Day 44

Bank St Petersburg v Vitaly Arkhangelsky [Master]

Day 44

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Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

1 :1 Thursday, 7 July 2016

  1. (10.30 am)
  1. MR JUSTICE HILDYARD: Yes, good morning.
  1. Closing submissions by MR BIRT (continued)
  1. MR BIRT: My Lord, good morning.
  1. Yesterday my Lord said you would welcome particular
  1. help with the public policy defence, which I was going
  1. to turn to this morning. We deal with this in our
  1. written closing, paragraphs 982 to 984.
  1. MR JUSTICE HILDYARD: You’re going to come back to
  1. the various issues, or at least the main issue on facts
  1. later, are you?
  1. MR BIRT: Can I just check what you mean by «the main issue
  1. on facts»?
  1. MR JUSTICE HILDYARD: I had an issue you were going to check
  1. yesterday as to the Bank’s appreciation of the value of
  1. the pledged assets, and the Lair valuations.
  1. MR BIRT: Yes, my Lord, and I was going to deal with that.
  1. If my Lord prefers, I can happily deal with that first
  1. up.
  1. MR JUSTICE HILDYARD: No, just to remind you. I don’t want
  1. to take you out of your planned sequence at all.
  1. MR BIRT: No, there was no particular magic to the order in
  1. which I was going to address them —
  1. MR JUSTICE HILDYARD: Go to and public policy and then come

2 :1 back, because I’ve got various questions for you later,

  1. and perhaps if we could remind each other that I do need
  1. to get your submissions on that factual issue.
  1. MR BIRT: My Lord, yes, I’ll certainly return to that.
  1. MR JUSTICE HILDYARD: Thank you.
  1. MR BIRT: Public policy in those paragraphs of our written
  1. closing. Just to put this in its rightful place,
  1. my Lord, on our case, you don’t actually get this far,
  1. or need to get this far, because we say that the huge
  1. falsities in the information memorandum, coupled, as
  1. I explained yesterday, with the bribery evidence,
  1. prevent any case on further financing from succeeding in
  1. any event, so the matter of causation; it doesn’t work.
  1. MR JUSTICE HILDYARD: Can I just mention one thing. I just
  1. can’t stop the transcript. I don’t seem to have any
  1. control over it. So sorry.
  1. 982 to 984. So sorry, Mr Birt.
  1. MR BIRT: Not at all.
  1. So I’ll just explain how, on our case, you don’t
  1. actually get this far or need to get this far. First of
  1. all there’s the causation point I’ve made. And second
  1. of all, we say that evidence, in any event, as
  1. I explained yesterday, undermines Ms Simonova’s
  1. calculations on value in any event, because she failed
  1. to take them into account in terms of amount or in terms

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

3 :1 of the risk that they posed to the project; and they

  1. would have had to have been taken into account. So, for
  1. those two reasons, this is an additional point, but one
  1. that one doesn’t need to get to. But if one does get to
  1. it, and for completeness, this is what we say about
  1. the effect of those payments.
  1. If Mr Arkhangelsky’s evidence as to the fact that he
  1. paid bribes is accepted by your Lordship, either in the
  1. amount of $160 million, or in any lesser amount, and we
  1. say that should, and is, an end to his claim insofar as
  1. the claim depends upon his having paid those bribes.
  1. We’ve cited two authorities for the general
  1. principle in footnote 2832, and it might be sensible for
  1. me just to make some comments on particular parts of
  1. those. I don’t know if my Lord has been provided with
  1. hard copies of the authorities bundles?
  1. MR JUSTICE HILDYARD: I don’t think I have. It’s perfectly
  1. possible I have, and it’s perfectly possible that
  1. they’re not here. I’ve got three volumes — four
  1. authorities bundles, 4 to 6.
  1. MR BIRT: Authorities bundles 4 to 6; that’s what we’ll
  1. need, my Lord, yes.
  1. MR JUSTICE HILDYARD: Where should I go?
  1. MR BIRT: So it is behind tab 20, my Lord.
  1. MR JUSTICE HILDYARD: Thank you.

4 :1 MR BIRT: First of all, the first case we cite in

  1. the footnote is the Bilta Ltd v Nazir case {AUTH5/20/1}.
  1. Via introduction, this is a case which my Lord may have
  1. come across before. It considered numerous — or at
  1. least a number of different and difficult issues, and in
  1. relation to the issue of illegality, there was
  1. discussion and there was a difference of opinion between
  1. some of their Lordships, and I’m simply going to show
  1. a couple of passages to explain, I hope shortly, what
  1. the issue was, and then what the general view was about
  1. the existing state of the law; and then that will assist
  1. when we come to the other authority, which is slightly
  1. older but, in my submission, just sets out what my Lord
  1. needs to have in mind in a nice narrative sense.
  1. So if, first of all, I could draw attention to
  1. the judgment of Lord Neuberger, and in particular to
  1. note that Lord Clarke and Carnwath agreed with him. He
  1. refers to the matters in dispute under paragraph 12 of
  1. his judgment, which is at page 11 of that tab
  1. {AUTH5/20/11}.
  1. So he identified under paragraph 12 that this is
  1. amongst the issues on which some of their Lordships
  1. disagreed. There was disagreement as to the basis on
  1. which the defence based on illegality or ex turpi causa
  1. is to be approached; and he says two approaches,

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

5 :1 Lord Sumption, Toulson and Hodge. Then he goes on in

  1. paragraph 13 to discuss the proper approach to
  1. the illegality defence.
  1. I think, for current purposes, one can look at
  1. paragraph 17. He discusses some of the recent cases and
  1. some of the differences in views in them, but when he
  1. gets to 17 {AUTH5/20/12}, he says in the middle of that
  1. paragraph:
  1. «Lord Sumption is right to say that, unless and
  1. until this court agrees to follow Tinsley, it is at the
  1. very least difficult to say that the law is as flexible
  1. as Lords Toulson and Hodge, suggest in their judgment,
  1. but … there is room for argument …»
  1. And there has been a Law Commission report, and we
  1. may look back — look at it again in the future.
  1. And indeed, I think there is a case currently
  1. pending but judgment hasn’t yet been handed down.
  1. The point I’m simply making at the moment is that
  1. the current state of the law, subject to any further
  1. development or appeals, or argument, is at least Tinsley
  1. v Milligan. There may be some wider principles, but at
  1. the moment it is Tinsley.
  1. And Lord Sumption, if I can just briefly look at
  1. what he says at paragraph 60, page 24 {AUTH5/20/24}. He
  1. set out the famous and authoritative statement of

6 :1 Lord Mansfield in Holman v Johnson, which I’m not going

  1. to read out, but my Lord is probably well familiar
  1. with it. He then explains some of the subsequent
  1. development in the law, but then comes back to explain
  1. that Tinsley v Milligan restated the position, and he
  1. says in paragraph 62 {AUTH5/20/25} and that «is binding
  1. authority, subject to review in this court», and we
  1. haven’t been invited to overrule it.
  1. So in other words, that is, if you like, the base
  1. position, which is that we’re still at
  1. Tinsley v Milligan, as I read this judgment, albeit, as
  1. Lord Neuberger said, there may well be argument along
  1. other lines as posed by Lords Hodge and Toulson, but at
  1. the moment that’s not open to anybody below
  1. the Supreme Court.
  1. We can go on to the Nayyar case, which is the other
  1. one we’ve relied upon, which sets out the test and
  1. the approach, and that’s behind tab 17 {AUTH5/17/1}.
  1. MR JUSTICE HILDYARD: Just pausing at Bilta,
  1. the discretionary jurisdiction which was suggested in
  1. the Court of Appeal in Euro-Diam, was rejected, at least
  1. by Lord Sumption, as being too unruly a horse.
  1. MR BIRT: My Lord, it was rejected by Lord Sumption, and
  1. the judgment of Lord Neuberger, with whom Lords Clarke
  1. and Carnwath agreed, is that there may be something to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

7 :1 be said for the more flexible approach, which was

  1. certainly advocated by Lords Hodge and Toulson in their
  1. judgment in Bilta, but, he said, the current position is
  1. that it is Tinsley, but he essentially was trailing
  1. further argument in a future case where that might be
  1. revisited.
  1. It seems the position is currently Tinsley.
  1. The Supreme Court may rule that it is in fact more
  1. flexible than that. So, for form’s sake, one would want
  1. to reserve the position to argue that if
  1. the Supreme Court does give a difficult ruling, or
  1. indeed to take the point on appeal in the future, as
  1. a sort of formal reservation. But the current position
  1. is, as I read this, the Tinsley position.
  1. MR JUSTICE HILDYARD: Right.
  1. MR BIRT: And then, my Lord, we go back to Nayyar in tab 17.
  1. And Mr Justice Hamblin in that case ran through some of
  1. the authorities in what seemed to us to be a helpful
  1. collection of them, starting at paragraph 75 at page 17
  1. {AUTH5/17/17}, summarising the ex-turpi maxim as:
  1. «… a principle that prevents a claimant from using
  1. the court to obtain benefits from his own wrongful
  1. conduct.»
  1. He again sets out that extract from Lord Mansfield’s
  1. speech in Holman v Johnson, and 76 summarises Tinsley:

8 :1 «The principle applies where the wrongful conduct

  1. has to be relied upon to advance the claim being made.»
  1. He cites Lord Phillip’s speech in Stone & Rolls,
  1. which effectively explains this under two
  1. subparagraphs in 77; the first being to do with
  1. enforcement of a contract, which doesn’t strictly arise
  1. here, but under (ii), the general principle:
  1. «The court will not assist a claimant to recover a
  1. benefit from his own wrongdoing.»
  1. I think those are the parts I would specifically
  1. draw attention to at the moment.
  1. For completeness, partly because of the facts of
  1. this case and the consideration given to bribery in that
  1. case, my Lord might like to have a quick look over
  1. the page at pages 20 and following, where the judge made
  1. some comments and cited various material about the evils
  1. of bribery.
  1. MR JUSTICE HILDYARD: Where’s that?
  1. MR BIRT: That’s starting at paragraph 83 {AUTH5/17/20}.
  1. And of course, that’s all English law. There’s also
  1. some commentary from the Lord Chancellor when he
  1. introduced the Bribery Bill, and comments on the law
  1. reports, the Law Commission Report. He runs through
  1. then the criminal offences of bribery, including, in
  1. paragraph 89, the 2001 Act which extended the bribery

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

9 :1 offences to cover conduct overseas.

  1. MR JUSTICE HILDYARD: There’s still the test — I mean,
  1. the description of the two polarities from
  1. Lord Justice Bingham’s judgment in Saunders v Edwards
  1. quoted at paragraph 80 makes clear that, at least under
  1. the existing law, one has to be a wee bit careful about
  1. this.
  1. The court won’t:
  1. «… lend its authority to a party seeking to pursue
  1. and enforce an object or agreement which the law
  1. prohibits.»
  1. But equally, it mustn’t invent a broader morality
  1. with which to express his disapproval and deny people
  1. rights which they are entitled to even without reliance
  1. on a particular act.
  1. MR BIRT: My Lord, yes. It requires, in my submission,
  1. a sort of critical look at how the unlawful conduct, in
  1. this case the bribery, affects the claim which is being
  1. pursued.
  1. MR JUSTICE HILDYARD: It has to be at the root of the claim.
  1. It has to be the thing he must assert to win.
  1. MR BIRT: Yes, I’m not saying «the thing»; it can be one of
  1. the things or part of the process. But it is one way of
  1. looking at it in this case — and we’ll come on to this
  1. a little bit more — is, given Dr Arkhangelsky’s

10 :1 evidence, we take his quantum case on the counterclaim

  1. which relies upon the development of
  1. the Western Terminal business into the all singing all
  1. dancing container port with the extra dredging in
  1. the channel and the extra berth; and his evidence
  1. was: none of that could be achieved without my having
  1. paid these huge amounts of money — which are obviously
  1. unlawful, and he admitted as much, and would be unlawful
  1. under English law; there’s no doubt about that. None of
  1. that could be done without the bribery —
  1. MR JUSTICE HILDYARD: And you say that made him an outlaw?
  1. For all purposes? Could he enforce debts?
  1. MR BIRT: What we’re saying, my Lord, is what he can’t do is
  1. then bring a claim in this court for loss which is said
  1. to reflect, or be calculated by reference to, the value
  1. of the business he would have achieved, which could only
  1. have been achieved through bribery.
  1. Not that he, having done that, this court will shut
  1. the doors to him for everything he comes in for. But
  1. insofar as his claim depends upon his having paid those
  1. bribes, that is the part of the claim which he cannot
  1. ask this court to award him; because what the court is
  1. effectively then doing is rewarding him for those
  1. payments, and that is the point at which this court will
  1. say: we don’t go there.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

11 :1 In order to say, «I would have made this into

  1. the successful port business, the container terminal,
  1. with, for example, the extra berth that I was going to
  1. construct» — «How would you have done that,
  1. Mr Arkhangelsky?» His answer is, «Well, I’d secured
  1. the approval because I’d paid the bribes».
  1. Well, absent his unlawful conduct, he can’t make
  1. that claim. So that’s his reliance on his unlawful
  1. conduct, because there’s no other way that he can
  1. prove — on his own evidence; this is all on the premise
  1. that my Lord accepts his evidence that this is what he
  1. did and this is what the purpose of them was for. But
  1. absent that, on his evidence, the third berth doesn’t
  1. get built. By asking this court to give him effectively
  1. loss of value in the business from that third berth, he
  1. is asking the court to reward him for his payment of
  1. bribes.
  1. MR JUSTICE HILDYARD: I find it difficult to see where
  1. the line is.
  1. MR BIRT: Well, if, for example, there’s a part of
  1. Dr Arkhangelsky’s claim — assume he were, against our
  1. case, to succeed in some way, and he had a valid claim
  1. that related to property that was, on his case, nothing
  1. to do with the port business, so it was untainted by
  1. this payment of bribe, well then, this principle would

12 :1 not prevent his recovery of loss connected with that

  1. property, or that reflected that property. Because
  1. although he had acted unlawfully, and although he
  1. committed criminal acts, and although that was part of
  1. the background to the case and part of the, if you like,
  1. factual matrix, it doesn’t touch that bit of his claim,
  1. that head of his loss. So it doesn’t fall within
  1. the path of the facts on which he has to rely to
  1. establish that particular part of it.
  1. MR JUSTICE HILDYARD: I quite understand that this court
  1. wouldn’t assist — for example, supposing the bribee, if
  1. that’s what he was, had promised a certain result, and
  1. Mr Arkhangelsky sued to enforce that result. It being
  1. a bribe, on that hypothesis, the court would not lend
  1. its assistance. I can understand that.
  1. But here, the bribe, if that’s what it was, was paid
  1. as part of the expenses, if you like, albeit of an
  1. unacceptable kind, if that’s what they were, as key
  1. money to the development of what he had acquired.
  1. MR BIRT: My Lord, yes.
  1. MR JUSTICE HILDYARD: And you say that his rights in respect
  1. of what had been acquired and its value are somehow
  1. polluted accordingly?
  1. MR BIRT: Well, if the right factual analysis is that his
  1. acquisition of the plot is not tainted by the bribery

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

13 :1 but only the future development of the plot is tainted

  1. by the bribery, then that bit of his claim which fails
  1. is the bit which depends upon the future development of
  1. the plot. It doesn’t have an all infecting character.
  1. But what it does is, when you ask the question: what is
  1. his claim for loss based upon? What is he showing to
  1. prove his claim for loss? I’m taking the example at the
  1. moment of his claim for a business loss based upon
  1. having developed the terminal, but his own evidence
  1. is: in order to develop the terminal in that way, it was
  1. necessary for me to commit these criminal offences.
  1. That is the bit at which he is having to rely upon his
  1. own conduct, which was his own criminal conduct.
  1. MR JUSTICE HILDYARD: But no part of the relationship
  1. between him and, if he was that, the bribee has to be
  1. prayed in aid. He has had to pay, and to that extent
  1. he’s the poorer, if he’s right, to the tune of
  1. 140 million or whatever it was, so his net advantage has
  1. been reduced by that amount, that’s true. But I mean,
  1. the court might be indignant, but how can it deny right?
  1. MR BIRT: My Lord, with respect, it does have to be prayed
  1. in aid, because if one poses the question: how on earth
  1. was Mr Arkhangelsky ever to develop the terminal in this
  1. way? I mean, he needs to be able to prove: I could have
  1. developed the terminal in this way. And part of that

14 :1 proof is that I could have raised the money to do it.

  1. And we say he falls down on that ground. A separate
  1. point.
  1. But it’s not just that, because on his own evidence
  1. it wasn’t just a question of him having the budget to do
  1. it, he also needed a whole raft of permissions. And on
  1. his own evidence, in order to get those permissions, he
  1. had to commit these criminal offences of bribery. So he
  1. does have to pray it in aid, my Lord, because —
  1. MR JUSTICE HILDYARD: Well, where does it go? Supposing he
  1. got permissions and that they were pursuant to a bribe,
  1. are you saying that those permissions could never have
  1. been enforced by a court?
  1. MR BIRT: In this country — and I don’t know what the
  1. attitude of Russian law is on this; I’m not trying to
  1. explain what Russian law is on it —
  1. MR JUSTICE HILDYARD: I don’t know, and there’s no separate
  1. Russian law on this; assume it’s all English law.
  1. MR BIRT: In English law, if this had happened in England
  1. and Dr Arkhangelsky was operating a port business in
  1. England and had obtained approvals for development
  1. through bribery of a local government official —
  1. MR JUSTICE HILDYARD: Yes.
  1. MR BIRT: — then the local authority could set them all
  1. aside. It’s like rescinding a contract for bribery. If

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

15 :1 somebody bribes my agent and therefore binds me to

  1. a contract, then the court will rescind that court upon
  1. proof of the bribe. There’s a number of other remedies
  1. as well, but in civil law that’s one of the remedies;
  1. and the same is no doubt true if somebody bribes
  1. a public official to enter into a public contract —
  1. MR JUSTICE HILDYARD: Yes, because then the thing to be
  1. enforced is the contract for the grant of
  1. the permission, and then you’re asserting that right as
  1. against the bribee.
  1. MR BIRT: Well, I think it may be a slightly different
  1. point, because the example that we’re talking about,
  1. which is rescinding a contract or rescinding an
  1. approval, is not so much an application of the doctrine
  1. of illegality or ex turpi, it’s an application of, in
  1. the first case, a principle of contract law that allows
  1. you to rescind for a number of reasons, one being that
  1. your agent or fiduciary has been bribed; and a similar
  1. principle in public law, which would allow the relevant
  1. authority to rescind a particular authorisation that it
  1. had given on the basis that the relevant officer had
  1. been bribed. In those situations, it’s not a cause of
  1. action necessarily that the grantee is asserting.
  1. I mean, I suppose if he said, «Where’s my approval?
  1. You haven’t actually issued it to me; you said you were

16 :1 going to», I’m not sure what right he would be enforcing

  1. in those circumstances.
  1. MR JUSTICE HILDYARD: He wouldn’t be able to enforce that.
  1. But take an example — it’s always dangerous, but
  1. take an example. A man holds property, holds land on
  1. which he needs some local authority permission to build,
  1. and he obtains the local permission to build on footing
  1. of a bribe, right? And he builds the house accordingly.
  1. He then sells the house and the land as developed has
  1. enabled the realisation of price, and he sells it to
  1. you, and you default, and you say you’re only going to
  1. pay the value of the land without the house on it or
  1. the development value on it. No court would prevent him
  1. asserting his contract against you on grounds of
  1. illegality.
  1. MR BIRT: But I think that’s a different situation where
  1. somebody’s seeking to enforce a contract. The rules
  1. operate slightly differently there, because you look at
  1. what the rights and obligations are that arise under
  1. the contract. The ex turpi defence arises in situations
  1. generally where it’s a tort claim, or something like
  1. that. And the court is saying effectively, as
  1. Lord Phillips said in the Stone & Rolls case, you can’t
  1. recover a benefit from your own wrongdoing; and that is
  1. what he is trying to do here.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

17 :1 MR JUSTICE HILDYARD: Right.

  1. MR BIRT: My Lord, I think those are the points on
  1. the illegality —
  1. MR JUSTICE HILDYARD: Do you think Graham Thomas helps,
  1. Lord Hoffmann? The distinction between causing
  1. something and merely providing the occasion for
  1. something else to cause something is one which we’re
  1. very familiar with. I think that helps.
  1. MR BIRT: Well, yes, and it might be a helpful way of
  1. expressing the sort of point that I’ve been ineptly
  1. trying to articulate. And we would say that here,
  1. the bribery is not simply the occasion for the profit he
  1. said he would have made, the value he said he would have
  1. made for which he’s claiming loss, it is the cause of
  1. it.
  1. MR JUSTICE HILDYARD: You say it’s the source of the value?
  1. MR BIRT: It’s the source of the value, my Lord, yes.
  1. MR JUSTICE HILDYARD: The bribe is the source of the value?
  1. MR BIRT: One of the sources of the value. You can have
  1. more than one source, as much as you can have more than
  1. one cause, including more than one cause in law; more
  1. than one source. But it’s more than a background
  1. factor. It’s more than that, more than the background
  1. or the occasion.
  1. Going on: was is it an integral part or a necessary

18 :1 direct consequence of the unlawful act? Does it arise

  1. directly ex turpi causa? Although he goes on to say
  1. once one keeps coming up with the different phrases, one
  1. perhaps muddies the waters. But, yes, we would say that
  1. this does directly arise. The profit he says he would
  1. have made, the value of the business he
  1. says Western Terminal would have grown into, arises
  1. directly from the bribes he says he paid, because on his
  1. account, you simply couldn’t develop the business at all
  1. without paying those bribes; it wasn’t an optional
  1. add-on is how he put it, it was a necessary part of
  1. carrying out this business.
  1. My Lord, the only other point I think I needed to
  1. make —
  1. MR JUSTICE HILDYARD: And that excludes him forever, in all
  1. courts, does it, from claiming the value of the business
  1. if it’s thought to be denied him?
  1. MR BIRT: My Lord, yes, it would.
  1. MR JUSTICE HILDYARD: It seems very broad.
  1. MR BIRT: Insofar as he is having to rely upon the fact that
  1. he would, absent the wrongdoing — the alleged
  1. wrongdoing — have developed the business.
  1. I mean, as I say, it’s not so much that — one has
  1. to actually look critically at what he has to say to
  1. prove his claim. It’s not that he had —

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

19 :1 MR JUSTICE HILDYARD: He doesn’t have to say any of that, he

  1. just says, «Here am I with the Western Terminal; its
  1. prospects are these». And someone says, «Oh, you bribed
  1. someone». He says, «I’m not mentioning that, nothing to
  1. do with me; in this case, all I’m doing is saying what
  1. the value of the land and its propensity is. That’s
  1. all».
  1. MR BIRT: But he’s not just saying that, my Lord, with
  1. respect. That’s not all he’s saying. He’s not just
  1. saying that’s what its propensity was. He’s running
  1. a positive case as to: this is how I was going to
  1. develop the business. This is all set out in
  1. the information memorandum. That is the basis upon
  1. which the calculations have been performed; that’s the
  1. basis on which value has been ascribed.
  1. MR JUSTICE HILDYARD: It’s a historical antecedent, but it’s
  1. no part of his claim. His claim would be — one can see
  1. it, and it’s quite useful to see it. Points of claim:
  1. I own the land.
  1. Paragraph 2: the land with its potentiality is worth
  1. X gazillion.
  1. Point 3: you’ve denied me the value of that land and
  1. its potentialities, and I claim against you.
  1. MR BIRT: Well, if he had pleaded the claim like that, I’m
  1. sure he would have met with a claim for further

20 :1 particulars:

  1. «When you say the value and its propensity was X,
  1. what do you mean? How do you get there?» And he would
  1. have said, as he has said in his evidence, «I’ll tell
  1. you how I would have got there; I would have developed
  1. it in this way and that way, and I would have got these
  1. approvals.» «How would you have got these approvals?»
  1. «I would have bribed Mr — «, whoever it was.
  1. MR JUSTICE HILDYARD: I thought he already had done this.
  1. MR BIRT: He got the approvals — that was his evidence —
  1. through his bribery.
  1. MR JUSTICE HILDYARD: I think you are going beyond
  1. Tinsley v Milligan. You may be right to do so, but I
  1. don’t know when the Supreme Court is — I think there is
  1. a matter just before it, isn’t there, on appeal?
  1. MR BIRT: As I understand it, considering at the moment.
  1. MR JUSTICE HILDYARD: Well, it is a broad proposition,
  1. I think, this.
  1. MR BIRT: Well —
  1. MR JUSTICE HILDYARD: But you disavow going beyond Tinsley
  1. v Milligan, though you reserve the right in another
  1. place to do that were the Supreme Court to decide that
  1. Tinsley v Milligan is old hat?
  1. MR BIRT: My Lord, yes, or if they are to set out further
  1. principles which shed further light on it, my Lord.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

21 :1 And we rely upon the points I’ve also drawn attention to

  1. in Lord Phillips judgment in Stone & Rolls, and in
  1. the other authorities my Lord and I have had
  1. the exchanges about this morning.
  1. MR JUSTICE HILDYARD: But you accept that I —
  1. MR BIRT: And just going back —
  1. MR JUSTICE HILDYARD: — am bound by Tinsley v Milligan
  1. really?
  1. MR BIRT: Well, by the general principle in Tinsley v
  1. Milligan, subject of course to how the courts are
  1. helping us to understand that, but not going as far as
  1. to say there is some much broader and flexible principle
  1. espoused by Lords Toulson and Hodge, which may or may
  1. not come to be the test. But on the majority
  1. judgments in Bilta, that approach, as I read it —
  1. MR JUSTICE HILDYARD: The majority judgements —
  1. MR BIRT: — isn’t open to us at this stage.
  1. MR JUSTICE HILDYARD: — confirm Tinsley and Bilta,
  1. therefore Tinsley is my rule?
  1. MR BIRT: Tinsley is your rule, my Lord, as the Tinsley rule
  1. is what it is. But the other statements in this case,
  1. which do not purport to depart from the Tinsley rule,
  1. are also informative in understanding how one
  1. understands it.
  1. MR JUSTICE HILDYARD: Yes.

22 :1 MR BIRT: So if, for example, one looks at paragraph 81 of

  1. this judgment, it’s not a question — that’s
  1. the quotation there from Lord Justice Beldam — it’s not
  1. a sort of technical approach, one doesn’t just look at
  1. the pleading. One has to analyse not just what has he
  1. pleaded, but what does he have to rely on to get his
  1. case home. And one could never just confine it to
  1. the pleading, my Lord, one has to analyse what is it
  1. that he has to rely on to get his case home, and we say
  1. that he has to — on his own evidence that’s what he has
  1. to rely on in order to show that he would have been able
  1. to develop the Terminal in the way his business loss
  1. claim assumes.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR BIRT: My Lord, those are the principles of English
  1. law: illegality and public policy.
  1. MR JUSTICE HILDYARD: Thank you, but you put it this
  1. way: you say that {AA3&4/14/521}:
  1. «… the value of any real estate
  1. at Western Terminal where the value of such real estate
  1. would be dependent on official support and/or licences
  1. and/or permits secured by the making of any corrupt
  1. payments …»
  1. And what you mean by that is because Mr Arkhangelsky
  1. said that he really would have been stopped in his

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

23 :1 tracks by officials unless he made these payments, that

  1. therefore he is not entitled to assert the value of any
  1. real estate at Western Terminal. He’s got —
  1. MR BIRT: Well, let me put it like this, my Lord: not
  1. entitled to assert the value of any real estate, but not
  1. entitled to assert it on a basis which depends upon
  1. being granted those sorts of permits and licenses and
  1. support, and so on, that he says he could only have
  1. secured through bribery — for development.
  1. So for example, one looks at — it is a plot of
  1. land, it can be valued as a plot of land. For example,
  1. on Mr Millard’s type of approach, that doesn’t require
  1. any proof of developing it, or permissions or approvals.
  1. Ms Simonova’s approach, which assumes turning it into
  1. a container port, would require approval and so on, and
  1. so we say you can’t go down that route, because to do so
  1. is again relying upon the approvals which she said could
  1. only be approved through these payments.
  1. MR JUSTICE HILDYARD: And a pledgee of that land, is it
  1. affected by this pollution problem?
  1. MR BIRT: No, my Lord, because the pledgee is not having to
  1. rely upon his own wrong, my Lord.
  1. MR JUSTICE HILDYARD: So he can take the full value of
  1. the land and not account for it?
  1. MR BIRT: Well, I think it’s different when one’s

24 :1 saying «not account for it» as opposed to claiming

  1. damages. I mean, say if it was sold for a particular
  1. amount, whatever that amount is, then that amount has to
  1. be accounted for. That’s the difference to the current
  1. position where Mr Arkhangelsky says: well, it may be
  1. sold for that amount, assume it was, take that, however
  1. because of some other collection of wrongs, I have lost
  1. a much more valuable facility, and I’ll show you how
  1. valuable it was by reference to the business it would
  1. have conducted, which I could have only conducted
  1. because of my bribery. So that’s a different situation
  1. from accounting for proceeds actually realised, because
  1. in a proceeds actually realised situation, if
  1. Mr Arkhangelsky says, «Ah, you realised this for
  1. a certain amount, which clears the debt and there’s
  1. a surplus value», then he’s not having to rely on
  1. anything apart from that, he’s not having to rely on
  1. the future value of the business, or the development
  1. potential, or anything like that. That’s not even on
  1. the cards in that situation.
  1. MR JUSTICE HILDYARD: Well then how does this help you?
  1. The shares and the assets ensured — the pleasure of
  1. the assets and the repos ensured that the entire value
  1. of the Western Terminal was inured to the pledgee, you,
  1. the Bank. And the Bank has a debt — has lent, say,

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

25 :1 100, and the land is worth, say, 110, but the land, in

  1. all its potentialities, including the business, is worth
  1. 5,000. There’s a default, and the Bank realises its
  1. securities, and those securities, on that hypothesis,
  1. generate 5,000-worth of value. Is the Bank to account
  1. only for 100, or for the 5,000?
  1. MR BIRT: I think I just need to re-read the figures,
  1. my Lord, to make sure I’ve got the right ones.
  1. MR JUSTICE HILDYARD: I mean, the figures may confuse it.
  1. The thing is: who bags the potentiality where
  1. the pledgee has obtained control of it? Does
  1. the pledgee just say, «Whoopee, I’ve got 5,000, that’s
  1. what it’s worth», and poor old owner — not so poor old
  1. owner, because he’s been wicked and bribed someone —
  1. because he has bribed someone, he is not entitled to any
  1. of that, only to the value of the land which could have
  1. been realised without the bribe. Is that right?
  1. MR BIRT: If we are talking about that situation without
  1. the repo transaction, and one was just talking about the
  1. pledge, and the land, whatever it is worth on an
  1. appraisal basis or someone’s value, or potentiality, is
  1. whatever it’s worth. The Bank has assumed there’s
  1. a default and the Bank has rights to enforce against it,
  1. and the Bank does, and the Bank sells it, and there’s
  1. a surplus, then the surplus has to go back to the owner.

26 :1 MR JUSTICE HILDYARD: All of it? The potentiality and all?

  1. MR BIRT: Well, once the deck’s cleared, the surplus goes
  1. back. Not potentiality, because it depends on the sale
  1. price —
  1. MR JUSTICE HILDYARD: But that’s what the Bank’s got; the
  1. Bank’s got the potentiality.
  1. MR BIRT: Well, the plot of land has been sold, and there is
  1. then a pot of money which is the proceeds of sale, and
  1. then that goes to discharge the debt and the surplus
  1. goes back. Because what the owner there, the claimant
  1. in this situation, is asserting is simply the fact of
  1. sale and the sale price. He’s not asserting anything
  1. about the potentiality; he’s not having to approve what
  1. the value was, he’s simply proving what the sale price
  1. was. He’s not having to rely on anything.
  1. MR JUSTICE HILDYARD: Yes, but the sale price will, unless
  1. he breaches his duties, include the potentialities of
  1. the land. He sells what he’s got.
  1. MR BIRT: Yes.
  1. MR JUSTICE HILDYARD: And that land has got potentiality.
  1. And he receives the land value and the potentiality
  1. value.
  1. MR BIRT: Yes.
  1. MR JUSTICE HILDYARD: Now, the potentiality, you say, back
  1. in history, was only released by the payment of a bribe.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

27 :1 Can the pledgee say to the briber, who was in fact

  1. the pledgor as well, «You cannot recover
  1. the potentiality»?
  1. MR BIRT: My Lord, the answer is no, but there is a sort of
  1. artificial distinction in your Lordship’s question,
  1. because my Lord poses it on the basis that the pledgee,
  1. when he sells, gets the value of the land plus
  1. the potentiality value. But that’s an artificial
  1. distinction; what he gets is the value of the land,
  1. which people may or may not regard. That’s the buyer’s
  1. prerogative, how much he decides to pay for it.
  1. MR JUSTICE HILDYARD: But you’re saying, at an earlier stage
  1. in your argument — I’ve already agreed with you — that
  1. you do have to make that distinction, because you’re
  1. saying it’s not the land which he’s not entitled to
  1. assert the value of, it’s the part of the value of
  1. the land which was released by the payment of the bribe.
  1. That’s why I’ve distinguished between the two.
  1. MR BIRT: Yes, I think my distinction was how are you
  1. valuing the land, rather than having two parts of
  1. the value of the land. But I see my Lord’s point. But
  1. with respect, when the owner of the land is seeking to
  1. recover the surplus, what he’s not having to do at that
  1. stage is prove: this is what I would have done with
  1. the land and that’s what I would have achieved with it.

28 :1 That’s not part of his claim. And on the pleading, nor

  1. when you drill down to it is it anything that he has to
  1. prove or go anywhere near, because it just doesn’t
  1. matter. In that situation, the question is what price
  1. was achieved.
  1. Now, if he had an additional claim against the Bank,
  1. and said, «You may not have achieved a surplus; when you
  1. sold it there wasn’t a surplus; but you’ve caused me
  1. loss through a fault, a sort of culpable and actionable
  1. fault, and if you hadn’t committed that fault, you would
  1. have realised it for a whole lot more, and that whole
  1. lot more is the value», we say, «What do you mean that’s
  1. the value? How do you prove that?» «Ah, because if you
  1. hadn’t taken it, I would have developed it in all these
  1. ways». «Well, how would you have developed it?»
  1. «Because I would have bribed people». Well, then you’re
  1. back in the illegality box at that stage.
  1. But that’s not the case of realised sale proceeds
  1. going back; that’s a different case.
  1. MR JUSTICE HILDYARD: But you would accept that the value of
  1. the land with all its potentialities in the hands of
  1. the Bank, is, when realised, to be accounted for to
  1. the pledgor after deduction of the debt?
  1. MR BIRT: Well, no, not the value of the land. The sale
  1. proceeds are to be accounted for after —

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

29 :1 MR JUSTICE HILDYARD: But here the problem is that there’s

  1. a claim that the sale proceeds were deficient. That’s
  1. why I’ve put it in the value of the land.
  1. MR BIRT: Precisely. But the question is then: what is
  1. the claim? It’s a claim for loss. How is he
  1. establishing his loss? He’s establishing it through
  1. saying the value was at a certain amount. How does he
  1. get to the value? He relies upon these bribes. That’s
  1. the point at which we say he can’t do that. He would
  1. have to be able to establish the value of the land
  1. without reliance on the various approvals that were only
  1. procured through bribery, my Lord. That’s what this
  1. point comes down to. It’s not an all or nothing point,
  1. it doesn’t shut him out from any claim, it simply
  1. analyses what he has to prove at each stage of it.
  1. MR JUSTICE HILDYARD: I’ll just clarify in my mind once
  1. more. The Bank has the land and the land has
  1. potentiality. It is true that the Bank may have sold
  1. it, but there’s an issue as to whether it had sold it
  1. for its full value. The pledgor wishes to recover from
  1. the Bank the difference between the value it was sold at
  1. and the value with its true potentiality taken into
  1. account. Can he do so?
  1. MR BIRT: Only if he proves its true value in a way which
  1. doesn’t require him to rely on his bribery.

30 :1 MR JUSTICE HILDYARD: If the sale price had been full,

  1. including its potentiality, you accept that the Bank
  1. would have had to account for the full receipt less
  1. the lending?
  1. MR BIRT: Yes, because then he doesn’t have to rely on his
  1. bribery.
  1. My Lord, the other point we should have just made in
  1. the footnote, in fairness, is of course that this, in
  1. one sense, derives from English law, but it is obviously
  1. an aspect of English public policy, so we say it would
  1. apply even though the underlying cause of action is in
  1. Russian law, and the gateway through which one gets to
  1. it, it’s in all the relevant choice of law statutory
  1. provisions. But for example, in the 1995 Law Reform
  1. (Miscellaneous Provisions) Act, which supplies
  1. the choice of law rule for torts, this court will not
  1. apply a rule of the foreign law which would conflict
  1. with principles of public policy.
  1. MR JUSTICE HILDYARD: No, I accept that. If the foreign law
  1. said, for example, bribes are okay, and in fact
  1. encouraged, in proceedings in England, the English court
  1. wouldn’t be very impressed.
  1. MR BIRT: My Lord, that’s correct.
  1. So that’s simply — the principle still applies, in
  1. other words, my Lord, because it is one of public

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

31 :1 policy.

