Oligarch case judge laments ‘heavily lawyered’ approach
The judge presiding over the acrimonious High Court battle between Russian oligarchs has criticised the ‘heavily lawyered’ nature of the case that undermined witness statements.
Mrs Justice Gloster (pictured) said the high-profile case involving Chelsea football club owner Roman Abramovich and Boris Berezovsky had gone through such scrutiny from both legal teams that it was difficult to establish the truth. In her judgment released today, which found in favour of Abramovich, the judge said the heavy presence of lawyers meant that ‘no evidential stone was left unturned, unaddressed or unpolished’.
She added: ‘Those features, not surprisingly, resulted in shifts or changes in the parties’ evidence or cases, as the lawyers microscopically examined each aspect of the evidence and acquired a greater in-depth understanding of the facts.
‘It also led to some scepticism on the court’s part as to whether the lengthy witness statements reflected more the industrious work product of the lawyers, than the actual evidence of the witnesses.’
But the judge praised the ‘highly professional and efficient’ way in which the case was conducted, not only by the teams of counsel and solicitors but by the respective participants. ‘Whatever tensions or undercurrents there may have been between the parties, or indeed the lawyers, in what were, heavily fought, acrimonious disputes involving serious allegations of dishonesty and blackmail, the case was battled out in a courteous, disciplined and restrained manner.’
Berezovsky, who was claiming a stake in Abramovich’s business interests worth £3bn, was funding his legal team at Addleshaw Goddard through a contingency fee agreement. However, a spokesman for the firm today denied the case was run on a 'no win, no fee' basis, instead describing it as ‘no win, smaller fee’.
The judgment noted that Berezovsky had denied that any of his witnesses stood to gain financially, a claim that was later found to be untrue.
According to the judgment, two of his witnesses, Dr Nosova and her husband Mr Michael Lindley, a solicitor, stood to gain ‘very substantially’ if Berezovsky was to win. The court found his excuse for not giving a truthful answer was ‘unconvincing’.
Mrs Justice Gloster said: ‘It appeared that, despite specific enquiries having been made earlier in the proceedings by Mr Abramovich's solicitors, these contingency agreements had previously been concealed from them, and indeed even from Mr Berezovsky's own solicitors.’
Mrs Justice Gloster said it was significant there were no contemporaneous notes or other documents recording any of the four agreements under dispute. Instead, the court was relying on oral evidence that was ‘extremely stale’, based on events occurring many years ago where witness accounts were understandably unreliable.
Berezovsky had claimed to be a business partner of Abramovich and accused him of a breach of trust and breach of contract. But while the judge found some of Berezovsky’s evidence to be ‘deliberately dishonest’, Abramovich was considered a ‘truthful, and on the whole reliable, witness’.
Comments
Deliberately dishonest
If the judge found Berezovsky’s evidence to be ‘deliberately dishonest’ why was he not arrested for perjury and for misleading and wasting the time of the court?
It seems lying in court is acceptable practice these days. No wonder the culture of dishonesty is so common in our society when the highest court in the land seem to tolerate it.
Also, the High Court is not
Also, the High Court is not "the highest court in the land".
Deliberately dishonest
He was not reported for perjury because there is a difference between a prima facie case of crime, and a civil judge finding for one side on the balance of probablities. In extreme cases judges do report witnesses to the AG for investigation.
I have always assumed that only lawyers read the Gazette.
Deliberately dishonest
He must have been warned by his lawyers about being deliberately dishonest and how this could affect the case but why would anyone run a case where there are questions of dishonesty on a reduced fee basis? Maybe for publicity although I would not think they need it.
Dishonesty
Dan
Yes, interesting. I note Addleshaw Goddard took on the case - noted for previously taking on questionable cases involving a tennis player a few years back.
Question for anyone who works for or has an insight into the magic circle law firms. Would one of these firms have taken on such a claim and on this basis where there were possible dishonesty issues concerning a client? I know the Russians can be slippery characters (although they seem to respect our legal system to some degree) so would be interesting to know how the professional law firms handle such issues.
The figure of total legal
The figure of total legal costs of £100 million is being bandied about. Addleshaws say they managed to get insurance against their client losing. It will be interesting to see if some insurer happily hands over a cheque for £50 million after their insured has had such a slating from the judge.
Even if Addleshaws were only on a partial CFA, they'll be taking a big fees hit, and according to Rollonfriday, they have just made 24 redundant.
Why here?
