JSC BTA Bank v Khrapunov: SC 21 Mar 2018

A had been chairman of the claimant bank. After removal, A fled to the UK, obtaining asylum. The bank then claimed embezzlement, and was sentenced for contempt after failing to disclose assets when ordered, but fled the UK. The Appellant, K, was A’s son-in-law living in Switzerland. It was claimed that he had assisted A in the disposal of assets and was guilty of conspiracy in the UK to cause financial loss to the bank by unlawful means, namely serial breaches of the freezing and receivership orders in contempt of court. He now appealed against a decision that the court had jurisdiction over him.
Held: The appeal failed.
The bank’s claims would, if established, amount to an unlawful means conspiracy. Conspiracies, broadly, have two forms, ‘lawful means’ and ‘unlawful means’ conspiracy. A person may pursue his interests by lawful means, even if it can be foreseen that others’ interests will suffer. If he chooses unlawful means, then he has no such right. That is true also where the means chosen are lawful but the overriding intention of the defendant is to injure the claimant. Either undermines any cause or excuse for the ‘combination’ with others.
Conspiracy is a tort of primary liability, and not just a kind of joint liability. Therefore the test of unlawful means is not derivable from whether they would give allow to a different action independent of the conspiracy. The test is of the existence of a just cause for the defendants combining with each other to use unlawful means. That depends on (i) the nature of the unlawfulness; and (ii) its relationship with the resultant damage to the claimant.
Article 5 provided an exception to the domicile requirement for jurisdiction that the a claim could be pursued in the jurisdiction where the events (in this case the agreement) alleged happened. That had been correctly established as being within the UK, and jurisdiction was established.
Lord Mance DPSC, Lord Sumption, Lord Hodge, Lord Lloyd-Jones, Lord Briggs JJSC
[2018] 3 All ER 293, [2018] UKSC 19, [2018] 2 All ER (Comm) 479, [2018] WLR(D) 184, [2018] ILPr 26, UKSC 2017/0043, [2020] AC 727, [2018] 2 WLR 1125
Bailii, Bailii Summary, WLRD, SC, SC Summary, SC Vid 24/01/2018 am, SC Vid 24/01/2018 pm, SC Vid 25/01/2018 am
Lugano Convention 2
England and Wales
Citing:
Appeal fromKhrapunov v JSC BTA Bank CA 2-Feb-2017
. .
CitedQuinn v Leathem HL 5-Aug-1901
Unlawful Means Conspiracy has two forms
Quinn was treasurer of a Belfast butchers’ association. Leathem, who traded as a butcher, employed some non-union men, although when the union made difficulties he asked for them to be admitted to the union, and offered to pay their dues. The union . .
CitedCrofter Hand Woven Harris Tweed Company Limited v Veitch HL 15-Dec-1941
The plaintiffs sought an interdict against the respondents, a dockers’ union, who sought to impose an embargo on their tweeds as they passed through the port of Stornoway.
Held: A trade embargo was not tortious because the predominant purpose . .
CitedLonrho Ltd v Shell Petroleum Co Ltd (No 2) HL 1-Apr-1981
No General Liability in Tort for Wrongful Acts
The plaintiff had previously constructed an oil supply pipeline from Beira to Mozambique. After Rhodesia declared unilateral independence, it became a criminal offence to supply to Rhodesia without a licence. The plaintiff ceased supply as required, . .
CitedLonrho plc v Fayed HL 2-Jan-1991
In a conspiracy, the intent to injure need not be the primary intent, but there must be some intent which involves the conspiring parties directing their minds towards the victim or a category of persons which would include the victim as a target to . .
CitedTotal Network Sl v Revenue and Customs HL 12-Mar-2008
The House was asked whether an action for unlawful means conspiracy was available against a participant in a missing trader intra-community, or carousel, fraud. The company appealed a finding of liability saying that the VAT Act and Regulations . .
