VTB Capital Plc v Nutritek International Corp & Ors [2012] EWCA Civ 808 (20 June 2012)

VTB Capital Plc v Nutritek International Corp & Ors [2012] EWCA Civ 808 (20 June 2012)

The Court of Appeal held that English law does not permit the corporate veil to be pierced so as to make controllers of a company liable as original parties to contracts entered into by the company. The authorities do not support the proposition that controllers become parties to the contract by virtue of veil...

Source-derived case information.

Citation
[2012] EWCA Civ 808
Parties
Claimant/appellant: VTB Capital plc; First Defendant/respondent: Nutritek International Corp; Second Defendant/respondent: Marshall Capital Holdings Ltd; Third Defendant: Marshall Capital LLC; Fourth Defendant/respondent: Konstantin Malofeev
Jurisdiction
England and Wales
Judgment Date
20 June 2012
Procedural Posture
Appeal (civil) / Court of Appeal Judgment on Appeals From High Court (chancery Division)
Outcome
Appeals dismissed
Legal Topics
Jurisdiction, Service Out of Jurisdiction, Piercing the Corporate Veil, Worldwide Freezing Order (wfo), Fraudulent Misrepresentation, Conspiracy, Contract and Tort Claims
Private International Law Company Law Civil Procedure Jurisdiction Service Out of Jurisdiction Piercing the Corporate Veil Worldwide Freezing Order (wfo) Fraudulent Misrepresentation +2 more

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Parties

VTB Capital plc

Claimant/appellant

Nutritek International Corp

First Defendant/respondent

Marshall Capital Holdings Ltd

Second Defendant/respondent

Marshall Capital LLC

Third Defendant

Konstantin Malofeev

Fourth Defendant/respondent

Procedural Posture

Appeal (civil) / Court of Appeal Judgment on Appeals From High Court (chancery Division)

Legal Issues

  1. 1 Whether the English court has jurisdiction over foreign defendants in tort and contract claims
  2. 2 Whether the corporate veil can be pierced to impose contractual liability on controllers of a company
  3. 3 Whether permission should be granted to amend pleadings to add contract claims against controllers

Ratio Decidendi

The Court of Appeal held that English law does not permit the corporate veil to be pierced so as to make controllers of a company liable as original parties to contracts entered into by the company. The authorities do not support the proposition that controllers become parties to the contract by virtue of veil piercing; at most, equitable remedies may be granted. The judge was correct to refuse permission to amend the claim to add contract claims against the controllers. The requirements for service out of jurisdiction were not met, as England was not shown to be clearly the appropriate forum. The Worldwide Freezing Order could not be continued as there was no sufficient risk of...

Court Disposition

Appeals dismissed

Orders

  • Permission to amend Particulars of Claim to add contract claims refused
  • Permission to serve proceedings out of jurisdiction refused