  1. MR JUSTICE HILDYARD: No, I see that.
  1. MR BIRT: We probably should have added the Act. We’ll add
  1. the Act to Magnum for my Lord’s note.
  1. MR JUSTICE HILDYARD: Thank you.
  1. MR BIRT: There was, I think, a couple of other points I was
  1. going to come back to from yesterday.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR BIRT: Part of this was covered yesterday; I just wanted
  1. to pull some of the threads together.
  1. One of the points my Lord asked was: suppose it’s
  1. established that the claimants win the guarantees case,
  1. in other words there’s no forgeries and Mr Arkhangelsky
  1. did indeed enter into the personal guarantees, the Scan
  1. guarantees and the personal loan, what effect does that
  1. have on the wider case? I don’t accept you can
  1. necessarily parcel them into a first half and second
  1. half — on other issues in the case, perhaps we should
  1. say.
  1. I made a number of these point yesterday, I just
  1. want to pull the themes together.
  1. First of all, that would confirm and demonstrate
  1. Mr Arkhangelsky’s dishonesty. His credibility is in
  1. issue on a number of points in this case, not just those
  1. that go to the Bank’s claim against him, but also his

32 :1 claims against the Bank.

  1. For example, he makes allegations of threats for
  1. which the only support is his own uncorroborated
  1. evidence, and his credibility is obviously critical for
  1. that. His allegations that there was an oral agreement
  1. made at the 25 December meeting that he thought was
  1. legally binding, and the suggestion that there was
  1. included in that an agreed six-month moratorium. Again,
  1. those are points where his evidence directly contradicts
  1. the evidence of the Bank, and his credibility is
  1. squarely central to that.
  1. Similarly, the value of his businesses to the extent
  1. that he gave evidence about them. For example,
  1. the financial pyramid scheme, what he did with such
  1. things as the payments to City Centre, and so on. So
  1. there’s a number of points on which his credibility is
  1. key, and we say that his continuation and running of
  1. the forgery case, which is obviously, we say, false,
  1. counts against his credibility and therefore infects all
  1. of those points.
  1. Second, his running of that case, continuation of
  1. that case, for so long and in so many jurisdictions,
  1. also shows that he was exactly the type of unscrupulous
  1. borrower that the Bank was concerned about, and why
  1. the protection offered by the repo was a good idea. It

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

33 :1 demonstrates that he would have tried every trick in

  1. the book to avoid payment.
  1. A further point is that his pleading of his
  1. conspiracy case includes and always has included his
  1. forgery allegations. We gave reference yesterday to
  1. paragraph 604 of our closing, and there’s also, to add
  1. to that, paragraph 177(a)(ii) of Mr Arkhangelsky’s
  1. pleading, which alleges that {A1/2/55}:
  1. «As part of the conspiracy the Bank wrongly brought
  1. proceedings against Scan on the basis of forged
  1. guarantees.»
  1. That’s always been part of his case.
  1. A further point is that it also goes to the Bank’s
  1. state of mind and the allegations about the Bank’s
  1. motivation and what Mr Arkhangelsky alleged was
  1. their sort of animus against him; the way they had set
  1. out to persecute him. That’s part of his case.
  1. One of the themes was that the allegation of forgery
  1. was an indicator of the Bank’s dishonest conduct. But
  1. of course that, as a pillar of that submission,
  1. completely falls away. He’s unable to rely on forgery
  1. as a point against the Bank to indicate any sort of bad
  1. conduct.
  1. Another way of putting that is that the allegations
  1. of forgery were part of the context to his conspiracy

34 :1 claim; one of the ways in which he sought to infer that

  1. the Bank were dishonest; another pillar on which he
  1. built his inference case. So that’s something else that
  1. falls away and he cannot rely on it for that.
  1. We say that the existence of the personal loan shows
  1. positively that the Bank was doing its best to assist
  1. Dr Arkhangelsky in the autumn of 2008. It was doing his
  1. best to give him more time to pay, which is what he
  1. wanted. They were trying to assist their client in
  1. difficult times.
  1. One may ask rhetorically why they would have
  1. bothered doing that if they had already settled on
  1. a plan to seize the assets at that stage.
  1. And then the Scan guarantees are also relevant of
  1. course to the Scan financial position. If, as we submit
  1. is obvious, they were valid, they go directly to
  1. the value of Scan, which of course affects the value of
  1. that part of the counterclaim.
  1. My Lord, this is pulling together some of
  1. the themes, many of which came out during the course of
  1. yesterday in any event.
  1. My Lord also asked me to come back to the evidence
  1. as to the Bank’s views on the value of the pledged
  1. assets as one moved towards the end of December 2008.
  1. As far as I’m aware, there’s no particular evidence,

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

35 :1 given by any of the witnesses or in the documents, about

  1. the Bank changing its views over that period.
  1. However, I ought to have drawn my Lord’s attention
  1. yesterday to something in our written closing, and to
  1. one of the documents by way of example, which slightly
  1. shakes the premise on which we were having our
  1. discussion yesterday.
  1. I just give the reference and then we can go to
  1. the document. We referred at paragraph 900 of
  1. the written closing to the real estate that was pledged
  1. under the forth Vyborg loan. That was of course
  1. the Western Terminal pledged assets. We noted there
  1. that the mortgage agreement agreed the value of the real
  1. estate for the purpose of the pledge to be 1.286 billion
  1. roubles.
  1. Perhaps I just ought to show that to my Lord. It’s
  1. at {D55/951/1}. If my Lord is still working from
  1. the contractual documents, the custom bundle that we
  1. arranged at some earlier stage of the trial, it’s tab 37
  1. of the second volume of that.
  1. MR JUSTICE HILDYARD: Thank you.
  1. MR BIRT: So this is the mortgage agreement. The first
  1. couple of pages identify the relevant parties.
  1. The first clause identifies the underlying loan
  1. agreement, which is the forth Vyborg loan.

36 :1 Turning on to page 6 of the bundle, under clause 2,

  1. it identifies the property to be —
  1. MR JUSTICE HILDYARD: Did you say D37?
  1. MR BIRT: I said D55/951. So it’s behind tab 37 of this
  1. bundle, I hope. I’m looking at the contractual
  1. documents custom bundle, volume 2.
  1. MR JUSTICE HILDYARD: I’ll look at it on this.
  1. MR BIRT: So I think on the screen showing clause 2, that
  1. identifies the mortgage property.
  1. Then if we could look at the next page, please.
  1. {D55/951/7}, under clause 2.2, this is the agreement
  1. under clause 2.2:
  1. «The Parties have appraised the total value of
  1. the Mortgaged Property at [1.286 billion roubles] …»
  1. And that’s split between the berth and the land plot
  1. respectively.
  1. So that’s what they had agreed as the value under
  1. that mortgage agreement, which seemed to me to be
  1. something I should show your Lordship in the context of
  1. our discussion yesterday. Part of the relevance of that
  1. is that, as explained in our written closing at
  1. paragraph 876, when one comes to enforce against
  1. a pledge or a mortgage, the initial sale price set by
  1. the court would be either the amount set out in
  1. the mortgage contract or 80 per cent of the market value

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

37 :1 set after an independent valuation.

  1. In other words, the default position, I suppose,
  1. failing having a further valuation, would be that that
  1. has to be the starting price, because that’s the value
  2. the parties have agreed. So that may have been — and 1
  1. as I say, I don’t think I can point to any evidence that
  1. shows whether that was the figure in the Bank’s mind
  1. it moved through December or not, none of the witnesses
  1. commented upon that, much as they didn’t comment upon
  1. the Lair valuation reports either. But that is
  1. the figure that has been agreed, and that will be
  1. the consequence when it comes to enforcement, my Lord.
  1. In terms of my Lord’s question that followed on from
  1. that — I think this was the question, but do correct me
  1. if I’m going down the wrong path: what were the parties
  1. envisaging, what was the Bank envisaging about what
  1. happened to any surplus value in the pledged property
  1. once the repo arrangements had been set up?
  1. Now, the first point is, there’s no evidence that
  1. they were really thinking about that at all. There’s
  1. nothing in the documents which suggests that specific
  1. thought was given to it, or specific appreciation was
  1. given to it.
  1. It may be — I simply say it may be — that if
  1. the figure having been agreed at 1.286 million, which

 

38 :1 would have been the starting point for any enforcement

  1. process, that’s not very surprising, because there’s
  1. very little headroom. And my Lord and I also had an
  1. exchange yesterday about: well, even those figures may
  1. start to feel shaky as you’re moving towards the end of
  1. 2008 and the fire’s starting to burn and so on.
  1. But if one looks at it not from what must the Bank
  1. have been thinking but from an objective point of view,
  1. if an enforcement process had been entered into after
  1. the companies are in the repo, and if the land is sold
  1. through all the normal processes, and it turns out to
  1. realise more than the debt against which it is secured,
  1. then the effect of that is first of all, the debt is
  1. then cleared, along with any other outstanding
  1. liabilities attaching to that security, and the normal
  1. rules would apply, which would be that the excess, any
  1. surplus, would go back to the owner of the properties.
  1. So in this example, it would be Western Terminal.
  1. But there’s a second stage, which would be that
  1. Mr Arkhangelsky, or rather in this case OMGP, always has
  1. the ability then to go to the court in Russia and say,
  1. «Retransfer the shares to me»; it’s the repo
  1. arrangement.
  1. MR JUSTICE HILDYARD: The repo obligation to retransfer
  1. the shares expires upon default.

1 3

 

PS 07/07/2016 11.29am

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

39 :1 MR BIRT: Well, the obligation in the written repo

  1. agreements does not expire on default.
  1. MR JUSTICE HILDYARD: I see.
  1. MR BIRT: There was certainly some evidence that the general
  1. market understanding of a repo transaction was that
  1. rights expire upon default. What we’ve got in this case
  1. is a simple arrangement, where they can go back to
  1. the court and require the shares to be retransferred —
  1. MR JUSTICE HILDYARD: Where’s the repo contract? The actual
  1. contract enabling OMG to reacquire the shares?
  1. MR BIRT: My Lord, yes, I’ll just go first to our closing,
  1. because that will give me the reference to where it is.
  1. My recollection is we deal with that at paragraph 412 of
  1. the written closing {AA3&4/14/240}. Then those
  1. repurchase agreements, the example there given is
  1. {D106/1530/7}.
  1. (Pause)
  1. MR JUSTICE HILDYARD: So your expert Mr Turetsky said that
  1. in any repo transaction, if a borrower were to default
  1. on payment when due, then he lost the rights to buy back
  1. the shares. That’s what I was thinking.
  1. MR BIRT: My Lord, yes, I fully acknowledge that. And that,
  1. of course, was the market understanding. I’m not sure
  1. and Professor Guriev said there was a similar market
  1. understanding; and we’ve got that set out at 413,

40 :1 subparagraph (1) {AA3&4/14/242}.

  1. He said that:
  1. «… since the ownership of the shares resided in
  1. the Original Purchasers, they would therefore be
  1. entitled to any ‘surplus value’ …»
  1. It’s the same view really. That’s why I completely
  1. acknowledge, that was their market understanding. My
  1. point is when one looks at the terms of the repo
  1. arrangements, that’s not a term of it. The term of it,
  1. as we set them out in the closing there, and we ran
  1. through this with Dr Gladyshev, and I think we’ve given
  1. the references in here as well —
  1. MR JUSTICE HILDYARD: This is the purchase. This is
  1. the sale to the Bank or to the original purchasers,
  1. is it?
  1. MR BIRT: I’m not sure. I think the reference we’ve given
  1. there — 412(1) — that’s the repurchase agreements. So
  1. that’s the agreement for the sale back from —
  1. MR JUSTICE HILDYARD: I’m sorry, right.
  1. MR BIRT: — the original purchaser to OMGP, or GOM, as
  1. the case may be.
  1. MR JUSTICE HILDYARD: I see.
  1. MR BIRT: So they have the right to go back to the court to
  1. ask for them to be transferred, but it’s all governed by
  1. the obligation on both sides to act reasonably in good

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

41 :1 faith. And the point I was putting to Dr Gladyshev was

  1. that in that situation, part of the content of what it
  1. means to act reasonably in good faith will obviously
  1. include what has been paid back relating to the debts.
  1. And the situation we are positing, which is that
  1. Western Terminal has in fact ended up with a surplus
  1. amount, there’s no reason to think that it wouldn’t be
  1. reasonable and in good faith for Dr Arkhangelsky to ask
  1. for the shares back. Or indeed, it may be unreasonable
  1. for the original purchaser in that circumstance not to
  1. allow them to be retransferred back. So that would be,
  1. we say, on analysis, possibly a machinery by which that
  1. would be solved.
  1. I’m not suggesting that this was a thought process
  1. that the Bank went through in December 2008. There’s no
  1. evidence, as I say, whether they did or they didn’t, or
  1. they considered this at all. I’m not trying to invent
  1. evidence about that. I’m simply trying to address
  1. your Lordship’s point about how it might have worked out
  1. if that had been the outcome.
  1. Of course, as we say, in the reality, nobody, when
  1. they were entering into these arrangements, envisaged
  1. that there would be such a surplus. That’s why I say
  1. nobody thought about it. But that’s drawing attention
  1. to what the agreements say, and —

42 :1 MR JUSTICE HILDYARD: I’m not sure there’s evidence that

  1. they didn’t think there would be a surplus. On
  1. the contrary, the service might be that they did,
  1. because of the Lair valuations.
  1. MR BIRT: Well, my Lord is right, there’s no positive
  1. evidence, I think, either way, and my Lord is right to
  1. draw attention to the Lair evaluations. But I would
  1. also put into the balance the agreed valuation in
  1. the mortgage contract, which would be the starting
  1. point, absent any other valuation, for the enforcement
  1. process.
  1. MR JUSTICE HILDYARD: Right.
  1. MR BIRT: So in a sense, we’re in that situation where it’s
  1. difficult to infer what the Bank might have been
  1. thinking. There’s no positive evidence on it. There
  1. probably was a solution for Dr Arkhangelsky, if that
  1. eventuality happened, but there’s certainly no
  1. suggestion that anybody thought that that was
  1. the territory they were getting into; and
  1. Dr Arkhangelsky certainly knew that, you know, he had
  1. very little left in the cupboard. I mean, one can —
  1. MR JUSTICE HILDYARD: (inaudible) shares to be repaid,
  1. they’re not valued.
  1. MR BIRT: One might think that if he genuinely thought, for
  1. example, that there was a vast amount of spare equity in

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

43 :1 Western Terminal, a very easy way out of his predicament

  1. would have been to go to another bank and say, «I’ve got
  1. a vast amount of equity, can you lend to me against a
  1. second charge?»
  1. MR JUSTICE HILDYARD: That’s what he was trying to do by
  1. eventually going to BNP and all the rest of them —
  1. MR BIRT: Well, he tried to and he just didn’t get anywhere.
  1. MR JUSTICE HILDYARD: Yes, that’s what he was trying to do.
  1. MR BIRT: Against all sorts of other things.
  1. MR JUSTICE HILDYARD: Yes, against existing, yes. He was
  1. trying to replace the facilities. But surely
  1. the position must be that absent contrary indication,
  1. the perspective of the Bank is to be taken as informed
  1. by the Lair valuations until much later in the day,
  1. surely?
  1. MR BIRT: My Lord, I don’t accept that, because
  1. the agreement between the parties in the mortgage
  1. agreement was that the property was of a different
  1. value; and that is where the enforcement process would
  1. have to start. So if the Bank was thinking about —
  1. MR JUSTICE HILDYARD: Surely that was the haircut value?
  1. That was the value ascribed for the purposes of
  1. the mortgage arrangements.
  1. MR BIRT: Yes.
  1. MR JUSTICE HILDYARD: It isn’t the value inherent, because

44 :1 the Bank will want a margin.

  1. MR BIRT: But the bank, if it is going through the thought
  1. process of saying: if I have to enforce here, what am I
  1. going to get back against my loan? The auction process,
  1. absent anything else, is going to start at the price in
  1. the mortgage agreement. So that is —
  1. MR JUSTICE HILDYARD: Start.
  1. MR BIRT: Start. But that’s their base value. So no doubt
  1. that’s the reason why it’s in there, because that’s what
  1. they will count on. They may think in a market with
  1. lots of time to sell, and so on and so forth, you might
  1. get a different value; but obviously a bank approaching
  1. a potential foresale doesn’t think in those terms.
  1. MR JUSTICE HILDYARD: And what was the amount extended under
  1. that mortgage?
  1. MR BIRT: The loan was set out in clause 1. It’s the fourth
  1. Vyborg loan; it was just over 1 billion roubles. So
  1. 1.088 billion roubles.
  1. MR JUSTICE HILDYARD: So there was margin of about 150, was
  1. there?
  1. MR BIRT: The difference between the amount lent and
  1. the agreed appraised value is about 200 million roubles.
  1. MR JUSTICE HILDYARD: So even on those figures, there was
  1. going to have to be an accounting of the difference
  1. between value and the loan?

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

45 :1 MR BIRT: There may be, save that I haven’t done

  1. the calculation, but of course the loan had been
  1. extended in July and there would have been some
  1. interest.
  1. MR JUSTICE HILDYARD: That’s true.
  1. MR BIRT: And we’re coming in, as we said yesterday, to
  1. a period when things were already going very badly wrong
  1. in the markets and the property markets, my Lord, so I’m
  1. not sure that anybody really would have realistically
  1. thought that was likely to happen.
  1. MR JUSTICE HILDYARD: Anyway, I think I should confess,
  1. I find it odd that the Bank simply closed its eyes to
  1. what it should do with any surplus, as normally, in my
  1. experience, certainly in England, bankers are very alive
  1. to the fact of having to account for a surplus, and are
  1. very keen to ensure that they can do so, lest they be
  1. sued. It may be different in Russia, I don’t know.
  1. Let’s walk through it on that footing. You say that
  1. the repo contract, the contract for repurchase by OMG of
  1. the shares that had been purchased by the Bank under
  1. the first limb of the repo arrangements did not
  1. expressly foreclose the right of repurchase upon
  1. default.
  1. You say that in general — and both experts appear
  1. to agree — it would be assumed that those rights would

46 :1 be foreclosed. However, in this case, there was an end

  1. runner of the court, which enabled OMG to go to
  1. the court, rely on the fact there was no express
  1. provision, accept the fact that there was market feeling
  1. the other way, but say in all fairness, the court should
  1. require redelivery of the shares.
  1. MR BIRT: My Lord, that is certainly a possibility that is
  1. open, an argument open to them on the terms of
  1. the agreement, my Lord, yes.
  1. MR JUSTICE HILDYARD: Open to OMG on the terms of the
  1. agreement?
  1. MR BIRT: Yes.
  1. Mr Eschwege draws my attention — we’ve made
  1. the point in the closing as well — that there’s also
  1. Article 10 under Russian law which protects against
  1. abuse of right, which might be an additional argument.
  1. But there’s an express clause in any event, but it’s an
  1. additional point.
  1. MR JUSTICE HILDYARD: Then there comes a time, at the time
  1. of default, when the shares are onward sold by
  1. the original purchasers to the subsequent purchasers.
  1. That’s after default, isn’t it?
  1. MR BIRT: Yes. After the first default.
  1. MR JUSTICE HILDYARD: And do you say the like entitlement
  1. arises notwithstanding the further sale?

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

47 :1 MR BIRT: Well, the right is a contractual right against

  1. the original purchasers, my Lord, so that would be their
  1. right —
  1. MR JUSTICE HILDYARD: While they’re out of the picture,
  1. they’ve sold.
  1. MR BIRT: There would undoubtedly be a cause of action
  1. against them if they didn’t do it.
  1. MR JUSTICE HILDYARD: (Inaudible) of action, it’s the right
  1. of redelivery available in the court, notwithstanding
  1. the general practice.
  1. MR BIRT: How it would work is that the court, if it was
  1. minded to grant the relief which compelled the party to
  1. this agreement to enter into the share repurchase
  1. agreement, and then —
  1. MR JUSTICE HILDYARD: If you say, «I’ve got nothing, I’ve
  1. passed the shares».
  1. MR BIRT: Quite. And then, if they did not comply with
  1. their obligations under that, then they would have
  1. breached the agreement that the court would have
  1. compelled them to enter into, and they would be liable
  1. in the normal way.
  1. MR JUSTICE HILDYARD: I don’t understand that, because
  1. I thought it was sort of: the contract says nothing,
  1. the market implies the term, the court says
  1. notwithstanding the implication of the term, we’re going

48 :1 to require redelivery. That’s as I understand

  1. the structure.
  1. Now, the court cannot require redelivery because
  1. the shares have gone; they’ve gone to the subsequent
  1. purchasers. There’s no evidence to suggest, is there,
  1. that the subsequent purchasers could have been required
  1. to redeliver the shares?
  1. MR BIRT: My Lord, there is nothing in the documents to
  1. suggest that that obligation — that obligation doesn’t
  1. come out of the repo contracts themselves, because
  1. they’re not party to them, my Lord.
  1. MR JUSTICE HILDYARD: No.
  1. MR BIRT: That’s right.
  1. MR JUSTICE HILDYARD: So the value at that point goes,
  1. without recourse by the original borrower, to
  1. the subsequent purchasers; is that right?
  1. MR BIRT: When the shares are passed on to the subsequent
  1. purchasers, the value in the shares goes to
  1. the subsequent purchasers, my Lord, yes.
  1. MR JUSTICE HILDYARD: So the effect of the subsequent
  1. purchase transaction was to defeat such rights as
  1. the borrower may have had to reclaim the shares?
  1. The contingent rights in court.
  1. MR BIRT: My Lord, no. The rights that he had was the right
  1. to compel them into a contract, and then if they

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

49 :1 breached that contract to return them, he could have

  1. sued them.
  1. MR JUSTICE HILDYARD: But it’s gone. It’s all gone.
  1. MR BIRT: But the rights haven’t gone; he’s still got
  1. the rights against them, in the same way as he would
  1. have the rights against anybody who had promised to sell
  1. him shares. If they have gone, then he sues them in
  1. the normal way. That was the deal he entered into.
  1. MR JUSTICE HILDYARD: I thought it was merely an application
  1. to the court notwithstanding the contract, in a sense ex
  1. aequo bono, for the retransfer of the shares. And
  1. I can’t see how that would be made good against
  1. the subsequent purchasers. But you say it could.
  1. I should take it that the court would either have
  1. commanded the subsequent purchasers, or alternatively
  1. have required the original purchasers to account for
  1. the value, although they can’t redeliver the shares.
  1. MR BIRT: My Lord, I don’t think I’m saying that there’s
  1. the action against the subsequent purchasers, but what
  1. I’ve said is there will be an action against
  1. the original purchasers, and if they can’t fulfil what
  1. will then be their contractual obligation to redeliver,
  1. they would be liable for that.
  1. MR JUSTICE HILDYARD: I see.
  1. MR BIRT: That’s how those agreements work, as far as we can

50 :1 see, my Lord.

  1. MR JUSTICE HILDYARD: Now — you may come on, because this
  1. is slightly separate, in which case you tell me you’re
  1. going to deal with it later. But when the subsequent
  1. purchasers identify that there’s a prospect of
  1. extracting value by bringing together the various
  1. hitherto separate assets — and for example, one sees
  1. that clearly in the case of the transfers to ROK, where
  1. the constituent elements are brought together, ROK won’t
  1. buy them as constituent elements but will as a package,
  1. so that value can be released at that stage, right?
  1. Does the Bank get that?
  1. MR BIRT: Well, the Bank doesn’t get that. What happened in
  1. relation to ROK —
  1. MR JUSTICE HILDYARD: Well, who gets it?
  1. MR BIRT: What happened in relation to ROK, one has to
  1. remember, was it starts off with the land at
  1. the terminal being in two separate parcels. There was
  1. a parcel owned by Scandinavia Insurance, which was
  1. pledged in relation to one set of loans, land owned by
  1. LPK Scan, pledged in relation to another set of loans.
  1. And they go through two separate enforcement
  1. processes. And the land is realised according to
  1. the relevant legal processes in each case, and the value
  1. is obtained by the Bank through those enforcement

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

51 :1 processes; and then the Bank accounts for that value

  1. against the debts for which it was security.
  1. The buyers end up, who are able to consolidate it,
  1. are Renord, through two of its companies. Then they
  1. then package it together, having — I think Ms Yatvetsky
  1. explains various things they did to it, including some
  1. improvements and various expenses, and they sold it on
  1. to ROK for a small profit.
  1. MR JUSTICE HILDYARD: To whom does the small profit inure?
  1. MR BIRT: Well, Renord.
  1. MR JUSTICE HILDYARD: The subsequent purchasers?
  1. MR BIRT: I don’t think it was the subsequent purchasers, it
  1. was the entities which had purchased the property at
  1. auction.
  1. MR JUSTICE HILDYARD: I see.
  1. MR BIRT: And that’s no worse than the Bank would have ever
  1. obtained, and Mr Arkhangelsky would have obtained, for
  1. those properties going through normal enforcement
  1. processes, even absent the repo, because the properties
  1. have got to be sold through enforcement of the relevant
  1. pledges for the relevant loans; and that is exactly what
  1. happened. That’s not really anything to do with
  1. the repo.
  1. My Lord, those are the points I was going to pick up
  1. from yesterday.

52 :1 As my Lord knows, there’s numerous other issues in

  1. the case which I haven’t developed orally but are
  1. covered in the written documents, and obviously we rely
  1. fully on everything in there, and I don’t want it to be
  1. thought that because I haven’t mentioned it or developed
  1. it orally, we not relying on it; we do.
  1. I don’t intend to raise specifically any other
  1. points, but rather to wait to see what Mr Stroilov said,
  1. in particular about those matters he has alluded to that
  1. might be developed orally which aren’t in his document,
  1. or indeed, any other points he makes.
  1. Otherwise I was going to rest there, unless my Lord
  1. had any further questions at this stage.
  1. MR JUSTICE HILDYARD: I’ve got one or two questions for you
  1. of a very miscellaneous and disparate sort, some of
  1. which, when I read them to myself, I will realise you’ve
  1. dealt with. But is that a good moment for a break, and
  1. then I will address these?
  1. They largely arise on Mr Stroilov’s submission; and
  1. there may be ones which I ask you and you say you would
  1. rather hear the way he elaborates it before you commit
  1. yourself, but I thought it would be useful for you to
  1. know where I need help. So shall we have five minutes
  1. now.
  1. (11.50 am)

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

53 :1 (A short break)

  1. (12.00 pm)
  1. MR JUSTICE HILDYARD: Yes, Mr Birt, as I say, I don’t wish
  1. to push you into precipitous answers or a premature one,
  1. because it is after all for Mr Stroilov to explain in
  1. more detail what he has said, but one of the things
  1. which I would like to explore with you both is
  1. the chronology with respect to the replacement of
  1. the management of Scan and Western Terminal, and as to
  1. whether that decision preceded or postdated
  1. the Morskoy Bank loan which caused the problem.
  1. The reference is essentially in paragraph 9(3)(iii)
  1. of Mr Stroilov’s closing submission, and that refers to
  1. paragraph 77 and 78.
  1. Is this a matter which you would prefer to deal with
  1. after having part of it explained, or is it something
  1. which you can assist me on now?
  1. MR BIRT: I think the position is set out in our written
  1. closing. I did look at this, at paragraphs 561 and
  1. following. Mr Stroilov — it’s right that the loan was
  1. taken out on 30 March, and it’s right that
  1. the resolution removing the directors was dated 7 April.
  1. Now, the point I think Mr Stroilov relies upon is
  1. the notices giving notice of the meeting were dated
  1. 17 March. So that seems to us to leave only two

54 :1 possibilities. One is those notices were created in

  1. response to the Morskoy Bank loan and then backdated; or
  1. two, they had already started to think about changing
  1. the directors before the Morskoy Bank loan, and in
  1. response to the other events that had taken place before
  1. that day, chiefly the failure to pay and the refusal to
  1. sign one of the mortgage agreements — we refer to that
  1. in 563 — but it was the discovery of the Morskoy Bank
  1. loan which then, if you like, tipped them over the edge,
  1. and they decided to follow through.
  1. So I think that’s all we can point to in relation to
  1. the chronology. But we do say that certainly by the
  1. time the decision to replace the directors took place,
  1. there was already obviously the breaches of
  1. the arrangements for failure to repay, and
  1. the Morskoy Bank loan had by then been taken out,
  1. my Lord.
  1. MR JUSTICE HILDYARD: But Mr Skylarevsky’s ‘s evidence cited
  1. in 562 may be inaccurate on that footing.
  1. MR BIRT: It may be susceptible to different readings. As
  1. I say, it may be that the parties had already started to
  1. think about changing directors as a response to
  1. the earlier events, but that this was the point that, if
  1. you like, tipped them over the edge, and said: no, no,
  1. it definitely needs to happen; it needs to happen now.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

55 :1 That may be one possibility, and that’s certainly

  1. consistent with what he said. Or what he said is
  1. absolutely right in the sense your Lordship’s reading
  1. it, and they backdated the notices. That’s another
  1. possibility, I suppose.
  1. MR JUSTICE HILDYARD: Was that suggested?
  1. MR BIRT: My recollection — well, I will have to check.
  1. Mr Eschwege’s right to remind me. We’ll have to
  1. check what I’m saying against what we’ve said at
  1. footnote 1641 of the written closing. We recite
  1. Ms Yatvetsky’s evidence, so the very effect of sending
  1. notice was absolutely relevant because it was owned by
  1. Renord and 99 per cent Western Terminal. So she said
  1. you didn’t need the notification procedure, so she tried
  1. to sideline the notices.
  1. MR JUSTICE HILDYARD: That’s a rather different point.
  1. MR BIRT: A different point. And Mr Sklyarevsky’s evidence
  1. made a similar point: explained why the date of issue
  1. did not matter.
  1. We’ll check that.
  1. MR JUSTICE HILDYARD: Thank you very much. That’s fine.
  1. MR BIRT: We’ll check that further in case there’s anything
  1. in addition to add.
  1. MR JUSTICE HILDYARD: Yes, thank you.
  1. At paragraph 81 of the defendant’s closing, there’s

56 :1 a reference to the fact the management board resolutions

  1. weren’t disclosed until a specific disclosure order was
  1. made, and then efforts were taken by the Bank to erase
  1. records of that decision from its documents. I remember
  1. there was a series of documents we looked at.
  1. At some point, not now, could you give me
  1. the references in the previous CMC transcripts to
  1. the specific disclosure application, and to
  1. the references in Mr Blinova’s evidence, which is really
  1. a matter for Mr Stroilov, but if you could together find
  1. out for me.
  1. MR BIRT: My Lord, yes.
  1. The suggestion that the Management Board resolutions
  1. were not disclosed until September 2015, I think he’s
  1. referring to the particular ones that he has referred to
  1. in the immediately preceding paragraphs. There were
  1. Management Board resolutions disclosed earlier, but what
  1. he’s saying is the specific ones that he’s drawing
  1. attention to here in relation to the transfers he refers
  1. to in paragraph 80, those are the ones that he means
  1. weren’t disclosed until the order was made in
  1. September 2015.
  1. MR JUSTICE HILDYARD: I think he might very well rely on
  1. the fact that some were and some weren’t.
  1. MR BIRT: My Lord, yes. Some had been disclosed at an

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

57 :1 earlier stage. We’ll give you the references, but the

  1. general picture is there was a further disclosure
  1. application, there were disclosure applications on both
  1. sides. My Lord may remember having heard in I think
  1. September and into October, as a result of that, further
  1. electronic and physical searches were undertaken,
  1. including of various archives, and that turned up
  1. various documents including these Management Board
  1. resolutions. I think that’s the position. As I say,
  1. we’ll check it and give my Lord the references.
  1. While on that paragraph, I think I should pick up
  1. one error in paragraph 81, so Mr Stroilov can deal
  1. with it if he wants to. He refers to the reports
  1. compiled by Ms Blinova, and he says that:
  1. «She substituted many dozens of documents … solely
  1. to delete one entry referring to the transfer of Western
  1. Terminal assets to SKIF.»
  1. That’s not right. There was another entry, and
  1. indeed Mr Stroilov acknowledged when he cross-examined
  1. both Ms Blinova and Ms Mironova that there was another
  1. entry which was deleted as well, which was an entry
  1. saying that:
  1. «The Management Board has taken a decision to
  1. organise and carry out required activities aimed at the
  1. Bank to assume possession of the vessels under the loan

58 :1 for the purposes of selling them.»

  1. So there was an entry about the Bank saying, «We
  1. need to take possession of the vessels in order to sell
  1. them». That entry was also deleted. So it’s not right
  1. to say solely that.
  1. No submissions were made about the deletion of that,
  1. and nobody was cross-examined about it. But we say that
  1. assists in casting doubt on the idea that this was all
  1. part of a cover-up conspiracy, because there is
  1. obviously something else been taken out as well. We say
  1. it’s more likely at some point somebody noticed a couple
  1. of entries that didn’t fit in the chronology, because of
  1. course the entry to the Management Board resolution that
  1. was deleted was something that never actually happened.
  1. Yes, there had been a resolution, but that transfer
  1. never actually happened.
  1. So that, we say, is not that surprising, and not
  1. really evidence of the cover up, particularly when one
  1. remembers that they kept all of the run of reports which
  1. did contain those entries; so it wasn’t as though
  1. Ms Blinova put them in the shredder, they just kept two
  1. series of reports.
  1. She found difficulty explaining why she’d created
  1. them. I don’t shirk from that. And she thought
  1. somebody might have told her, and never quite got to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

59 :1 the bottom of it. But we say it can’t have been a cover

  1. up if she’s kept everything. It’s a slightly unusual
  1. way to cover things up, my Lord.
  1. MR JUSTICE HILDYARD: References, please.
  1. MR BIRT: Yes.
  1. MR JUSTICE HILDYARD: Again, it may be you would prefer to
  1. deal with this in reply, but you have not addressed in
  1. your closing submissions so far the curiosity of the six
  1. testimonies in exact corroboration with each other
  1. singing the same song to the investigator, which I don’t
  1. think is really contended for as being the true state of
  1. things. He deals with this in 95, 96 and 97 of his
  1. closing. The witnesses might have been thought to be
  1. slightly uncomfortable when this was put to them. Is
  1. this a matter you would prefer to deal with in reply?
  1. MR BIRT: Well, I can flag up, if it’s helpful, where we’ve
  1. dealt with it in our written closing, and we’ve got it
  1. in paragraphs 801, 802; and we also say, when one’s
  1. looking at these interviews, one needs to remember
  1. another part of the context, which is — my Lord will
  1. probably remember this from the evidence — that the
  1. Archangelskys themselves took a not dissimilar position
  1. with respect to the repo when they first started
  1. bringing claims before the Russian courts. And we’ve
  1. noted at paragraph 584 that they didn’t refer to

60 :1 the repo either when they were first bringing claims in

  1. relation to the share transfers; they simply referred to
  1. them as sales at nominal value.
  1. So we say that is an important context, and in
  1. a sense, shame on both sides if one is casting
  1. aspersions here.
  1. But we do say that Mr Stroilov goes too far with his
  1. submission at the end of paragraph 97 when he says one
  1. has to infer a conspiracy involving all of the Bank,
  1. Renord and the six individuals. That’s just too great
  1. a leap, because these interviews, just because
  1. the interviews describe the sales as sales rather than
  1. part of a repo, you can’t leap from that to say
  1. the whole thing must have been a fraud. Just because
  1. these statements ended up telling the same story and
  1. there’s evidence that after the interviews they were
  1. drafted by the investigator, who, no doubt when you’ve
  1. got a common hand drafting them, does draft them along
  1. the same lines, and then each of the witnesses who gave
  1. evidence said they hadn’t read them properly, and they
  1. maybe shouldn’t have signed up to them. But there we
  1. go. That’s not enough to then draw an inference of
  1. conspiracy. And particularly when allegations here are
  1. made against Ms Stalevskaya, who hasn’t been said to be
  1. one of the conspirators in any event.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

61 :1 I think that’s probably what we say about those

  1. passages, my Lord.
  1. MR JUSTICE HILDYARD: Thank you.
  1. I’m skipping some because I think they really will
  1. be better dealt with if developed.
  1. On the question of whether Mr Savelyev’s indirect
  1. holdings in the Bank were disclosed, can you tell me
  1. where those are? I remember a great chunk of materials
  1. which Mr Lord provided.
  1. MR BIRT: My Lord, yes, there was, I think, two bundles —
  1. MR JUSTICE HILDYARD: Yes.
  1. MR BIRT: — handed up containing largely the Bank
  1. prospectuses for sales of shares.
  1. MR JUSTICE HILDYARD: Right.
  1. MR BIRT: I’ve got the references. I may have mentioned
  1. them yesterday, but I probably said so in such a gallop
  1. that I should repeat them.
  1. MR JUSTICE HILDYARD: For the benefit of the transcript, it
  1. would be really helpful if you find it.
  1. MR BIRT: It’s definitely here. I think 667 of the written
  1. closing. It may be there’s one or two other paragraphs
  1. as well. {AA384/14/429}. 667 is the references to
  1. the annual reports, the website, and then
  1. the prospectuses. And 670 is where we deal with his
  1. shareholding; and there’s some more references in

62 :1 the footnote at 1971 to the annual report.

