Darnitsa v Metabay Import/Export Ltd

Darnitsa v Metabay Import/Export Ltd

There is a good arguable case against Metabay under both English and Ukrainian law, supported by the pleadings in the Ukrainian proceedings and evidence of substantial fraud and family control; risk of dissipation is real given unexplained arrangements and Metabay's status; no material failure of full and frank disclosure sufficient to discharge the order.

Parties
Claimant: Private Joint Stock Company "Pharmaceutical Firm Darnitsa"; Defendant: Metabay Import/Export Limited
Jurisdiction
England and Wales
Judgment Date
28 May 2021
Procedural Posture
Injunction Application (worldwide Freezing Order) / Return Date Hearing on Continuation/discharge of Injunction
Outcome
Application to discharge the freezing order dismissed; freezing order continued with minor amendments.
Legal Topics
Freezing Orders, Chabra Jurisdiction, Shareholder Derivative Actions, Interim Relief, Full and Frank Disclosure
Civil Procedure International Commercial Law Freezing Orders Chabra Jurisdiction Shareholder Derivative Actions Interim Relief Full and Frank Disclosure

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Parties

Private Joint Stock Company "Pharmaceutical Firm Darnitsa"

Claimant

Metabay Import/Export Limited

Defendant

Procedural Posture

Injunction Application (worldwide Freezing Order) / Return Date Hearing on Continuation/discharge of Injunction

Legal Issues

  1. 1 Whether there is a good arguable case against Metabay for the purposes of a freezing order under s25 Civil Jurisdiction and Judgments Act 1982
  2. 2 Whether there is a real risk of dissipation of assets justifying continuation of the freezing order
  3. 3 Whether the Claimant failed in its duty of full and frank disclosure

Ratio Decidendi

There is a good arguable case against Metabay under both English and Ukrainian law, supported by the pleadings in the Ukrainian proceedings and evidence of substantial fraud and family control; risk of dissipation is real given unexplained arrangements and Metabay's status; no material failure of full and frank disclosure sufficient to discharge the order.

Court Disposition

Application to discharge the freezing order dismissed; freezing order continued with minor amendments.

Orders

  • Freezing order against Metabay continued until 7 days after judgment in Ukrainian proceedings or further order.
  • Disclosure order clarified to limit scope to policing the freezing order.