A dispute between Russia and Ukraine over an unpaid debt of $3 billion (£2.39bn) should not go to full trial, the High Court has ruled.
In a judgment handed down last week the court rejected a bid by Ukraine for the dispute to go to a full trial, saying Ukraine did not have valid justiciable defence for why it had not paid back the money.
The case focuses on $3 billion Moscow lent Kiev in December 2013 during the presidency of Viktor Yanukovich.The financial aid came in the form of a eurobond governed by English law.
Ruling that the case should not go to full trial Mr Justice William Blair said: ‘Ultimately this is a claim for repayment of debt instruments to which the court has held there is no justiciable defence. It would not be right to order the case to go forward to a full trial in such circumstances.’
Russia sued Ukraine for non-payment in February last year and Ukraine attempted to resist the claim. Its defences included a claim that non-payment was a countermeasure against Russian interference with Ukraine’s sovereignty.
David Goldberg, partner at City law firm White & Case, and who divides his time between London and Moscow, told the Gazette that the case was an important test of English courts as a forum for international disputes.
’The English courts are there to apply the law rather than to be drawn into political debate,’ Goldberg said. ‘If you apply the law then the result is hardly surprising - there is a simple debt that is enforceable in law.’
In a statement, the Ministry of Finance of the Russian Federation said: ‘After numerous attempts to settle this dispute out of court, in February 2016 Russia instructed The Law Debenture Trust Corporation, acting as the Trustee under the eurobonds, to commence proceedings against Ukraine in the English High Court.’
‘The court held that Ukraine had no basis to resist the claim, which sought payment of Ukraine’s obligations under a debt instrument that the court found to be valid.’
Ukraine is understood to be appealing the ruling.