  1. As I say, those are all the Magnum references. My
  1. recollection is that there were two hard copy bundles
  1. that Mr Lord handed up as well. Hopefully they can be
  1. found. If my Lord can’t find those, we’ll supply
  1. further copies.
  1. MR JUSTICE HILDYARD: And they cover Ms Mironova’s holding
  1. as well, do they? The disclosures?
  1. MR BIRT: I’ll check that. My recollection is they give an
  1. account of who all the shareholders are.
  1. MR JUSTICE HILDYARD: She had this arrangement whereby she
  1. paid later, as it were. I don’t know whether they were
  1. disclosed.
  1. MR BIRT: Off the top of my head, I don’t know whether that
  1. specific arrangement is in any of those documents, but
  1. we can have a look, my Lord.
  1. MR JUSTICE HILDYARD: I’m sure this will be expanded on by
  1. Mr Stroilov, but Mr Savelyev’s evidence in the BVI was
  1. in a sense more detailed and covered more meetings than
  1. subsequently he felt had occurred when he gave evidence
  1. in the proceedings here. Where is that within your
  1. closing?
  1. MR BIRT: I’ll have to check and come back to you, my Lord.
  1. MR JUSTICE HILDYARD: Thank you.
  1. I think I’ll leave the rest to see how they’re

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

63 :1 developed and give you a chance, since we have up to

  1. a half day reserved for you.
  1. MR BIRT: Yes.
  1. MR JUSTICE HILDYARD: And I’m very grateful to you.
  1. MR BIRT: My Lord, yes. I can give my Lord one more
  1. reference in relation to one of the earlier questions,
  1. which was my Lord said was it put to anybody that these
  1. were backdated, so I’m going back to the chronology —
  1. MR JUSTICE HILDYARD: Oh, yes.
  1. MR BIRT: — between —
  1. MR JUSTICE HILDYARD: The removal of the directors.
  1. MR BIRT: The removal of the directors. And I think one of
  1. the references in the footnote to Mr Sklyarevsky
  1. evidence does refer to that, and this was at Day 24,
  1. page 71, line 18 to 72 line 11 {Day24/71:18}. I think
  1. that’s one of the references. And that’s where he says
  1. it doesn’t really matter because they were more or less
  1. 100 per cent shareholders. This is as far as it goes:
  1. well, I believe maybe they did backdate the documents,
  1. and it didn’t really matter if they did, because no
  1. third party interests were affected.
  1. That was just in response to your Lordship’s
  1. specific question about that.
  1. MR JUSTICE HILDYARD: Yes. Thank you very much.

25

64 :1 Closing submissions by MR STROILOV

  1. MR STROILOV: My Lord, while we don’t move too far away from
  1. the subject of references on this point, I think by the
  1. detailed cross-examination of Mr Sklyarevsky about this
  1. chronology starts on Day 22, page 27, line 16
  1. {Day22/27:16}, and then goes on for quite a number of
  1. pages. It’s just for your Lordship’s note.
  1. MR JUSTICE HILDYARD: On the removal of the directors?
  1. MR STROILOV: The removal of the directors, and how it is
  1. linked with the decision on the transfer of shares from
  1. original purchasers to subsequent purchasers, and
  1. whether it’s linked with Morskoy Bank loan, and whether
  1. the notices were backdated.
  1. MR JUSTICE HILDYARD: Thank you very much.
  1. MR STROILOV: So that was quite a detailed cross-examination
  1. point specifically aimed at this point.
  1. My Lord, obviously if you have any preferences as to
  1. how I should structure my submission, I will listen very
  1. carefully, but I would suggest that the first thing
  1. I need to touch upon is the standard of proof for fraud,
  1. as in my submission, what has been said by the claimants
  1. about the need for more serious allegations in a way
  1. proven by more cogent evidence, and insofar as innocent
  1. explanation is possible, it is to be preferred. In my
  1. submission, that puts it somewhat higher than

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

65 :1 the position is.

  1. The authority I would like to draw to your attention
  1. is Otkritie & Others v Urumov, which is authority 6/28
  1. {AUTH6/28/32}. It’s quite a massive fraud case against
  1. them. I think it has just been uploaded, my Lord —
  1. MR JUSTICE HILDYARD: Yes, I don’t go that far.
  1. MR STROILOV: — so it probably won’t be in your paper
  1. versions. If that assists, over the luncheon
  1. adjournment I could print out the report, but that’s
  1. 223 pages and I only want a few paragraphs.
  1. MR JUSTICE HILDYARD: Just tell me what the paragraphs are.
  1. Unless Mr Birt wants it, it may be that those pages will
  1. suffice.
  1. MR BIRT: My Lord, I don’t know. Mr Stroilov just told me
  1. before court he was going to refer to it, so we’ll just
  1. wait and see.
  1. MR JUSTICE HILDYARD: We’ll have a look. If you want it,
  1. fine, but otherwise let’s spare the trees.
  1. MR STROILOV: Yes, my Lord. I don’t think the facts are
  1. very important, apart from knowing that this was a big
  1. fraud case against a large number of defendants.
  1. Then if we scroll down to page 32 in this tab
  1. {AUTH6/28/32}, there you have — over the page you see
  1. the discussion of burden and standard of proof. You
  1. will see that there is a summary — and I think

66 :1 a helpful summary — of the submissions that were made

  1. in that case. I think I will invite your Lordship to
  1. read through this, and then to read about two pages, if
  1. you don’t mind, of this and the next one.
  1. (Pause)
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: So if you could scroll down one page. In
  1. the authority, the bottom line is paragraph 88
  1. {AUTH6/28/33}. That’s what I specifically rely on.
  1. MR JUSTICE HILDYARD: Yes, okay, so I should be particularly
  1. careful on that.
  1. MR STROILOV: Yes.
  1. (Pause)
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: Yes, my Lord, so really the point —
  1. MR JUSTICE HILDYARD: Can we go over the page.
  1. {AUTH6/28/34}.
  1. (Pause)
  1. Can we go over the page again. {AUTH6/28/35}.
  1. (Pause)
  1. Yes.
  1. MR STROILOV: So my Lord, just very briefly, what I’m
  1. driving at is that some of the criticisms of our case as
  1. advanced are incorrect. Well, it is not wrong to ask
  1. your Lordship to find fraud by inference as such; that’s

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

67 :1 a perfectly proper thing to do. And the standard of

  1. proof remains civil. It’s not that we have to totally
  1. exclude any innocent or negligent explanation, it’s
  1. just, as usual, in all the circumstances, fraud is more
  1. likely than not.
  1. Similarly, I think, in a way, part of the criticism
  1. advanced against us is that not every element of
  1. conspiracy is proven, we have not identified how exactly
  1. each of the bailiffs or auctioneers — whether they were
  1. engaged in a conspiracy, and how they were engaged.
  1. Again, that’s not what we have to prove — it is
  1. specific in the authorities, and I could take you to
  1. that, if necessary.
  1. You can infer conspiracy. There will very rarely be
  1. direct proof of conspiracy, of a meeting, or
  1. a combination, very expressly, where there was an
  1. agreement between people. You infer a conspiracy from
  1. overt acts. Perhaps it makes sense to have a quick look
  1. at the authority I have in mind, which also has only
  1. been uploaded this morning. That is Kuwait Oil Tanker
  1. Company v Al Bader. That’s authority 6/29.
  1. {AUTH6/29/1}. If we could scroll down to paragraph 111
  1. of the judgment. I will find the page. {AUTH6/29/56}.
  1. If I could ask you to read paragraph 111 and 112,
  1. over the page. {AUTH4/29/54}.

68 :1 MR JUSTICE HILDYARD: Yes.

  1. MR STROILOV: If you could scroll down, please.
  1. (Pause)
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: My Lord, I think that’s simply meant to
  1. respond to some of the criticisms, because in effect we
  1. are being fired a series of questions that can be asked
  1. about any conspiracy case. We are criticised for not
  1. identifying any particular bid at a particular stage and
  1. we haven’t proven something about, and we are not
  1. required to.
  1. My Lord, it is obviously important to analyse
  1. the interrelations between the issues, and it’s
  1. a massive case. I will come to the issue of forgeries
  1. — or alleged forgeries in due course, but at this stage
  1. I do reject the submission made by the claimants that
  1. forgeries are central to the conspiracy case. They seem
  1. to be quite keen on it, and I’m not going to pretend
  1. that forgeries are anything other than the weakest part
  1. of our case, and that’s why they are keen on it.
  1. Nevertheless, I will submit in due course that on
  1. the balance of probabilities, even our case on forgeries
  1. is untrue. But whether or not it is true, it simply
  1. does not affect the counterclaim in any material sense.
  1. Yes, we did say, when particularising the case on

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

69 :1 forgeries, that that was part of the conspiracy. Like

  1. a lot of other things, we say it was all part of
  1. the same conspiracy. And in a way, if our counterclaim
  1. was disproven, that would undermine the case on
  1. forgeries, but not the other way around. If anything,
  1. the hypothesis that there were personal guarantees, it
  1. undermines some of the aspects of the claimants’ defence
  1. to the counterclaim.
  1. If Oslo Marine Group, as they say, was a financial
  1. pyramid based on revaluing assets, and borrowing more
  1. and more, and then effectively embezzling some of
  1. the money and running away, well, that scheme only makes
  1. sense if there are no personal guarantees, and then
  1. the companies get bankrupt, and Mr Arkhangelsky is
  1. laughing because he has taken the money away. But with
  1. personal guarantees, it rather makes little sense.
  1. My Lord, it may be that you find it easier than I to
  1. analyse interrelations between the issues, but the way
  1. I found helpful was this: in any fraud, in a sense —
  1. this is a case where both parties allege fraud against
  1. each other, and it is indeed impossible to see how both
  1. might have acted honestly; one or the other must have
  1. been fraudulent.
  1. Now, in analysing a complex fraud, I think there are
  1. features common to any complex fraud, by which I mean

70 :1 this: it all starts in a way which looks perfectly

  1. appropriate and above board, and is perfectly consistent
  1. with all sorts of innocent explanations. Parties are
  1. dealing with each other, and the very nature of fraud is
  1. that it should look all right from the start. And then
  1. the further it develops, the more likely that the more
  1. suspicious matters you discover. The further you go in
  1. time, the more difficult it is to explain away various
  1. suspicious matters, until it possibly becomes all too
  1. clear, but then it is too late to do anything. That,
  1. I would say, is the general pattern of any fraud.
  1. So it makes sense, in my submission, to analyse it
  1. rather in reverse chronological order, to look at
  1. the end result, and then the final stages of it, and
  1. then go backwards to see whether it’s all still
  1. consistent with innocence, and then go backwards in time
  1. to try and understand when it may have gone wrong, at
  1. what stage it went wrong, or whether it was all wrong
  1. from the beginning.
  1. So I would suggest starting from the so-called
  1. public auctions, then looking into the wider context of
  1. various transfers between Renord companies which led up
  1. to those public auctions and into the (inaudible)
  1. transfers of both shares and assets, as they are all
  1. interrelated. And then we effectively arrive to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

71 :1 the repo agreement, and I will submit that the trial has

  1. shown that the agreement was intended by the Bank to be
  1. the means of appropriating OMG assets from the start.
  1. So my Lord, looking at the auctions, firstly,
  1. I think, in my respectful submission, the observation
  1. your Lordship made yesterday to the effect that — well,
  1. if I understood you correctly, which I not necessarily
  1. did, but what I understood you to be saying was that at
  1. the first stage of the analysis, you exclude valuation
  1. evidence from your mind and look at the auction on
  1. the assumption that the value was honest, and then see
  1. if there is any reason to — well, if there is
  1. sufficient reason to consider the auction to be unlawful
  1. in some way, and then, and only after that, you can go
  1. into the valuation territory.
  1. In my respectful submission, that’s not quite so.
  1. Of course you can’t, and we wouldn’t have invited you to
  1. infer that the auctions were fraudulent just from
  1. the fact that the prices don’t match the evidence of
  1. market value. But generally speaking, in assessing
  1. whether the auctions were honest, you are entitled to
  1. look at all the circumstances, including the evidence as
  1. to the market value.
  1. Market value is ultimately a fact, and there may be
  1. different explanations as to why the auctions did not

72 :1 achieve the market value, and some of them may be

  1. perfectly innocent. But if your Lordship accepts
  1. valuations of, say, Mrs Simonova, and then as a next
  1. step you do find as a fact that the auctions did not
  1. achieve the market value, and then you look at
  1. the possible explanations. Obviously we do invite you
  1. to accept Mrs Simonova’s evidence and to find
  1. the undervalue; Mr Milner will address on you that in
  1. detail in due course.
  1. But apart from that, you have clear evidence, really
  1. uncontradicted evidence from the claimant themselves, of
  1. what Professor Maggs calls «bid rigging». In each case,
  1. you had two bidders controlled by Renord, only one of
  1. them bidding at one step above the market price and
  1. buying the asset at that price. And the evidence given
  1. to you about the structure of Renord and how it
  1. operates, both by Mr Smirnov, who was not
  1. cross-examined, and by Mrs Yatvetsky who was, they leave
  1. no doubt that Renord companies are not genuinely
  1. independent of each other in the sense that they’re
  1. taking their own decisions. It is Mr Smirnov, or
  1. Renord Invest at any rate, who takes the decisions and
  1. then chooses the company to implement it through. So
  1. effectively it was Renord competing with Renord pursuant
  1. to its own plan, and if there is no doubt, of course

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

73 :1 Renord was interested in buying the assets at a low

  1. price and not at a fair price. Well, that’s normal
  1. commercial approach. So bid rigging is obvious, and
  1. that in itself is enough to question the auctions.
  1. MR JUSTICE HILDYARD: Professor Maggs’ evidence, as
  1. I understood it — and you must contradict this if this
  1. is wrong — was that the requirement for no less than
  1. two bidders did not preclude those bidders being
  1. associated.
  1. MR STROILOV: In itself, it doesn’t, but it goes further in
  1. this case. In this case, you have two bidders. Well,
  1. obviously it’s all virtual reality. In reality, it’s
  1. just Renord —
  1. MR JUSTICE HILDYARD: Your case is they are two different
  1. names, but that’s it.
  1. MR STROILOV: Indeed, my Lord. Well, it’s a different
  1. scenario if you have, say, two companies owned by
  1. the same person but managed independently by different
  1. managers and they decide to bid. That’s all right. But
  1. it’s quite another matter if it is all part of a plan.
  1. Well, there it’s paradigm bid rigging.
  1. And secondly, of course, in each case it was Renord
  1. selling to itself, so it was a sham transaction in that
  1. sense. And again, it was the evidence given to you by
  1. a representative of Renord, and representatives of

74 :1 the Bank, that it was all part of a bigger plan to

  1. achieve — well, as they say, to achieve maximum
  1. recovery, and we say to achieve maximum value but to
  1. minimise the recovery. But it was part of a bigger
  1. plan. They were selling half of Onega Terminal to Solo,
  1. and then the other was sold to Mercury, whereas
  1. the intention was to sell it eventually, or transfer it
  1. to ROK Prichaly. So it wasn’t a genuine auction where
  1. they would be selling assets at the best possible price,
  1. it was part of a scheme. And of course, in that
  1. context, where auction is simply used to transfer an
  1. asset from one Renord company to another in the context
  1. of a bigger scheme, that’s not what is intended as part
  1. of the auction.
  1. And it is not material for the purposes of this case
  1. whether the auctioneer was part of the fraud or was
  1. simply misled. That doesn’t matter, so long as we are
  1. suing the auctioneer. But there is no doubt that Renord
  1. did that, and the witnesses on the claimant’s side were
  1. unanimous in saying that Renord always acted pursuant to
  1. the Bank’s instructions, and no one considered that
  1. Renord abused the Bank’s trust in any way. So really,
  1. any attempt to shift responsibility cannot work, and
  1. I don’t think they are trying. Either they were all
  1. acting honestly, or they were all in it together, they

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

75 :1 were all in the fraud.

  1. My Lord, it is fairly clear that the ultimate goal
  1. of this series of transactions, including the public
  1. auctions, was for the assets, the most significant of
  1. them being obviously the two terminals, to end up with
  1. specific companies. In the case of Western Terminal, it
  1. was Baltic Fuel Company; in the case of Onega Terminal,
  1. ROK Prichaly.
  1. As far as Baltic Fuel Company — it is remarkable,
  1. in a way, that neither of the genuine buyers or
  1. transferees would actually bid at the auction; it would
  1. always be some other company which then transferred
  1. the asset to the ultimate purchaser in some unknown way.
  1. I will come to ROK. As far as Baltic Fuel Company
  1. is concerned, there is a rather intriguing discrepancy
  1. between the evidence of Mr Smirnov and Mrs Yatvetsky on
  1. this point, as Mr Smirnov tells you in his witness
  1. statement that the majority shareholder is Renord,
  1. whereas Mrs Yatvetsky, in response to my question,
  1. denied, in very clear terms, that Renord had anything to
  1. do with it, and rather said that it was just an
  1. independent investment of Mr Smirnov. I will give
  1. your Lordship the references in a moment.
  1. I beg your pardon, I think something is going …
  1. Yes, so Mrs Yatvetsky’s cross-examination on that is

76 :1 on {Day38/109:11}. And so there, as you see at line 11,

  1. she says:
  1. «Baltic Fuel Company is a personal private
  1. investment within Mr Smirnov’s personal investment
  1. portfolio.»
  1. And then she confirms that it has nothing to do with
  1. Renord as such.
  1. Whereas Mr Smirnov, of course, in his witness
  1. statement at {B2/12/13} — I think it’s page 13. No,
  1. it’s slightly earlier. So that is at page 11.
  1. {B2/12/11}. In paragraph 63 he explains in some detail
  1. that it is Renord Invest who is actually the shareholder
  1. of Baltic Fuel.
  1. My Lord, obviously, I think what has been suggested
  1. is that since, for various reasons, the different parts
  1. of the assets were sold separately rather than part of
  1. the overall terminal, so any auction would have probably
  1. achieved the same price and not those suggested by
  1. Mrs Simonova, so that does not show undervalue in
  1. itself.
  1. However, that is rather undermined by the evidence
  1. being given to you by Mrs Mironova and Mr Sklyarevsky,
  1. and I think Mrs Yatvetsky as well, to the effect that
  1. Renord and the Bank appreciated at the time that
  1. the assets had to be unified to achieve the maximum

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

77 :1 value, and this series of transfers which went on and

  1. which has been detailed in evidence and summarised in
  1. closing submissions, it largely had the aim to unify all
  1. the assets, in one hand, so as to maximise the value.
  1. But of course, at all the auctions where pledge was
  1. realised, that was not reflected. In the case of
  1. Western Terminal, there was quite a curious scheme where
  1. it was first sold at unrelated auction, or ostensibly
  1. unrelated auction pursuant to Morskoy Bank loan, it was
  1. bought by Renord company called Nefte-Oil, and
  1. Ms Mironova explained to you that the purpose was to
  1. avoid the asset being burdened by — well, there could
  1. be difficulties if someone preserves the title to some
  1. small building or railway there which is formerly not
  1. pledged, and could then hold the owner to ransom, and
  1. that drives the price down. I hope I am fairly
  1. summarising what she told you. I will find
  1. the reference if necessary.
  1. But then, immediately afterwards, Nefte-Oil sells it
  1. to another Renord company, but only sells the pledge, so
  1. now it preserves the leverage. And then pledge goes
  1. through this independent series of transactions and is
  1. sold at an auction finally to Baltic Fuel, which is also
  1. controlled by Renord. It is sold separately, whereas at
  1. the end of the day, Baltic Fuel Company controls

78 :1 everything and achieved full synergistic value.

  1. My Lord, in relation to ROK Prichaly, we are saying
  1. it is controlled by Renord, we do plead that it is
  1. a connected party, and in my submission, it could have
  1. simply have been inferred from the pattern of how these
  1. things are done. However, some evidence has come to
  1. light at the trial to the effect that there are more
  1. connections that have originally been disclosed by
  1. the claimants.
  1. Firstly, so ROK Prichaly is part of the Fishing Port
  1. Group. You may recall, or I may find the reference that
  1. at one point, on quite an unrelated matter,
  1. Mrs Yatvetsky mentioned that the Fishing Port was bought
  1. by a business partner of Mr Smirnov. So that’s not
  1. a totally independent party.
  1. And then, of course, I think the owner, or
  1. a co-owner of that group of companies —
  1. MR JUSTICE HILDYARD: ROK Prichaly?
  1. MR STROILOV: ROK Prichaly and Fishing Port. I think it’s
  1. ROK Prichaly who owns Fishing Port, unless I am
  1. mistaken.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: So it’s a gentleman called Mr Soshnik, and
  1. I asked Mrs Volodina about him. You may recall — you
  1. may look at the transcript. Essentially, I only asked

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

79 :1 her whether she knew that gentleman. She said it’s

  1. a client. I asked her whether he was her personal
  1. friend, and she seemed rather uncomfortable with that
  1. question, but eventually said, «No, I wouldn’t describe
  1. him as friend».
  1. MR JUSTICE HILDYARD: Can you give me the reference for
  1. that?
  1. MR STROILOV: Yes, I will find that.
  1. That’s {Day8/17:21}, starting at line 21, through to
  1. page 18, line 5 {Day8/18:5}.
  1. MR JUSTICE HILDYARD: Thank you.
  1. MR STROILOV: But then something Mrs Volodina does not tell
  1. you in her evidence, didn’t tell you in her evidence
  1. in-chief, or in cross-examination — well, in fairness,
  1. I didn’t ask her about it that, because at that stage
  1. I didn’t know. But I think, if I’m not mistaken, it was
  1. Ms Mironova who actually volunteered to your Lordship
  1. evidence that it was Mrs Volodina who at one point came
  1. and reported that, «I have found a buyer for
  1. Onega Terminal». I can find the reference to that as
  1. well. Perhaps it’s better if I postpone that as
  1. something for the lunch adjournment, because it may take
  1. some time. I recall it was Ms Mironova, but I’m not
  1. sure which day, for the moment.
  1. MR JUSTICE HILDYARD: Okay.

80 :1 MR STROILOV: So my Lord, it is also not an unconnected

  1. party as far as ROK Prichaly is concerned.
  1. But in a way, even if it was an independent party,
  1. it is surprising that there is no independent evidence
  1. as to the price at which the Terminal was eventually
  1. sold to ROK Prichaly. I believe Mr Sklyarevsky and
  1. Ms Mironova have both asserted that it was 400 or
  1. 500 million roubles. I think Mrs Yatvetsky as well.
  1. But it is rather surprising that no documentary record
  1. of that has been produced, and that’s obviously quite
  1. important for the Bank’s case. Well, we simply don’t
  1. know. It may be any amount that really —
  1. the terms that Renord has raised.
  1. MR JUSTICE HILDYARD: I would quite like the references to
  1. the oral evidence given as to the value, which you think
  1. is about 500 million.
  1. MR STROILOV: Yes, it’s probably quicker if I give it to you
  1. just after the luncheon —
  1. MR JUSTICE HILDYARD: Yes, of course.
  1. MR STROILOV: — adjournment, so that I don’t spend time
  1. looking for it.
  1. Speaking of which, now may be the time.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: And then I’ll give you all references, as
  1. discussed a moment.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

81 :1 MR JUSTICE HILDYARD: I suppose on your case, if you

  1. establish that the objective was to unify, to maximise,
  1. and then realise the maximum price by sale to
  1. Baltic Fuel in the case of one, and ROK Prichaly in
  1. the case of Onega, there’s a certain compelling logic in
  1. all the auctions having to be controlled lest a vital
  1. piece of the jigsaw be bought by somebody else.
  1. MR STROILOV: Yes, my Lord. Yes.
  1. MR JUSTICE HILDYARD: And I can see the logic of that.
  1. Of course, you will have to show why it was that
  1. there were only two attendants at the auction, and how
  1. that was contrived. And you will have to, I think, get
  1. into whether it was properly advertised, et cetera,
  1. otherwise it’s difficult to see, unless the gates were
  1. locked or some such, do you see what I mean? You not
  1. only have to show some compact, express or tacit,
  1. between the two who did attend, but how it was that
  1. strangers, who might have had different ideas and
  1. weren’t within the plan, didn’t pitch up. Do you see
  1. what I mean?
  1. MR STROILOV: Yes, I will address you on all these points.
  1. MR JUSTICE HILDYARD: I am, as you can tell, and as Mr Birt
  1. and his clients can tell, extremely interested in
  1. the auction process, and, frankly, suspicious about it.
  1. I need some help.

82 :1 MR STROILOV: Yes, my Lord, I will address that at

  1. 2 o’clock.
  1. (1.00 pm)

4 (The short adjournment)

  1. (2.00 pm)
  1. MR STROILOV: May it please your Lordship.
  1. Now to recap on references which we discussed just
  1. before the adjournment. If we could look at Day 34,
  1. page 58. That’s part of cross-examination of
  1. Ms Mironova.
  1. Starting at line 5, you can see the reference to it
  1. being Ms Volodina who actually found ROK Prichaly; and
  1. then Ms Mironova explains how it proceeded, and she
  1. gives the price of «a little over RUB 400 million», at
  1. line 20.
  1. MR JUSTICE HILDYARD: Two questions. Could I see the page
  1. before —
  1. MR STROILOV: Yes, if you could scroll.
  1. MR JUSTICE HILDYARD: — as well.
  1. The long-standing partner. And what sort of time
  1. period are we talking about?
  1. MR STROILOV: Well, I don’t think it is dated in any way.
  1. It’s rather there is some — to summarise it quickly, we
  1. can look at the transcript in more detail.
  1. I think I referred her to — you will recall there

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

83 :1 was an undated stage plan for the two parts of

  1. Onega Terminal to eventually ROK Prichaly. And I was
  1. asking her about this. And that it was undated.
  1. I think it’s not quite clear to what date her evidence
  1. refers.
  1. MR JUSTICE HILDYARD: Okay. Well, I can set it in context.
  1. I’ll read the transcript.
  1. MR STROILOV: It probably makes sense to look at it now. If
  1. we look at Day 23, page 13 {Day23/13:4}. That’s
  1. cross-examination of Mr Sklyarevsky, and starting at
  1. line 4, he explains really the same story. And at line
  1. 12 he gives the figure of 500 million roubles. And
  1. curiously he seems to assume that credit was given for
  1. that 500 million roubles, which of course is not quite
  1. the case. It was done separately for separate elements
  1. of Onega Terminal, and in one case on auction price, and
  1. on the other, in relation to the other half of
  1. Onega Terminal, it was done in this curious way by
  1. assignment of rights to the pledgor, to Mercury, to
  1. which I will come in a moment in more detail.
  1. MR JUSTICE HILDYARD: Yes, I need some help as to what
  1. exactly happened. Broadly speaking, was not the debt
  1. forgiven in respect of all this?
  1. MR STROILOV: Broadly speaking, in relation to the debt
  1. secured by the pledge of LPK Scandinavia, that’s right

84 :1 it was assigned to the company called Mercury —

  1. MR JUSTICE HILDYARD: Yes, which was then sold to ROK.
  1. MR STROILOV: This 97 per cent discount. But then Mercury
  1. did not enforce the loan agreements. So in that sense,
  1. yes, it made sense —
  1. MR JUSTICE HILDYARD: Someone will tell me at some point
  1. where the precise mechanics are described.
  1. MR STROILOV: Yes, my Lord. I think I will come to that at
  1. some point later on.
  1. I think thirdly, just to finish on the price of
  1. Onega Terminal, if we go to the witness statement of
  1. Mrs Yatvetsky at {B2/18/8}. That’s obviously a late
  1. addition, but in paragraph 38, she also gives evidence
  1. about the sale to ROK Prichaly, and she also gives
  1. a figure of 500 million.
  1. Of course, it is, in my submission, quite remarkable
  1. that this is not cross-examination, she had time to
  1. prepare the witness statement, it was a late addition
  1. where after the issues were very clear in
  1. cross-examination of Mr Sklyarevsky at least, and yet
  1. she does not exhibit any documents. And she says she
  1. reviewed documents and they made a profit of 55 million,
  1. but does not exhibit anything to confirm that.
  1. My Lord, I really don’t think it would be
  1. a productive use of your time if I go through

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

85 :1 the witnesses one by one and make submissions as to how

  1. credible all our witnesses are and how unsatisfactory
  1. the claimants’ witnesses are, simply because I think
  1. that’s all very predictable what I am going to say, and
  1. in any event, you must have formed your own impression
  1. by now, which I am unlikely to change by argument.
  1. But essentially what I would say is that an
  1. assertion, undocumented assertion, of these three
  1. witnesses as to the price at which it was sold to
  1. ROK Prichaly is not good enough. You cannot give much
  1. weight to it. In my submission, none of these three was
  1. a credible witness.
  1. My Lord, continuing on, on deviation slightly —
  1. before I come back to the auctions, I will make
  1. a general point going back to the question of disclosure
  1. of documents which would have been in the possession of
  1. Renord and various companies controlled by Renord, which
  1. participated in the events giving rise to this
  1. counterclaim.
  1. You will recall there was an issue as to what extent
  1. documents were within control of the Bank so as to be
  1. disclosable. Well, now, having examined the relations
  1. between the Bank and Renord in some detail at the trial,
  1. it is, in my submission, perfectly clear that the Bank
  1. had unlimited access to these documents if the Bank

86 :1 wanted to disclose them.

  1. Well, indeed, I would submit that whatever the legal
  1. characterisation of this relationship, applying the test
  1. of control for disclosure and a relationship I think, as
  1. we formulated it when we considered the issue,
  1. the relationship is clearly sufficiently akin to agency
  1. for the bank to have control over the documents in
  1. practical terms.
  1. Further, the relations between the Bank and Renord
  1. are sufficiently close to expect that if the Bank
  1. genuinely asked them for documents, Renord would have
  1. provided them voluntarily.
  1. And finally, Renord itself, even if it is
  1. a genuinely independent business, Renord itself had its
  1. reputation at stake in these proceedings.
  1. Well, indeed, in a way, it’s incidental that — it
  1. so happens that it is not among the counterdefendants.
  1. Originally, Renord companies were defendants in BVI and
  1. in the Commercial Court claim. It was simply because of
  1. the resources difficulty that essentially we couldn’t
  1. afford to serve it on each of the Renord companies.
  1. But reputation wise, Renord was under attack. If
  1. there was nothing to hide, they would have provided
  1. disclosure voluntarily.
  1. Now coming back to auctions.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

87 :1 MR JUSTICE HILDYARD: Yes. On disclosure, the thing is, as

  1. I think is reflected in the judgment I gave back in
  1. September or October, there’s the legal test, which
  1. wasn’t easy to apply in the circumstances because
  1. the relationship between the Bank and the Renord
  1. companies was left fairly open and certainly was
  1. undocumented.
  1. Then there’s the practical reality test, which may
  1. not give you a right to disclosure, but which does
  1. invite questions. I will be looking at the submissions
  1. on 22 and 23 September, because I do find it surprising
  1. that it was objected to so strenuously.
  1. MR STROILOV: Indeed, my Lord. In my submission, I invite
  1. here an inference that they didn’t want to disclose
  1. the details of things which were in the hands of Renord.
  1. And as you know now, it was all — literally every step
  1. was under the direction of the Bank, and they didn’t
  1. want the documents to come to light. That is
  1. the inference I invite from that history.
  1. So coming back to auctions. In a way, we don’t know
  1. the full picture of why other participants may not have
  1. participated. And one of the reasons we don’t have
  1. a fuller picture is that we didn’t have proper
  1. disclosure in relation to auctions.
  1. However, there is evidence at least that significant

88 :1 efforts were made to try and exclude the genuinely

  1. independent participants.
  1. First, here I think we have to look at the whole
  1. series of transfers of assets rather than at
  1. the individual auctions to understand how it worked.
  1. I think it is summarised, I hope, in a helpfully
  1. succinct way in our closing submission at — I will
  1. start, I think, from Onega. So that starts at
  1. paragraph 130 of our closing submissions, and
  1. Western Terminal comes before in written submissions,
  1. but I will make oral submissions afterwards.
  1. {AA5/15/52}.
  1. So looking at my paragraph 130, in relation to
  1. Russian auction houses, we know from the minutes of
  1. the auction, and you may recall that Ms Mironova
  1. commented on them, that there had been two other
  1. participants which were excluded for one reason or
  1. another from the auction.
  1. Yet we don’t know what was the reason. But the
  1. circumstances in which that sale was argued were very
  1. suspicious. It was purportedly under a settlement
  1. agreement between the Bank and Scan. We now know that
  1. both sides were controlled by the same people, as Scan
  1. was now run by Renord and Renord was acting under
  1. the direction of the Bank.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

89 :1 The agreement stipulated that it was for the Bank to

  1. choose the auctioneer. And Russian auction house, as
  1. you have heard, my Lord, it was run at the time by an
  1. official in Mrs Matvienko’s administration, who later,
  1. according to Mr Arkhangelsky, told him that he had to
  1. sell these assets because he was ordered to do so by
  1. Mrs Matvienko; and according to Mr Arkhangelsky, he was
  1. rather apologetic about this; he seemed to realise he
  1. did something wrong.
  1. MR JUSTICE HILDYARD: The auction house is owned by
  1. Sberbank, isn’t it?
  1. MR STROILOV: It is owned by Sberbank, yes.
  1. MR JUSTICE HILDYARD: And this was one of its first major —
  1. if not the first — major auction that was under review?
  1. It was in the public eye?
  1. MR STROILOV: Indeed, my Lord. You may recall when that
  1. fact was put to Professor Guriev, from memory I think he
  1. said that he didn’t know about it at the time. If he
  1. did, he would have wanted this looked into by the Bank.
  1. MR JUSTICE HILDYARD: The exclusion of the genuine bidders,
  1. have I got a reference for that?
  1. MR STROILOV: That will be in cross-examination of
  1. Mrs Mironova. I think I can find it reasonably —
  1. MR JUSTICE HILDYARD: Otherwise let me know in due course.
  1. It’s not meant to be a memory test, if you see what

90 :1 I mean.

  1. MR STROILOV: Yes. I think I will find it quickly.
  1. I believe it was Day 34, and then, just to be sure you
  1. don’t forget, my Lord.
  1. MR BIRT: My Lord, I don’t know if it helps. We’ve given
  1. some references in footnote 2702 of our closing.
  1. I don’t know if those are the references that
  1. Mr Stroilov’s looking for.
  1. MR JUSTICE HILDYARD: How helpful. Thank you.
  1. MR STROILOV: I’m grateful. It probably is — let me then
  1. check later whether that’s what I had in mind, and
  1. possibly come back to this.
  1. MR JUSTICE HILDYARD: Day 34, page 21. {Day34/21}
  1. MR STROILOV: Yes, that must be it. Yes, my Lord.
  1. Well, in any event, my Lord, I would submit that
  1. this part of Ms Mironova’s cross-examination is worth
  1. re-reading in due course.
  1. So this being so —
  1. MR JUSTICE HILDYARD: It was an inference from the fact of
  1. the numbers on the bids, isn’t it?
  1. MR STROILOV: Yes, my Lord. The bidders were numbered as 3
  1. and 4.
  1. MR JUSTICE HILDYARD: There might have been another from 1
  1. and 2?
  1. MR STROILOV: Yes, which was really Ms Mironova’s suggestion

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

91 :1 with which I agree, that this means that 1 and 2 were

  1. excluded for whatever reason.
  1. MR BIRT: Just for completeness, she went on to suggest some
  1. possible reasons at the bottom of page 22.
  1. MR STROILOV: I’m grateful.
  1. MR JUSTICE HILDYARD: Do we know anything about the — are
  1. you going to come to this — advertisement process?
  1. MR STROILOV: No, we don’t know much. I think the claimants
  1. have said that it was advertised in a major business
  1. newspaper. I don’t know if it was exhibited or
  1. disclosed, whether any advertisement has been. I simply
  1. don’t know that, I’m afraid.
  1. MR JUSTICE HILDYARD: I can’t remember whether the Russian
  1. auction provisions require a certain minimum amount of
  1. advertisement notice.
  1. MR STROILOV: Well, we are not saying that it was not
  1. complied with. We are not —
  1. MR JUSTICE HILDYARD: Do they dictate where it is to be
  1. advertised?
  1. MR STROILOV: As this was extrajudicial, I think it’s all to
  1. be agreed between the parties, really. But in this
  1. case, apparently it was advertised in a major newspaper.
  1. So again, we are not making any particular allegations
  1. in this respect.
  1. MR JUSTICE HILDYARD: You accept that it was properly

92 :1 advertised in the sense of in compliance with whatever

  1. procedures were mandated under the Russian law, but also
  1. sufficient to give reasonable exposure of the upcoming
  1. auction to have a serious prospect of inviting people
  1. interested?
  1. MR STROILOV: No, I wouldn’t go as far as to accept that.
  1. I would say we accept that it was advertised, but as to
  1. reasonable exposure, no, we would say about the general
  1. patterns of how the Bank and Renord approached this,
  1. that one of the astonishing features is that there was
  1. no genuine marketing effort. There was, at best, just
  1. enough to comply with formal provisions for auctions as
  1. it is advertised just before notice is given. But it is
  1. just that.
  1. And of course, in my submission, the evidence of
  1. Mrs Yatvetsky on the alleged marketing efforts by
  1. Mr Smirnov is completely unsatisfactory, not least
  1. because Mr Smirnov himself does not tell you that in his
  1. witness statement. He tells you something different.
  1. He tells you Renord itself became interested in
  1. the assets. And he does not mention any — but I think,
  1. in fairness, he mentions in passing —
  1. MR JUSTICE HILDYARD: That was true in a sense, but Renord
  1. was a sort of collecting agency for further transmission
  1. on to ROK, is that right?

