaintiffs claim that the alleged scheme is in the nature of a “raider attack”, the purpose of which is to defraud the plaintiffs of their shares in ToAZ and that it has a number of different manifestations.

7 . A series of allegations are made against the fourth and fifth defendants, Eurotoaz and Mr. Babichev. It is claimed that they have been involved in a campaign of vexatious civil and criminal litigation in Russia in support of a claim by Eurotoaz that it is entitled to a percentage shareholding in ToAZ.

8 . The plaintiffs claim that UCCU, and various of the other defendants, including the Russian UCCU defendants, embarked on a campaign of vexatious civil and criminal litigation against ToAZ and its officers in furtherance of the alleged scheme in which freezing orders were made in respect of the plaintiffs' shares in ToAZ and certain officers of ToAZ were detained and suspended from their positions. Serious threats are also alleged to have been made by and on behalf of the first defendant, Mr. Mazepin.

9 . The plaintiffs claim that the acts in furtherance of the alleged scheme are ongoing in Russia and have sought separate anti-enforcement relief in respect of steps taken in Russia following a judgment of Judge Kirillov of the Komsomolsky District Court in July 2019. I have heard that application and have reserved judgment.

10 . It can be seen, therefore, that the plaintiffs claim that the Russian UCCU defendants and Eurotoaz/Mr. Babichev are parties to a conspiracy and that they have suffered loss, including the de facto expropriation of their shares in ToAZ, the loss of dividends, and the loss in value attributable to their ToAZ shares as a consequence of the acts complained of.

(3) Jurisdiction Issues: Overview

11 . The plaintiffs have asserted that the High Court has jurisdiction in relation to its claims against the various defendants, including the UCCU defendants. With respect to the Russian UCCU defendants, the plaintiffs sought and obtained an order from the High Court (McDermott J.) on 7 November 2016 permitting service of the proceedings in Russia on...