Perhaps I'm missing something but this case hinges on two wealthy Russians squabbling about something that originally took place in Russia. So why is our court system being saddled with this? Are these seriously wealthy obligarchs paying anywhere near what it costs to put on such a high profile case, and if not, why not? Send em both packing back to Russian and let Putin deal with it. I'd hazard a guess this case would have lasted a week, tops. What's this got to do with the UK or has Russian joined the EU without telling us. This makes me what to spit blood. When are we going to stop being such a soft touch?
Come on - the VAT alone
Come on - the VAT alone incurred on their £100m in legal fees would more than cover all costs associated with the case - let alone the tax paid by the lawyers and the employment generated. Legal proceedings are a fantastic export earner.
Why here? (again)
Excuse the typos above. It's obviously the red mist that's interfered with my ability to spell. Where's that spitoon?!!
Dishonesty
Why do you assume that only magic circle firms occasionally have the misfortune to act for a client whose evidence is rejected by a judge? It happens day in, day out, to firms of all kinds. Obviously, if you know your client is not being truthful and refuses to change his instructions to you, you have to withdraw from the case. That's a pretty rare occurrence. More likely, you do not know for sure that the client is lying and advise him that there is a risk (perhaps a high risk) of his evidence being rejected because it does not accord with (or is not supported by) contemporaneous documentation.
It's not clear if there was any ATE insurance in place here. There are at least two reported examples of an ATE insurer refusing to cover an adverse costs order, because the insured had been found to have misrepresented the position in his proposal (England v Burnley Healthcare and Samuel v Swansea CIty and County Council). Applications for costs orders against the ATE insurers failed in both instances.
Russia
I would imagine we probably do very well out of these cases. At least the lawyers here do anyway (perhaps with the exception of Addleshaw Goddard). And I was reading somewhere that the Russians like our justice system because it is considered fair and not under political control as it is in all the ex Soviet Union states.
I am sure the courts must get paid their fees for entertaining these cases as there would be an outcry otherwise.
Being from a non legal background, the jurisdictional side of this does puzzle me because as you say these cases seem to concern events which have taken place in Russia.
Good grief! Well done
Good grief! Well done Kelly-you have actually understood something-i.e. that the UK encourages dispute settlement in our Court system because the UK makes money out of it. God knows the balance of payments needs all the help it can get since the trashing of much of our manufacturing base.
Keep trying -you might eventually understand that lawyers aren't just thieves in suits.
The Commercial Court (a
The Commercial Court (a division of the High Court) accepts jurisdiction for high value cases throughout the world, with the consent of the parties. This is a very high tariff business, and there is no question of the wasting of anyone's time. The fees, both of the Court itself and of course the teams of high grade commercial litigators and their counsel, will be commensurate.
A summary of the judgment is now on baillii if anyone is that interested - see
http://www.bailii.org/ew/cases/EWHC/Ch/2012/B15.html
A different world to my own. Legal aid, anyone?
Jurisdiction/choice of law clauses
The answer to Kelly Matthews' puzzlement is that many agreements will contain clauses which provide that they are to be governed by English law and any disputes arising out of them are to be heard by the English courts. These clauses exist because parties often have more faith in the English courts than in the courts of their home country.
The Courts do get paid fees, but these will only be a tiny proportion of the sums earned by the lawyers involved (http://www.justice.gov.uk/downloads/consultations/appeal-high-court-fees-consultation.pdf).
Jurisdiction
Choice of Law clauses are common, but even without them, the English courts will takes cases in foreign law, if both parties consent to the jurisdiction. Does anyone remember Argenti v Argenti, when a Greek daughter sued her father, in London, in Greek law, for her dowry, when her father had withheld his consent to the match? This must have been about 1961 or so...
I do these disputes all the
I do these disputes all the time - breach of contract (although on a lower scale). It is who is to be believed in their recollection of events. It does not always mean one side has to be lying. Sometimes they both have a different recollection,
It was always pretty clear Abramovitch was in the right. Even the evidence about where the agreement was made and the change of story on the other side when they realised A was out of the country on the relevant date made it all seem very unlikely.
It does show that London is a great place for big commercial disputes and that we have a fair and good system of justice.
As said above if anyone chooses to litigate here they can and given many countries have a pretty shabby system of justice eg Russia and China it is not surprising people choose to litigate here.
can you do too good a job?
It's the phrase : "heavily lawyered approach" that I find strange. The next time i'm criticised in court for not including a document or failing to number a page in a bundle I will put forward the defence that i didn't want it to look like "a heavily lawyered" case!
deadline day
By the way I suppose we can now expect chelsea to be even more active than normal on the last day of football horse trading!