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

93 :1 MR STROILOV: Yes, that seems to be so in relation to

  1. Onega Terminal.
  1. MR JUSTICE HILDYARD: ROK is on the scene before
  1. the auctions?
  1. MR STROILOV: I beg your pardon?
  1. MR JUSTICE HILDYARD: As I understand it, ROK is on
  1. the scene before the auctions. That’s why I was
  1. interested in the chronology as to when — I mean, we
  1. know that ROK was a long-standing partner.
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: It’s disputed as to its connection
  1. with the Bank in any more formal or greater sense. We
  1. know that it was introduced to the Bank with the idea
  1. that it should buy something at Onega — was introduced
  1. as a thought by Volodina.
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: Which is why I was enquiring. We
  1. don’t know what the chronology of that was.
  1. MR STROILOV: We don’t, my Lord. And I actually asked
  1. various witnesses questions aimed at establishing this;
  1. and I think no one was quite sure, or perhaps not quite
  1. willing to explain the chronology in much detail.
  1. I think what has been admitted by Mr Sklyarevsky is
  1. that it was prior to the sale to Mercury that
  1. the ROK Prichaly plan was already in operation. And

94 :1 indeed, that’s why Renord asked him to provide Mercury

  1. LLC as a kind of vehicle to facilitate that.
  1. I think none of them have said in terms that prior
  1. to Russian auction house sale, ROK was on the scene.
  1. However, if we go back to the bit in Ms Mironova’s
  1. evidence — well, perhaps it’s unnecessary to look at it
  1. right now, unless your Lordship indicates otherwise —
  1. where she talks about Mrs Volodina entering the room and
  1. suggesting ROK Prichaly. There is also a reference to
  1. Mr Skatin.
  1. Then if you look at the witness statement of
  1. Ms Mironova, you will see that when she gives her
  1. background, she explains that she was reporting to
  1. Mr Skatin in the first few months of her work in client
  1. monitoring and directorate, and then it was
  1. Mrs Malysheva. So that rather suggested was like an
  1. early stage.
  1. MR JUSTICE HILDYARD: But it’s presently unclear whether
  1. the notion of ROK purchasing the assembled assets, or
  1. some part of them, was before or after the auction.
  1. MR STROILOV: It is unclear, my Lord. It is unclear.
  1. Clearly it was prior to the Mercury saga, but as for
  1. Russian auction house, chronology isn’t.
  1. MR JUSTICE HILDYARD: It raises a question, whichever might
  1. be the sequence: if they were introduced before, then

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

95 :1 it’s some support for the notion that there was some

  1. sort of understanding with respect to the assembly of
  1. the constituent parts in which it might be interested.
  1. If there was no such agreement before, then it begs
  1. the question as to why ROK didn’t at least attend at
  1. the auction, given it was the natural bidder.
  1. The answer to that, as I understand it, offered by
  1. the Bank is that ROK was simply not interested in
  1. the constituent elements full stop, and only became
  1. interested once they had been assembled. But it is odd.
  1. MR STROILOV: Indeed, my Lord. And at the time when
  1. the Russian auction house sale takes place, it is
  1. already clear to the Bank that there is a cross default
  1. of the entire OMG group, and the LPK land at
  1. Onega Terminal is to be sold in due course.
  1. So it’s not clear at all what this Russian auction
  1. house sale was about really, as you have heard evidence
  1. that Renord participated in that way reluctantly and
  1. that was only seen as a halfway stop. It wasn’t that
  1. Solo was going to run it as a business.
  1. So for this, there has been no explanation, at least
  1. no credible explanation.
  1. MR JUSTICE HILDYARD: Your case is that auctions were used
  1. as a washing machine.
  1. MR STROILOV: Indeed, my Lord. That is our case. That was

96 :1 still the time at the end of 2009 when Russian

  1. proceedings were very much active; and as you were told
  1. astonishingly in terms by Mr Sklyarevsky and a number of
  1. other witnesses, the reason for the transfers of shares
  1. and then for the proposed transfer of assets to other
  1. companies was to protect the assets from a potential
  1. judgment in Mr Arkhangelsky’s favour, or at least one of
  1. the purposes of these transfers.
  1. And in that context, using an auction by Russian
  1. auction house for the same purpose seems like an
  1. improvement on that regional plan.
  1. MR JUSTICE HILDYARD: Well, on your case, I think it’s more
  1. than that, isn’t it? Your case, as I understand it, is
  1. that the process of auction, whether judicial or
  1. extrajudicial, under the Russian law in effect cuts off
  1. complaints, unless brought within a year against the
  1. bailiffs, about the process of sale, whereas otherwise
  1. they would be exposed to review. That’s as I understand
  1. your case to be.
  1. MR STROILOV: Quite. So that’s a stronger protection than
  1. simply a «bona fide purchaser», and then there is an
  1. argument how bona fide they are.
  1. So we say that is the only real explanation for
  1. using Russian auction house sale for the purpose of that
  1. sale, because it’s clear that it was a collusive deal.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

97 :1 Of course, Russian auction house was operating under

  1. an agency agreement with the bank, the whole sale was
  1. pursuant to an agreement between the Bank and Scan, now
  1. controlled by the Bank via Renord’s management, and then
  1. both bidders were also Renord companies. It was
  1. collusive. In itself that may have been all right —
  1. MR JUSTICE HILDYARD: Within a closed circle. I don’t know
  1. whether you can say it’s collusive.
  1. MR STROILOV: Indeed, my Lord. So clearly, there was some
  1. common purpose to this, and we say the only purpose was
  1. simply to further remove the assets.
  1. Now, what is, again, an unexplained difficulty in
  1. terms of looking at the realisation of Onega assets
  1. overall, obviously, if ROK Prichaly was interested, or
  1. indeed if the Bank was simply realising the security,
  1. and if they knew that ROK Prichaly is interested, well
  1. the obvious solution would be a very straightforward
  1. one: to sell both parts at public auctions to
  1. ROK Prichaly, or whoever may have bid.
  1. Well, instead, the Bank and Renord use the loan
  1. given by Western Terminal to LPK Scandinavia to enforce
  1. against LPK assets. They have a public auction where
  1. the land is sold to Mercury, but with the encumbrance
  1. subject to the Bank’s pledge; and that, in my
  1. submission, is the likely explanation to exclude any

98 :1 potential independent bidders by selling it with

  1. the encumbrance, whereas they could have simply sold
  1. the pledge.
  1. In my submission, the explanation given by
  1. Mrs Yatvetsky as to why the loan from Western Terminal
  1. to LPK Scandinavia was not recovered simply by realising
  1. the pledge of land, there was a pledge belonging to
  1. Mrs Arkhangelsky, and Mrs Yatvetsky told you that they
  1. decided not to enforce it for compassionate reasons;
  1. they felt sorry for Mrs Arkhangelsky. So instead of
  1. realising her pledge, they decided to enforce against
  1. LPK Scandinavia. In my submission, that’s not credible
  1. at all.
  1. And then, once it is sold to Mercury — so it’s
  1. again, the same kind of auction except that it is
  1. judicial, but it’s all between connected parties. Then
  1. rather than realising the pledge to the Bank then, they
  1. assign the rights to Mercury with 97 per cent discount,
  1. but then Mercury is not enforcing the loan.
  1. So, my Lord, that is the clearest instance where
  1. genuine bidders who could have bought it at a much
  1. higher price had really no chance to come into
  1. the picture; and there is no explanation why it couldn’t
  1. be done in a much more straightforward way simply by
  1. selling it at a public auction.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

99 :1 Of course, going further, considering that

  1. the Bank and Renord did appreciate the importance of
  1. synergistic value, you would rather expect them to carry
  1. out two auctions for the two parts of the terminal, and
  1. to bring them close to each other in time, just so that
  1. a bidder who’s interested in the terminal could be that
  1. close(?). They haven’t done that, and there is no
  1. innocent explanation.
  1. As far as the Western Terminal is concerned, of
  1. course you have quite a clear indication of the Bank’s
  1. intentions in —
  1. MR JUSTICE HILDYARD: Is there any documentary evidence of
  1. any communications between the Bank and/or Renord on
  1. the one hand, and ROK on the other with respect to these
  1. assets?
  1. MR STROILOV: I stand to be corrected. To my knowledge, no,
  1. not a single document. Well, except the stage plan,
  1. which I think Mrs Yatvetsky has told you in her witness
  1. statement related to the Bank providing a loan to
  1. ROK Prichaly to finance the whole operation on
  1. ROK Prichaly side. And again, I don’t think we have had
  1. the loan documentation disclosed.
  1. MR JUSTICE HILDYARD: That was not disclosed.
  1. MR STROILOV: It wasn’t disclosed, no.
  1. MR JUSTICE HILDYARD: So the entity considered to be

100 :1 the natural and possibly only bidder, there’s no

  1. evidence of any marketing effort?
  1. MR STROILOV: No documentary evidence or independent
  1. evidence.
  1. MR JUSTICE HILDYARD: Only Volodina’s introduction?
  1. MR STROILOV: Well, apart from what the witnesses’s said.
  1. Apart from that, there is literally nothing. And I will
  1. submit that you would expect, if that was as
  1. the Bank says, you would really expect someone from
  1. ROK Prichaly to come and give evidence to say, «No, of
  1. course it’s all rubbish, we are genuine buyers, we
  1. bought it because we wanted to run a business and we did
  1. pay».
  1. MR JUSTICE HILDYARD: It’s not disputed that they probably
  1. were genuine buyers, is it? I know you say they were
  1. connected, and that’s disputed.
  1. MR STROILOV: No, we don’t know. They may have been genuine
  1. buyers.
  1. MR JUSTICE HILDYARD: They had a genuine interest, didn’t
  1. they.
  1. MR STROILOV: Yes, they definitely had a genuine interest,
  1. but we don’t really know the full arrangement, why
  1. the Bank decided to let them have it. It may be for
  1. money, it may be because they are a connected party, and
  1. we may not necessarily know the full extent of that

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

101 :1 connection. Well, after all, Mrs Yatvetsky told you

  1. that the fishing port, which is the same as
  1. ROK Prichaly, belongs to a business partner of
  1. Mr Smirnov; and she told you that she assisted in
  1. assessing the risks of port business. But the full
  1. extent of that partnership and what that involves is
  1. something that we don’t know.
  1. So it may be either or both of these things. It may
  1. have been a sale at a higher price, or it may have been
  1. some concealed gift, or a good bargain given to
  1. a friend.
  1. Whatever it is, the aim clearly was for the asset to
  1. end up in the hands of ROK Prichaly, and there was quite
  1. a considerable effort obviously to keep that quiet.
  1. Well, at no auction — you don’t encounter
  1. ROK Prichaly as a name until very late, and only in
  1. internal documents of the Bank. In very few of them.
  1. Again, I am only thinking of the stage plan, and it
  1. may be the only one. You can find in the land register
  1. that ROK Prichaly eventually came to own this, but it’s
  1. very — it’s not transparent at all.
  1. MR JUSTICE HILDYARD: If ROK Prichaly was not associated,
  1. and there were no arrangements beyond the arrangements
  1. for synergy value, Salon(?), what would be the motive of
  1. the people, the Bank and/or Renord? Why go to all this

102 :1 trouble?

  1. MR STROILOV: On that assumption, I would simply point out
  1. that we’ve got no documentary or independent evidence as
  1. to the price at which it was sold. They give you
  1. the figure of half a billion roubles, but that’s say so
  1. by witnesses who are not —
  1. MR JUSTICE HILDYARD: You think it might have been a lot
  1. more, do you?
  1. MR STROILOV: It might have been. We simply don’t know.
  1. And the proper way is to note that the genuine sale in
  1. the end was done behind closed doors and kept
  1. deliberately separate from the public auctions; and then
  1. simply to go by the market value, whatever you find it
  1. was, and consider that had the thing been done properly,
  1. market value would have been realised at —
  1. MR JUSTICE HILDYARD: Was there any explanation as to why
  1. documentation demonstrating the sale and its price was
  1. not provided?
  1. MR STROILOV: No, I don’t recall anything of that kind.
  1. I think there was correspondence on that in disclosure
  1. in the context of disclosure and criticising disclosure.
  1. With your permission I’ll look it up at a later stage.
  1. I think it must have been in the correspondence relating
  1. to —
  1. MR JUSTICE HILDYARD: Well, if a good explanation or any

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

103 :1 explanation was offered, then between you I’m sure

  1. you’ll identify it for me.
  1. MR STROILOV: Yes, I will come back to this.
  1. My Lord, turning now to Western Terminal, we see
  1. a situation with some parallels with Onega Terminal, in
  1. that, firstly, as the Gunard lease is, in my submission,
  1. quite a remarkable illustration of the intention to push
  1. the value of the pledge down.
  1. So you have these uncommercial terms; the rent is to
  1. be paid in 49 years time or 39 years time. Clearly,
  1. the value, the real value in the hands of Renord is
  1. preserved, whereas the value for any potential
  1. independent bidder is pushed down. Whether or not that
  1. plan actually went ahead is something unclear.
  1. The witnesses on the Bank’s side denied that the plan
  1. was actually realised. It’s not very clear whether it
  1. was, because — if we could, perhaps, have a look at
  1. the lease agreement.
  1. MR JUSTICE HILDYARD: I know it quite well.
  1. MR STROILOV: Yes, my Lord.
  1. MR JUSTICE HILDYARD: But let’s have a look.
  1. MR STROILOV: Yes, my Lord, I will open it now.
  1. MR JUSTICE HILDYARD: In the end, apart from Mr Belykh,
  1. possibly, was it not agreed that the terms were rather
  1. unusual, but that they could be folded at any time?

104 :1 MR STROILOV: It was — I think it was accepted, yes, that

  1. the terms were unusual. What was a particular
  1. peculiarity, which I had in mind, is that — let’s open
  1. it. That’s at {D128/2060/1}.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: What I had in mind is, as you see in
  1. clause 2.1.1, the assets are to be transferred to Renord
  1. within three days from the date —
  1. MR JUSTICE HILDYARD: Yes, that was brought out in
  1. cross-examination, I think.
  1. MR STROILOV: Yes, my Lord, it was.
  1. MR JUSTICE HILDYARD: And there’s a difference between that
  1. and the term which states «effect from registration».
  1. MR STROILOV: What we know, if Renord wished, they could,
  1. and possibly did, actually use these assets for
  1. the benefit of Gunard. Well, it doesn’t matter which
  1. company, what matters is that it doesn’t appear on
  1. the —
  1. MR JUSTICE HILDYARD: But your case on this is that if you
  1. look at the lease and you assume that it is, or will be,
  1. put in place, or that possession has already been
  1. acquired, so that they’re going to be difficult to
  1. remove because they’ll pray in aid the agreement even if
  1. it’s not registered, it is a serious disincentive to
  1. acquire the land. And you say it’s no answer to that to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

105 :1 say: well, if it had been the right person, we could

  1. have folded the arrangements.
  1. MR STROILOV: Exactly.
  1. MR JUSTICE HILDYARD: In fact, you say that that answer
  1. confirms the noxious —
  1. MR STROILOV: Quite.
  1. MR JUSTICE HILDYARD: — character.
  1. MR STROILOV: Quite, my Lord. Well, I think I have put to
  1. Mrs Yatvetsky a number of reasons why her explanation is
  1. not satisfactory for that.
  1. But in any event, whether or not there was an
  1. additional — well, perhaps the primary objective of
  1. facilitating some sub-leases which would give a stream
  1. of income, it’s clearly the effect of this agreement,
  1. and therefore a serial effect of this agreement is that
  1. the value of the pledge goes down dramatically.
  1. It is telling that a copy of this agreement was
  1. provided to Mr Millard. To his credit, he did not take
  1. it into account; he considered that it was not
  1. sufficient evidence of the encumbrance. But it was
  1. provided to Mr Millard, and I believe — perhaps I’d
  1. better check, but I believe I have put this to
  1. Mrs Kosova in cross-examination, and I don’t believe she
  1. had anything to say by way of explanation why it was
  1. provided to Mr Millard. Perhaps I’d better check.

106 :1 I don’t want to be inaccurate.

  1. I suppose all I’m saying is that that really
  1. confirms that one of the purposes which the Bank had at
  1. the time was to reduce the value for independent buyers
  1. but not for connected buyers.
  1. MR JUSTICE HILDYARD: Yes, because on one view of the lease,
  1. the reversion is worth whatever capital value you put on
  1. $20,000 at the end of 49 years or more if extended,
  1. which might be a dollar or two, but not be much more
  1. than that.
  1. MR STROILOV: I would say it’s even more. Assuming that
  1. $20,000 is really a market price, yes, so the buyer buys
  1. the terminal and then he cannot use it for 49 years, or
  1. for 30 years —
  1. MR JUSTICE HILDYARD: Yes, that’s looking at it at that
  1. side, yes. It’s subject to this extreme — it’s been
  1. promised forever, really.
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: Well, I know that this is one of
  1. the things which Mr Birt will assist me on. It is
  1. a curious document.
  1. MR STROILOV: Yes. And my Lord, just for the reference,
  1. I think I put the matter to Mrs Kosova on Day 25,
  1. page 47, {Day25/47} where I put it to her. I put this
  1. agreement to her, and the fact that it was given to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

107 :1 Mr Millard. I think she didn’t say anything of

  1. substance, and that’s a fair summary, but if
  1. your Lordship is minded to scan-read through the next
  1. four pages, you may like to do so.
  1. MR JUSTICE HILDYARD: Do you want me to read those?
  1. MR STROILOV: Not necessarily now, my Lord.
  1. MR JUSTICE HILDYARD: Okay, I’ll read them in my own time.
  1. MR STROILOV: My Lord, then subsequently, if we go back —
  1. well, perhaps it’s easier to follow my written closing
  1. submission. If we go to my written closing at
  1. paragraph 122. That’s at page 50.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: {AA5/15/50}
  1. I think I am looking at my paragraph 122. I think
  1. I have to correct this. Sevzapalians did not initiate
  1. the claim, it actually took over the enforcement
  1. proceedings started by Morskoy Bank. And I do apologise
  1. for this inaccuracy.
  1. My Lord, that gives you the chronology of
  1. the further transfers which happened in relation to
  1. Western Terminal.
  1. So again, the auction you have in December 2011,
  1. the one I describe in paragraph 124, once again, you can
  1. see the same mechanics, where you have the assets sold
  1. not as part of realisation of the pledge, but sold again

108 :1 to a connected party, but with the encumbrance of

  1. the pledge to the Bank, so that outsiders are unlikely
  1. to bid on these conditions.
  1. But interestingly, if you go further, I think
  1. I continue to describe this in 126, then once Nefte-Oil
  1. buys it, it then sells the assets to another Renord
  1. company, but not all of the assets or with a pledge. So
  1. you have the situation where the pledge, again, it is
  1. subject to an ostensibly different company having
  1. various property rights to railway tracks on that land,
  1. or to berths there, and potentially creating
  1. difficulties. So that is an artificial disincentive for
  1. any potential third-party buyer.
  1. MR JUSTICE HILDYARD: I don’t know whether there was
  1. synergistic value in the unpledged berth and railway
  1. tracks.
  1. MR STROILOV: My Lord, I think on — well, perhaps not —
  1. the unpledged berth, I think on the valuation evidence
  1. you had, it does add synergistic value.
  1. As for the railway tracks, we don’t know there. But
  1. I think Ms Mironova has indicated to you, as she was
  1. explaining the strategy to unify, to maximise, and why
  1. she chose Western Terminal as the object of repo. As
  1. she explains that having a number of these small,
  1. unpledged assets scattered around the pledge and

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

109 :1 connected with the pledge may be very inconvenient, and

  1. it may enable the appropriator of minor unpledged assets
  1. to hold the owner of the pledged to ransom over this.
  1. So the purpose of unifying the assets was to avoid that.
  1. That’s quite possible.
  1. But then the question is, what was the purpose of
  1. them separating them and moving the pledge from
  1. Nefte-Oil to VECTOR, whereas the unpledged assets
  1. remained within the ownership of Nefte-Oil. My Lord,
  1. Nefte-Oil being another oil business of Renord, just
  1. like Baltic Fuel Company. That is one of
  1. the indications that at that stage, the plan is in place
  1. for Baltic Fuel Company to utilise Western Terminal.
  1. There are several such indications along the road, but
  1. in my submission, that is pretty clear that by that
  1. stage, as we’ve seen, it is clear.
  1. MR JUSTICE HILDYARD: You say the auction was unlawful
  1. because Nefte-Oil was the only bidder? That’s right,
  1. is it? There wasn’t even another?
  1. MR STROILOV: That’s not clear. I think Mr Smirnov’s
  1. witness statement indicates that — well, it’s not quite
  1. conclusive. If we could go to Mr Smirnov’s. Let me
  1. find it. You found it quicker than I. {B2/12/1}.
  1. Anyway, I’ll open it on my computer. Sorry, it’s
  1. being slow.

110 :1 I think the phrase he uses is that «in the absence

  1. of any competing bids» — let’s look at it rather than
  1. quote from memory.
  1. MR JUSTICE HILDYARD: Paragraph 59.
  1. MR STROILOV: 59, yes, my Lord, you are right. I beg your
  1. pardon. I was a bit slow. So:
  1. «In the absence of any competing bids …»
  1. Whereas I think at some point it was submitted on
  1. behalf of the claimants that this does not mean there
  1. were no other bidders. But at no stage I think we were
  1. told the name of that other bidder, if there was any.
  1. MR JUSTICE HILDYARD: Did we see those little — as in
  1. the other auctions, was that little sort of form which
  1. showed who had attended?
  1. MR STROILOV: No, I think the only document we have in
  1. relation to this auction is {D154/25/88}. And that only
  1. gives the name of the seller and the buyer, but not of
  1. any other bidder. And I stand to be corrected if I’ve
  1. overlooked anything, but I believe we don’t have
  1. Protocols 1, 2 and 3 in relation to this auction.
  1. MR JUSTICE HILDYARD: As far as the evidence goes, and
  1. Mr Birt will direct my attention to something else, as
  1. far as the evidence goes, this was not a valid auction?
  1. MR STROILOV: Yes, my Lord. Well, yes, that is my
  1. submission. But in any event, in the alternative, if

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

111 :1 you are not prepared to find that the formal rules were

  1. broken, in my submission, it’s a clear example of an
  1. abuse of process, and the auction is —
  1. MR JUSTICE HILDYARD: I understand your general point, but
  1. in all the other cases, there have been two legal
  1. entities. In this case, as far as the evidence you have
  1. shown me goes, there’s only one.
  1. MR STROILOV: Yes, my Lord.
  1. MR JUSTICE HILDYARD: And the rule is you’ve got to have
  1. a minimum of two.
  1. Now, it may be that there’s other evidence,
  1. documentary or oral, that there were two, and that’s
  1. what I’m alerting Mr Birt to show me. But as far as
  1. you’re aware, it isn’t that?
  1. MR STROILOV: Yes, my Lord.
  1. I think then I consider the settlement agreement
  1. with VECTOR Invest in paragraph 127 of my submission.
  1. Frankly, I think I don’t need to expand on that
  1. a lot. I’m referring to it only for completeness, so
  1. that you have the whole chain of transfers in mind.
  1. The evidence of Ms Mironova was quite clear.
  1. MR JUSTICE HILDYARD: Give me the reference to that, or
  1. someone will at some point. The effective admission.
  1. MR STROILOV: Yes. I think it will be easier for me to
  1. delay this a little.

112 :1 MR JUSTICE HILDYARD: Yes, that’s fine.

  1. MR STROILOV: My Lord, we had, in relation to the actual
  1. auction that was the second auction where the pledge was
  1. sold to Kontur, which is, we are told, part of
  1. Baltic Fuel Group, and clearly is a company connected
  1. with Baltic Fuel Company, I would simply stress, in
  1. other disclosure we had in relation to that auction,
  1. that is one of the cases where the second bidder was
  1. not —
  1. MR JUSTICE HILDYARD: Yes, that’s Globex comes out of
  1. the woodwork a year later.
  1. MR STROILOV: Yes, very late. Well, I think it wasn’t quite
  1. a year later, because it was named in the defence to
  1. the counterclaim.
  1. MR JUSTICE HILDYARD: Right.
  1. MR STROILOV: But there was an inexplicable absence of
  1. protocol number 1, or any documentary evidence of
  1. the second bidder participating.
  1. MR JUSTICE HILDYARD: But there is now, is there?
  1. MR STROILOV: There is now, yes. It has been disclosed in
  1. the end.
  1. MR JUSTICE HILDYARD: Okay, someone will give me
  1. the reference for those. I’m sorry to be tedious,
  1. but~…
  1. MR STROILOV: Yes, my Lord, I will do so.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

113 :1 So my Lord, even though perhaps we cannot

  1. demonstrate step by step how exactly any genuine
  1. third-party bidders were excluded, well, you have
  1. sufficient evidence of the intention to do so, and
  1. significant efforts taken by the Bank and Renord to
  1. ensure that the assets are sold to themselves and not to
  1. an independent bidder by — well, most typically by
  1. encumbrances. Possibly auctioneers were part of that
  1. scheme, but that is something we don’t know and we don’t
  1. invite you to find expressly. But again, we would say,
  1. that the inherent improbability of that is overturned.
  1. It’s not the case that you have to assume without most
  1. cogent evidence that the bailiffs were acting honestly.
  1. There is quite a — well, if nothing else, simply by the
  1. very fact that bailiffs apparently haven’t asked
  1. questions about all these suspicious matters we’ve
  1. outlined, in a way it speaks for itself. But
  1. ultimately, in all the circumstances, it is clear that
  1. unless they were part of the conspiracy, they were
  1. misled in some way. But clearly an auctioneer trying to
  1. comply with his duty would have had some difficulties.
  1. MR JUSTICE HILDYARD: Well, I’m not entirely clear what
  1. the bailiffs were meant to do.
  1. In a case where the value was stated between
  1. the parties, then you took the 10 per cent off, or

114 :1 whatever it was, whereby it established the minimum bid

  1. price. It may be that in other cases, the bailiffs had
  1. responsibility for striking a value. I don’t know.
  1. Subject to that, they were in a sort of ministerial
  1. position, weren’t they? They just watched the whole
  1. thing — if there were two and there were two bids or
  1. three bids, whatever it is, as long as it was above
  1. the minimum, they just signed off on the dotted line,
  1. didn’t they?
  1. MR STROILOV: Essentially that was their function, yes,
  1. my Lord.
  1. What I’m saying is that your Lordship should not
  1. infer too much from the fact that you don’t have any
  1. evidence of attempts by independent bidders to bid,
  1. because there may have been a number of reasons why not.
  1. A) artificial encumbrances; B) the apparent role played
  1. by state authorities makes it likely that the bailiffs
  1. might have excluded them.
  1. MR JUSTICE HILDYARD: Well, that is going a long way, isn’t
  1. it? On what basis could I legitimately assume that
  1. there had been some interference with the bailiffs by
  1. some state office? That is conjecture, isn’t it? It’s
  1. mere speculation, isn’t it? You think Matvienko was
  1. involved in lots of stuff, but there is no factual
  1. evidential basis, is there, for supposing that there was

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

115 :1 interference? Is there?

  1. MR STROILOV: Well, my Lord, obviously as there is no
  1. (inaudible), we don’t have a particularised case as to
  1. how each particular bailiff may have been —
  1. MR JUSTICE HILDYARD: Well, no, you have no case on whether
  1. they were, let alone how.
  1. I mean, I very much take your point as to how you
  1. approach pleas of fraud or dishonesty, and I very much
  1. take Lord Hoffmann’s reminder that it’s common sense
  1. rather than a legal rule which makes you alight on fraud
  1. last. But one thing you’re definitely not allowed to
  1. do, in my book, is to simply say what you think in world
  1. terms is a perfect possibility, and then convert that
  1. into proof.
  1. MR STROILOV: In a way, I answer a conjecture by conjecture.
  1. What has been advanced on behalf of the claimants is
  1. that surely, if the value was as high as you say, you
  1. know, other bidders would have flocked to try and buy
  1. it. All I am saying is that this is speculation; there
  1. may be all sort of reasons why not.
  1. You should look at the fact that these auctions were
  1. collusive and that the price achieved is so much below
  1. the market value. Looking at that, there needs to be —
  1. simply by saying that we have not perhaps sufficiently
  1. identified the reason why others didn’t bid, that is not

116 :1 a complete answer to the allegation. I submit that the

  1. balance of probabilities is still in our favour. We
  1. simply know too little. Again, perhaps if fuller
  1. disclosure was given, that would have helped to dispel
  1. suspicions, but it wasn’t.
  1. MR JUSTICE HILDYARD: I take your point that there’s
  1. a series of auctions attended by — the most is two, and
  1. both connected in every case, and the price paid is
  1. a maximum of one step beyond the minimum. And this
  1. happens time and again. It begins to cause anxiety,
  1. suspicion, as I’ve said.
  1. MR STROILOV: My Lord, a further point, I think, in relation
  1. to auctions is that really, this series of transfers,
  1. what it shows is that it was not a forced sale or a fire
  1. sale. It did not have value and the market was
  1. depressed; it did not have to be on depressed market.
  1. Clearly a lot of thought has gone into it, and there was
  1. sufficient time to achieve the best conditions. It’s
  1. not the case where the Bank was in a rush to realise
  1. the pledges and just put them on the market as quickly
  1. as possible, and whatever is recovered is recovered.
  1. No, they have taken significant efforts, very complex
  1. transactions, aimed at unifying the assets. In the case
  1. of Western Terminal, the pledge was only released three
  1. and a half years after the alleged default. So

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

117 :1 explaining the undervalue by its being a forced sale or

  1. a fire sale in these circumstances is not credible
  1. at all.
  1. That is, my Lord, all I have to say in relation to
  1. auctions.
  1. Perhaps it is a convenient moment to talk a little
  1. bit about Renord as such and what has come to light in
  1. terms of its beneficial ownership and its connections
  1. with the Bank. But before I do so, I wonder if perhaps
  1. a five-minute break or ten minute break.
  1. MR JUSTICE HILDYARD: Yes, indeed.
  1. (3.10 pm)

13 (A short break)

  1. (3.20 pm)
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: May it please your Lordship. So in relation
  1. to Renord, I think a lot of issues have now been
  1. eliminated simply because of the admissions made by the
  1. claimants in evidence; and I actually mean the witness
  1. statements rather than the cross-examination. But it
  1. deserves a mention that prior to the service of witness
  1. statements, at no time did the claimants admit that
  1. the assets were bought by connected parties; companies
  1. such as Solo and Mercury and Kontur were companies
  1. controlled by Renord group.

118 :1 That reluctance in a way speaks for itself. Indeed,

  1. I think our pleadings in relation to that, imperfect as
  1. they were, and they were criticised for lack of
  1. particularity, but the companies were named there, it
  1. was aware that they were connected to the claimants and
  1. there were no admissions until very recently.
  1. My Lord, we say that you are still not told
  1. the whole truth on that, in that what came to light at
  1. the trial suggests that in fact Renord is controlled by
  1. Mr Savelyev via the Bank or otherwise.
  1. I say that not just because he’s using nominees and
  1. Renord is owned by nominees, but essentially,
  1. the evidence you have had about the beneficial ownership
  1. of Renord, what you were told by Mr Smirnov in his
  1. witness statement is that it was — well, perhaps we’d
  1. better look at it first hand.
  1. {B2/12/1}, that’s Mr Smirnov’s statement. He
  1. explains the beneficial ownership I think at page 3,
  1. paragraph 14. {B2/12/3}. He explains that it was
  1. a joint venture between him and Mr Malyshev; and then he
  1. says that in March 2008, Mr Malyshev sold his
  1. 75 per cent shareholding, as he says, to him, to
  1. Mr Smirnov; and that was initially a company called
  1. Trak, and then a company called Barrister. And then in
  1. August 2013, Barrister transferred its shares to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

119 :1 Mr Smirnov. Then he names Mr Maleev as a nominee who

  1. held the shares in Barrister on Mr Smirnov’s behalf.
  1. The question is how true this evidence is. As you
  1. will see, if we now look at the cross-examination of
  1. Mrs Yatvetsky on Day 40, page 55. {Day40/55}
  1. Starting there, I ask her about this series of
  1. sales. If we could, perhaps on the other screen,
  1. I don’t know, or if we could simply scroll down to
  1. page 56. You will see, when I ask about 75 per cent of
  1. Renord, which is supposed to be a big and successful
  1. business being sold for 7.5000 roubles. Then I think if
  1. we go one page down, I continue asking her about this.
  1. What I am suggesting, my Lord, is that from this
  1. evidence, it is clear that all these transfers of Renord
  1. shareholding were at a purely nominal price. And in
  1. circumstances where the only evidence as to beneficial
  1. ownership which you have is the untested evidence of
  1. Mr Smirnov and now given the importance of Renord in
  1. these proceedings, I would submit that untested evidence
  1. on any contentious point carries very little weight,
  1. whatever the reason as to why it could not be tested.
  1. Then you have the evidence of Mrs Yatvetsky, who was
  1. not apparently able to corroborate that evidence on
  1. beneficial ownership in her witness statement. But when
  1. she was pressed on this in cross-examination, she

120 :1 suddenly remembered, or told you so, that she was

  1. involved in all these transfers and she knows all that.
  1. So that evidence is very significant(?).
  1. Now, you have the prices — and it has been admitted
  1. that the prices were nominal — from which it follows,
  1. in my submission, that the ownership did not really
  1. change. Whoever was the beneficial owner, Mr Malyshev
  1. and Mr Maleev, and possibly Mr Smirnov, were all
  1. nominees for the beneficial owner; or one of them may
  1. have been the beneficial owner, but there was no change.
  1. MR JUSTICE HILDYARD: And who’s the beneficial owner?
  1. MR STROILOV: Now, my Lord, in my submission, it is likely
  1. to be Mr Savelyev. The reason I say this is because it
  1. has transpired in cross-examination that Mr Maleev is
  1. a person who Mr Savelyev habitually uses to manage his
  1. companies, and on some occasions as a nominee. Well,
  1. not only Mr Savelyev actually; we have seen him acting
  1. as a director general for a company which appears to be
  1. a business project of Mr Savelyev’s brother. He also
  1. acts in companies co-owned by Mr Savelyev’s daughter.
  1. I think I have summarised it all in the closing
  1. submissions, so I am just galloping through this. And
  1. of course it was a big part of Mr Savelyev’s
  1. cross-examination.
  1. So on one hand, we have this clear evidence that

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

121 :1 Mr Savelyev trusts Mr Maleev with precisely these kind

  1. of tasks effectively, to manage and sometimes to hold
  1. companies on his behalf. And the same is true of
  1. Mr Savelyev’s family. At the same time, apart from
  1. Barrister and possibly some other companies connected
  1. with Renord and the Bank, there is nothing linking
  1. Mr Smirnov with Mr Maleev.
  1. I think on Mrs Yatvetsky’s evidence, it was a purely
  1. oral arrangement, which obviously implies a very high
  1. level of trust. Mr Savelyev, I think, wasn’t sure that
  1. Mr Smirnov and Mr Maleev even know each other. It all
  1. just does not sound credible that Mr Smirnov was
  1. the beneficiary. It’s far more likely that Mr Maleev
  1. was performing the role he has always been performing,
  1. that is holding the company on behalf of Mr Savelyev, or
  1. the Bank.
  1. MR JUSTICE HILDYARD: Can I demonstrate supreme ignorance,
  1. please. The chap who habitually acted for, you say,
  1. Mr Smirnov was Maleev, isn’t that right?
  1. MR STROILOV: M-A-L-E-E-V.
  1. MR JUSTICE HILDYARD: And then there’s another chap called
  1. «Malyshev».
  1. MR STROILOV: Indeed. And that is the husband of Mrs
  1. Malysheva.
  1. MR JUSTICE HILDYARD: I’m worried on the transcripts these

122 :1 two are getting confused.

  1. MR STROILOV: Yes, they shouldn’t be confused of course.
  1. MR JUSTICE HILDYARD: No, because I’m getting confused, and
  1. I think —
  1. MR STROILOV: So Maleev is a gentleman who was 100 per cent
  1. nominal shareholder of Barrister.
  1. MR JUSTICE HILDYARD: That’s 148(3) of your closing.
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: And then Mr Vladimir Malyshev,
  1. Mrs Malysheva’s husband I assume, held 75 per cent in
  1. Renord as a nominee; and that’s in sub 4 of paragraph
  1. 148. But they are different people.
  1. MR STROILOV: They are.
  1. MR JUSTICE HILDYARD: I think the transcript needs to be
  1. checked to make sure that we’ve got the right person.
  1. MR STROILOV: Indeed, my Lord.
  1. MR JUSTICE HILDYARD: I’m sorry to raise it, otherwise it
  1. could be confusing.
  1. MR STROILOV: If I spot any confusion, I will point that
  1. out.
  1. MR JUSTICE HILDYARD: Thank you.
  1. MR STROILOV: But that’s really, I think, at least the most
  1. important and the strongest part of the evidence to
  1. infer that the real owner of Renord is Mr Savelyev.
  1. It’s not that we have to prove that. Well, in

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

123 :1 reality, they may have been in the conspiracy together

  1. without Mr Savelyev being the beneficial owner. But it
  1. is important in several respects. Well, firstly, that
  1. shows that they still continue to hide the truth about
  1. Renord and what it was.
  1. Secondly, a point has been made that if the Bank was
  1. participating in the fraud as alleged, then effectively,
  1. the Bank would be defrauding itself. Well, in
  1. the circumstances where the Bank and Renord are owned by
  1. the same people largely, or the Bank owns Renord, well,
  1. that difficulty falls away. Again, it’s not a fatal
  1. difficulty on any view, but it affects inherent
  1. probabilities.
  1. MR BIRT: Sorry, my Lord, I only rise just to check
  1. the point. As one reads the transcript, one’s not quite
  1. sure whether one’s heard right, but Mr Stroilov — I’m
  1. getting my names mixed up now — slightly moves between
  1. Renord was owned by the Bank and Renord was owned by
  1. Mr Savelyev. And I’d just like, for my own purpose, to
  1. know which it is that he’s saying, because it does jump
  1. about a bit, my Lord.
  1. I hope that’s not an unnecessary interruption.
  1. MR STROILOV: I’m grateful. We invite these findings in
  1. the alternative. We would say it is not material which
  1. it is simply because on the evidence of Mr Savelyev,

124 :1 it’s quite clear that he controls the Bank. The exact

  1. extent of his ownership of the Bank is not quite clear,
  1. but the Bank is under his control. So whether he owns
  1. or co-owns Renord, or through the Bank indirectly, or
  1. more directly, is not something that in my submission is
  1. necessary to establish, or possible.
  1. Really, the point is that it’s not a case where you
  1. have a genuinely independent party, and then it looks
  1. like the Bank has defrauded itself in favour of a third
  1. party, which is not impossible, but creates a difficulty
  1. which I think falls away in the light of Mr Savelyev’s
  1. cross-examination on this point.
  1. That’s not the only thing, and we summarise various
  1. connections between the Bank and Renord Group in our
  1. closings, which we simply rely on the number of these
  1. connections in terms of officers and managers migrating
  1. between the Bank and Renord, and so on. The number of
  1. these connections is overwhelming. It’s way more than
  1. a client relationship, a good trust client relationship
  1. in this situation.
  1. I think a particular aspect I would like to mention
  1. is you will recall, and it was not in dispute, that
  1. the sister of Mr Guz is the head of the Legal Department
  1. of Renord. And Mr Guz gave you hearsay evidence from
  1. her to the effect that she was in no way involved in OMG

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

125 :1 matters. However, that’s not correct, and I have put to

  1. Mrs Kosova her correspondence with Ms Guz in relation to
  1. Western Terminal. I will find the reference in
  1. a moment.
  1. That will be Day 25, page 20. And page 21, if we
  1. could have that as well. {Day25/20}
  1. I’m afraid I’m not sure if the document was since
  1. uploaded. There is obviously the disclosure reference
  1. number, and Mrs Kosova has read it out, so it was
  1. translated orally at the time. But there was an email
  1. exchange. Also on the other screen if we could have 22
  1. and 23 as well.
  1. You have the email exchange involving both
  1. Mrs Kosova and Ms Guz discussing precisely the strategy
  1. to unify, to maximise the value of Western Terminal. So
  1. whether — 21, 22, 23.
  1. So whether the evidence of Mr Guz was untrue or
  1. whether he was misled by his sister, it is clear that
  1. this denial which he volunteered is untrue.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: So, my Lord, I think obviously I incorporate
  1. everything we say in the closing submissions, or else
  1. I summarise. I think, generally speaking, I have
  1. explained what we say about Renord as such.
  1. I think I should move on, because in a way, it’s an

126 :1 endless subject.

