JSC Mezhdunarodniy Promyshlenniy Bank & Anor v Pugachev & Ors [2015] EWHC 3221 (Ch) (5 November 2015)

JSC Mezhdunarodniy Promyshlenniy Bank & Anor v Pugachev & Ors [2015] EWHC 3221 (Ch) (5 November 2015)

'Trading business' in the freezing order does not include ordinary trust activities such as making distributions or loans to beneficiaries; 'day-to-day expenditure' is limited to administrative expenses and does not extend to payments to beneficiaries or their legal representatives.

Citation
[2015] EWHC 3221 (Ch)
Parties
Claimant: JSC Mezhdunarodniy Promyshlenniy Bank; Claimant: State Corporation 'Deposit Insurance Agency'; Defendant: Sergei Viktorovich Pugachev; Defendant: Kea Trust Company Limited; Defendant: Finetree Company Limited; Defendant: Bramerton Company Limited; Defendant: Bluering Company Limited; Defendant: Maru Limited; Defendant: Hapori Limited; Defendant: Miharo Limited; Defendant: Arotau Limited; Defendant: Luxury Consulting Limited; Defendant: Victor Sergeyevitch Pugachev
Jurisdiction
England and Wales
Judgment Date
05 November 2015
Procedural Posture
Chancery Division Civil Claim / Interlocutory Application for Construction of Freezing Order
Outcome
Application for broader interpretation of freezing order dismissed
Legal Topics
Construction of Freezing Orders, Trustee Powers, Distributions to Beneficiaries, Interpretation of Court Orders
Civil Procedure Trusts and Equity Construction of Freezing Orders Trustee Powers Distributions to Beneficiaries Interpretation of Court Orders

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Parties

JSC Mezhdunarodniy Promyshlenniy Bank

Claimant

State Corporation 'Deposit Insurance Agency'

Claimant

Sergei Viktorovich Pugachev

Defendant

Kea Trust Company Limited

Defendant

Finetree Company Limited

Defendant

Bramerton Company Limited

Defendant

Bluering Company Limited

Defendant

Maru Limited

Defendant

Hapori Limited

Defendant

Miharo Limited

Defendant

Arotau Limited

Defendant

Luxury Consulting Limited

Defendant

Victor Sergeyevitch Pugachev

Defendant

Procedural Posture

Chancery Division Civil Claim / Interlocutory Application for Construction of Freezing Order

Legal Issues

  1. 1 Whether 'trading business' in the freezing order includes ordinary trust activities
  2. 2 Whether loans or distributions to beneficiaries are permitted under the freezing order
  3. 3 Whether certain payments constitute 'day-to-day expenditure' under the order

Ratio Decidendi

'Trading business' in the freezing order does not include ordinary trust activities such as making distributions or loans to beneficiaries; 'day-to-day expenditure' is limited to administrative expenses and does not extend to payments to beneficiaries or their legal representatives.

Court Disposition

Application for broader interpretation of freezing order dismissed

Orders

  • Trustees are not permitted to make distributions or loans to beneficiaries under the guise of 'trading business' or 'day-to-day expenditure'.
  • Payments such as the $800,000 for legal costs are not permitted under the current order.