It seems from the report that
It seems from the report that jurisdiction was based upon service of proceedings on Mr A in this country and the fact that Mr B cannot easily litigate in the Russian court system as he is a 'wanted man' so to speak over there. Not an expert but had abrief look at case report
I do these disputes all the time
I'm afraid I don't, I'm just responding to the comment. The fact that the judge was free to say what she thought, without needing anyone's instructions, says it all. Compare the Russian judiciary, eg the Pussy Riot case, and of course Abramovich's old mate, Khodorkovsky. British justice is justice, so defined, and I am struggling to think of anywhere better. Think of poor Christopher Tappin , hoovered up by America on no evidence. Think of Diana's body, cremated days after her death on the authority of a French magistrate. No, all in all, the Court appears to have reached the correct conclusion. And if it brought in gazillions to our beleaguered economy, chain me to the wall!
There was plenty evidence
There was plenty evidence against Christopher Tappin, the Court of Appeal found his conduct amounted to a conspiracy to defraud. Read the case, Mr Tappin made the wrong call. Read specifically para 46 of Justice Cranston's judgement, http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWHC/Admin/2011/22.html&query=title+(+tappin+)&method=boolean, it reads 'In this jurisdiction the conduct would found an offence or offences of conspiracy to defraud and that is sufficient for the purposes of section 137(2)(b) of the Extradition Act 2003.'
So what is your point???
IIRC Diana wasn't cremated, she was buried intact on an island on her brother's estate. And anyway what relevance has Diana got to the issue here?
There was plenty evidence
Thank you for the reference to the Christopher Tappin case, and for the clarification regarding Diana. My point, which I reiterate, is that the UK legal system has acquitted itself, in the Berezovsky/Abramovitch case, rather well. The judge was clearly not under political control, as are the courts in the parties' homeland, Russia. The judgement, in those parts at least which have been published, seems well-considered and certainly not constrained. Never mind, then, about comparison with the Russian system. Other "Western" legal systems, certainly including the US and the French, to both of which I briefly referred, do not appear to come off so well as ours. The US seems to have a penchant for hoovering up defendants from all over the world, to face questionable justice in a foreign court. Eg computer hackers from UK and New Zealand, or of course the NatWest bankers from UK, who were obliged by the infamous plea bargaining system they have, to plead guilty and suffer incarceration to avoid even more severe punishment (a 30 year sentence in a US prison must compare with a death penalty, surely), and were effectively unable to defend their innocence. That is administration,. not justice. Exactly the same happened in New Zealand where the NZ police, on instructions from the FBI, deployed a SWAT team against the private home of an alleged copyright infringer called Kim Dotcom, seized all his assets and forbade him from outside contact, even by Internet. . The NZ courst have just thrown it out, bless them. A French magistrate, too, has vast powers. Yes, in Britain, there is scrutiny and a legal system worthy of the name. That, presumably, is why litigants are prepared to invest in it. That is my point.
Lord Sumption
How can a judge of the High Court act as a lawyer in tha same country?
Sumption is a Justice of the
Sumption is a Justice of the Supreme Court not a judge in the High Court. He joined the UKSC bench right after he finished the case. Actually this case was the reason he delayed his elevation to the Supreme Court so instead of joining the Court in April 2011 he only joined it in January of this year.
Sebastian: Judges in our
Sebastian: Judges in our system are drawn from the ranks of practising lawyers (mostly barristers but nowadays some solicitors as well.) Unlike some Continental jurisdictions we do not have a professional judiciary with a distinct career structure.
LOL
The last laugh is on the oligarchs. Hundreds of millions of pounds spent to get a judgment that would not be totally out of place in a 2 1/2 p case before JPs "witnesses of truth blah blah"
Russian Oligarchs and their State Church
When there is an issue in the English Courts involving the Russian State or bodies close to it like the Russian Orthodox Church, you get very unsatisfactory litigation - see Dean v. Burne [2009] EWHC 1250 which casts an interesting light on the Attorney-General's role in charity litigation when one party was allegedly being funded by a Russian Oligarch at the behest of the Patriarch of Moscow.
Think then about the issues of Church and State relations under Putin that the Pussy Riot affair brought into the open.
A commentary from a Russian legal expert in Oxford
There is an interesting commentary on this case on the Open Democracy - Russia website from Vladimir Pastukhov, a visiting fellow at St Anthony's College, Oxford:
http://www.opendemocracy.net/od-russia/vladimir-pastukhov/pyrrhic-victory-for-abramovich