  1. MR JUSTICE HILDYARD: What weight do you place on the fact
  1. that there was no formal arrangement between
  1. the Bank and Renord?
  1. MR STROILOV: Well, it is obviously, as our banking expert
  1. says in quite strong terms and the claimants’ banking
  1. expert says in more gentle terms, it’s extremely
  1. unusual. Well, there is nothing wrong in it being
  1. unusual in itself, but given that the claimants had been
  1. telling the court for some time that it was perfectly
  1. conventional and commonly used, that rather undermines
  1. their case on the repo.
  1. We say that the reason why it was not documented is
  1. likely to be because it was fraudulent and they didn’t
  1. want to leave unnecessary records of that.
  1. Clearly the intention is likely to have been at the
  1. time that it may be necessary at some stage to contend
  1. that Renord is independent and the Bank has nothing to
  1. do with it. As indeed they did in the Russian criminal
  1. case in relation to Morskoy Bank. They said it was
  1. simply a genuine sale from OMG to original
  1. purchaser: Sevzapalians in that case.
  1. So clearly, if the intention was as the claimants
  1. say, if it was simply a question of additional security
  1. or preventing any unscrupulous and illegitimate

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

127 :1 resistance to enforcement of pledges, if it was all

  1. above board, there would be no difficulty in writing
  1. down at least something; not necessarily a formal
  1. document, but some memorandums on the back of
  1. the envelope. It would be obviously — even if they
  1. trust each other, it’s important to know that they
  1. understood each other correctly.
  1. So I would submit that the lack of formal
  1. arrangements and the lack of remuneration for the repo
  1. are both strong factors indicating that what the
  1. claimants tell you is not true —
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: — in relation to repo.
  1. Indeed, I think I need to say a bit more about the
  1. repo agreements and the December 2008 agreement more
  1. generally, and the issue you have touched upon while in
  1. questions to my learned friends was whether it accepts
  1. the evidence of banking experts that the usual
  1. arrangement would be that in the event of default, any
  1. surplus price is effectively lost.
  1. I think here we are in agreement. Whatever may have
  1. been the general practice, as the banking experts have
  1. told you, clearly in this case that was not
  1. the intention; and you see that from the repo contracts
  1. themselves.

128 :1 I think if you look at the memorandum — let me open

  1. it. So that’s {D107/1537/1}. If we now scroll down to
  1. the next page {D107/1537/2}, in clause 2 you see
  1. the words:
  1. «After the complete fulfilment of the Group’s
  1. obligations to the Bank, sale and purchase transactions
  1. in reverse will be carried out …»
  1. So my Lord, my reading of that is that
  1. the obligations may be fulfilled by repayment of loans,
  1. or, in the event of default, by a realisation of pledges
  1. where the normal rules apply. Well, if the loan is
  1. repaid by realisation of pledges, then surplus goes back
  1. to the pledgor company, and then the shares are
  1. returned. It seems to me that there isn’t much
  1. disagreement between us as to the meaning of this. So
  1. I agree on this.
  1. Now, my Lord, in terms of the repo —
  1. MR JUSTICE HILDYARD: So you agree that the right of
  1. repurchase survives default?
  1. MR STROILOV: Yes, my Lord, on proper analysis, yes, we
  1. agree with that.
  1. MR JUSTICE HILDYARD: Under the terms of this particular
  1. agreement?
  1. MR STROILOV: Yes — well, that was the intention of this
  1. contract, clearly. Obviously we may disagree as to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

129 :1 the contractual analysis of this, beyond just to say

  1. that there was an agreement with — an oral component,
  1. and they don’t accept that, and they prefer to analyse
  1. this as a series of separate agreements. But yes, of
  1. course they say it will clearly be — it will be clearly
  1. an unfair term if it gave the Bank the right to realise
  1. the pledges and to take any surplus, or the companies
  1. nominated by the Bank to take any surplus value. Given
  1. that, for example, Western Terminal was pledged at 38
  1. per cent of what was at that time perceived by the
  1. parties to be its market value, that would be a very
  1. substantial increase.
  1. MR JUSTICE HILDYARD: Do you say that the right or the value
  1. of the right is enforceable against the subsequent
  1. purchasers?
  1. MR STROILOV: Well, that is difficult to say. Really, we
  1. say that the party to the agreement is obviously
  1. the Bank. Simply looking at the December 2008
  1. agreement, it is enforceable against the Bank, whoever
  1. is acting on its behalf. And obviously it’s our case
  1. that the transfer to subsequent purchasers was a breach
  1. of the agreement and a fraudulent act. So to that
  1. extent, well, obviously it is enforceable against
  1. whoever eventually gets the shares.
  1. Obviously the shares in this case is merely, in

130 :1 a way, a device for holding the assets, or for

  1. controlling the business. So I agree with that
  1. particular contention.
  1. Now —
  1. MR BIRT: I’m so sorry, my Lord, and I may be wrong about
  1. this; I’m sorry to interrupt. I wasn’t sure whether it
  1. is part of their case that the transfer to
  1. the subsequent purchaser was a breach of contract.
  1. I couldn’t find it quickly. I just wanted to put that
  1. marker down.
  1. MR STROILOV: I’m pretty sure it is, but … Well, I can
  1. find it in the pleadings, if that helps, my Lord.
  1. MR JUSTICE HILDYARD: Do you want to check that later?
  1. MR STROILOV: I can, yes.
  1. MR BIRT: I wasn’t trying to be difficult, I just wanted to
  1. let him know now rather than raise it in the last five
  1. minutes of Monday or something.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: Yes, my Lord.
  1. Now, in terms of going back to repo for a moment,
  1. I think in addition to everything that we have said,
  1. I would also — I think we say it in the written
  1. submissions: as far as the evidence of banking experts
  1. is concerned, I submit that on all points of
  1. disagreement, clearly Professor Guriev’s evidence is to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

131 :1 be preferred. Mr Turetsky, with all due respect, was

  1. not an impartial expert, but I’m sure you have formed
  1. your own judgement in relation to him.
  1. Now, my Lord, perhaps before we turn away from
  1. the issue of the December agreement, if I could pick up
  1. on the question you asked earlier in terms of the Bank’s
  1. perception of the value of the pledges at the time, and
  1. when they began to doubt Lair valuations.
  1. If we could look at Day 30, starting at page 60, and
  1. if we could do, as much as possible, 60 to 63,
  1. I suppose. If we could call it on the screen one by
  1. one.
  1. I tried to press Ms Savelyev on this, starting on
  1. the line 18. I suppose the burden of his evidence is
  1. that at the time, the Bank was still under
  1. the impression that the value was well in excess of
  1. the loans.
  1. Similarly —
  1. MR JUSTICE HILDYARD: Where does he say that, sorry?
  1. MR STROILOV: I think he talks — I’m looking at page 60,
  1. and I ask him — yes, I think he actually hasn’t
  1. answered, but the question was asked.
  1. MR BIRT: I think probably the top of page 63, it carries on
  1. all the way up to then. That’s where he’s asked about
  1. the time period.

132 :1 MR STROILOV: I’m very grateful, yes.

  1. MR JUSTICE HILDYARD: I don’t find it wholly clear, I must
  1. say. Am I missing a page? Should I have 62?
  1. MR BIRT: 62 is missing off the screen.
  1. MR STROILOV: I see, yes.
  1. MR JUSTICE HILDYARD: I don’t find the answer. You tell me
  1. there is an answer there?
  1. MR BIRT: Mr Stroilov asked the question originally about,
  1. «At the time you called a default», and not making
  1. submissions about Mr Savelyev’s long answer, but then
  1. my Lord helped Mr Savelyev to focus on the question, and
  1. asked him to focus on the time period at the bottom of
  1. 62, asked about the default, and then Mr Savelyev
  1. confirms, as I read the top of page 63, he says:
  1. «I have just been talking about the time period when
  1. the Bank was provided with pledges when the loans were
  1. made.»
  1. I think is what he means there. In other words, his
  1. previous answer when he has been saying, «Yes, we had
  1. plenty of cover», that goes back to his answer at the
  1. bottom of 62:
  1. «At that point in time, when we were extending loans
  1. to the group, there were plenty of pledges and
  1. sufficient number of assets, otherwise the Bank would
  1. have not extended the loans.»

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

133 :1 Then his next sentence at the top of 63:

  1. «… I’m not discussing the moment when the Bank
  1. declared a default, because when default was called, we
  1. already had different information.»
  1. So I think by that, I would read him to be
  1. saying: well, by that time, we didn’t think we were
  1. sufficiently covered. But I’m moving to submission
  1. rather than identification, my Lord, there.
  1. MR JUSTICE HILDYARD: Yes, thank you.
  1. MR STROILOV: I’m grateful.
  1. There is another point in cross-examination of
  1. Mr Savelyev which I would like to draw attention to in
  1. relation to the same issue, which is at Day 20 — in Day
  1. 28, and if you could go to page 148, and subsequent as
  1. far as it can go. That was another line of questioning
  1. on that.
  1. MR JUSTICE HILDYARD: 20/28?
  1. MR STROILOV: Day 28, page 148. {Day28/148}
  1. We are talking again about the time when the loans
  1. were given, but then later on …
  1. If we could skip to page 154 and subsequent. It may
  1. be interesting to read the whole sequence, but now that
  1. your Lordship has the reference, I would invite you to
  1. look at 154 and subsequent.
  1. I think, starting at the bottom of 154 at line 23,

134 :1 Mr Savelyev gives quite a long answer about how he says

  1. the Bank came to doubt Lair valuations.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: Then I referred Mr Savelyev to a document
  1. which perhaps is worth looking at on the other screen,
  1. the one at {D122/1955/0.1}.
  1. Mr Savelyev in June 2009 appears to give an order to
  1. check the values. And looking at the transcript of
  1. cross-examination, again, I’m afraid I’m asking him to
  1. read it. But then if we could go to 157 and 158, you
  1. will see that I am asking him — well, really getting at
  1. this point, trying to establish when the Bank says they
  1. started to doubt Lair valuations.
  1. I asked him whether it was the conclusions of this
  1. working group, and he says it was among other things,
  1. and then effectively he strays to wider matters.
  1. Then he thought that it reported on 3 August.
  1. I think that’s it.
  1. So essentially, there’s a date: the earliest when
  1. the Bank may have had doubts about Lair valuations was
  1. in June 2009. And that is very important, as that
  1. really undermines very significantly the explanation
  1. given by the Bank about there being nothing to rate(?),
  1. about the effect of repo being simply to secure access
  1. to pledges rather than control over much bigger assets

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

135 :1 of value.

  1. It undermines the Bank’s explanation for calling
  1. default in March 2009, whether or not there was
  1. a moratorium really. If you have a group which owns
  1. assets well in excess of its liabilities, or
  1. the Bank rightly or wrongly believes so, clearly on
  1. a commercial deal, with which everyone on the Bank’s
  1. side agreed, you would expect it to restore solvency,
  1. and then you wouldn’t call a default, unless you
  1. actually want to take advantage of the position and to
  1. appropriate those assets.
  1. Finally, still on the same issue, I think one more
  1. document you may find helpful is an email at
  1. {D93/1166/5}. Not an email, an information memorandum,
  1. an internal memorandum of the Bank. Before that list of
  1. bullet points which you see in the middle, two
  1. paragraphs up, it says:
  1. «Pursuant to the Mortgage Contract, the pledge value
  1. of the properties is RUR …»
  1. 1.3 approximately billion.
  1. MR JUSTICE HILDYARD: 37.92 per cent of the market value.
  1. MR STROILOV: Yes. Then after the list of bullet points,
  1. you can see the reference to land surveying, which you
  1. may recall there was discussion in cross-examination;
  1. it’s not a perfect translation. What it really refers

136 :1 to is the separation for cadastral purposes, and there’s

  1. a discussion of the possibility of part of the land
  1. being later released from the pledge, provided
  1. the market —
  1. MR JUSTICE HILDYARD: I think the Bank says that was not on
  1. the cards, but you say it is?
  1. MR STROILOV: In my submission, this document indicates
  1. rather clearly that it was on the cards.
  1. MR JUSTICE HILDYARD: Yes.
  1. So the point, amongst other things, goes to
  1. this: whereas it was submitted that the repo
  1. arrangements were really simply about protection because
  1. all, or substantially all, assets had already been
  1. pledged, you made the point that then the problem is
  1. that the person with, in effect, the equity of
  1. redemption is under the control, on your view of things,
  1. of the Bank itself, and therefore the Bank calls
  1. the shots.
  1. MR STROILOV: My Lord, on any view of things, whether or not
  1. Renord was controlled by the Bank, or completely
  1. independent, in relation to these particular shares and
  1. assets, everyone admits it was acting — every step was
  1. done with the Bank’s approval and on the Bank’s
  1. instructions.
  1. MR JUSTICE HILDYARD: So notwithstanding the obligation of

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

137 :1 repurchase, to honour the repurchase call, which you

  1. have accepted, whereby Mr Arkhangelsky would restore
  1. the value or the surplus value left in the company,
  1. nevertheless it’s the Bank that calls the shots. Is
  1. that what your point is?
  1. MR STROILOV: My Lord, obviously the obligation is
  1. the repurchase right. That was the intention of
  1. the contract.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: But in parallel, as soon as the Bank has
  1. the opportunity, you saw a series of steps designed at,
  1. firstly, removing the shares from the original
  1. purchasers, making it more difficult to enforce, and
  1. then removing the assets of the two companies to other
  1. companies, making the shares —
  1. MR JUSTICE HILDYARD: For undervalue, yes. I see what you
  1. mean.
  1. MR STROILOV: Yes, and substituting the pledgor so that —
  1. MR JUSTICE HILDYARD: If you exercise the right of
  1. repurchase, the problem is that the assets had been
  1. stripped out and replaced with money of lesser value
  1. than the assets were.
  1. MR STROILOV: Well —
  1. MR JUSTICE HILDYARD: Is that what your case is?
  1. MR STROILOV: Well, it was, sir, replaced by the money in

138 :1 the sense that the Bank gave some credit for the debts

  1. it said it recovered. Whereas of course what should
  1. have happened if the Bank and Renord acted honestly was
  1. that there would be surplus, which would have gone to
  1. Western Terminal and Scan respectively, and then
  1. the liability of OMG to the Bank is extinguished, and
  1. the shares are to be returned to OMG.
  1. MR JUSTICE HILDYARD: Yes, I understand that.
  1. I had wondered whether your case was, further, that
  1. the position was worsened as against OMG,
  1. Mr Arkhangelsky, by the subsequent purchasers. I had
  1. wondered whether it was alleged that that cut off even
  1. the right of repurchase. But I have got it clear that
  1. it is not so alleged.
  1. MR STROILOV: I wonder if there is a misunderstanding here
  1. really, because obviously we say that that right arose
  1. as part of the December 2008 agreement, which has to be
  1. analysed as a whole.
  1. MR JUSTICE HILDYARD: The right to repurchase?
  1. MR STROILOV: Yes.
  1. I mean, I wonder if there was a misunderstanding.
  1. The specific rights against the original purchasers, and
  1. whether they were inherited, as it were, by subsequent
  1. purchasers.
  1. MR JUSTICE HILDYARD: This was the point I was canvassing

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

139 :1 with Mr Birt. I’m not absolutely sure what your case is

  1. on this, and to some extent I’m not absolutely sure what
  1. Mr Birt’s case is on this.
  1. My understanding of what Mr Birt’s case is, is that
  1. the specific repurchase agreement enabled OMG to
  1. repurchase the shares notwithstanding default. You
  1. agree with that. You’ve confirmed with that.
  1. MR STROILOV: Yes, quite.
  1. MR JUSTICE HILDYARD: And that is contrary to the usual
  1. market practice, but one must follow the contract in
  1. clause 2, which you pointed out.
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: But the contract is between OMG and
  1. the Bank or the original purchasers.
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: The question is whether that
  1. contractual right was defeated by the disposal of
  1. the shares from the original purchasers to
  1. the subsequent purchasers, because then those shares
  1. could no longer be delivered up by the original
  1. purchasers. I thought your answer was: yes, but they
  1. could be procured to be transferred by the director of
  1. all things, the Bank. But I wanted to make sure that is
  1. your case.
  1. MR STROILOV: Yes, that’s our contractual case, absolutely,

140 :1 that the Bank was obliged.

  1. MR JUSTICE HILDYARD: So the repurchase commitment —
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: — was not destroyed by the subsequent
  1. purchaser’s transaction?
  1. MR STROILOV: It was not destroyed by anything. If we are
  1. right that there was a contract between OMG and
  1. the Bank, well, that contract remained in force; and we
  1. do say that the Bank is in breach of it on — well, on
  1. many counts.
  1. MR JUSTICE HILDYARD: Does it follow from that, or not, that
  1. it was not the intention of the Bank or the original
  1. purchasers or Renord, by entering into the subsequent
  1. sales to the subsequent purchasers, to undermine your
  1. right to repurchase the shares and thereby claw back
  1. the value?
  1. MR STROILOV: From the evidence, it is quite apparent that
  1. the intention was, rather than wait until — they
  1. weren’t thinking about 2011 —
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: — when shares would have to be returned on
  1. this isolated analysis of repo contracts. They were
  1. rather thinking that they were expecting legal action
  1. from Mr Arkhangelsky. And of course, it is telling that
  1. immediately upon calling the default, they began to

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

141 :1 expect legal action before it was brought or threatened.

  1. MR JUSTICE HILDYARD: Well, banks often do, I suspect, but
  1. in any event, the fraud, as you would have it, is in
  1. stripping out the assets for an undervalue, not in
  1. effectively cutting off what I’ve called the «equity of
  1. redemption», that is to say the recourse to the assets
  1. via the shares? Do you see what I mean?
  1. MR STROILOV: We do say that the transfer to subsequent
  1. purchasers was part of the fraud, not least because at
  1. the time, the Bank never informed OMG that subsequent
  1. purchasers are actually still acting our behalf —
  1. MR JUSTICE HILDYARD: The motive of that was to reduce
  1. further the value of the assets, or to obtain for
  1. subsequent purchasers some bonus from assembling the
  1. assets and selling them on; it was not to deprive OMG of
  1. the right of repurchase?
  1. MR STROILOV: That was the point, that when the fraud came
  1. out, the Bank was, we say, in breach of the moratorium,
  1. it —
  1. MR JUSTICE HILDYARD: I understand that.
  1. MR STROILOV: — would be replacing the management, and
  1. the purpose of transfer to subsequent purchasers was
  1. simply to remove — well, we are not saying that the
  1. Bank was anticipating that in 2011, Mr Arkhangelsky
  1. would rely on repurchase agreements. It was rather —

142 :1 and the evidence on that was quite consistent — that

  1. they rather expected repo to be challenged in Russian
  1. courts, and then obviously it will have been convenient,
  1. in terms of if we are right on their dishonesty, they
  1. would want some ostensibly independent subsequent
  1. purchasers to have the shares, rather than original
  1. purchasers which could be shown to have received
  1. the shares in these circumstances, pursuant to this deal
  1. with the Bank.
  1. MR JUSTICE HILDYARD: I see.
  1. MR STROILOV: And at nominal price.
  1. So indeed, we are happy to accept the evidence of
  1. the Bank’s witnesses, that the purpose of that was to
  1. defeat a potential judgment of Russian courts; and that
  1. was the primary concern.
  1. MR JUSTICE HILDYARD: Yes, I understand that.
  1. MR STROILOV: Obviously we say that the replacement of
  1. management pursues the same point.
  1. While we are on this subject, if you could call
  1. the memorandum back on the screen, that’s {D107/1537/2}.
  1. Simply in terms of our saying that this was a breach
  1. of contract, what we are looking at here is clause 3,
  1. the second bullet point. We say that this was really
  1. breached, whereas the Bank says this was no longer in
  1. force because the group was in default by that time.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

143 :1 MR JUSTICE HILDYARD: Well, that’s one of the things that’s

  1. caused me anxiety, because there’s no timing restriction
  1. on 3 either, is there?
  1. MR STROILOV: Well, it’s provided so long as the group
  1. fulfills its obligations.
  1. MR JUSTICE HILDYARD: Fulfills its obligations to the Bank.
  1. MR STROILOV: Yes. So if we are right and there was
  1. a moratorium, it follows that there was no default, and
  1. it follows that by transferring the shares in
  1. March/April, the Bank was in breach.
  1. MR JUSTICE HILDYARD: I appreciate that.
  1. MR STROILOV: But on their case obviously, there was default
  1. and this was no longer in force. So that turns on
  1. the moratorium issue effectively.
  1. MR JUSTICE HILDYARD: Clause 2 — sorry to bat on. Clause 2
  1. can only be given proper effect if the Bank does control
  1. the original and subsequent purchasers.
  1. MR STROILOV: 2 and 3, absolutely. 3 as well.
  1. MR JUSTICE HILDYARD: The only circumstance in which
  1. the Bank can fulfill its promises under the memorandum
  1. is if it has the means of control over the original and
  1. subsequent purchasers.
  1. MR STROILOV: Indeed, my Lord. And it is obviously —
  1. MR JUSTICE HILDYARD: Sorry to rehearse it with you, but
  1. I just need to get this straight in my mind.

144 :1 MR STROILOV: We expressly invite this inference.

  1. MR JUSTICE HILDYARD: It’s not an inference, it’s just
  1. because the repurchase — well, it simply follows from 2
  1. and 3, does it not? The Bank’s got to be able to
  1. fulfill its commitments under 2 and 3, and 4.
  1. MR STROILOV: Exactly, my Lord.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: Yes. Not 4, because the 4 relates to OMG at
  1. that point.
  1. MR JUSTICE HILDYARD: To the seller, yes. I’m sorry.
  1. MR STROILOV: But 2 and 3, exactly. And we expressly invite
  1. from the text of the memorandum the inference that
  1. the original purchasers are controlled by the Bank
  1. and/or by Mr Savelyev.
  1. It is curious, I would submit, that Mr Savelyev told
  1. you, truthfully or not, that when he signed this, he had
  1. no idea who the companies would be. And he simply
  1. relied on Mrs Malysheva that there would be some
  1. companies within Renord. And that obviously gives some
  1. idea of how the whole scheme operates, in the sense that
  1. Renord is effectively — on the evidence, I would invite
  1. the finding that Renord is effectively a stable of
  1. various companies which the Bank can get —
  1. MR JUSTICE HILDYARD: Call on, yes.
  1. MR STROILOV: I think, we have reached December. On

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

145 :1 the moratorium, there are relatively detailed

  1. submissions in our written submissions. I think one
  1. additional point that is, my Lord, starting at
  1. paragraph 29 of our written submissions. I think in 29
  1. I summarise in ten subparagraphs what we rely on.
  1. {AA5/15/12}.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: My Lord, I think just a couple of points.
  1. Firstly, it is clear from the chronology, which has
  1. been explored in enormous detail, that the whole thing
  1. only makes sense if the terms of the restructuring were
  1. agreed in substance before 30 or 31 December, whenever
  1. the repo was given effect. There is practically nothing
  1. in writing from that period; no emails going on saying,
  1. «Well, the terms of restructuring should be A, B and C».
  1. So in effect, it is much likelier that it was
  1. something simple and general, such as six months
  1. moratorium, rather than something as specific as saying,
  1. «Well, we will give you six months’ extension on these
  1. loans, but on the particular PetroLes loans and Vyborg
  1. shipping loans, that is an exception, and it will only
  1. be rolled up to the maturity dates». If it was as
  1. complex as that, you would expect it to be in writing.
  1. And as there is nothing in writing, and clearly the deal
  1. was reached by that time, it follows that they were an

146 :1 oral agreement, and oral agreement may only be

  1. relatively simple; it has to be something in the nature
  1. of a general moratorium for six months, but it cannot be
  1. something as elaborate as going loan by loan, and making
  1. specific provisions for each loan.
  1. We say there is nothing unexpected in the fact that
  1. at the initial stage — and you have been given quite
  1. detailed evidence on how the whole thing was done in
  1. a rush, first on the computer accounting system and only
  1. then formalised. At the initial stage the interest
  1. payments were only rolled up to the maturity dates,
  1. simply because it’s more complex to extend the maturity
  1. dates and roll up interest, rather than simply roll up
  1. interest.
  1. There was time to put it right later in January and
  1. February; and that’s what was apparently intended.
  1. The roll-up of interest, as I understand the evidence
  1. given by the Bank’s witnesses, rolling up the interest
  1. does not require additional reserves, an extension of
  1. the maturity date probably would, and so it would make
  1. every sense if the general agreement was simply on a six
  1. months’ moratorium, it would be perfectly consistent
  1. with a general agreement.
  1. MR JUSTICE HILDYARD: On interest? Six months on interest?
  1. MR STROILOV: No, the moratorium on all payments.

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

147 :1 MR JUSTICE HILDYARD: On all payments.

  1. MR STROILOV: For six months. And that includes implicitly
  1. a roll-up of interest on the loans which expire after
  1. the end of June.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: And an extension of loans which expire before
  1. the end of June. Several loans were extended in that
  1. way; and then in relation to a few others, I think there
  1. was a schedule of capital repayments, going on until
  1. June, and that was rolled up as well.
  1. So effectively, what the Bank is telling you is that
  1. there was a six-month moratorium subject to
  1. the exception of the loans which expired in March, April
  1. and May, but no others. Well, in relation to other
  1. loans, their case is consistent with six months’
  1. moratorium; the loans which expired in December — well,
  1. all capital repayments which were due.
  1. MR JUSTICE HILDYARD: What do you say about PetroLes and
  1. Vyborg Shipping?
  1. MR STROILOV: Well, about PetroLes, we say that there wasn’t
  1. an exception. Mrs Volodina may have said something, but
  1. her role at the meeting was clearly limited to
  1. discussing the issue of reserves. She may have
  1. highlighted some difficulty.
  1. MR JUSTICE HILDYARD: But still, no payments, whether by

148 :1 capital or interest, in respect of any of the loans for

  1. the next six months, is the deal —
  1. MR STROILOV: We say that was the agreement. And of course,
  1. I don’t think it’s necessary to turn the pages, and
  1. I referred to this in too many cross-examinations. And
  1. of course, up to the beginning of March, parties seemed
  1. to have proceeded on that assumption.
  1. MR JUSTICE HILDYARD: Yes.
  1. MR STROILOV: That’s why PetroLes, advance(?) March, asks
  1. for extension of the loans and roll-up.
  1. MR JUSTICE HILDYARD: Yes, it does explain why. You say
  1. because it had all been agreed already.
  1. MR STROILOV: Indeed, my Lord.
  1. Apart from what is summarised here in writing and
  1. then on subsequent pages, I elaborate on some of these
  1. points in the written submissions.
  1. MR JUSTICE HILDYARD: I’d like you to tell me where
  1. the documentary evidence which confirms that OMG
  1. perceived the default to be a breach of the agreement on
  1. the part of the Bank, which you refer to at 9, I’d like
  1. references, please.
  1. MR STROILOV: Yes, that’s further on —
  1. MR JUSTICE HILDYARD: Not necessarily now, but just in due
  1. course.
  1. MR STROILOV: I think it’s a little further on in

Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

149 :1 the written submission. I do give references.

  1. MR JUSTICE HILDYARD: Thank you. I’m so sorry.
  1. MR STROILOV: So if you scroll down to paragraph 40.
  1. MR JUSTICE HILDYARD: 40?
  1. MR STROILOV: Yes. And then there are three subparagraphs.
  1. MR JUSTICE HILDYARD: I’m sorry. Thank you very much.
  1. MR STROILOV: Without hyperlinks, but otherwise there are
  1. the references.
  1. MR JUSTICE HILDYARD: That’s excellent.
  1. Well, unless you’ve got anything more on
  1. the moratorium for the moment, that may be a good place
  1. to pause.
  1. MR STROILOV: It may be, yes.
  1. Tomorrow is Friday, so you have Mr Milner before you
  1. in the morning, and then I take over.
  1. MR JUSTICE HILDYARD: I see. So he’s being interposed, is
  1. he, as it were?
  1. MR STROILOV: Yes, my Lord. Well, it was important to give
  1. him a fixed slot, so that he doesn’t have to hang about
  1. unnecessarily.
  1. MR JUSTICE HILDYARD: Okay.
  1. MR STROILOV: So I think he will give you a real jump from
  1. subject to subject in a sense, but I hope it’s not too
  1. confusing; and he will address you on valuations and
  1. Russian law, and then I take over to cover all

150 :1 outstanding issues.

  1. MR JUSTICE HILDYARD: Yes. And how are you doing on time?
  1. MR STROILOV: I think it is fine. Well, I’m not entirely
  1. confident of finishing tomorrow, but in the first couple
  1. of hours on Monday, I am likely to finish.
  1. MR JUSTICE HILDYARD: Very good. So as to leave the half
  1. day for Mr Birt.
  1. MR STROILOV: Yes.
  1. MR JUSTICE HILDYARD: 10.30 then tomorrow.
  1. (4.30 pm)
  1. (The hearing adjourned until 10.30 am

12 on Friday, 8 July 2016)

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Bank St Petersburg v Vitaly Arkhangelsky [Master] Day 44

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  1. Closing submissions by MR BIRT …………………..1 (continued)
  1. Closing submissions by MR STROILOV ………………64

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A

A1/2/5533:8 AA3&4/14/24039:14 AA3&4/14/24240:1 AA3&4/14/52122:18 AA384/14/42961:22 AA5/15/12145:6 AA5/15/50107:13 AA5/15/5288:12 ability38:21

above ( 4 ) 70:2 72:14 114:7 127:2

absence ( 3 ) 110:1

110:7 112:16 absent ( 7 ) 11:7 11:13

18:21 42:10 43:12 44:5 51:19

absolutely ( 6 ) 55:3 55:12 139:1 139:2 139:25 143:18

abuse ( 2 ) 46:16 111:3 abused74:22

accept ( 13 ) 21:5 28:20 30:2 30:19 31:16 43:16 46:4 72:7 91:25 92:6 92:7 129:3 142:12

accepted ( 3 ) 3:8 104:1 137:2

accepts ( 3 ) 11:11 72:2 127:17

access ( 2 ) 85:25

134:24

according ( 3 ) 50:23 89:5 89:7

accordingly ( 2 ) 12:23 16:8

account ( 12 ) 2:25 3:2 18:9 23:24 24:1 25:5 29:23 30:3 45:15 49:16 62:10 105:19

accounted ( 3 ) 24:4

28:22 28:25 accounting ( 3 ) 24:12

44:24 146:9 accounts51:1 achieve ( 7 ) 72:1 72:5

74:2 74:2 74:3 76:25 116:18

achieved ( 9 ) 10:6 10:16 10:17 27:25 28:5 28:7 76:18 78:1 115:22

acknowledge ( 2 )

39:22 40:7 acknowledged57:19 acquire104:25 acquired ( 3 ) 12:19

12:22 104:22 acquisition12:25 across4:4

acted ( 5 ) 12:3 69:22 74:20 121:18 138:3

acting ( 7 ) 74:25 88:24 113:13 120:17 129:20 136:22 141:11

action ( 8 ) 15:23 30:11 47:6 47:8 49:19 49:20 140:23 141:1

actionable 28:9 active96:2 activities57:24 acts ( 3 ) 12:4 67:18

120:20

actual ( 2 ) 39:9 112:2 add-on18:11 added31:3

addition ( 4 ) 55:23 84:13 84:18 130:21

additional ( 8 ) 3:3 28:6 46:16 46:18 105:12 126:24 145:3 146:19

pastedGraphic_1.png

136:22 137:14 137:20 137:22 141:4 141:6 141:13 141:15

assign98:18 assigned84:1 assignment83:19 assist ( 7 ) 4:11 8:8

12:11 34:6 34:9 53:17 106:20

assistance12:15 assisted101:4 assists ( 2 ) 58:8 65:8 associated ( 2 ) 73:9

101:22

assume ( 9 ) 11:21 14:18 24:6 57:25 83:13 104:20 113:12 114:20 122:10

assumed ( 2 ) 25:22 45:25

assumes ( 2 ) 22:13 23:14

Assuming106:11 assumption ( 3 ) 71:11

102:2 148:7 astonishing92:10 astonishingly96:3 attaching38:15 attack86:22 attempt74:23 attempts114:14 attend ( 2 ) 81:17 95:5 attendants81:11 attended ( 2 ) 110:14

116:7

attention ( 11 ) 4:15 8:11 21:1 35:3 41:24 42:7 46:13 56:19 65:2 110:22 133:12

attitude14:15 auction ( 47 ) 44:4

51:14 71:10 71:13 74:8 74:11 74:14 75:11 76:17 77:8 77:9 77:23 81:11 81:24 83:16 88:14 88:15 88:18 89:2 89:10 89:14 91:14 92:4 94:4 94:20 94:23 95:6 95:12 95:16 96:9 96:10 96:14 96:24 97:1 97:22 98:15 98:25 101:15 107:22 109:17 110:16 110:20 110:23 111:3 112:3 112:3 112:7

auctioneer ( 4 ) 74:16 74:18 89:2 113:20 auctioneers ( 2 ) 67:9

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auctions ( 28 ) 70:21 70:23 71:4 71:18 71:21 71:25 72:4 73:4 75:4 77:5 81:6 85:14 86:25 87:20 87:24 88:5 92:12 93:4 93:7 95:23 97:18 99:4 102:12 110:13 115:21 116:7 116:13 117:5

August ( 2 ) 118:25 134:17

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authorisation15:20 authoritative5:25 authorities ( 8 ) 3:12

3:16 3:20 3:21 7:18 21:3 67:12 114:17 authority ( 11 ) 4:12 6:7 9:9 14:24 15:20 16:6 65:2 65:3 66:8 67:19

67:21 autumn34:7 available47:9

avoid ( 3 ) 33:2 77:12 109:4

award10:22

aware ( 3 ) 34:25 111:14 118:5

away ( 9 ) 33:21 34:4 64:2 69:12 69:15 70:8 123:11 124:11 131:4

B

B2/12/1 ( 2 ) 109:23

118:17

B2/12/1176:11

B2/12/1376:9

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back ( 40 ) 1:10 2:1 5:15 6:4 7:16 21:6 25:25 26:3 26:10 26:24 28:17 28:19 31:7 34:22 38:17 39:7 39:20 40:18 40:23 41:4 41:9 41:11 44:4 62:23 63:8 85:14 85:15 86:25 87:2 87:20 90:12 94:5 103:3 107:8 127:4 128:12 130:20 132:20 140:15 142:20

backdate63:19 backdated ( 4 ) 54:2

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background ( 4 ) 12:5

17:22 17:23 94:13 backwards ( 2 ) 70:15

70:16 bad 33:22

Bader67:21 badly45:7 bags25:10 bailiff115:4

bailiffs ( 8 ) 67:9 96:17 113:13 113:15 113:23 114:2 114:17 114:21

balance ( 3 ) 42:8 68:22 116:2

Baltic ( 12 ) 75:7 75:9 75:14 76:3 76:13 77:23 77:25 81:4 109:11 109:13 112:5 112:6

Bank ( 154 ) 24:25 24:25 25:3 25:5 25:22 25:23 25:24 25:24 28:6 28:22 29:17 29:18 29:21 30:2 32:1 32:10 32:24 33:9 33:22 34:2 34:6 35:2 37:16 38:7 40:14 41:15 42:14 43:2 43:13 43:20 44:1 44:2 44:12 45:12 45:20 50:12 50:13 50:25 51:1 51:16 53:11 54:2 54:4 54:8 54:16 56:3 57:25 58:2 60:9 61:7 61:12 64:12 71:2 74:1 76:24 77:9 85:21 85:23 85:24 85:25 86:7 86:9 86:10 87:5 87:17 88:22 88:25 89:1 89:19 92:9 93:12 93:13 95:8 95:13 97:2 97:3 97:4 97:15 97:20

