Trafalgar Developments Ltd v Mazepin

• Jurisdiction: Ireland
• Judge: Mr. Justice David Barniville
• Judgment Date: 31 July 2019
• Neutral Citation: [2019] IEHC 611
• Docket Number: [2016 No. 9981 P.]
• Court: High Court
• Date: 31 July 2019

[2019] IEHC 611

THE HIGH COURT

COMMERCIAL

Barniville J.

[2016 No. 9981 P.]

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

(DISCOVERY SOUGHT BY PLAINTIFFS AGAINST NINTH DEFENDANT)

Discovery – Categories of documents – Communications – Plaintiffs seeking discovery – Whether the plaintiffs were entitled to discovery of the documents sought

Facts: The plaintiffs, Trafalgar Developments Ltd, Instantania Holdings Ltd, Kamara Ltd and Bairiki Inc, initially sought discovery of nine categories of documents from the ninth defendant, Ms Charilaou, in their request for voluntary discovery dated 11th January, 2019. A number of those categories were agreed in the response to the request sent on behalf of Ms Charilaou on 22nd February, 2019. In correspondence on behalf of Ms Charilaou, the point consistently made on her behalf was that the plaintiffs’ case against Ms Charilaou on the pleadings concerned her alleged involvement in the signing of the share purchase agreement (SPA) between UCCU and Belport Investments Ltd dated 8th August, 2011 (which the plaintiffs claimed was a sham or false document) and in the signing of the letter of 3rd October, 2011 which purported to demand the payment of $1 million as a result of an alleged breach by UCCU of the SPA. Ms Charilaou agreed to make discovery of documents relating to those allegations against her but was not agreeable to making discovery in more general terms and on the basis of the more general allegations made against her on the basis that it was contended that such discovery amounted to a fishing expedition. The plaintiffs issued a motion seeking an order for discovery against Ms Charilaou on 27th March, 2019. At that stage, five categories of discovery were fully in dispute and there was dispute in respect of certain parts of two other categories. In dispute were the documents sought in Categories 1, 2, 3, 4, 5(b), 7 and 8(e). The basis on which the plaintiffs sought to be entitled to discovery in respect of those disputed categories was set out in an affidavit sworn by Ms Harty on 27th March, 2019. An affidavit was sworn in response on behalf of Ms Charilaou by Mr Burke on 12th April, 2019 and a further affidavit was sworn on behalf of the plaintiffs by Ms Harty on 7th May, 2019. Following further engagement between the parties on the day of the hearing, the plaintiffs refined their request for discovery further. In lieu of the documents sought at Categories 1 to 4, the plaintiffs sought a revised version of Category 2. Ms Charilaou agreed to make discovery of those documents, namely “all documents or communications passing between the ninth defendant and one or more of the other defendants of and concerning the scheme as described in the amended statement of claim”. Ms Charilaou also agreed to make discovery of the documents sought in Category 8(e) (which concerned “the Article 159(4) criminal case and any related proceedings by UCCU as described from paragraph 110 of the amended statement of claim onwards” in respect of the period from 1st January, 2011 to 25th July, 2018 (being the date on which an unconditional appearance was entered in the proceedings on behalf of Ms Charilaou)). Category 9 was previously agreed and it was agreed that those documents would be included in Category 8. Two categories remained in dispute, namely: Category 5(b) “Documents relating to the incorporation, assets, ownership, management and trading activity of: (b) Sanders Enterprises Limited including (but not limited to) communications with registered agents, documents relating to the appointment of the 9th Defendant as a director of and/or the engagement of CGV as agents of or advisors to, either of these companies and documents relating to any indemnity arising from such engagement”; and Category 7 “Documents relating to, including but not limited to communications with or relating to: (a) Benstock Finance Limited; (b) Havenport Investments Limited”

Held by the High Court (Barniville J) that, having considered the case made and the arguments advanced in respect of each of those categories, it had not been persuaded that the plaintiffs were entitled to discovery of the documents sought.

Barniville J held that he would refuse the plaintiffs’ application for discovery in respect of both categories.

Application refused.

JUDGMENT of Mr. Justice David Barniville delivered on the 31st day of July, 2019

Introduction

1 This is my judgment on an application for discovery made by the plaintiffs as against the ninth defendant, Androula Charilaou (‘Ms. Charilaou’).

