As explained in greater detail below, in order to make Mr Malofeev and Marcap BVI jointly and severally liable with RAP under the Agreements, VTB also sought to pierce the corporate veil of RAP. VTB brought claims in deceit and conspiracy against Nutritek, Mr Malofeev and another BVI company also said to be under the control of Mr Malofeev (Marcap BVI), on the basis that they were jointly and severally liable for the misrepresentations described above. VTB claimed that it had been induced, in London, to enter into the Agreements by fraudulent misrepresentations (i) about the true value of the dairy companies and (ii) that RAP and Nutritek were not under common control (it being VTB’s case that both RAP and Nutritek were in fact under the ultimate control of the fourth defendant, Mr Malofeev, a Russian businessman resident in Moscow, and that the purchase of the dairy companies was not, therefore, an arm’s length deal). RAP subsequently defaulted on the loan, leaving VTB with a shortfall in excess of $185m. The advance was ostensibly to enable RAP to buy a number of Russian dairy companies from Nutritek International Corp (Nutritek). VTB entered into a loan agreement and other associated agreements (the Agreements) with a Russian company called Russagroprom LLC (RAP), under which VTB lent RAP $225m. The claimant, VTB Capital plc (VTB) was an English incorporated bank, which was majority owned by JSC VTB Bank (VTB Moscow), a state-owned bank based in Moscow. These issues arose in the context of an application for permission to serve proceedings out of the jurisdiction and the Supreme Court also provided important guidance on the circumstances in which England will be the proper forum (forum conveniens) to determine a case, and the practicalities of dealing with jurisdictional disputes. The Supreme Court also held that, even if the power to pierce the corporate veil does exist, it does not enable a claimant to hold parties that control a company jointly and severally liable under contracts entered into by that company. Perhaps the most striking aspect of the case is that it casts doubt on the notion that the Court has the power to pierce the corporate veil. This article considers the Supreme Court decision in VTB Capital plc v Nutritek International Corp & ors.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |