La Micro Group (UK) Ltd & Anor v La Micro Group, Inc & Ors [2021] EWCA Civ 1429 (05 October 2021)

La Micro Group (UK) Ltd & Anor v La Micro Group, Inc & Ors [2021] EWCA Civ 1429 (05 October 2021)

The Court of Appeal held that Inc and Mr Frenkel were not estopped by conduct from denying Inc's beneficial ownership, as the earlier proceedings did not turn on the post-2010 ownership issue. There was no valid disclaimer of Inc's interest in 2010, as Inc had already accepted its interest and could not disclaim without writing. The claim was not an abuse of process, as Inc could not realistically have participated in the 2015 proceedings due to deadlock and lack of independent representation. The 2010 arrangements did not amount to a contractual surrender of Inc's beneficial interest, as there was insufficient evidence of a binding agreement to that effect. The declarations granted by...

Citation
[2021] EWCA Civ 1429
Parties
Claimant/first Respondent: LA Micro Group (UK) Limited; Claimant/second Respondent: David Bell; First Defendant/appellant: LA Micro Group, Inc; Second Defendant/appellant: Roman Frenkel; Third Defendant/respondent: Arkadiy Lyampert
Jurisdiction
England and Wales
Judgment Date
05 October 2021
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal dismissed
Legal Topics
Constructive Trusts, Beneficial Ownership, Estoppel, Abuse of Process, Disclaimer of Interest, Shareholder Disputes
Equity Company Law Civil Procedure Constructive Trusts Beneficial Ownership Estoppel Abuse of Process Disclaimer of Interest +1 more

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Parties

LA Micro Group (UK) Limited

Claimant/first Respondent

David Bell

Claimant/second Respondent

LA Micro Group, Inc

First Defendant/appellant

Roman Frenkel

Second Defendant/appellant

Arkadiy Lyampert

Third Defendant/respondent

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 Whether LA Micro Group, Inc retains a 51% beneficial interest in LA Micro Group (UK) Limited after 2010
  2. 2 Whether Mr Bell and Mr Lyampert are the sole beneficial owners of LA Micro Group (UK) Limited
  3. 3 Whether estoppel by conduct prevents Mr Bell and UK from denying Inc's beneficial ownership

Ratio Decidendi

The Court of Appeal held that Inc and Mr Frenkel were not estopped by conduct from denying Inc's beneficial ownership, as the earlier proceedings did not turn on the post-2010 ownership issue. There was no valid disclaimer of Inc's interest in 2010, as Inc had already accepted its interest and could not disclaim without writing. The claim was not an abuse of process, as Inc could not realistically have participated in the 2015 proceedings due to deadlock and lack of independent representation. The 2010 arrangements did not amount to a contractual surrender of Inc's beneficial interest, as there was insufficient evidence of a binding agreement to that effect. The declarations granted by...

Court Disposition

Appeal dismissed

Orders

  • Declarations that the shares in LA Micro Group (UK) Limited are owned by Mr Bell and Mr Lyampert
  • Declaration that Inc is not a beneficial owner of any shares in LA Micro Group (UK) Limited or entitled to any share of its distributable profits