98:17 99:2 99:13 99:19 100:9 100:23 101:17 101:25 106:3 107:17 108:2 113:5 116:19 117:9 118:10 121:6 121:16 123:6 123:8 123:9 123:10 123:18 124:1 124:2 124:3 124:4 124:9 124:14 124:17 126:4 126:18 126:20 128:6 129:6 129:8 129:18 129:19 131:15 132:16 132:24 133:2 134:2 134:12 134:20 134:23 135:6 135:15 136:5 136:17 136:17 136:20 137:4 137:10 138:1 138:3 138:6 139:14 139:23 140:1 140:8 140:9 140:12 141:10 141:18 141:24 142:9 142:24 143:6 143:10 143:16 143:20 144:13 144:23 147:11 148:20

Bank’s ( 23 )1:16 26:5 26:6 31:25 33:13 33:14 33:19 34:23 37:7 74:21 74:22 80:11 97:24 99:10 103:15 131:6 135:2 135:7 136:23 136:23 142:13 144:4 146:18

bankers45:14 banking ( 5 ) 126:5

126:6 127:18 127:22 130:23

bankrupt69:14 banks141:2 bargain101:10 Barrister ( 5 ) 118:24

118:25 119:2 121:5 122:6

base ( 2 ) 6:9 44:8 based ( 4 ) 4:24 13:6

13:8 69:10

basis ( 10 ) 4:23 15:21 19:13 19:15 23:6 25:21 27:6 33:10 114:20 114:25

bat143:15

became ( 2 ) 92:20 95:9 becomes70:9

before ( 24 ) 4:4 20:15 52:21 54:4 54:5 59:24 65:15 82:8 82:17 85:14 88:10 92:13 93:3 93:7 94:20 94:25 95:4 117:9 131:4 135:15 141:1 145:12 147:6 149:14

beg ( 3 ) 75:24 93:5 110:5

began ( 2 ) 131:8 140:25

beginning ( 2 ) 70:19

148:6 begins116:10 begs 95:4 behalf ( 7 ) 110:9

115:16 119:2 121:3 121:15 129:20 141:11

behind ( 4 ) 3:24 6:18 36:4 102:11

Beldam22:3

believe ( 7 ) 63:19 80:6 90:3 105:21 105:22 105:23 110:19

believes135:6 belonging98:7 belongs101:3

below ( 2 ) 6:14 115:22

Belykh103:23 beneficial ( 10 ) 117:8

118:13 118:18 119:16 119:24 120:7 120:9 120:10 120:11 123:2

beneficiary121:13 benefit ( 4 ) 8:9 16:24

61:18 104:16 benefits7:22

berth ( 7 ) 10:5 11:3 11:13 11:15 36:15 108:15 108:18

berths108:11

best ( 5 ) 34:6 34:8 74:9 92:11 116:18

better ( 5 ) 61:5 79:21 105:22 105:25 118:16

between ( 35 ) 4:7 13:15 17:5 27:18 29:21 36:15 43:17 44:21 44:25 63:10 67:17 68:13 69:18 70:22 75:16 81:17 85:23 86:9 87:5 88:22 91:21 97:3 98:16 99:13 103:1 104:12 113:24 118:20 123:17 124:14 124:17 126:3 128:15 139:13 140:7

beyond ( 5 ) 20:12 20:20 101:23 116:9 129:1

bid ( 11 ) 68:9 72:12 73:3 73:19 73:21 75:11 97:19 108:3 114:1 114:14 115:25

bidder ( 10 ) 95:6 99:6 100:1 103:13 109:18 110:11 110:18 112:8 112:18 113:7

bidders ( 13 ) 72:13 73:8 73:8 73:11 89:20 90:21 97:5 98:1 98:21 110:10 113:3 114:14 115:18

bidding72:14

bids ( 5 ) 90:20 110:2 110:7 114:6 114:7 big ( 3 ) 65:20 119:10

120:23

bigger ( 4 ) 74:1 74:4 74:13 134:25

Bill8:22

billion ( 6 ) 35:14 36:14 44:17 44:18 102:5 135:20

Bilta ( 5 ) 4:2 6:19 7:3 21:15 21:18

binding ( 2 ) 6:6 32:7 binds15:1 Bingham’s9:4

BIRT ( 144 ) 1:4 1:5 1:13 1:18 1:23 2:4 2:6 2:17 2:18 3:21 3:24 4:1 6:23 7:16 8:19 9:16 9:22 10:13 11:20 12:20 12:24 13:21 14:14 14:19 14:24 15:11 16:16 17:2 17:9 17:17 17:19 18:18 18:20 19:8 19:24 20:10 20:16 20:19 20:24 21:6 21:9 21:17 21:20 22:1 22:15 23:4 23:21 23:25 25:7 25:18 26:2 26:7 26:19 26:23 27:4 27:19 28:24 29:4 29:24 30:5 30:23 31:3 31:6 31:9 35:22 36:4 36:8 39:1 39:4 39:11 39:22 40:16 40:20 40:23 42:5 42:13 42:24 43:7 43:9 43:16 43:24 44:2 44:8 44:16 44:21 45:1 45:6 46:7 46:12 46:23 47:1 47:6 47:11 47:17 48:8 48:13 48:17 48:24 49:4 49:18 49:25 50:13 50:16 51:10 51:12 51:16 53:3 53:18 54:20

55:7 55:17 55:22 56:12 56:25 59:5 59:16 61:10 61:12 61:15 61:20 62:9 62:14 62:23 63:3 63:5 63:10 63:12 65:12 65:14 81:22 90:5 91:3 106:20 110:22 111:13 123:14 130:5 130:15 131:23 132:4 132:8 139:1 150:7 151:3

Birt’s ( 2 )139:3 139:4 bit ( 11 ) 9:6 9:25 12:6 13:2 13:3 13:12 94:5

110:6 117:7 123:21 127:14

Blinova ( 3 ) 57:14 57:20 58:21

Blinova’s56:9

BNP43:6

board ( 8 ) 56:1 56:13 56:17 57:8 57:23 58:13 70:2 127:2 bona ( 2 ) 96:21 96:22

bono49:11 bonus141:14

book ( 2 ) 33:2 115:12 borrower ( 4 ) 32:24 39:19 48:15 48:22

borrowing69:10

both ( 18 ) 40:25 45:24 53:7 57:3 57:20 60:5 69:20 69:21 70:24 72:17 80:7 88:23 97:5 97:18 101:8 116:8 125:13 127:10

bothered34:12 bottom ( 6 ) 59:1 66:8

91:4 132:12 132:21 133:25

bought ( 6 ) 77:10 78:13 81:7 98:21 100:12 117:23

bound21:7 box28:17

breach ( 7 ) 129:21 130:8 140:9 141:18 142:21 143:10 148:19

breached ( 3 ) 47:19 49:1 142:24

breaches ( 2 ) 26:17 54:14

break ( 5 ) 52:17 53:1 117:10 117:10 117:13

bribe ( 10 ) 11:25 12:14 12:16 14:11 15:3 16:8 17:18 25:17 26:25 27:17

bribed ( 7 ) 15:18 15:22 19:3 20:8 25:14 25:15 28:16

bribee ( 3 ) 12:11 13:15 15:10

briber27:1

bribery ( 21 ) 2:11 8:13 8:17 8:22 8:24 8:25 9:18 10:10 10:17 12:25 13:2 14:8 14:22 14:25 17:12 20:11 23:9 24:11 29:12 29:25 30:6

bribes ( 11 ) 3:8 3:11 10:21 11:6 11:17 15:1 15:5 18:8 18:10 29:8 30:20

briefly ( 2 ) 5:23 66:22 bring ( 2 ) 10:14 99:5 bringing ( 3 ) 50:6 59:24

60:1

broad ( 2 ) 18:19 20:17 broader ( 2 ) 9:12 21:12 Broadly ( 2 ) 83:22

83:24 broken111:2 brother120:19 brought ( 5 ) 33:9 50:9

96:16 104:9 141:1

budget14:5

build ( 2 ) 16:6 16:7 building77:14 builds16:8

built ( 2 ) 11:14 34:3 bullet ( 3 ) 135:16

135:22 142:23 bundle ( 4 ) 35:18 36:1

36:5 36:6

bundles ( 5 ) 3:16 3:20 3:21 61:10 62:3

burden ( 2 ) 65:24 131:14

burdened77:12 burn38:6

business ( 28 ) 10:3 10:16 11:2 11:15 11:24 13:8 14:20 18:6 18:9 18:12 18:16 18:22 19:12 22:12 24:9 24:18 25:2 78:14 86:14 91:9 95:20 100:12 101:3 101:5 109:10 119:11 120:19 130:2

businesses32:12 but~112:24

buy ( 4 ) 39:20 50:10 93:14 115:18

buyer ( 4 ) 79:19 106:12 108:13 110:17

buyer’s27:10

buyers ( 7 ) 51:3 75:10 100:11 100:15 100:18 106:4 106:5

buying ( 2 ) 72:15 73:1 buys ( 2 ) 106:12 108:6 BVI ( 2 ) 62:18 86:18

C

cadastral136:1 calculated10:15 calculation45:2 calculations ( 2 ) 2:24

19:14

call ( 5 ) 131:11 135:9 137:1 142:19 144:24

called ( 9 ) 77:10 78:23 84:1 118:23 118:24 121:21 132:9 133:3 141:5

calling ( 2 ) 135:2 140:25

calls ( 3 ) 72:12 136:17 137:4

cannot ( 9 ) 10:21 27:2 34:4 48:3 74:23 85:10 106:13 113:1 146:3

canvassing 138:25 capital ( 4 ) 106:7 147:9

147:17 148:1

cards ( 3 ) 24:20 136:6 136:8

careful ( 2 ) 9:6 66:11 carefully64:19 Carnwath ( 2 ) 4:17 6:25 carried128:7

carries ( 2 ) 119:20 131:23

carry ( 2 ) 57:24 99:3 carrying18:12 cases ( 4 ) 5:5 111:5

112:8 114:2 casting ( 2 ) 58:8 60:5 causa ( 2 ) 4:24 18:2 causation ( 2 ) 2:13

2:21

cause ( 8 ) 15:22 17:7 17:14 17:21 17:21 30:11 47:6 116:10 caused ( 3 ) 28:8 53:11

143:2 causing 17:5

cent ( 12 ) 36:25 55:13 63:18 84:3 98:18

113:25 118:22 119:9 122:5 122:10 129:10 135:21

central ( 2 ) 32:11 68:17 Centre32:15

certain ( 5 ) 12:12 24:15 29:7 81:5 91:14

cetera81:13 chain111:20 challenged142:2 chance ( 2 ) 63:1 98:22 Chancellor8:21 change ( 3 ) 85:6 120:7

120:10

changing ( 3 ) 35:2 54:3 54:22

channel10:5

chap ( 2 ) 121:18 121:21 character ( 2 ) 13:4

105:7 characterisation86:3 charge43:4

check ( 15 ) 1:13 1:15 55:7 55:9 55:20 55:22 57:10 62:9 62:23 90:11 105:22 105:25 123:14 130:13 134:8

checked122:15 chiefly54:6

choice ( 2 ) 30:13 30:16 choose89:2 chooses72:23 chose108:23 chronological70:13 chronology ( 11 ) 53:8

54:12 58:12 63:8 64:5 93:8 93:18 93:22 94:23 107:19 145:9

chunk61:8 circle97:7 circumstance ( 2 )

41:10 143:19 circumstances ( 10 )

16:2 67:4 71:22 87:4 88:20 113:18 117:2 119:16 123:9 142:8

cite4:1

cited ( 3 ) 3:12 8:16 54:18

cites8:3

City32:15

civil ( 2 ) 15:4 67:2 claimant ( 4 ) 7:21 8:8

26:10 72:11 claimant’s74:19 claimants ( 13 ) 31:12

64:21 68:16 78:9 91:8 110:9 115:16 117:19 117:22 118:5 126:9 126:23 127:11

claimants’ ( 3 )69:7

85:3 126:6 claiming ( 3 ) 17:14

18:16 24:1

claims ( 3 ) 32:1 59:24 60:1

clarify29:16

Clarke ( 2 ) 4:17 6:24 clause ( 13 ) 35:24 36:1

36:8 36:11 36:12 44:16 46:17 104:7 128:3 139:11 142:22 143:15 143:15

claw140:15

clear ( 28 ) 9:5 70:10 72:10 75:2 75:20 83:4 84:19 85:24 95:13 95:16 96:25 99:10 103:16 109:15 109:16 109:20 111:2 111:21 113:18 113:22 119:14 120:25 124:1 124:2 125:18 132:2 138:13 145:9

cleared ( 2 ) 26:2 38:14 clearest98:20

pastedGraphic_2.png

pastedGraphic_3.png

directly ( 6 ) 18:2 18:5 18:8 32:9 34:16 124:5

director ( 2 ) 120:18 139:22

directorate94:15 directors ( 8 ) 53:22

54:4 54:13 54:22 63:11 63:12 64:8 64:9

disagree128:25 disagreed4:23 disagreement ( 3 ) 4:23

128:15 130:25 disapproval9:13 disavow20:20 discharge26:9 disclosable85:22 disclose ( 2 ) 86:1 87:14 disclosed ( 13 ) 56:2

56:14 56:17 56:21 56:25 61:7 62:13 78:8 91:11 99:22 99:23 99:24 112:20

disclosure ( 16 ) 56:2 56:8 57:2 57:3 85:15 86:4 86:24 87:1 87:9 87:24 102:20 102:21 102:21 112:7 116:4 125:8

disclosures62:8 discount ( 2 ) 84:3

98:18 discover70:7 discovery54:8 discrepancy 75:15 discretionary6:20 discuss5:2 discussed ( 2 ) 80:25

82:7 discusses5:5

discussing ( 3 ) 125:14 133:2 147:23

discussion ( 6 ) 4:7 35:7 36:20 65:24 135:24 136:2

dishonest ( 2 ) 33:19 34:2

dishonesty ( 3 ) 31:23 115:8 142:4

disincentive ( 2 )

104:24 108:12 disparate52:15 dispel 116:4 disposal139:17 disproven69:4 dispute ( 2 ) 4:18

124:22

disputed ( 3 ) 93:11 100:14 100:16

dissimilar59:22 distinction ( 5 ) 17:5

27:5 27:9 27:14 27:19 distinguished27:18 doctrine 15:14 document ( 10 ) 35:9

52:10 99:17 106:21 110:15 125:7 127:4 134:4 135:13 136:7 documentary ( 7 ) 80:9 99:12 100:3 102:3

111:12 112:17 148:18 documentation ( 2 )

99:22 102:17 documented126:13 documents ( 22 ) 35:1

35:5 35:18 36:6 37:21 48:8 52:3 56:4 56:5 57:8 57:15 62:15 63:19 84:21 84:22 85:16 85:21 85:25 86:7 86:11 87:18 101:17

does ( 38 ) 3:4 7:11 13:5 13:21 14:9 14:10 18:1 18:5 18:16 22:6 24:21 25:11 25:24 29:7 31:15 39:2 50:12 51:9 60:18 63:14 68:24

76:19 79:12 84:21 84:23 87:9 92:18 92:21 108:19 110:9 121:12 123:20 131:19 140:11 143:16 144:4 146:19 148:11

doing ( 6 ) 10:23 19:5 34:6 34:7 34:12 150:2

dollar106:9

done ( 15 ) 10:10 10:18 11:4 20:9 27:24 45:1 78:6 83:15 83:18 98:24 99:7 102:11 102:14 136:23 146:8

doors ( 2 ) 10:19 102:11 dotted114:8

doubt ( 11 ) 10:9 15:5 44:8 58:8 60:17 72:19 72:25 74:18 131:8 134:2 134:13

doubts134:20

down ( 20 ) 5:17 14:2 23:16 28:2 29:13 37:15 65:22 66:7 67:22 68:2 77:16 103:8 103:13 105:16 119:8 119:12 127:3 128:2 130:10 149:3

dozens57:15 draft60:18 drafted60:17 drafting60:18 dramatically105:16 draw ( 6 ) 4:15 8:11 42:7

60:22 65:2 133:12 drawing ( 2 ) 41:24

56:18

drawn ( 2 ) 21:1 35:3 draws46:13 dredging10:4 drill28:2 drives77:16 driving66:23

due ( 10 ) 39:20 68:15 68:21 72:9 89:24 90:17 95:15 131:1 147:17 148:23

during34:20 duties26:17 duty113:21

E

earlier ( 8 ) 27:12 35:19 54:23 56:17 57:1 63:6 76:10 131:6

earliest134:19 early94:17 earth 13:22

easier ( 3 ) 69:17 107:9 111:24

easy ( 2 ) 43:1 87:4 edge ( 2 ) 54:9 54:24

Edwards 9:4

effect ( 19 ) 3:6 31:15 38:13 48:20 55:11 68:6 71:6 76:23 78:7 96:15 104:13 105:14 105:15 124:25 134:24 136:15 143:16 145:13 145:16

effective111:23 effectively ( 16 ) 8:4

10:23 11:14 16:22 69:11 70:25 72:24 121:2 123:7 127:20 134:16 141:5 143:14 144:21 144:22 147:11

effort ( 3 ) 92:11 100:2 101:14

efforts ( 5 ) 56:3 88:1 92:16 113:5 116:22

either ( 9 ) 3:8 36:24 37:10 42:6 49:14 60:1 74:24 101:8 143:3

elaborate ( 2 ) 146:4 148:15

elaborates52:21 electronic57:6 element67:7 elements ( 4 ) 50:9

50:10 83:15 95:9 eliminated117:18

else ( 8 ) 17:7 34:3 44:5 58:10 81:7 110:22 113:14 125:22

email ( 4 ) 125:10 125:13 135:13 135:14

emails145:14 embezzling69:11 enable109:2

enabled ( 3 ) 16:10 46:2 139:5

enabling39:10 encounter 101:15 encouraged30:21 encumbrance ( 4 )

97:23 98:2 105:20 108:1

encumbrances ( 2 )

113:8 114:16

end ( 17 ) 3:10 34:24 38:5 46:1 51:3 60:8 70:14 75:5 77:25 96:1 101:13 102:11 103:23 106:8 112:21 147:4 147:7

ended ( 2 ) 41:6 60:15 endless126:1 enforce ( 13 ) 9:10

10:12 12:13 16:3 16:17 25:23 36:22 44:3 84:4 97:21 98:9 98:11 137:13

enforceable ( 3 ) 129:14 129:19 129:23

enforced ( 2 ) 14:13

15:8

enforcement ( 12 ) 8:6 37:12 38:1 38:9 42:10 43:19 50:22 50:25 51:18 51:20 107:16 127:1

enforcing ( 2 ) 16:1 98:19

engaged ( 2 ) 67:10 67:10

England ( 4 ) 14:19 14:21 30:21 45:14

English ( 8 ) 8:20 10:9 14:18 14:19 22:15 30:9 30:10 30:21

enormous145:10 enough ( 4 ) 60:22 73:4

85:10 92:12 enquiring93:17

ensure ( 2 ) 45:16 113:6 ensured ( 2 ) 24:22

24:23

enter ( 4 ) 15:6 31:14 47:13 47:20

entered ( 2 ) 38:9 49:8 entering ( 3 ) 41:22 94:8

140:13

entire ( 2 ) 24:23 95:14 entirely ( 2 ) 113:22

150:3

entities ( 2 ) 51:13 111:6

entitled ( 8 ) 9:14 23:2 23:5 23:6 25:15 27:15 40:5 71:21

entitlement 46:24 entity99:25

entries ( 2 ) 58:12 58:20 entry ( 7 ) 57:16 57:18

57:21 57:21 58:2 58:4 58:13

envelope127:5 envisaged 41:22 envisaging ( 2 ) 37:16

37:16

equally9:12

equity ( 4 ) 42:25 43:3 136:15 141:5

erase 56:3 error57:12 Eschwege46:13 Eschwege’s55:8 espoused21:13 essentially ( 8 ) 7:4

53:12 78:25 85:7 86:20 114:10 118:12 134:19

establish ( 5 ) 12:9 29:10 81:2 124:6 134:12

established ( 2 ) 31:12 114:1

establishing ( 3 ) 29:6 29:6 93:20

estate ( 6 ) 22:19 22:20 23:3 23:5 35:10 35:14

Euro-Diam6:21 evaluations42:7 even ( 16 ) 9:14 24:19

30:11 38:4 44:23 51:19 68:22 80:3 86:13 104:23 106:11 109:19 113:1 121:11 127:5 138:12

event ( 13 ) 2:13 2:22 2:24 34:21 46:17 60:25 85:5 90:15 105:11 110:25 127:19 128:10 141:3

events ( 3 ) 54:5 54:23 85:18

eventuality42:17 eventually ( 7 ) 43:6

74:7 79:4 80:5 83:2 101:20 129:24

ever ( 2 ) 13:23 51:16 every ( 6 ) 33:1 67:7

87:16 116:8 136:22 146:21

everyone ( 2 ) 135:7 136:22

everything ( 6 ) 10:19 52:4 59:2 78:1 125:22 130:21

evidence ( 109 ) 2:11 2:22 3:7 10:1 10:5 11:10 11:11 11:13 13:9 14:4 14:7 20:4 20:10 22:10 32:4 32:9 32:10 32:13 34:22 34:25 37:6 37:19 39:4 41:16 41:18 42:1 42:6 42:15 48:5 54:18 55:11 55:17 56:9 58:18 59:21 60:16 60:20 62:18 62:20 63:14 64:23 71:10 71:19 71:22 72:7 72:10 72:11 72:15 73:5 73:24 75:16 76:21 77:2 78:6 79:13 79:13 79:18 80:4 80:15 83:4 84:13 87:25 92:15 94:6 95:17 99:12 100:2 100:3 100:4 100:10 102:3 105:20 108:18 110:21 110:23 111:6 111:11 111:21 112:17 113:4 113:13 114:14 117:19 118:13 119:3 119:14 119:16 119:17 119:19 119:22 119:23 120:3 120:25 121:8 122:23 123:25 124:24 125:17 127:18 130:23 130:25 131:14 140:17 142:1 142:12 144:21 146:8 146:17 148:18

evidential114:25 evils 8:16 ex-turpi7:20

exact ( 2 ) 59:9 124:1 exactly ( 8 ) 32:23 51:21

67:8 83:22 105:3 113:2 144:6 144:11

examined85:22 example ( 21 ) 11:3

11:20 12:11 13:7 15:12 16:4 16:5 22:1 23:10 23:11 30:14 30:20 32:2 32:13 35:5 38:18 39:15 42:25 50:7 111:2 129:9

excellent149:9

except ( 2 ) 98:15 99:17 exception ( 3 ) 145:21

147:13 147:21

excess ( 3 ) 38:16

131:16 135:5 exchange ( 3 ) 38:4 125:11 125:13

exchanges21:4 exclude ( 4 ) 67:3 71:9

88:1 97:25 excluded ( 4 ) 88:17

91:2 113:3 114:18

excludes18:15 exclusion89:20 exercise137:19

exhibit ( 2 ) 84:21 84:23 exhibited91:10 existence34:5

existing ( 3 ) 4:11 9:6 43:10

expand111:18 expanded62:17 expect ( 7 ) 86:10 99:3

100:8 100:9 135:8 141:1 145:23

expected142:2 expecting140:23 expenses ( 2 ) 12:17

51:7 experience45:14 expert ( 4 ) 39:18 126:5

126:7 131:2 experts ( 4 ) 45:24

127:18 127:22 130:23 expire ( 4 ) 39:2 39:6

147:3 147:6

expired ( 2 ) 147:13

147:16 expires38:25

explain ( 8 ) 2:19 4:9 6:4 14:16 53:5 70:8 93:22 148:11

explained ( 7 ) 2:11 2:23 36:21 53:16 55:18 77:11 125:24

explaining ( 3 ) 58:23

108:22 117:1 explains ( 10 ) 6:3 8:4

51:6 76:11 82:13 83:11 94:13 108:24 118:18 118:19

explanation ( 16 ) 64:24 67:3 95:21 95:22 96:23 97:25 98:4 98:23 99:8 102:16 102:25 103:1 105:9 105:24 134:22 135:2

explanations ( 3 ) 70:3 71:25 72:6

explore53:7 explored145:10 exposed96:18 exposure ( 2 ) 92:3 92:8 express ( 4 ) 9:13 46:3

46:17 81:16 expressing17:10 expressly ( 5 ) 45:22

67:16 113:10 144:1 144:11

extend146:12 extended ( 6 ) 8:25

44:14 45:3 106:8 132:25 147:7

extending132:22

extension ( 4 ) 145:19 146:19 147:6 148:10 extent ( 8 ) 13:16 32:12

85:20 100:25 101:6 124:2 129:23 139:2

extinguished138:6 extra ( 3 ) 10:4 10:5

11:3 extract7:24 extracting50:6

extrajudicial ( 2 ) 91:20 96:15

extreme106:16 extremely ( 2 ) 81:23

126:7 eye89:15 eyes45:12

F

facilitate94:2 facilitating105:13 facilities43:11 facility24:8 factor17:23 factors127:10 factual ( 4 ) 2:3 12:6

12:24 114:24 failed 2:24 failing37:3 fails 13:2

failure ( 2 ) 54:6 54:15 fair ( 2 ) 73:2 107:2 fairly ( 3 ) 75:2 77:16

87:6

fairness ( 4 ) 30:8 46:5 79:14 92:22

faith ( 3 ) 41:1 41:3 41:8 fall12:7

falls ( 5 ) 14:2 33:21 34:4 123:11 124:11

false32:18 falsities2:10 familiar ( 2 ) 6:2 17:8 family121:4 famous5:25

far ( 24 ) 2:8 2:9 2:20 2:20 21:11 34:25 49:25 59:8 60:7 63:18 64:2 65:6 75:9 75:14 80:2 92:6 99:9 110:21 110:23 111:6 111:13 121:13 130:23 133:15

fatal 123:11

fault ( 3 ) 28:9 28:10 28:10

favour ( 3 ) 96:7 116:2 124:9

features ( 2 ) 69:25

92:10

February146:16 feel38:5

feeling 46:4

felt ( 2 ) 62:20 98:10 few ( 4 ) 65:10 94:14

101:17 147:8

fide ( 2 ) 96:21 96:22 fiduciary15:18 figure ( 6 ) 37:7 37:11

37:25 83:12 84:15 102:5

figures ( 4 ) 25:7 25:9 38:4 44:23

final70:14

finally ( 3 ) 77:23 86:13 135:12

finance99:20 financial ( 3 ) 32:14

34:15 69:9 financing2:12

find ( 28 ) 11:18 45:12 56:10 61:19 62:5 66:25 67:23 69:17 72:4 72:7 77:17 78:11 79:8 79:20 87:11 89:23 90:2 101:19

102:13 109:23 111:1 113:10 125:3 130:9 130:12 132:2 132:6 135:13

finding144:22 findings123:23

fine ( 4 ) 55:21 65:18 112:1 150:3

finish ( 2 ) 84:10 150:5 finishing150:4

fire ( 2 ) 116:14 117:2 fire’s38:6

fired68:7

first ( 28 ) 1:19 2:20 4:1 4:1 4:15 8:5 15:16 31:17 31:22 35:22 35:24 37:19 38:13 39:11 45:21 46:23 59:23 60:1 64:19 71:9 77:8 88:3 89:13 89:14 94:14 118:16 146:9 150:4

firstly ( 6 ) 71:4 78:10 103:6 123:3 137:12 145:9

Fishing ( 5 ) 78:10 78:13 78:19 78:20 101:2

fit58:12

five ( 2 ) 52:23 130:16 five-minute117:10 fixed149:19 flag59:16

flexible ( 4 ) 5:11 7:1 7:9 21:12

flocked115:18 focus ( 2 ) 132:11

132:12

folded ( 2 ) 103:25 105:2

follow ( 5 ) 5:10 54:10 107:9 139:10 140:11

followed37:13 following ( 2 ) 8:15

53:20

follows ( 5 ) 120:5 143:8 143:9 144:3 145:25 footing ( 3 ) 16:7 45:18

54:19

footnote ( 7 ) 3:13 4:2 30:8 55:10 62:1 63:13 90:6

force ( 3 ) 140:8 142:25 143:13

forced ( 2 ) 116:14 117:1

foreclose45:22 foreclosed46:1

foreign ( 2 ) 30:17 30:19 foresale44:13

forever ( 2 ) 18:15 106:17

forged 33:10 forgeries ( 8 ) 31:13

68:14 68:15 68:17 68:19 68:22 69:1 69:5

forgery ( 5 ) 32:18 33:5 33:18 33:21 33:25

forget90:4 forgiven83:23 form110:13 form’s7:9

formal ( 7 ) 7:13 92:12 93:12 111:1 126:3 127:3 127:8

formalised146:10 formed ( 2 ) 85:5 131:2 formerly77:14 formulated86:5

forth ( 3 ) 35:11 35:25 44:11

found ( 6 ) 58:23 62:5 69:19 79:19 82:12 109:23

four ( 2 ) 3:19 107:4 fourth 44:16

frankly ( 2 ) 81:24 111:18

fraud ( 20 ) 60:14 64:20 65:4 65:21 66:25 67:4 69:19 69:20 69:24 69:25 70:4 70:11 74:16 75:1 115:8 115:10 123:7 141:3 141:9 141:17

fraudulent ( 4 ) 69:23 71:18 126:14 129:22

Friday ( 2 ) 149:14 150:12

friends127:17

Fuel ( 12 ) 75:7 75:9 75:14 76:3 76:13 77:23 77:25 81:4 109:11 109:13 112:5 112:6

fulfil49:21

fulfill ( 2 ) 143:20 144:5 fulfilled128:9

fulfills ( 2 ) 143:5 143:6 fulfilment128:5

full ( 10 ) 23:23 29:20 30:1 30:3 78:1 87:21 95:9 100:22 100:25 101:5

fuller ( 2 ) 87:23 116:3 fully ( 2 ) 39:22 52:4 function114:10 further ( 29 ) 2:12 5:19

7:5 19:25 20:24 20:25 33:3 33:13 37:3 46:25 52:13 55:22 57:2 57:5 62:6 70:6 70:7 73:10 86:9 92:24 97:11 99:1 107:20 108:4 116:12 138:9 141:13 148:22 148:25

future ( 6 ) 5:15 7:5 7:12 13:1 13:3 24:18

G

gallop 61:16 galloping120:22 gates81:14 gateway30:12

gave ( 8 ) 32:13 33:5 60:19 62:20 87:2 124:24 129:6 138:1

gazillion19:21

general ( 18 ) 3:12 4:10 8:7 21:9 39:4 45:24 47:10 57:2 70:11 85:15 92:8 111:4 120:18 127:22 145:17 146:3 146:21 146:23

generally ( 4 ) 16:21 71:20 125:23 127:16

generate25:5 gentle126:7 gentleman ( 3 ) 78:23

79:1 122:5 genuine ( 13 ) 74:8

75:10 89:20 92:11 98:21 100:11 100:15 100:17 100:19 100:21 102:10 113:2 126:21

genuinely ( 6 ) 42:24 72:19 86:11 86:14 88:1 124:8

get ( 22 ) 2:3 2:8 2:9 2:20 2:20 3:4 3:4 11:14 14:7 20:3 22:6 22:9 29:8 43:7 44:4 44:12 50:12 50:13 69:14 81:12 143:25 144:23

gets ( 6 ) 5:7 27:7 27:9 30:12 50:15 129:24 getting ( 5 ) 42:19 122:1 122:3 123:17 134:11

gift101:10

give ( 28 ) 7:11 11:14 34:8 35:8 39:12 56:6 57:1 57:10 62:9 63:1 63:5 75:22 79:6 80:17 80:24 85:10 87:9 92:3 100:10 102:4 105:13 111:22 112:22 134:7 145:19 149:1 149:18 149:22

given ( 31 ) 8:13 9:25 15:21 35:1 37:22 37:23 39:15 40:11 40:16 72:15 73:24 76:22 80:15 83:13 90:5 92:13 95:6 97:21 98:4 101:10 106:25 116:4 119:18 126:9 129:8 133:20 134:23 143:16 145:13 146:7 146:18

gives ( 9 ) 82:14 83:12 84:13 84:14 94:12 107:19 110:17 134:1 144:19

giving ( 2 ) 53:24 85:18

Gladyshev ( 2 ) 40:11 41:1

Globex112:10 goal 75:2

GOM40:20

gone ( 9 ) 48:4 48:4 49:3 49:3 49:4 49:7 70:17 116:17 138:4

good ( 14 ) 1:3 1:5 32:25 40:25 41:3 41:8 49:12 52:17 85:10 101:10 102:25 124:19 149:11 150:6

governed40:24 government14:22 Graham17:4

grant ( 2 ) 15:8 47:12 granted23:7 grantee15:23

grateful ( 6 ) 63:4 90:10 91:5 123:23 132:1 133:10

great ( 2 ) 60:10 61:8 greater93:12 ground14:2 grounds16:14

Group ( 12 ) 69:9 78:11 78:17 95:14 112:5 117:25 124:14 132:23 134:15 135:4 142:25 143:4

Group’s128:5 grown18:7 guarantees ( 8 ) 31:12

31:14 31:15 33:11 34:14 69:6 69:13 69:16

Gunard ( 2 ) 103:6 104:16

Guriev ( 2 ) 39:24 89:17

Guriev’s130:25

Guz ( 5 ) 124:23 124:24

125:2 125:14 125:17

H

habitually ( 2 ) 120:15 121:18

haircut43:21

half ( 8 ) 31:17 31:18 63:2 74:5 83:17 102:5 116:25 150:6

halfway95:19 Hamblin7:17

hand ( 5 ) 60:18 77:4 99:14 118:16 120:25

handed ( 3 ) 5:17 61:12 62:4

hands ( 4 ) 28:21 87:15 101:13 103:11

hang149:19

happened ( 11 ) 14:19 37:17 42:17 50:13 50:16 51:22 58:14 58:16 83:22 107:20 138:3

happens ( 2 ) 86:17 116:10

happily1:19 happy142:12

hard ( 2 ) 3:16 62:3 hat20:23

he’s ( 28 )13:17 13:17 17:14 19:8 19:9 19:9 19:10 23:3 24:16 24:17 25:14 26:12 26:13 26:14 26:15 26:18 27:15 27:23 29:6 33:21 49:4 56:14 56:18 56:18 118:11 123:20 131:24 149:16

head ( 3 ) 12:7 62:14 124:23

headroom38:3 hear52:21

heard ( 4 ) 57:4 89:3 95:17 123:16

hearing150:11 hearsay124:24

held ( 2 ) 119:2 122:10 help ( 5 ) 1:7 24:21

52:23 81:25 83:21 helped ( 2 ) 116:4

132:11

helpful ( 8 ) 7:18 17:9 59:16 61:19 66:1 69:19 90:9 135:13

helpfully 88:6 helping21:11

helps ( 4 ) 17:4 17:8 90:5 130:12

here ( 20 ) 3:19 8:7 12:16 16:25 17:11 19:2 29:1 40:12 44:3 56:19 60:6 60:23 61:20 62:21 87:14 88:3 127:21 138:15 142:22 148:14

hide ( 2 ) 86:23 123:4 high ( 2 ) 115:17 121:9 higher ( 3 ) 64:25 98:22

101:9 highlighted147:24 HILDYARD ( 299 ) 1:3

1:10 1:15 1:21 1:25 2:5 2:14 3:17 3:23 3:25 6:19 7:15 8:18 9:2 9:20 10:11 11:18 12:10 12:21 13:14 14:10 14:17 14:23 15:7 16:3 17:1 17:4 17:16 17:18 18:15 18:19 19:1 19:16 20:9 20:12 20:17 20:20 21:5 21:7 21:16 21:18 21:25 22:14 22:17 23:19 23:23 24:21 25:9 26:1 26:5 26:16 26:20 26:24 27:12 28:20 29:1 29:16 30:1 30:19 31:2 31:5 31:8 35:21 36:3 36:7 38:24 39:3 39:9 39:18 40:13 40:19 40:22 42:1 42:12 42:22 43:5 43:8 43:10 43:21 43:25 44:7 44:14 44:19 44:23 45:5 45:11 46:10 46:19 46:24 47:4 47:8 47:15 47:22 48:12 48:14 48:20 49:3 49:9 49:24 50:2 50:15 51:9 51:11 51:15 52:14 53:3 54:18 55:6 55:16 55:21 55:24 56:23 59:4 59:6 61:3 61:11 61:14 61:18 62:7