2 The background to, and a description of, the proceedings has been set out by me in a separate judgment which I am also delivering today on applications for discovery as between the plaintiffs and the fourth and fifth defendants, Eurotoaz Limited (‘Eurotoaz’) and Andrey Gennadyevich Babichev (‘Mr. Babichev’)(the ‘Eurotoaz judgment’). A more detailed description of the proceedings and of the alleged scheme which forms the basis of the plaintiffs” claims against all of the defendants can be found in that judgment. I do not propose to rehearse that detail in this judgment. I will, however, refer to the claims made in the proceedings by the plaintiffs against Ms. Charilaou and the pleadings exchanged between them. I do not propose to rehearse the legal principles on discovery which I discussed in greater detail in the Eurotoaz judgment. I have adopted and applied the legal principles discussed in that judgment in considering and determining the plaintiffs” application for discovery against the ninth defendants. Having discussed briefly the claims made by the plaintiffs against Ms. Charilaou, I consider the categories of discovery which remain in dispute between the parties, substantial agreement having been reached between them prior to the hearing.

3 For reasons which I set out in this judgment, I am refusing the plaintiffs” application for discovery of the two categories in dispute.

Proceedings against Ms. Charilaou

4 In the amended statement of claim, the plaintiffs claim that the defendants, including Ms. Charilaou, are parties to a conspiracy which has taken the form of an alleged scheme intended wrongfully to divest the plaintiffs of their shares, or the benefit of their shares, in ToAZ for the benefit of the first defendant, Mr. Mazepin. The plaintiffs claim that the alleged scheme displays features of a ‘raider attack’, the purpose of which is to defraud the plaintiffs of their shares in ToAZ.

5 The plaintiffs have included Ms. Charilaou as one of the defendants and have alleged that she is an active participant in the alleged scheme. She is specifically referred to at para. 31 of the amended statement of claim where she is described as being a director of Belport Investments Limited (‘Belport’), a company registered in the British Virgin Islands (‘BVI’), which was the counterparty to an alleged false or sham share purchase agreement (‘SPA’) purported to have been entered into with UCCU. The plaintiffs have obtained judgment in default of appearance against Belport. It is also alleged (at para. 32 of the amended statement of claim) that Ms. Charilaou is a director of another company, Sanders Enterprises Limited (‘Sanders’), which is also incorporated in the BVI. Sanders is stated to be a wholly owned subsidiary of the second named defendant, UCCU, through a Cypriot company, Havenport Investments Limited (‘Havenport’). UCCU is also said to own 100% of the shares of Havenport. It is pleaded that Ms. Charilaou, as a director of Belport, signed the alleged false SPA between Belport and UCCU.

6 At para. 35 of the amended statement of claim, it is alleged that the fourth to eleventh defendants (including Ms. Charilaou) are linked through a common relationship with the first, second and third defendants (Mr. Mazepin, UCCU and Uralchem Holding plc (‘Holding’)). Mr. Mazepin is alleged to be the controlling mind and will of UCCU and Holding and the instigator and orchestrator of the alleged scheme. As one of the relevant defendants, Ms. Charilaou is alleged to have acted on the basis of a shared combination or understanding with Mr. Mazepin and has been an active participant in the alleged scheme in pursuit of the alleged common understanding reached with Mr. Mazepin.

7 The particular allegations made against Ms. Charilaou are contained in paras. 98 to 108 of the amended statement of claim. In particular, it is alleged that Ms. Charilaou (with others) produced or knowingly acquiesced in the production and/or execution of the allegedly false or sham SPA and knowingly acquiesced or permitted UCCU to rely on that document in support of its proceedings against ToAZ. At para. 108, it is alleged that Ms. Charilaou, the director of Belport who signed the alleged false or sham SPA, was at the time a director of Sanders, an indirect subsidiary of UCCU. The plaintiffs plead that Belport and UCCU were affiliated companies and that the purported transaction between them was not a genuine one. The plaintiffs contend that it is to be inferred that Ms. Charilaou knew that she was signing a sham or false document to be relied on as false evidence in one of the criminal complaints initiated by UCCU against the management of ToAZ.

8 The features and methods employed in the alleged scheme are set out at para. 6 of the amended statement of claim. However, the only feature or method which appears to be directly referable to Ms. Charilaou is that contained in subparagraph (e) concerning the production of allegedly forged or sham documents against...