English Courts Dealing With Letters Of Request From Foreign Jurisdictions – Ensure The Client Is Prepared

Key Considerations

Recently, the English High Court delivered its decision in Atlantica Holdings, Inc & Anor v Sovereign Wealth Fund & Ors [2019] EWHC 319 (QB) in which it refused an application to set aside an order for United Kingdom-residents to be orally examined under oath in proceedings taking place in the United States.

The judgment, handed down by Julian Knowles J, offers useful insight into the Court's current approach as to the Evidence (Proceedings in Other Jurisdictions) Act 1975 (the "Act") and the extent to which the Court will be willing to use its discretion under the Act to refuse a letter of request ("LOR") transmitted under the provisions of the Hague Convention of 1970.

The key message from the decision is that if an LOR is being obtained, then it is best to make sure that it is clear on its face that the referring Judge has considered and determined relevance. However, generally, English Courts will respect the principle of comity with foreign jurisdictions and there is usually a high threshold to be met, before an English judge will set aside a valid LOR.

Background

Pavel Prosyankin and John Howell (the "Applicants"), both UK residents, were the subject of LORs issued in the US District Court. The LORs were transmitted to the English Court pursuant to the Hague Convention on the Taking of Evidence Abroad in Civil or Commercial Matters 1970.

At a high level, the underlying proceedings in the US concerned the purchase by the Plaintiffs of securities in BTA Bank (the "BTA Bank"), a bank ultimately owned by the sovereign wealth fund of Kazakhstan. It was claimed that the purchase was made in reliance on false statements and omissions by the Defendants, amounting to a much wider and more complex fraudulent scheme, whereby the Defendants diverted assets from BTA Bank over the course of two debt restructurings for the benefit of the sovereign wealth fund, the result being that the securities lost their value to the detriment of the Plaintiff.

It was believed by the Plaintiff that the Applicants had relevant evidence to be used as testimony in trial including, among other things, evidence that BTA Bank had under-reported its asset recoveries. Mr Prosyankin was believed to have been a member of BTA Bank's asset recovery subcommittee and subsequently became a member of the Bank's management board. Mr Howell was a consultant who specialised in asset recovery and had previously advised BTA Bank in the restructure.

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