Madison Pacific Trust Ltd v Shakoor Capital Ltd & Anor

Madison Pacific Trust Ltd v Shakoor Capital Ltd & Anor

The trustee would not be acting in breach of trust by accepting and distributing payments from PrivatBank under the arbitral awards solely to Entitled UAHs, as the inability to recover for Related UAHs arises from a legal impediment (illegality) determined by the tribunal, not from any action or inaction of the trustee. The trust deed, properly construed, permits such distribution in these unique circumstances.

Parties
Claimant: Madison Pacific Trust Limited; First Defendant: Shakoor Capital Limited; Second Defendant: Joint-Stock Company Commercial Bank PrivatBank
Jurisdiction
England and Wales
Judgment Date
16 March 2020
Procedural Posture
Civil (trust/finance) / Application for Directions by Trustee After Arbitral Award
Outcome
Application granted
Legal Topics
Trustee Duties, Illegality Defence, Enforcement of Security, Distribution of Trust Assets, Issue Estoppel
Trust Law Banking and Finance Law Arbitration Trustee Duties Illegality Defence Enforcement of Security Distribution of Trust Assets Issue Estoppel

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Parties

Madison Pacific Trust Limited

Claimant

Shakoor Capital Limited

First Defendant

Joint-Stock Company Commercial Bank PrivatBank

Second Defendant

Procedural Posture

Civil (trust/finance) / Application for Directions by Trustee After Arbitral Award

Legal Issues

  1. 1 Whether the trustee may, consistent with its duties, accept and distribute proceeds from PrivatBank under the arbitral awards solely to certain ultimate account holders (UAHs)
  2. 2 Whether such payments would constitute a breach of trust or violate the pari passu principle under the trust deed
  3. 3 Whether the arbitral tribunal's findings bind all UAHs, including those excluded from recovery due to illegality or late response

Ratio Decidendi

The trustee would not be acting in breach of trust by accepting and distributing payments from PrivatBank under the arbitral awards solely to Entitled UAHs, as the inability to recover for Related UAHs arises from a legal impediment (illegality) determined by the tribunal, not from any action or inaction of the trustee. The trust deed, properly construed, permits such distribution in these unique circumstances.

Court Disposition

Application granted

Orders

  • The trustee is at liberty to make payments to or at the direction of the Noteholders or Ultimate Account Holders in accordance with the payment scheme set out at operative paragraphs 5 to 9 of the arbitral awards.