62:11 62:17 62:24 63:4 63:9 63:11 63:24 64:8 64:14 65:6 65:11 65:17 66:6 66:10 66:14 66:16 68:1 68:4 73:5 73:14 78:18 78:22 79:6 79:11 79:25 80:14 80:19 80:23 81:1 81:9 81:22 82:16 82:19 83:6 83:21 84:2 84:6 87:1 89:10 89:13 89:20 89:24 90:9 90:13 90:19 90:23 91:6 91:13 91:18 91:25 92:23 93:3 93:6 93:11 93:17 94:18 94:24 95:23 96:12 97:7 99:12 99:23 99:25 100:5 100:14 100:19 101:22 102:7 102:16 102:25 103:19 103:21 103:23 104:5 104:9 104:12 104:19 105:4 105:7 106:6 106:15 106:19 107:5 107:7 107:12 108:14 109:17 110:4 110:12 110:21 111:4 111:9 111:22 112:1 112:10 112:15 112:19 112:22 113:22 114:19 115:5 116:6 117:11 117:15 120:11 121:17 121:21 121:25 122:3 122:7 122:9 122:14 122:17 122:21 125:20 126:2 127:12 128:18 128:22 129:13 130:13 130:18 131:19 132:2 132:6 133:9 133:17 134:3 135:21 136:5 136:9 136:25 137:9 137:16 137:19 137:24 138:8 138:19 138:25 139:9 139:13 139:16 140:2 140:4 140:11 140:20 141:2 141:12 141:20 142:10 142:16 143:1 143:6 143:11 143:15 143:19 143:24 144:2 144:7 144:10 144:24 145:7 146:24 147:1 147:5 147:18 147:25 148:8 148:11 148:17 148:23 149:2 149:4 149:6 149:9 149:16 149:21 150:2 150:6 150:9

himself92:18 historical19:16

history ( 2 ) 26:25 87:19 hitherto50:7

Hodge ( 5 ) 5:1 5:12

6:13 7:2 21:13

Hoffmann17:5 Hoffmann’s115:9 hold ( 3 ) 77:15 109:3

121:2

holding ( 3 ) 62:7 121:15 130:1

holdings61:7 holds ( 2 ) 16:5 16:5 Holman ( 2 ) 6:1 7:25 home ( 2 ) 22:7 22:9

honest ( 2 ) 71:11 71:21 honestly ( 4 ) 69:22

74:25 113:13 138:3 honour137:1

hope ( 6 ) 4:9 36:5 77:16 88:6 123:22 149:23

Hopefully62:4 horse6:22 hours150:5

house ( 12 ) 16:8 16:9 16:12 89:2 89:10 94:4

94:23 95:12 95:17 96:10 96:24 97:1

houses88:14

however ( 8 ) 24:6 35:3 46:1 76:21 78:6 87:25 94:5 125:1

huge ( 2 ) 2:9 10:7 husband ( 2 ) 121:23

122:10 hyperlinks149:7 hypothesis ( 3 ) 12:14

25:4 69:6

I

I’d ( 7 )11:5 11:6 105:21 105:25 123:19 148:17 148:20

I’ll ( 15 )2:4 2:19 20:4 24:8 29:16 36:7 39:11 62:9 62:23 62:25 80:24 83:7 102:22 107:7 109:24

I’ve ( 19 )2:1 2:21 3:19 17:10 21:1 25:8 25:12 27:13 27:18 29:3 43:2 47:15 47:15 49:20 52:14 61:15 110:18 116:11 141:5

idea ( 5 ) 32:25 58:8 93:13 144:17 144:20

ideas81:18 identification133:8 identified ( 3 ) 4:21 67:8

115:25

identifies ( 3 ) 35:24 36:2 36:9

identify ( 3 ) 35:23 50:5 103:2

identifying68:9 ignorance121:17 iii53:12

illegality ( 8 ) 4:6 4:24 5:3 15:15 16:15 17:3 22:16 28:17

illegitimate 126:25 illustration103:7 immediately ( 3 ) 56:16

77:19 140:25 impartial131:2 imperfect118:2 implement72:23 implication47:25 implicitly 147:2

implies ( 2 ) 47:24 121:9 importance ( 2 ) 99:2

119:18 important ( 9 ) 60:4

65:20 68:12 80:11 122:23 123:3 127:6 134:21 149:18

impossible ( 2 ) 69:21 124:10

impressed30:22 impression ( 2 ) 85:5

131:16 improbability113:11 improvement96:11 improvements51:7 in-chief79:14 inaccuracy107:18 inaccurate ( 2 ) 54:19

106:1

inaudible ( 4 ) 42:22 47:8 70:23 115:3

incidental86:16 include ( 2 ) 26:17 41:4 included ( 2 ) 32:8 33:4 includes ( 2 ) 33:4

147:2

including ( 9 ) 8:24 17:21 25:2 30:2 51:6 57:7 57:8 71:22 75:3

income105:14 inconvenient109:1 incorporate 125:21

incorrect66:24 increase129:12 independent ( 20 ) 37:1

72:20 75:22 77:22 78:15 80:3 80:4 86:14 88:2 98:1 100:3 102:3 103:13 106:4 113:7 114:14 124:8 126:18 136:21 142:5

independently73:18 INDEX 151:1 indicate33:22 indicated108:21 indicates ( 3 ) 94:7

109:21 136:7 indicating127:10 indication ( 2 ) 43:12

99:10

indications ( 2 ) 109:12 109:14

indicator33:19 indignant13:20 indirect 61:6 indirectly124:4 individual88:5 individuals60:10 ineptly 17:10 inexplicable112:16 infecting13:4 infects32:19

infer ( 8 ) 34:1 42:14 60:9 67:14 67:17 71:18 114:13 122:24

inference ( 9 ) 34:3 60:22 66:25 87:14 87:19 90:19 144:1 144:2 144:12

inferred78:5 information ( 4 ) 2:10

19:13 133:4 135:14 informative21:23 informed ( 2 ) 43:13

141:10

inherent ( 3 ) 43:25 113:11 123:12

inherited138:23 initial ( 3 ) 36:23 146:7

146:10 initially118:23 initiate 107:15 innocence70:16 innocent ( 5 ) 64:23

67:3 70:3 72:2 99:8 insofar ( 4 ) 3:10 10:20

18:20 64:23 instance98:20 instead ( 2 ) 97:20

98:10

instructions ( 2 ) 74:21

136:24

Insurance50:19 integral17:25 intend52:7 intended ( 3 ) 71:2

74:13 146:16 intention ( 10 ) 74:7

103:7 113:4 126:16 126:23 127:24 128:24 137:7 140:12 140:18

intentions99:11 interest ( 12 ) 45:4

100:19 100:21 146:10 146:13 146:14 146:17 146:18 146:24 146:24 147:3 148:1

interested ( 11 ) 73:1 81:23 92:5 92:20 93:8 95:3 95:8 95:10 97:14 97:16 99:6

interesting133:22 interestingly108:4 interests63:21 interference ( 2 )

114:21 115:1

internal ( 2 ) 101:17

135:15

interposed149:16

interrelated70:25 interrelations ( 2 )

68:13 69:18 interrupt130:6 interruption123:22 interviews ( 4 ) 59:19

60:11 60:12 60:16 into ( 30 ) 2:25 3:2 10:3

11:1 15:6 18:7 23:14 29:22 31:14 31:17 38:9 41:22 42:8 42:19 47:13 47:20 48:25 49:8 53:4 57:5 70:21 70:23 71:15 81:13 89:19 98:22 105:19 115:14 116:17 140:13

intriguing75:15 introduced ( 4 ) 8:22

93:13 93:14 94:25

introduction ( 2 ) 4:3

100:5 inure51:9 inured24:24

invent ( 2 ) 9:12 41:17

Invest ( 3 ) 72:22 76:12

111:17

investigator ( 2 ) 59:10 60:17

investment ( 3 ) 75:22 76:4 76:4

invite ( 11 ) 66:2 72:6 87:10 87:13 87:19 113:10 123:23 133:23 144:1 144:11 144:21

invited ( 2 ) 6:8 71:17 inviting92:4 involved ( 3 ) 114:24

120:2 124:25 involves101:6 involving ( 2 ) 60:9

125:13 isolated140:22 issued15:25

issues ( 10 ) 1:11 4:5 4:22 31:18 52:1 68:13 69:18 84:19 117:17 150:1

It’s ( 123 )3:17 3:18 14:4 14:18 14:25 15:15 15:22 16:4 16:21 17:16 17:17 17:22 17:23 18:17 18:23 18:25 19:16 19:16 19:18 22:2 22:3 23:25 25:13 25:22 27:15 27:16 29:5 29:13 30:13 31:11 35:16 35:19 36:4 38:22 40:6 40:24 42:13 44:9 44:16 46:17 47:8 49:3 49:3 53:20 53:21 58:4 58:11 59:2 59:16 61:20 64:7 64:12 65:4 67:2 67:3 68:13 70:15 73:12 73:12 73:16 73:20 73:21 76:9 76:10 78:19 78:23 79:1 79:21 80:17 81:14 82:23 83:4 86:16 89:25 91:20 93:11 94:6 94:18 95:1 95:16 96:12 96:25 97:8 98:14 98:16 100:11 100:14 101:20 101:21 103:16 104:24 104:25 105:14 106:11 106:16 106:16 107:9 109:21 109:24 111:2 113:12 114:22 115:9 116:18 121:13 122:25 123:11 124:1 124:7 124:18 125:25 126:7 127:6 129:20 135:25 137:4 143:4 144:2 144:2 146:12 148:4 148:25 149:23

its ( 38 ) 2:7 9:9 12:15 12:22 19:2 19:6 19:10 19:20 19:23 20:2 25:2 25:3 28:21 29:20 29:22 29:24 30:2 34:6 35:2 45:12 51:4 56:4 72:25 86:14 89:13 93:11 102:17 117:1 117:8 117:8 118:25 129:11 129:20 135:5 143:5 143:6 143:20 144:5

itself ( 14 ) 73:4 73:10 73:23 76:20 86:13 86:14 92:20 97:6 113:17 118:1 123:8 124:9 126:9 136:17

J

January146:15 jigsaw81:7

Johnson ( 2 ) 6:1 7:25 joint118:20 judge8:15 judgement131:3 judgements21:16 judgment ( 14 ) 4:16

4:19 5:12 5:17 6:11 6:24 7:3 9:4 21:2 22:2 67:23 87:2 96:7 142:14

judgments21:15 judicial ( 2 ) 96:14 98:16 July ( 3 ) 1:1 45:3

150:12

jump ( 2 ) 123:20 149:22

June ( 5 ) 134:7 134:21 147:4 147:7 147:10

jurisdiction6:20 jurisdictions32:22

K

keen ( 3 ) 45:16 68:18 68:20

keep101:14 keeps18:3

kept ( 4 ) 58:19 58:21 59:2 102:11

key ( 2 ) 12:18 32:17 kind ( 5 ) 12:18 94:2

98:15 102:19 121:1 knew ( 3 ) 42:20 79:1

97:16

know ( 49 ) 3:15 14:14 14:17 20:14 42:20 45:17 52:23 62:12 62:14 65:14 79:16 80:12 87:16 87:20 88:14 88:19 88:22 89:18 89:24 90:5 90:7 91:6 91:8 91:10 91:12 93:9 93:13 93:18 97:7 100:15 100:17 100:22 100:25 101:7 102:9 103:19 104:14 106:19 108:14 108:20 113:9 114:3 115:18 116:3 119:8 121:11 123:20 127:6 130:16

knowing65:20 knowledge99:16 knows ( 2 ) 52:1 120:2

Kontur ( 2 ) 112:4 117:24

Kosova ( 5 ) 105:23 106:23 125:2 125:9 125:14

Kuwait67:20

L

lack ( 3 ) 118:3 127:8 127:9

Lair ( 9 ) 1:17 37:10 42:4 42:7 43:14 131:8 134:2 134:13 134:20

land ( 46 ) 16:5 16:9 16:12 19:6 19:19 19:20 19:22 23:11 23:11 23:19 23:24 25:1 25:1 25:16 25:20 26:7 26:18 26:20 26:21 27:7 27:9 27:15 27:17 27:20 27:21 27:22 27:25 28:21 28:24 29:3 29:10 29:17 29:17 36:15 38:10 50:17 50:20 50:23 95:14 97:23 98:7 101:19 104:25 108:10 135:23 136:2

large65:21

largely ( 4 ) 52:19 61:12 77:3 123:10

last ( 2 ) 115:11 130:16 late ( 5 ) 70:10 84:12

84:18 101:16 112:12 later ( 15 ) 1:12 2:1

43:14 50:4 62:12 84:9 89:4 90:11 102:22 112:11 112:13 130:13 133:20 136:3 146:15

laughing69:15

leap ( 2 ) 60:11 60:13 lease ( 4 ) 103:6 103:18

104:20 106:6

least ( 15 ) 1:11 4:5 5:11 5:20 6:21 9:5 84:20 87:25 92:17 95:5 95:21 96:7 122:22 127:3 141:9

leave ( 5 ) 53:25 62:25 72:18 126:15 150:6

led70:22

left ( 3 ) 42:21 87:6 137:3

legal ( 8 ) 50:24 86:2 87:3 111:5 115:10 124:23 140:23 141:1

legally32:7 legitimately114:20 lend ( 3 ) 9:9 12:14 43:3 lending30:4

lent ( 2 ) 24:25 44:21 less ( 3 ) 30:3 63:17

73:7

lesser ( 2 ) 3:9 137:21 lest ( 2 ) 45:16 81:6

let ( 8 ) 23:4 89:24 90:10 100:23 109:22 115:6 128:1 130:16

level121:10 leverage77:21 liabilities ( 2 ) 38:15

135:5 liability138:6

liable ( 2 ) 47:20 49:23 licences 22:21 licenses23:7

light ( 6 ) 20:25 78:7 87:18 117:7 118:8 124:11

like ( 26 ) 6:9 8:14 12:5 12:17 14:25 16:21 19:24 23:4 24:19 46:24 53:7 54:9 54:24 65:2 69:1 80:14 94:16 96:10 107:4 109:11 123:19 124:9 124:21 133:12 148:17 148:20

likelier145:16

likely ( 11 ) 45:10 58:11 67:5 70:6 97:25 114:17 120:12 121:13 126:14 126:16 150:5

limb45:21 limited147:22

line ( 16 ) 11:19 63:15 63:15 64:5 66:8 76:1 79:9 79:10 82:11 82:15 83:11 83:11 114:8 131:14 133:15 133:25

lines ( 2 ) 6:13 60:19 linked ( 2 ) 64:10 64:12 linking 121:6

list ( 2 ) 135:15 135:22 listen64:18

literally ( 2 ) 87:16 100:7

little ( 12 ) 9:25 38:3 42:21 69:16 82:14 110:12 110:13 111:25 116:3 117:6 119:20 148:25

LLC94:2

loan ( 29 ) 31:15 34:5 35:11 35:24 35:25 44:4 44:16 44:17 44:25 45:2 53:11 53:20 54:2 54:4 54:9 54:16 57:25 64:12 77:9 84:4 97:20 98:5 98:19 99:19 99:22 128:11 146:4 146:4 146:5

loans ( 20 ) 50:20 50:21 51:21 128:9 131:17 132:16 132:22 132:25 133:19 145:20 145:20 145:21 147:3 147:6 147:7 147:13 147:15 147:16 148:1 148:10

local ( 4 ) 14:22 14:24 16:6 16:7

locked81:15

logic ( 2 ) 81:5 81:9 long ( 7 ) 32:22 74:17

114:7 114:19 132:10 134:1 143:4

long-standing ( 2 )

82:20 93:9

longer ( 3 ) 139:20

142:24 143:13

look ( 39 ) 5:4 5:15 5:15 5:23 8:14 9:17 16:18 18:24 22:4 36:7 36:10 53:19 62:16 65:17 67:18 70:5 70:13 71:10 71:22 72:5 78:25 82:8 82:24 83:8 83:9 88:3 94:6 94:11 102:22 103:17 103:21 104:20 110:2 115:21 118:16 119:4 128:1 131:9 133:24

looked ( 2 ) 56:5 89:19 looking ( 18 ) 9:24 36:5 59:19 70:21 71:4

80:21 87:10 88:13 90:8 97:13 106:15 107:14 115:23 129:18 131:20 134:5 134:8 142:22

looks ( 6 ) 22:1 23:10 38:7 40:8 70:1 124:8

Lord’s ( 4 )27:21 31:4 35:3 37:13

Lords ( 5 ) 5:12 6:13 6:24 7:2 21:13

Lordship ( 14 ) 3:8 36:19 66:2 66:25 71:6 72:2 75:23 79:17 82:6 94:7 107:3 114:12 117:16 133:23

Lordship’s ( 5 )27:5 41:19 55:3 63:22 64:7

Lordships ( 2 ) 4:8 4:22 loss ( 12 ) 10:14 11:15 12:1 12:7 13:6 13:7

13:8 17:14 22:12 28:9 29:5 29:6

lost ( 3 ) 24:7 39:20 127:20

lot ( 7 ) 28:11 28:12 69:2 102:7 111:19 116:17 117:17

lots ( 2 ) 44:11 114:24 low 73:1

LPK ( 7 ) 50:21 83:25 95:14 97:21 97:22 98:6 98:12

Ltd4:2 lunch79:22 luncheon ( 2 ) 65:8

80:18

M

M-A-L-E-E-V121:20 machine95:24 machinery41:12 Maggs72:12 Maggs’73:5 magic1:23

Magnum ( 2 ) 31:4 62:2 main ( 2 ) 1:11 1:13 major ( 4 ) 89:13 89:14

91:9 91:22 majority ( 3 ) 21:14

21:16 75:18 makes ( 11 ) 9:5 32:2

52:11 67:18 69:12 69:16 70:12 83:8 114:17 115:10 145:11

making ( 7 ) 5:18 22:22 91:23 132:9 137:13 137:15 146:4

Maleev ( 9 ) 119:1 120:8 120:14 121:1 121:7 121:11 121:13 121:19 122:5

Malyshev ( 5 ) 118:20 118:21 120:7 121:22 122:9

Malysheva ( 3 ) 94:16 121:24 144:18

Malysheva’s122:10 man16:5

manage ( 2 ) 120:15 121:2

managed73:18 management ( 10 )

53:9 56:1 56:13 56:17 57:8 57:23 58:13 97:4 141:21 142:18

managers ( 2 ) 73:19 124:16

mandated92:2 Mansfield6:1 Mansfield’s7:24 many ( 5 ) 32:22 34:20

57:15 140:10 148:5 March ( 7 ) 53:21 53:25

118:21 135:3 147:13 148:6 148:9

March/April143:10 margin ( 2 ) 44:1 44:19 Marine69:9 marker130:10

market ( 25 ) 36:25 39:5 39:23 39:24 40:7 44:10 46:4 47:24 71:20 71:23 71:24 72:1 72:5 72:14 102:13 102:15 106:12 115:23 116:15 116:16 116:20 129:11 135:21 136:4 139:10

marketing ( 3 ) 92:11 92:16 100:2

markets ( 2 ) 45:8 45:8 massive ( 2 ) 65:4 68:14 match71:19

material ( 4 ) 8:16 68:24 74:15 123:24

materials 61:8 matrix12:6

matter ( 14 ) 2:13 20:15 28:4 53:15 55:19

56:10 59:15 63:17 63:20 73:20 74:17 78:12 104:16 106:23

matters ( 8 ) 4:18 52:9 70:7 70:9 104:17 113:16 125:1 134:16

maturity ( 4 ) 145:22 146:11 146:12 146:20

Matvienko ( 2 ) 89:7 114:23

Matvienko’s89:4 maxim7:20

maximise ( 4 ) 77:4 81:2 108:22 125:15

maximum ( 5 ) 74:2 74:3 76:25 81:3 116:9

maybe ( 2 ) 60:21 63:19 mean ( 23 ) 1:13 9:2

13:19 13:24 15:24 18:23 20:3 22:24 24:2 25:9 28:12 42:21 69:25 81:15 81:20 90:1 93:8 110:9 115:7 117:19 137:17 138:21 141:7

meaning128:15 means ( 6 ) 41:3 56:20

71:3 91:1 132:18 143:21

meant ( 3 ) 68:5 89:25 113:23

mechanics ( 2 ) 84:7 107:24

meeting ( 4 ) 32:6 53:24 67:15 147:22

meetings62:19 memorandum ( 8 ) 2:10

19:13 128:1 135:14 135:15 142:20 143:20 144:12

memorandums127:4 memory ( 3 ) 89:17

89:25 110:3

mention ( 4 ) 2:14 92:21

117:21 124:21 mentioned ( 3 ) 52:5

61:15 78:13

mentioning19:4 mentions92:22 Mercury ( 12 ) 74:6

83:19 84:1 84:3 93:24 94:1 94:22 97:23 98:14 98:18 98:19 117:24

mere114:23

merely ( 3 ) 17:6 49:9 129:25

met19:25

middle ( 2 ) 5:7 135:16 might ( 24 ) 3:13 7:5

8:14 13:20 17:9 41:19 42:3 42:14 42:24 44:11 46:16 52:10 56:23 58:25 59:13 69:22 81:18 90:23 94:24 95:3 102:7 102:9 106:9 114:18

migrating 124:16 Millard ( 4 ) 105:18

105:21 105:25 107:1

Millard’s23:12

Milligan ( 8 ) 5:21 6:5

6:11 20:13 20:21 20:23 21:7 21:10 million ( 11 ) 3:9 13:18 37:25 44:22 80:8 80:16 82:14 83:12 83:14 84:15 84:22 Milner ( 2 ) 72:8 149:14 mind ( 12 ) 4:14 29:16

33:14 37:7 66:4 67:19 71:10 90:11 104:3 104:6 111:20 143:25

minded ( 2 ) 47:12 107:3

minimise74:4

minimum ( 5 ) 91:14 111:10 114:1 114:8 116:9

ministerial 114:4 minor109:2 minute117:10 minutes ( 3 ) 52:23

88:14 130:17

Mironova ( 13 ) 57:20 76:22 77:11 79:17 79:23 80:7 82:10 82:13 88:15 89:23 94:12 108:21 111:21

Mironova’s ( 4 )62:7

90:16 90:25 94:5

Miscellaneous ( 2 )

30:15 52:15

misled ( 3 ) 74:17

113:20 125:18 missing ( 2 ) 132:3

132:4

mistaken ( 2 ) 78:21 79:16

misunderstanding ( 2 )

138:15 138:21 mixed123:17

moment ( 16 ) 5:18 5:22 6:14 8:11 13:8 20:16 52:17 75:23 79:24 80:25 83:20 117:6 125:4 130:20 133:2 149:11

Monday ( 2 ) 130:17 150:5

money ( 9 ) 10:7 12:19 14:1 26:8 69:12 69:15 100:24 137:21 137:25

monitoring94:15 months ( 6 ) 94:14

145:17 146:3 146:24 147:2 148:2

months’ ( 3 )145:19 146:22 147:15

morality 9:12 moratorium ( 13 ) 32:8

135:4 141:18 143:8 143:14 145:1 145:18 146:3 146:22 146:25 147:12 147:16 149:11

morning ( 6 ) 1:3 1:5 1:8 21:4 67:20 149:15

Morskoy ( 9 ) 53:11 54:2 54:4 54:8 54:16 64:12 77:9 107:17 126:20

mortgage ( 13 ) 35:13 35:22 36:9 36:18 36:23 36:25 42:9 43:17 43:23 44:6 44:15 54:7 135:18

Mortgaged36:14 motivation33:15 motive ( 2 ) 101:24

141:12

move ( 2 ) 64:2 125:25 moved ( 2 ) 34:24 37:8 moves123:17

moving ( 3 ) 38:5 109:7 133:7

muddies18:4

must ( 11 ) 9:21 38:7 43:12 60:14 69:22 73:6 85:5 90:14 102:23 132:2 139:10

mustn’t9:12 myself52:16

N

name ( 3 ) 101:16 110:11 110:17 named ( 2 ) 112:13

118:4

names ( 3 ) 73:15 119:1 123:17

narrative4:14

natural ( 2 ) 95:6 100:1 nature ( 2 ) 70:4 146:2 Nayyar ( 2 ) 6:16 7:16 Nazir4:2

near28:3

necessarily ( 7 ) 15:23 31:17 71:7 100:25 107:6 127:3 148:23 necessary ( 8 ) 13:11 17:25 18:11 67:13 77:18 124:6 126:17

148:4

need ( 16 ) 2:2 2:9 2:20 3:4 3:22 25:7 52:23 55:14 58:3 64:20 64:22 81:25 83:21 111:18 127:14 143:25

needed ( 2 ) 14:6 18:13 needs ( 8 ) 4:14 13:24 16:6 54:25 54:25

59:19 115:23 122:14

Nefte-Oil ( 7 ) 77:10 77:19 108:5 109:8 109:9 109:10 109:18

negligent67:3 neither75:10 net13:18

Neuberger ( 3 ) 4:16 6:12 6:24

never ( 6 ) 14:12 22:7 58:14 58:16 58:25 141:10

Nevertheless ( 2 ) 68:21 137:4

newspaper ( 2 ) 91:10 91:22

next ( 7 ) 36:10 66:4 72:3 107:3 128:3 133:1 148:2

nice4:14

nobody ( 3 ) 41:21 41:24 58:7

nominal ( 5 ) 60:3 119:15 120:5 122:6 142:11

nominated129:8 nominee ( 3 ) 119:1

120:16 122:11 nominees ( 3 ) 118:11

118:12 120:9 none ( 5 ) 10:6 10:9

37:8 85:11 94:3 nor 28:1

normal ( 7 ) 38:11 38:15 47:21 49:8 51:18 73:2 128:11

normally45:13

note ( 4 ) 4:17 31:4 64:7 102:10

noted ( 2 ) 35:12 59:25 nothing ( 18 ) 11:23

19:4 29:13 37:21 47:15 47:23 48:8 76:6 86:23 100:7 113:14 121:6 126:8 126:18 134:23 145:13 145:24 146:6

notice ( 4 ) 53:24 55:12 91:15 92:13

noticed58:11

notices ( 5 ) 53:24 54:1 55:4 55:15 64:13

notification55:14 notion ( 2 ) 94:19 95:1 notwithstanding ( 6 )

46:25 47:9 47:25 49:10 136:25 139:6

noxious105:5 number ( 17 ) 4:5 15:3

15:17 31:20 31:24 32:16 64:6 65:21 96:3 105:9 108:24 112:17 114:15 124:15 124:17 125:9 132:24

numbered90:21 numbers90:20 numerous ( 2 ) 4:4 52:1

O

o’clock82:2

object ( 2 ) 9:10 108:23 objected87:12 objective ( 3 ) 38:8 81:2

105:12

obligation ( 8 ) 38:24 39:1 40:25 48:9 48:9 49:22 136:25 137:6

obligations ( 6 ) 16:19 47:18 128:6 128:9 143:5 143:6

obliged140:1 observation 71:5 obtain ( 2 ) 7:22 141:13 obtained ( 5 ) 14:21

25:11 50:25 51:17 51:17

obtains16:7

obvious ( 3 ) 34:16 73:3 97:17

obviously ( 37 ) 10:7 30:9 32:4 32:18 41:3 44:12 52:3 54:14 58:10 64:17 68:12 72:6 73:12 75:5 76:14 80:10 84:12 97:14 101:14 115:2 121:9 125:8 125:21 126:5 127:5 128:25 129:17 129:20 129:23 129:25 137:6 138:16 142:3 142:17 143:12 143:23 144:19

occasion ( 3 ) 17:6 17:12 17:24

occasions120:16 occurred62:20 October ( 2 ) 57:5 87:3 odd ( 2 ) 45:12 95:10 offences ( 4 ) 8:24 9:1

13:11 14:8

offered ( 3 ) 32:25 95:7 103:1

office114:22 officer15:21 officers124:16 official ( 4 ) 14:22 15:6

22:21 89:4 officials23:1 often141:2

Oil ( 2 ) 67:20 109:10 okay ( 7 ) 30:20 66:10 79:25 83:6 107:7

112:22 149:21 old ( 3 ) 20:23 25:13

25:13 older4:13

OMG ( 18 ) 39:10 45:19 46:2 46:10 71:3 95:14 124:25 126:21 138:6 138:7 138:10 139:5 139:13 140:7 141:10 141:15 144:8 148:18

OMGP ( 2 ) 38:20 40:20 once ( 8 ) 18:3 26:2

29:16 37:18 95:10 98:14 107:23 108:5 one’s ( 4 )23:25 59:18

123:15 123:16

Onega ( 14 ) 74:5 75:7 79:20 81:5 83:2 83:16 83:18 84:11 88:8 93:2 93:14 95:15 97:13 103:5

ones ( 5 ) 25:8 52:20 56:15 56:18 56:20

onward46:20

open ( 10 ) 6:14 21:17 46:8 46:8 46:10 87:6 103:22 104:3 109:24 128:1

operate16:18

operates ( 2 ) 72:17 144:20

operating ( 2 ) 14:20 97:1

operation ( 2 ) 93:25 99:20

opinion4:7 opportunity137:11 opposed24:1 optional 18:10 oral ( 8 ) 32:5 80:15

88:11 111:12 121:9 129:2 146:1 146:1

orally ( 4 ) 52:2 52:6 52:10 125:10

order ( 10 ) 1:23 11:1 13:10 14:7 22:11 56:2 56:21 58:3 70:13 134:7

ordered89:6 organise57:24 Original ( 21 ) 40:4

40:14 40:20 41:10 46:21 47:2 48:15 49:16 49:21 64:11 126:21 137:12 138:22 139:14 139:18 139:20 140:12 142:6 143:17 143:21 144:13

originally ( 3 ) 78:8 86:18 132:8

Oslo69:9 ostensibly ( 3 ) 77:8

108:9 142:5

Others ( 4 ) 65:3 115:25 147:8 147:14

Otherwise ( 10 ) 52:12 65:18 81:14 89:24 94:7 96:17 118:10 122:17 132:24 149:7

Otkritie65:3

ought ( 2 ) 35:3 35:16 outcome41:20 outlaw10:11 outlined113:17 outsiders108:2 outstanding ( 2 ) 38:14

150:1

over ( 19 ) 2:16 8:14 35:2 44:17 54:9 54:24 65:8 65:23 66:16 66:19 67:25 82:14 86:7 107:16 109:3 134:25 143:21 149:15 149:25

overall ( 2 ) 76:17 97:14 overlooked110:19 overrule6:8 overseas9:1 overt67:18 overturned113:11 overwhelming124:18 own ( 20 ) 7:22 8:9

11:10 13:9 13:13 13:13 14:4 14:7 16:24 19:19 22:10 23:22 32:3 72:21 72:25 85:5 101:20 107:7 123:19 131:3

owned ( 10 ) 50:19 50:20 55:12 73:17 89:10 89:12 118:12 123:9 123:18 123:18

owner ( 15 ) 25:13 25:14 25:25 26:10 27:22 38:17 77:15 78:16 109:3 120:7 120:9 120:10 120:11 122:24 123:2

ownership ( 9 ) 40:3 109:9 117:8 118:13 118:18 119:17 119:24 120:6 124:2

owns ( 4 ) 78:20 123:10 124:3 135:4

P

package ( 2 ) 50:10 51:5 pages ( 9 ) 8:15 35:23

64:7 65:10 65:12 66:3 107:4 148:4 148:15

paid ( 11 ) 3:8 3:11 10:7 10:20 11:6 12:16 18:8 41:4 62:12 103:10 116:8

paper 65:7 paradigm73:21 parallel137:10 parallels103:5

parcel ( 2 ) 31:17 50:19 parcels50:18

pardon ( 3 ) 75:24 93:5 110:6

part ( 52 ) 9:23 10:21 11:20 12:4 12:5 12:9 12:17 13:14 13:25 17:25 18:11 19:17 27:16 28:1 31:9 33:9 33:12 33:17 33:25 34:18 36:20 41:2 53:16 58:9 59:20 60:13 67:6 68:19 69:1 69:2 73:20 74:1 74:4 74:10 74:13 74:16 76:16 78:10 82:9 90:16 94:20 107:25 112:4 113:8 113:19 120:23 122:23 130:7 136:2 138:17 141:9 148:20

participants ( 3 ) 87:21 88:2 88:17

participated ( 3 ) 85:18 87:22 95:18

participating ( 2 )

112:18 123:7 particular ( 21 ) 1:6 1:23

3:14 4:16 9:15 12:9 15:20 24:2 34:25 52:9 56:15 68:9 68:9 91:23 104:2 115:4 124:21 128:22 130:3 136:21 145:20

particularised115:3 particularising68:25 particularity118:4 particularly ( 3 ) 58:18

60:23 66:10 particulars20:1 parties ( 14 ) 35:23

36:13 37:5 37:15 43:17 54:21 69:20 70:3 91:21 98:16 113:25 117:23 129:11 148:6

partly8:12

partner ( 4 ) 78:14 82:20 93:9 101:3

partnership101:6 parts ( 8 ) 3:14 8:10

27:20 76:15 83:1 95:3 97:18 99:4

party ( 13 ) 9:9 47:12 48:11 63:21 78:4 78:15 80:2 80:3 100:24 108:1 124:8 124:10 129:17

passages ( 2 ) 4:9 61:2 passed ( 2 ) 47:16 48:17 passing92:22

path ( 2 ) 12:8 37:15 pattern ( 2 ) 70:11 78:5 patterns92:9

Pause ( 7 ) 39:17 66:5 66:13 66:18 66:20 68:3 149:12

pausing6:19

pay ( 6 ) 13:16 16:12 27:11 34:8 54:6 100:13

paying18:10 payment ( 6 ) 11:16

11:25 26:25 27:17 33:2 39:20

payments ( 10 ) 3:6 10:24 22:23 23:1 23:18 32:15 146:11 146:25 147:1 147:25

peculiarity104:3 pending5:17

people ( 9 ) 9:13 27:10 28:16 67:17 88:23 92:4 101:25 122:12 123:10

per ( 12 ) 36:25 55:13 63:18 84:3 98:18 113:25 118:22 119:9 122:5 122:10 129:10 135:21

perceived ( 2 ) 129:10 148:19

perception131:7 perfect ( 2 ) 115:13

135:25

perfectly ( 9 ) 3:17 3:18 67:1 70:1 70:2 72:2 85:24 126:10 146:22

performed19:14 performing ( 2 ) 121:14

121:14

perhaps ( 23 ) 2:2 18:4 31:18 35:16 67:18 79:21 93:21 94:6 103:17 105:12 105:21 105:25 107:9 108:17 113:1 115:24 116:3 117:6 117:9 118:15 119:7 131:4 134:5

period ( 7 ) 35:2 45:7 82:21 131:25 132:12 132:15 145:14

permission ( 4 ) 15:9

16:6 16:7 102:22 permissions ( 5 ) 14:6 14:7 14:11 14:12

23:13

permits ( 2 ) 22:22 23:7 persecute33:17 person ( 5 ) 73:18 105:1

120:15 122:15 136:15 personal ( 9 ) 31:14

31:15 34:5 69:6 69:13 69:16 76:3 76:4 79:2

perspective43:13 PetroLes ( 4 ) 145:20

147:18 147:20 148:9

Phillip’s8:3

Phillips ( 2 ) 16:23 21:2 phrase110:1 phrases18:3 physical57:6

pick ( 3 ) 51:24 57:11 131:5

picture ( 5 ) 47:4 57:2 87:21 87:23 98:23

piece81:7

pillar ( 2 ) 33:20 34:2 pitch81:19

place ( 9 ) 2:7 20:22 54:5 54:13 95:12 104:21 109:12 126:2 149:11

plan ( 14 ) 34:13 72:25 73:20 74:1 74:5 81:19 83:1 93:25 96:11 99:17 101:18 103:14 103:15 109:12

planned1:22 played 114:16 plead78:3

pleaded ( 2 ) 19:24 22:6 pleading ( 5 ) 22:5 22:8

28:1 33:3 33:8

pleadings ( 2 ) 118:2

130:12 pleas115:8 pleasure24:22

pledge ( 26 ) 25:20 35:14 36:23 77:5 77:20 77:21 83:25 97:24 98:3 98:7 98:7 98:11 98:17 103:8 105:16 107:25 108:2 108:7 108:8 108:25 109:1 109:7 112:3 116:24 135:18 136:3

pledged ( 11 ) 1:17 34:23 35:10 35:12 37:17 50:20 50:21 77:15 109:3 129:9 136:14

pledgee ( 7 ) 23:19 23:21 24:24 25:11 25:12 27:1 27:6

pledges ( 10 ) 51:21 116:20 127:1 128:10 128:12 129:7 131:7 132:16 132:23 134:25

pledgor ( 6 ) 27:2 28:23 29:20 83:19 128:13 137:18

plenty ( 2 ) 132:20 132:23

plot ( 7 ) 12:25 13:1 13:4 23:10 23:11 26:7 36:15

plus 27:7 pointed139:11

points ( 18 ) 17:2 19:18 21:1 31:6 31:11 31:24 32:9 32:16 32:20 51:24 52:8 52:11 81:21 130:24 135:16 135:22 145:8 148:16

polarities9:3

policy ( 7 ) 1:7 1:25 2:6 22:16 30:10 30:18 31:1

polluted12:23 pollution23:20

poor ( 2 ) 25:13 25:13 poorer13:17

port ( 11 ) 10:4 11:2 11:24 14:20 23:15 78:10 78:13 78:19 78:20 101:2 101:5

portfolio76:5 posed ( 2 ) 3:1 6:13

poses ( 2 ) 13:22 27:6 positing41:5

position ( 18 ) 6:5 6:10 7:3 7:7 7:10 7:13 7:14 24:5 34:15 37:2 43:12 53:18 57:9 59:22 65:1 114:5 135:10 138:10

positive ( 3 ) 19:11 42:5 42:15

positively34:6 possession ( 4 ) 57:25

58:3 85:16 104:21 possibilities54:1 possibility ( 5 ) 46:7

55:1 55:5 115:13 136:2

possible ( 10 ) 3:18 3:18 64:24 72:6 74:9 91:4 109:5 116:21 124:6 131:10

possibly ( 9 ) 41:12 70:9 90:12 100:1 103:24 104:15 113:8 120:8 121:5

postdated 53:10 postpone79:21 pot26:8

potential ( 7 ) 24:19 44:13 96:6 98:1 103:12 108:13 142:14

potentialities ( 4 ) 19:23

25:2 26:17 28:21 potentiality ( 15 ) 19:20 25:10 25:21 26:1

26:3 26:6 26:13 26:20

26:21 26:24 27:3 27:8 29:18 29:22 30:2

potentially108:11 practical ( 2 ) 86:8 87:8 practically145:13 practice ( 3 ) 47:10

127:22 139:10 pray ( 2 ) 14:9 104:23

prayed ( 2 ) 13:16 13:21 preceded53:10 preceding56:16 precipitous53:4 precise84:7

Precisely ( 3 ) 29:4

121:1 125:14

preclude73:8 predicament 43:1 predictable85:4 prefer ( 4 ) 53:15 59:6

59:15 129:3 preferences64:17 preferred ( 2 ) 64:24

131:1 prefers1:19 premature53:4

premise ( 2 ) 11:10 35:6 prepare84:18 prepared111:1 prerogative27:11 presently94:18 preserved103:12 preserves ( 2 ) 77:13

