Ziyavudin Magomedov & Ors v Konstantin Kuzovkov & Ors
[2024] EWHC 2527 (Comm)
The Kingdom Bank Corporation v Moorwand Ltd
1 December 2023
[2023] EWHC 3069 (Comm)
High Court
A bank lost money through a failed payment company. They tried to get another company to reveal information to help recover the lost funds. The court refused, saying the bank hadn't shown enough evidence of wrongdoing or that they needed this information to get their money back. The bank could have tried other ways to get the information first.
Key Facts
- •Kingdom Bank Corporation (Claimant), a Dominica-registered offshore bank, seeks a Norwich Pharmacal order against Moorwand Ltd (Defendant), an English electronic money institution (EMI), for disclosure of information relating to an account held by the Defendant.
- •The Claimant alleges that approximately €1.4 million of its and its customers' money, initially paid to Safe Payment Solutions s.r.o. (SPS), a Czech electronic money issuer, ended up in the Defendant's account and is now missing.
- •SPS went into liquidation, and the Claimant argues that the Defendant is implicated in the loss of funds.
- •The Defendant opposes the application, citing jurisdictional issues, a lack of grounds for Norwich Pharmacal relief, and a preference for alternative disclosure methods (CPR 31.16).
Legal Principles
Norwich Pharmacal Order requirements: A wrong must have been committed; an order is needed to pursue the wrongdoer; and the respondent must be implicated and able to provide relevant information.
Mitsui & Co Ltd v Nexen Petroleum UK Ltd [2005] EWHC 625 (Ch)
Good arguable case test for Norwich Pharmacal relief: More than barely capable of serious argument, but not necessarily a >50% chance of success.
Ramilos Trading Ltd v Buyanovsky [2016] EWHC 3175 (Comm)
Norwich Pharmacal jurisdiction is exceptional and requires necessity; alternative means of obtaining information are relevant.
Mitsui & Co Ltd v Nexen Petroleum UK Ltd [2005] EWHC 625 (Ch)
Electronic Money Regulations 2011 (EM Regulations): Govern the operation of EMIs, including the safeguarding of customer funds. Funds received by an EMI are not held on trust; electronic money holders do not retain proprietary or equitable interests.
In re ipagoo LLP (in liquidation) [2022] EWCA Civ 302
Outcomes
The Claimant's claim for a Norwich Pharmacal order is dismissed.
The Claimant failed to establish the necessary conditions for a Norwich Pharmacal order. They did not demonstrate a good arguable case of wrongdoing against the Defendant, nor that the requested information was necessary to pursue a claim against any wrongdoer. Alternative avenues for obtaining the information existed.
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