Syed Rahman considers a case where sanctions were a factor in a defendant’s ability to give evidence.
The case of Gorbachev v Guriev [2024] EWHC 2174 (Comm) was notable for highlighting how an individual being sanctioned can have an impact on their other legal matters.
The case arose from a dispute over shares in a publicly-traded Russian fertiliser company, PJSC PhosAgro. The claimant, Alexander Gorbachev, alleged that he was entitled to 24.75% of defendant Andrey Guriev's shares in the company. His claim was based on verbal agreements he said were made at various venues in London between 2005 and 2008. But he had no documentary evidence to support his argument that there had been verbal agreements.
The trial saw both parties challenging the other’s version of events and legal experts being called to talk about whether the supposed agreements would be enforceable under Russian law.
But arguably the most noteworthy aspect of the case was how Guriev was to give evidence. As a sanctioned individual, Guriev was not allowed to travel to the UK to testify. As a response to this, the judge, His Honour Judge Pelling KC, said he would hear the defendant's evidence in person in Dubai, with Guriev testifying with the help of interpreters. The judge said that this would ensure a fair process, allowing for effective cross-examination without any of the difficulties associated with evidence being given remotely. Both Guriev and Gorbachev agreed that it would be more worthwhile to have Guriev testify in person.
The judge eventually concluded that much of the oral evidence could not be relied on, due to inconsistencies within it and a lack of relevant documentation. As Gorbachev’s claim was not supported by documents or other credible witnesses, he was unsuccessful.
Buit while the case emphasises the problem of relying on verbal agreements in commercial disputes where there is a lack of supporting documentation, it is arguably more significant for the judge’s approach to Guriev being a sanctioned individual. The judge’s decision to put in place arrangements for Guriev to give his evidence in person outside of the UK showed how responsive the UK courts can be to challenges. It is also an indicator that designated persons may still have options available to them when it comes to seeking justice in matters that are not sanctions related but are affected by them having been designated.
When it comes to litigating, sanctioned individuals are not – as has been seen in this case – excluded from the UK legal system. But ensuring that such an individual is able to fully exercise their legal rights may require seeking advice from those with relevant in-depth experience of both commercial litigation and the sanctions regime.