CitedDouglas and others v Hello! Ltd and others; similar HL 2-May-2007
In Douglas, the claimants said that the defendants had interfered with their contract to provide exclusive photographs of their wedding to a competing magazine, by arranging for a third party to infiltrate and take and sell unauthorised photographs. . .
CitedMogul Steamship Company Limited v McGregor Gow and Co CA 2-Jul-1889
Ship-owners formed an association which in this action others claimed to be a tortious conspiracy.
Held: There is a cause of action against the conspirators where there is an agreement which constitutes an indictable conspiracy and that . .
CitedCouling v Coxe 7-Dec-1848
A plaintiff in a civil action who has issued a witness summons or subpoena to a witness to attend may have an action against a witness who fails to attend, but the damages recoverable were limited to the costs of an abortive hearing when the . .
CitedFairclough and Sons v The Manchester Ship Canal Co CA 1897
The court considered the remedies for a contempt of court.
Held: Lord Russell CJ said: ‘We desire to make it clear that in such cases no casual or accidental and unintentional disobedience of an Order would justify either a commitment or . .
CitedSorrell v Smith HL 1925
Torts of Conspiracy by Unlawful Means
The plaintiff had struck the first blow in a commercial battle between the parties, and the defendant then defended himself, whereupon the plaintiff sued him.
Lord Cave quoted the French saying: ‘cet animal est tres mechant; quand on . .
CitedChapman v Honig CA 1963
A landlord’s notice to quit was held valid notwithstanding that the landlord seeking to uphold its validity had himself given it in contempt of court.
A contractual right may be exercised for any reason good, bad or indifferent and the motive . .
CitedMileage Conference Group of the Tyre Manufacturers’ Conference Ltd’s Agreement 1966
A substantial fine was imposed for contempt by breach of an undertaking which was not merely non-contumacious, but was committed reasonably on legal advice.
Megaw J suggested, obiter, that a penal order against a contemnor might include a . .
CitedHM Customs and Excise v Barclays Bank Plc HL 21-Jun-2006
The claimant had served an asset freezing order on the bank in respect of one of its customers. The bank paid out on a cheque inadvertently as to the order. The Commissioners claimed against the bank in negligence. The bank denied any duty of care. . .
CitedN v Agrawal CA 9-Jun-1999
A doctor examining a victim of a rape, but who failed to give evidence at court was not liable to the victim for further psychiatric damages caused by the resultant collapse of the prosecution. There was no doctor/patient relationship to give rise . .
CitedRe Hudson, Hudson v Hudson ChD 1966
The plaintiff’s marriage had been dissolved and her former husband was ordered to pay her maintenance at a specified rate. The husband subsequently filed evidence that he was unable to comply with that order but offered to undertake to pay one-third . .
CitedCement LaFarge v BC Lightweight Aggregate 26-Apr-1983
(Supreme Court of Canada) Respondent, a supplier of lightweight aggregate, ceased business and was awarded damages for the tort of conspiracy to injure after its client, a manufacturer, began using another aggregate to produce its light-weight . .
CitedMarrinan v Vibart CA 1962
The court considered an action in the form an attempt to circumvent the immunity of a witness at civil law by alleging a conspiracy.
Held: The claim was rejected. The court considered the basis of the immunity from action given to witnesses. . .
CitedHandelskwekerij GJ Bier Bv v Mines De Potasse D’Alsace Sa ECJ 30-Nov-1976
Europa Where the place of the happening of the event which may give rise to liability in tort, delict or quasi-delict and the place where that event results in damage are not identical, the expression ‘place . .
CitedRegina v Barnet London Borough Council, Ex parte Shah HL 16-Dec-1982
The five applicants had lived in the UK for at least three years while attending school or college. All five were subject to immigration control, four had entered as students with limited leave to remain for the duration of their studies, and the . .
CitedMidland Marts v Hobday ChD 1989
The court considered a claim for costs on an application for committal of the defendant for infringement.
Held: Vinelott J said: ‘I can see no reason in principle why the Court, if satisfied that the facts proved at the hearing of a motion to . .

These lists may be incomplete.
Updated: 11 March 2021; Ref: scu.608731