British International Investment Plc v Sunny Varkey & Anor
[2024] EWHC 1785 (Comm)
European Bank for Reconstruction and Development v Tatiana Vysokova & Ors
21 July 2023
[2023] EWHC 3554 (Comm)
High Court
A bank sued some people for breaking a contract about company shares. The people didn't show up to court, so the judge ruled in the bank's favor, stopping them from doing things that break the contract. The judge said the bank was right, and the other people had to pay the bank's legal fees.
Key Facts
- •EBRD applied for a default judgment against Vysokovs and Center-Invest for breaching a shareholder agreement (SHA).
- •The defendants failed to file an acknowledgment of service.
- •The SHA contained negative covenants preventing share capital increases without EBRD's consent.
- •The defendants repeatedly attempted to increase share capital without EBRD's consent, leading to EBRD seeking injunctions.
- •The defendants did not appear in court and claimed it was impossible due to the geopolitical situation.
- •The defendants ultimately cancelled the EGM to increase share capital.
Legal Principles
Default judgment can be granted if the claimant meets certain conditions, including service of the claim form and the defendant's failure to file an acknowledgment of service or defense.
CPR 12.4(3), 12.12(6), 58.8(1), 58.6(2)
The court has jurisdiction to grant final injunctive relief where it is just and convenient to do so.
Section 37(1) Senior Courts Act 1981
When enforcing negative covenants, injunctions are usually granted unless unjust or unconscionable.
SDI Retail Services Ltd v The Rangers Football Club Ltd [2018] EWHC 2772 (Comm)
An English court can order a party to do something contrary to foreign law.
Masri v Consolidated Contractors International Co. Sal & Ors [2008] EWCA Civ 1367
Outcomes
Default judgment granted in favor of EBRD.
Defendants failed to file an acknowledgment of service, and the court found a real risk of further breaches of the SHA.
Final injunction granted, restraining defendants from increasing share capital without EBRD's consent.
To prevent further breaches of the SHA and protect EBRD's shareholding.
EBRD awarded costs of £68,550.
Summary assessment of costs reasonably incurred and proportionate.