77:21 press131:13 pressed119:25 pretend 68:18 pretty ( 2 ) 109:15

130:11

prevent ( 3 ) 2:12 12:1 16:13

preventing126:25 prevents7:21 previous ( 2 ) 56:7

132:19

price ( 34 ) 16:10 26:4 26:12 26:14 26:16 28:4 30:1 36:23 37:4 44:5 72:14 72:15 73:2 73:2 74:9 76:18 77:16 80:5 81:3 82:14 83:16 84:10 85:9 98:22 101:9 102:4 102:17 106:12 114:2 115:22 116:8 119:15 127:20 142:11

prices ( 3 ) 71:19 120:4 120:5

Prichaly ( 27 ) 74:8 75:8 78:2 78:10 78:18 78:19 78:20 80:2 80:6 81:4 82:12 83:2 84:14 85:10 93:25 94:9 97:14 97:16 97:19 99:20 99:21 100:10 101:3 101:13 101:16 101:20 101:22

primary ( 2 ) 105:12 142:15

principle ( 10 ) 3:13 7:21 8:1 8:7 11:25 15:16 15:19 21:9 21:12 30:24

principles ( 4 ) 5:21 20:25 22:15 30:18

print65:9

prior ( 4 ) 93:24 94:3 94:22 117:21

private 76:3 probabilities ( 3 ) 68:22

116:2 123:13 probably ( 14 ) 6:2 31:3

42:16 59:21 61:1 61:16 65:7 76:17 80:17 83:8 90:10 100:14 131:23 146:20

problem ( 5 ) 23:20 29:1 53:11 136:14 137:20

procedure55:14 procedures92:2 proceeded ( 2 ) 82:13

148:7

proceedings ( 7 ) 30:21 33:10 62:21 86:15 96:2 107:17 119:19

proceeds ( 6 ) 24:12 24:13 26:8 28:18 28:25 29:2

process ( 13 ) 9:23 38:2 38:9 41:14 42:11 43:19 44:3 44:4 81:24 91:7 96:14 96:17 111:3

processes ( 5 ) 38:11 50:23 50:24 51:1 51:19

procured ( 2 ) 29:12 139:22

produced80:10 productive84:25 Professor ( 5 ) 39:24

72:12 73:5 89:17 130:25

profit ( 5 ) 17:12 18:5 51:8 51:9 84:22

prohibits9:11

project ( 2 ) 3:1 120:19 promised ( 3 ) 12:12

49:6 106:17 promises143:20 proof ( 8 ) 14:1 15:3

23:13 64:20 65:24 67:2 67:15 115:14 propensity ( 3 ) 19:6

19:10 20:2 proper ( 6 ) 5:2 67:1

87:23 102:10 128:20 143:16

properly ( 4 ) 60:20 81:13 91:25 102:14

properties ( 4 ) 38:17 51:18 51:19 135:19 property ( 12 ) 11:23 12:2 12:2 16:5 36:2

36:9 36:14 37:17 43:18 45:8 51:13 108:10

proposed96:5 proposition20:17 prospect ( 2 ) 50:5 92:4 prospects19:3 prospectuses ( 2 )

61:13 61:24 protect96:6 protection ( 3 ) 32:25

96:20 136:12 protects46:15 protocol112:17 Protocols110:20 prove ( 10 ) 11:10 13:7

13:24 18:25 27:24 28:3 28:13 29:15 67:11 122:25

proven ( 3 ) 64:23 67:8 68:10

proves29:24 provide94:1 provided ( 11 ) 3:15

61:9 86:12 86:23 102:18 105:18 105:21 105:25 132:16 136:3 143:4

providing ( 2 ) 17:6 99:19

proving26:14 provision46:4 provisions ( 5 ) 30:14

30:15 91:14 92:12 146:5

public ( 18 ) 1:7 1:25 2:6 15:6 15:6 15:19 22:16 30:10 30:18 30:25 70:21 70:23 75:3 89:15 97:18 97:22 98:25 102:12

pull ( 2 ) 31:10 31:21 pulling34:19 purchase ( 3 ) 40:13

48:21 128:6 purchased ( 2 ) 45:20

51:13

purchaser ( 6 ) 40:20 41:10 75:13 96:21 126:22 130:8

purchaser’s140:5 Purchasers ( 41 ) 40:4

40:14 46:21 46:21 47:2 48:5 48:6 48:16 48:18 48:19 49:13 49:15 49:16 49:19 49:21 50:5 51:11 51:12 64:11 64:11 129:15 129:21 137:13 138:11 138:22 138:24 139:14 139:18 139:19 139:21 140:13 140:14 141:9 141:11 141:14 141:22 142:6 142:7 143:17 143:22 144:13

purchasing94:19 purely ( 2 ) 119:15

121:8 purport21:22 purportedly88:21 purpose ( 12 ) 11:12

35:14 77:11 96:10 96:24 97:10 97:10 109:4 109:6 123:19 141:22 142:13

purposes ( 8 ) 5:4 10:12 43:22 58:1 74:15 96:8 106:3 136:1

pursuant ( 7 ) 14:11 72:24 74:20 77:9 97:3 135:18 142:8

pursue 9:9 pursued9:19 pursues142:18 push ( 2 ) 53:4 103:7 pushed103:13 puts64:25

putting ( 2 ) 33:24 41:1 pyramid ( 2 ) 32:14

69:10

Q

quantum10:1 question ( 25 ) 13:5

13:22 14:5 22:2 27:5 28:4 29:4 37:13 37:14 61:6 63:23 73:4 75:19 79:4 85:15 94:24 95:5 109:6 119:3 126:24 131:6 131:22 132:8 132:11 139:16

questioning 133:15 questions ( 10 ) 2:1

52:13 52:14 63:6 68:7 82:16 87:10 93:20 113:16 127:17

quick ( 2 ) 8:14 67:18 quicker ( 2 ) 80:17

109:23

quickly ( 4 ) 82:23 90:2 116:20 130:9

quiet101:14

quite ( 40 ) 12:10 19:18 47:17 58:25 64:6 64:15 65:4 68:18 71:16 73:20 77:7 78:12 80:10 80:14 83:4 83:14 84:16 93:21 93:21 96:20 99:10 101:13 103:7 103:19 105:6 105:8 109:5 109:21 111:21 112:12 113:14 123:15 124:1 124:2 126:6 134:1 139:8 140:17 142:1 146:7

quotation22:3 quote110:3 quoted9:5

R

raft14:6

railway ( 4 ) 77:14 108:10 108:15 108:20

raise ( 3 ) 52:7 122:17 130:16

raised ( 2 ) 14:1 80:13 raises94:24

ran ( 2 ) 7:17 40:10 ransom ( 2 ) 77:15

109:3 rarely67:14

rate ( 2 ) 72:22 134:23 rather ( 36 ) 27:20 38:20

52:8 52:21 55:16 60:12 69:16 70:13 75:15 75:21 76:16 76:21 79:3 80:9 82:23 88:4 89:8 94:16 98:17 99:3 103:24 110:2 115:10 117:20 126:11 130:16 133:8 134:25 136:8 140:18 140:23 141:25 142:2 142:6 145:18 146:13

re-read25:7 re-reading90:17 reached ( 2 ) 144:25

145:25 reacquire39:10

read ( 17 ) 6:2 6:11 7:14 21:15 52:16 60:20 66:3 66:3 67:24 83:7 107:5 107:7 125:9 132:14 133:5 133:22 134:10

reading ( 2 ) 55:3 128:8 readings54:20 reads123:15

real ( 10 ) 22:19 22:20 23:3 23:5 35:10 35:13 96:23 103:11 122:24 149:22

realisation ( 5 ) 16:10 97:13 107:25 128:10 128:12

realise ( 6 ) 38:12 52:16 81:3 89:8 116:19 129:6

realised ( 11 ) 24:12 24:13 24:14 25:17 28:11 28:18 28:22 50:23 77:6 102:15 103:16

realises25:3 realising ( 4 ) 97:15

98:6 98:11 98:17 realistically 45:9 reality ( 5 ) 41:21 73:12

73:12 87:8 123:1 reason ( 12 ) 41:7 44:9 71:12 71:13 88:17 88:19 91:2 96:4

115:25 119:21 120:13 126:13

reasonable ( 3 ) 41:8 92:3 92:8

reasonably ( 3 ) 40:25 41:3 89:23

reasons ( 9 ) 3:3 15:17 76:15 87:22 91:4 98:9 105:9 114:15 115:20

recall ( 10 ) 78:11 78:24 79:23 82:25 85:20 88:15 89:16 102:19 124:22 135:24

recap82:7 receipt30:3 received 142:7 receives26:21 recent5:5

recently118:6 recite 55:10 reclaim48:22

recollection ( 4 ) 39:13 55:7 62:3 62:9

record 80:9 records ( 2 ) 56:4

126:15

recourse ( 2 ) 48:15 141:6

recover ( 5 ) 8:8 16:24 27:2 27:23 29:20

recovered ( 4 ) 98:6 116:21 116:21 138:2

recovery ( 3 ) 12:1 74:3 74:4

redeliver ( 3 ) 48:7 49:17 49:22 redelivery ( 4 ) 46:6 47:9 48:1 48:3

redemption ( 2 ) 136:16

141:6

reduce ( 2 ) 106:4

141:12 reduced13:19

refer ( 5 ) 54:7 59:25 63:14 65:15 148:20

reference ( 23 ) 10:15 24:9 33:5 35:8 39:12 40:16 53:12 56:1 63:6 77:18 78:11 79:6 79:20 82:11 89:21 94:9 106:22 111:22 112:23 125:3 125:8 133:23 135:23

references ( 22 ) 40:12 56:7 56:9 57:1 57:10 59:4 61:15 61:22 61:25 62:2 63:13 63:16 64:3 75:23 80:14 80:24 82:7 90:6 90:7 148:21 149:1 149:8

referred ( 6 ) 35:9 56:15 60:2 82:25 134:4 148:5

referring ( 3 ) 56:15 57:16 111:19

reflect10:15

reflected ( 3 ) 12:2 77:6 87:2

Reform 30:14 refusal54:6 regard27:10 regional96:11 register 101:19 registered104:24 registration104:13 rehearse143:24 reject68:16

rejected ( 2 ) 6:21 6:23 related ( 2 ) 11:23 99:19 relates144:8

relating ( 2 ) 41:4 102:23

relation ( 32 ) 4:6 50:14 50:16 50:20 50:21 54:11 56:19 60:2 63:6 78:2 83:17 83:24 87:24 88:13 93:1 107:20 110:16 110:20 112:2 112:7 116:12 117:4 117:16 118:2 125:2 126:20 127:13 131:3 133:13 136:21 147:8 147:14

relations ( 2 ) 85:22 86:9

relationship ( 7 ) 13:14 86:3 86:4 86:6 87:5 124:19 124:19

relatively ( 2 ) 145:1 146:2

released ( 5 ) 26:25 27:17 50:11 116:24 136:3

relevance36:20

relevant ( 9 ) 15:19 15:21 30:13 34:14 35:23 50:24 51:20 51:21 55:12

reliance ( 3 ) 9:14 11:8 29:11

relied ( 3 ) 6:17 8:2 144:18

relief47:12

relies ( 3 ) 10:2 29:8 53:23

reluctance118:1 reluctantly95:18 rely ( 22 ) 12:8 13:12

18:20 21:1 22:6 22:9 22:11 23:22 24:16 24:17 26:15 29:25 30:5 33:21 34:4 46:3 52:3 56:23 66:9 124:15 141:25 145:5

relying ( 2 ) 23:17 52:6 remained ( 2 ) 109:9

140:8 remains67:2 remarkable ( 3 ) 75:9

84:16 103:7 remedies ( 2 ) 15:3 15:4 remember ( 7 ) 50:17

56:4 57:4 59:19 59:21 61:8 91:13

remembered120:1 remembers58:19 remind ( 3 ) 1:21 2:2

55:8 reminder115:9 removal ( 4 ) 63:11

63:12 64:8 64:9 remove ( 3 ) 97:11

104:23 141:23

removing ( 3 ) 53:22 137:12 137:14 remuneration127:9

Renord ( 89 ) 51:4 51:10 55:13 60:10 70:22 72:13 72:16 72:19 72:22 72:24 72:24 73:1 73:13 73:22 73:25 74:12 74:18 74:20 74:22 75:18 75:20 76:7 76:12 76:24 77:10 77:20 77:24 78:3 80:13 85:17 85:17 85:23 86:9 86:11 86:13 86:14 86:18 86:21 86:22 87:5 87:15 88:24 88:24 92:9 92:20 92:23 94:1 95:18 97:5 97:20 99:2 99:13 101:25 103:11 104:7 104:14 108:6 109:10 113:5 117:7 117:17 117:25 118:9 118:12 118:14 119:10 119:14 119:18 121:6 122:11 122:24 123:5 123:9 123:10 123:18 123:18 124:4 124:14 124:17 124:24 125:24 126:4 126:18 136:20 138:3 140:13 144:19 144:21 144:22

Renord’s97:4 rent103:9 repaid ( 2 ) 42:22

128:12 repay54:15 repayment128:9

repayments ( 2 ) 147:9 147:17

repeat61:17 replace ( 2 ) 43:11

54:13

replaced ( 2 ) 137:21 137:25

replacement ( 2 ) 53:8

142:17

replacing141:21 reply ( 2 ) 59:7 59:15 repo ( 33 ) 25:19 32:25

37:18 38:10 38:22 38:24 39:1 39:5 39:9 39:19 40:8 45:19 45:21 48:10 51:19 51:23 59:23 60:1 60:13 71:1 108:23 126:12 127:9 127:13 127:15 127:24 128:17 130:20 134:24 136:11 140:22 142:2 145:13

report ( 4 ) 5:14 8:23 62:1 65:9

reported ( 2 ) 79:19 134:17

reporting94:13 reports ( 6 ) 8:23 37:10

57:13 58:19 58:22 61:23

repos24:23 representative73:25 representatives73:25 repurchase ( 19 ) 39:15

40:17 45:19 45:22 47:13 128:19 137:1 137:1 137:7 137:20 138:13 138:19 139:5 139:6 140:2 140:15 141:16 141:25 144:3

reputation ( 2 ) 86:15 86:22

require ( 9 ) 23:12 23:15 29:25 39:8 46:6 48:1 48:3 91:14 146:19 required ( 4 ) 48:6 49:16

57:24 68:11 requirement73:7 requires9:16

rescind ( 3 ) 15:2 15:17 15:20

rescinding ( 3 ) 14:25 15:13 15:13

reservation7:13 reserve ( 2 ) 7:10 20:21 reserved63:2 reserves ( 2 ) 146:19

147:23 resided40:3 resistance127:1 resolution ( 3 ) 53:22

58:13 58:15 resolutions ( 4 ) 56:1

56:13 56:17 57:9

resources86:20 respect ( 12 ) 12:21

13:21 19:9 27:22 53:8 59:23 83:23 91:24 95:2 99:14 131:1 148:1

respectful ( 2 ) 71:5 71:16

respectively ( 2 ) 36:16 138:5

respects123:3 respond68:6

response ( 5 ) 54:2 54:5 54:22 63:22 75:19

responsibility ( 2 )

74:23 114:3

rest ( 3 ) 43:6 52:12 62:25

restated6:5

restore ( 2 ) 135:8 137:2 restriction 143:2 restructuring ( 2 )

145:11 145:15 result ( 4 ) 12:12 12:13

57:5 70:14

Retransfer ( 3 ) 38:22 38:24 49:11

retransferred ( 2 ) 39:8 41:11

return ( 2 ) 2:4 49:1 returned ( 3 ) 128:14

138:7 140:21

revaluing69:10 reverse ( 2 ) 70:13

128:7 reversion106:7 review ( 3 ) 6:7 89:14

96:18 reviewed84:22 revisited7:6 reward11:16 rewarding10:23 rhetorically34:11 rigging ( 3 ) 72:12 73:3

73:21 rightful2:7 rightly135:6

rights ( 17 ) 9:14 12:21 16:19 25:23 39:6 39:20 45:25 48:21 48:23 48:24 49:4 49:5 49:6 83:19 98:18 108:10 138:22

rise ( 2 ) 85:18 123:14 risk3:1

risks101:5 road109:14

ROK ( 43 ) 50:8 50:9 50:14 50:16 51:8 74:8 75:8 75:14 78:2 78:10 78:18 78:19 78:20 80:2 80:6 81:4 82:12 83:2 84:2 84:14 85:10 92:25 93:3 93:6 93:9 93:25 94:4 94:9 94:19 95:5 95:8 97:14 97:16 97:19 99:14 99:20 99:21 100:10 101:3 101:13 101:16 101:20 101:22

role ( 3 ) 114:16 121:14 147:22

roll ( 2 ) 146:13 146:13 roll-up ( 3 ) 146:17

147:3 148:10 rolled ( 3 ) 145:22 146:11 147:10

rolling146:18 Rolls ( 3 ) 8:3 16:23

21:2

room ( 2 ) 5:13 94:8 root9:20

roubles ( 10 ) 35:15 36:14 44:17 44:18 44:22 80:8 83:12 83:14 102:5 119:11

route23:16

RUB82:14 rubbish100:11

rules ( 4 ) 16:17 38:16 111:1 128:11

ruling7:11

run ( 5 ) 58:19 88:24 89:3 95:20 100:12

runner46:2 running ( 4 ) 19:10

32:17 32:21 69:12 runs8:23

RUR135:19

rush ( 2 ) 116:19 146:9 Russia ( 2 ) 38:21 45:17

Russian ( 23 ) 14:15 14:16 14:18 30:12 46:15 59:24 88:14 89:2 91:13 92:2 94:4 94:23 95:12 95:16 96:1 96:9 96:15 96:24 97:1 126:19 142:2 142:14 149:25

S

saga94:22 sake7:9

sale ( 34 ) 26:3 26:8 26:12 26:12 26:14 26:16 28:18 28:24 29:2 30:1 36:23 40:14

40:18 46:25 81:3 84:14 88:20 93:24 94:4 95:12 95:17 96:17 96:24 96:25 97:2 101:9 102:10 102:17 116:14 116:15 117:1 117:2 126:21 128:6

sales ( 6 ) 60:3 60:12 60:12 61:13 119:7 140:14

Salon101:24

same ( 21 ) 15:5 40:6 49:5 59:10 60:15 60:19 69:3 73:18 76:18 83:11 88:23 96:10 98:15 101:2 107:24 121:3 121:4 123:10 133:13 135:12 142:18

satisfactory105:10 Saunders9:4 save45:1

Savelyev ( 20 ) 118:10 120:13 120:15 120:17 121:1 121:10 121:15 122:24 123:2 123:19 123:25 131:13 132:11 132:13 133:12 134:1 134:4 134:7 144:14 144:15

Savelyev’s ( 8 )61:6 62:18 120:19 120:20 120:23 121:4 124:11 132:10

saw137:11

saying ( 33 ) 9:22 10:13 14:12 16:22 19:5 19:8 19:9 19:10 24:1 27:12 27:15 29:7 44:3 49:18 55:9 56:18 57:22 58:2 71:8 74:20 78:2 91:16 106:2 114:12 115:19 115:24 123:20 132:19 133:6 141:23 142:21 145:14 145:18

Sberbank ( 2 ) 89:11

89:12

Scan ( 11 ) 31:14 33:10 34:14 34:15 34:17 50:21 53:9 88:22 88:23 97:3 138:5

scan-read107:3 Scandinavia ( 5 ) 50:19

83:25 97:21 98:6 98:12

scattered108:25 scenario73:17 scene ( 3 ) 93:3 93:7

94:4 schedule147:9 scheme ( 7 ) 32:14

69:12 74:10 74:13 77:7 113:9 144:20 screen ( 7 ) 36:8 119:7

125:11 131:11 132:4 134:5 142:20

scroll ( 8 ) 65:22 66:7 67:22 68:2 82:18 119:8 128:2 149:3

searches57:6 second ( 10 ) 2:21

31:17 32:21 35:20 38:19 43:4 112:3 112:8 112:18 142:23

secondly ( 2 ) 73:22 123:6

secure134:24

secured ( 5 ) 11:5 22:22 23:9 38:12 83:25

securities ( 2 ) 25:4 25:4

security ( 4 ) 38:15 51:2 97:15 126:24

see ( 44 ) 11:18 19:17 19:18 27:21 31:2 39:3 40:22 49:12 49:24

50:1 51:15 52:8 62:25 65:16 65:23 65:25 69:21 70:15 71:11 76:1 81:9 81:14 81:15 81:19 82:11 82:16 89:25 94:12 103:4 104:6 107:24 110:12 119:4 119:9 127:24 128:3 132:5 134:11 135:16 135:23 137:16 141:7 142:10 149:16

seeking ( 3 ) 9:9 16:17 27:22

seem ( 2 ) 2:15 68:17 seemed ( 5 ) 7:18 36:18

79:3 89:8 148:6 seems ( 7 ) 7:7 18:19 53:25 83:13 93:1

96:10 128:14

seen ( 3 ) 95:19 109:16 120:17

sees 50:7 seize34:13

sell ( 6 ) 44:11 49:6 58:3 74:7 89:6 97:18

seller ( 2 ) 110:17 144:10

selling ( 7 ) 58:1 73:23 74:5 74:9 98:1 98:25 141:15

sells ( 8 ) 16:9 16:10 25:24 26:18 27:7 77:19 77:20 108:6

sending 55:11

sense ( 27 ) 4:14 30:9 42:13 49:10 55:3 60:5 62:19 67:18 68:24 69:13 69:16 69:19 70:12 72:20 73:24 83:8 84:4 84:5 92:1 92:23 93:12 115:9 138:1 144:20 145:11 146:21 149:23

sensible3:13 sentence133:1 separate ( 9 ) 14:2

14:17 50:3 50:7 50:18 50:22 83:15 102:12 129:4

separately ( 3 ) 76:16 77:24 83:15

separating109:7 separation136:1 September ( 5 ) 56:14

56:22 57:5 87:3 87:11 sequence ( 3 ) 1:22

94:25 133:22 serial105:15

series ( 12 ) 56:5 58:22 68:7 75:3 77:1 77:22 88:4 116:7 116:13 119:6 129:4 137:11

serious ( 3 ) 64:22 92:4 104:24

serve86:21

service ( 2 ) 42:3 117:21 set ( 16 ) 5:25 14:24

19:12 20:24 33:16 36:23 36:24 37:1 37:18 39:25 40:10 44:16 50:20 50:21 53:18 83:6

sets ( 3 ) 4:13 6:17 7:24 settled34:12 settlement ( 2 ) 88:21

111:16

several ( 3 ) 109:14 123:3 147:7

Sevzapalians ( 2 )

107:15 126:22 shakes35:6 shaky38:5 shall52:23 sham73:23 shame60:5

share ( 2 ) 47:13 60:2

shareholder ( 3 ) 75:18 76:12 122:6

shareholders ( 2 )

62:10 63:18 shareholding ( 3 )

61:25 118:22 119:15 shares ( 43 ) 24:22

38:22 38:25 39:8 39:10 39:21 40:3 41:9 42:22 45:20 46:6 46:20 47:16 48:4 48:7 48:17 48:18 48:22 49:7 49:11 49:17 61:13 64:10 70:24 96:4 118:25 119:2 128:13 129:24 129:25 136:21 137:12 137:15 138:7 139:6 139:18 139:19 140:15 140:21 141:7 142:6 142:8 143:9

she’d58:23 she’s59:2 shed20:25 shift74:23

shipping ( 2 ) 145:21 147:19

shirk58:24

short ( 3 ) 53:1 82:4 117:13

shortly4:9

shots ( 2 ) 136:18 137:4 should ( 22 ) 3:10 3:23

30:7 31:3 31:18 36:19 45:11 45:13 46:5 49:14 57:11 61:17 64:18 66:10 70:5 93:14 114:12 115:21 125:25 132:3 138:2 145:15

shouldn’t ( 2 )60:21 122:2

show ( 9 ) 4:8 22:11 24:8 35:16 36:19 76:19 81:10 81:16 111:13

showed110:14 showing ( 2 ) 13:6 36:8 shown ( 3 ) 71:2 111:7

142:7

shows ( 5 ) 32:23 34:5 37:7 116:14 123:4

shredder58:21

shut ( 2 ) 10:18 29:14 side ( 5 ) 74:19 99:21

103:15 106:16 135:8 sideline55:15

sides ( 4 ) 40:25 57:4 60:5 88:23

sign54:7

signed ( 3 ) 60:21 114:8 144:16

significant ( 5 ) 75:4 87:25 113:5 116:22 120:3

significantly134:22 similar ( 3 ) 15:18 39:24

55:18

Similarly ( 3 ) 32:12 67:6 131:18

Simonova ( 2 ) 72:3

76:19

Simonova’s ( 3 )2:23

23:14 72:7

simple ( 3 ) 39:7 145:17 146:2

since ( 4 ) 40:3 63:1 76:15 125:7

singing ( 2 ) 10:3 59:10 single99:17

sir137:25

sister ( 2 ) 124:23 125:18

situation ( 13 ) 16:16 24:11 24:13 24:20 25:18 26:11 28:4

41:2 41:5 42:13 103:5 108:8 124:20

situations ( 2 ) 15:22 16:20

six ( 10 ) 59:8 60:10 145:17 145:19 146:3 146:21 146:24 147:2 147:15 148:2

six-month ( 2 ) 32:8 147:12

Skatin ( 2 ) 94:10 94:14

SKIF57:17

skip133:21 skipping61:4 Sklyarevsky ( 8 ) 63:13

64:4 76:22 80:6 83:10 84:20 93:23 96:3

Sklyarevsky’s55:17 Skylarevsky’s54:18 slightly ( 10 ) 4:12 15:11 16:18 35:5

50:3 59:2 59:14 76:10 85:13 123:17

slot149:19

slow ( 2 ) 109:25 110:6 small ( 4 ) 51:8 51:9

77:14 108:24

Smirnov ( 19 ) 72:17 72:21 75:16 75:17 75:22 76:8 78:14 92:17 92:18 101:4 118:14 118:23 119:1 119:18 120:8 121:7 121:11 121:12 121:19

Smirnov’s ( 5 )76:4 109:20 109:22 118:17 119:2

so-called 70:20 sold ( 31 ) 24:2 24:6

26:7 28:8 29:18 29:19 29:21 38:10 46:20 47:5 51:7 51:20 74:6 76:16 77:8 77:23 77:24 80:6 84:2 85:9 95:15 97:23 98:2 98:14 102:4 107:24 107:25 112:4 113:6 118:21 119:11

solely ( 2 ) 57:15 58:5

Solo ( 3 ) 74:5 95:20

117:24

solution ( 2 ) 42:16 97:17

solved41:13 solvency135:8 somebody ( 5 ) 15:1

15:5 58:11 58:25 81:7 somebody’s16:17 somehow 12:22 someone ( 9 ) 19:3 19:4

25:14 25:15 77:13 84:6 100:9 111:23 112:22

someone’s25:21 something ( 30 ) 6:25

16:21 17:6 17:7 17:7 34:3 35:4 36:19 53:16 58:10 58:14 68:10 75:24 79:12 79:22 89:9 92:19 93:14 101:7 103:14 110:22 113:9 124:5 127:3 130:17 145:17 145:18 146:2 146:4 147:21

sometimes121:2 somewhat64:25 song59:10 soon137:10

sort ( 16 ) 7:13 9:17 17:10 22:4 27:4 28:9 33:16 33:22 47:23 52:15 82:20 92:24 95:2 110:13 114:4 115:20

sorts ( 3 ) 23:7 43:9 70:3

Soshnik78:23

sought34:1 sound121:12

source ( 5 ) 17:16 17:17 17:18 17:20 17:22

sources17:19

spare ( 2 ) 42:25 65:18 speaking ( 5 ) 71:20

80:22 83:22 83:24 125:23

speaks ( 2 ) 113:17 118:1

specific ( 13 ) 37:21 37:22 56:2 56:8 56:18 62:15 63:23 67:12 75:6 138:22 139:5 145:18 146:5

specifically ( 4 ) 8:10

52:7 64:16 66:9 speculation ( 2 ) 114:23

115:19

speech ( 2 ) 7:25 8:3 spend80:20 split36:15 spot122:19 squarely32:11 stable144:22

stage ( 27 ) 21:17 27:12 27:24 28:17 29:15 34:13 35:19 38:19 50:11 52:13 57:1 68:9 68:15 70:18 71:9 79:15 83:1 94:17 99:17 101:18 102:22 109:12 109:16 110:10 126:17 146:7 146:10

stages70:14 stake86:15 Stalevskaya60:24 stand ( 2 ) 99:16 110:18 standard ( 3 ) 64:20

65:24 67:1

start ( 8 ) 38:5 43:20 44:5 44:7 44:8 70:5 71:3 88:8

started ( 5 ) 54:3 54:21 59:23 107:17 134:13 starting ( 15 ) 7:19 8:19

37:4 38:1 38:6 42:9 70:20 79:9 82:11 83:10 119:6 131:9 131:13 133:25 145:3

starts ( 4 ) 50:17 64:5 70:1 88:8

stated113:24 statement ( 12 ) 5:25

75:18 76:9 84:11 84:18 92:19 94:11 99:19 109:21 118:15 118:17 119:24

statements ( 4 ) 21:21 60:15 117:20 117:22

states104:13 statutory 30:13 step ( 7 ) 72:4 72:14

87:16 113:2 113:2 116:9 136:22

steps137:11

still ( 14 ) 6:10 9:2 30:24 35:17 49:4 70:15 96:1 116:2 118:7 123:4 131:15 135:12 141:11 147:25

stipulated89:1 Stone ( 3 ) 8:3 16:23

21:2

stop ( 3 ) 2:15 95:9 95:19

stopped22:25

story ( 2 ) 60:15 83:11 straight143:25 straightforward ( 2 )

97:17 98:24 strangers81:18 strategy ( 2 ) 108:22

125:14 strays134:16 stream 105:13

strenuously87:12 stress112:6 strictly8:6 striking114:3 stripped137:21 stripping141:4 Stroilov ( 189 ) 52:8

53:5 53:20 53:23 56:10 57:12 57:19 60:7 62:18 64:1 64:2 64:9 64:15 65:7 65:14 65:19 66:7 66:12 66:15 66:22 68:2 68:5 73:10 73:16 78:19 78:23 79:8 79:12 80:1 80:17 80:20 80:24 81:8 81:21 82:1 82:6 82:18 82:22 83:8 83:24 84:3 84:8 87:13 89:12 89:16 89:22 90:2 90:10 90:14 90:21 90:25 91:5 91:8 91:16 91:20 92:6 93:1 93:5 93:10 93:16 93:19 94:21 95:11 95:25 96:20 97:9 99:16 99:24 100:3 100:6 100:17 100:21 102:2 102:9 102:19 103:3 103:20 103:22 104:1 104:6 104:11 104:14 105:3 105:6 105:8 106:11 106:18 106:22 107:6 107:8 107:13 108:17 109:20 110:5 110:15 110:24 111:8 111:15 111:24 112:2 112:12 112:16 112:20 112:25 114:10 115:2 115:15 116:12 117:16 120:12 121:20 121:23 122:2 122:5 122:8 122:13 122:16 122:19 122:22 123:16 123:23 125:21 126:5 127:13 128:20 128:24 129:16 130:11 130:14 130:19 131:20 132:1 132:5 132:8 133:10 133:18 134:4 135:22 136:7 136:19 137:6 137:10 137:18 137:23 137:25 138:15 138:20 139:8 139:12 139:15 139:25 140:3 140:6 140:17 140:21 141:8 141:17 141:21 142:11 142:17 143:4 143:7 143:12 143:18 143:23 144:1 144:6 144:8 144:11 144:25 145:8 146:25 147:2 147:6 147:20 148:3 148:9 148:13 148:22 148:25 149:3 149:5 149:7 149:13 149:18 149:22 150:3 150:8 151:4

Stroilov’s ( 3 )52:19

53:13 90:8

strong ( 2 ) 126:6 127:10

stronger96:20 strongest122:23 structure ( 3 ) 48:2

64:18 72:16 stuff114:24 sub122:11 sub-leases105:13 subject ( 13 ) 5:19 6:7

21:10 64:3 97:24 106:16 108:9 114:4 126:1 142:19 147:12 149:23 149:23

submit ( 11 ) 34:15 68:21 71:1 86:2 90:15 100:8 116:1 119:19 127:8 130:24 144:15

submitted ( 2 ) 110:8 136:11

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119:10 succinct88:7 suddenly120:1

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sues49:7 suffice65:13 sufficient ( 6 ) 71:13

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sufficiently ( 4 ) 86:6 86:10 115:24 133:7

suggest ( 6 ) 5:12 48:5 48:9 64:19 70:20 91:3

suggested ( 5 ) 6:20 55:6 76:14 76:18 94:16

suggesting ( 3 ) 41:14 94:9 119:13

suggestion ( 4 ) 32:7 42:18 56:13 90:25 suggests ( 2 ) 37:21

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summarise ( 4 ) 82:23 124:13 125:23 145:5 summarised ( 4 ) 77:2

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summary ( 3 ) 65:25 66:1 107:2

Sumption ( 5 ) 5:1 5:9 5:23 6:22 6:23

supplies 30:15 supply 62:5

support ( 4 ) 22:21 23:8 32:3 95:1

suppose ( 8 ) 15:24 31:11 37:2 55:5 81:1 106:2 131:11 131:14

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sure ( 22 ) 16:1 19:25 25:8 39:23 40:16 42:1 45:9 62:17 79:24 90:3 93:21 103:1 121:10 122:15 123:16 125:7 130:6 130:11 131:2 139:1 139:2 139:23

surely ( 4 ) 43:11 43:15 43:21 115:17

surplus ( 21 ) 24:16 25:25 25:25 26:2 26:9

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surprising ( 5 ) 38:2 58:17 80:4 80:9 87:11

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70:9 81:24 88:21 113:16

synergistic ( 4 ) 78:1 99:3 108:15 108:19

synergy101:24 system146:9

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tab ( 7 ) 3:24 4:19 6:18 7:16 35:19 36:4 65:22

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tainted ( 2 ) 12:25 13:1 taken ( 13 ) 3:2 28:14 29:22 43:13 53:21

54:5 54:16 56:3 57:23 58:10 69:15 113:5 116:22

takes ( 2 ) 72:22 95:12 taking ( 2 ) 13:7 72:21 talk117:6

talking ( 6 ) 15:12 25:18 25:19 82:21 132:15 133:19

talks ( 2 ) 94:8 131:20

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105:17 126:10 140:24 147:11

tells ( 3 ) 75:17 92:19 92:20

ten ( 2 ) 117:10 145:5 term ( 6 ) 40:9 40:9

47:24 47:25 104:13 129:6

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terminals75:5

terms ( 29 ) 2:25 2:25 37:13 40:8 44:13 46:8 46:10 75:20 80:13 86:8 94:3 96:3 97:13 103:9 103:24 104:2 115:13 117:8 124:16 126:6 126:7 128:17 128:22 130:20 131:6 142:4 142:21 145:11 145:15

territory ( 2 ) 42:19 71:15

test ( 7 ) 6:17 9:2 21:14 86:3 87:3 87:8 89:25

tested119:21 testimonies59:9 text144:12

themes ( 3 ) 31:21

33:18 34:20 themselves ( 5 ) 48:10

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there’s ( 51 )2:21 8:20 9:2 10:9 11:9 11:20 14:17 15:3 24:15 25:3 25:22 25:24 29:1 29:19 31:13 32:16 33:6 34:25 37:19 37:20 38:2 38:19 41:7 41:15 42:1 42:5 42:15 42:17 46:14 46:17 48:5 49:18 50:5 52:1 55:22 55:25 60:16 61:21 61:25 81:5 87:3 87:8 100:1 104:12 111:7 111:11 116:6 121:21 134:19 136:1 143:2

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21:19 23:2 32:19 40:4 105:15 136:17

they’ll104:23

they’re ( 7 )3:19 42:23 47:4 48:11 62:25 72:20 104:22

they’ve ( 2 )47:5 48:4 thing ( 15 ) 2:14 9:21 9:22 15:7 25:10

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thinking ( 8 ) 37:20 38:8 39:21 42:15 43:20 101:18 140:19 140:23

third ( 4 ) 11:13 11:15 63:21 124:9

third-party ( 2 ) 108:13 113:3

thirdly84:10 Thomas17:4

though ( 4 ) 20:21 30:11 58:20 113:1

thought ( 20 ) 18:17 20:9 32:6 37:22 41:14 41:24 42:18 42:24 44:2 45:10 47:23 49:9 52:5 52:22 58:24 59:13 93:15 116:17 134:17 139:21

threads31:10 threatened141:1 threats32:2

three ( 7 ) 3:19 85:8 85:11 104:8 114:7 116:24 149:5

through ( 31 ) 7:17 8:23 10:17 14:22 20:11 23:9 23:18 28:9 29:6 29:12 30:12 37:8 38:11 40:11 41:15 44:2 45:18 50:22 50:25 51:4 51:18 51:20 54:10 66:3 72:23 77:22 79:9 84:25 107:3 120:22 124:4

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time ( 46 ) 34:8 44:11 46:19 46:19 54:13 70:8 70:16 76:24 79:23 80:20 80:22 82:20 84:17 84:25 89:3 89:18 95:11 96:1 99:5 103:10 103:10 103:25 106:4 107:7 116:10 116:18 117:22 121:4 125:10 126:10 126:17 129:10 131:7 131:15 131:25 132:9 132:12 132:15 132:22 133:6 133:19 141:10 142:25 145:25 146:15 150:2

times34:10 timing143:2

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tipped ( 2 ) 54:9 54:24 title77:13

together ( 9 ) 31:10 31:21 34:19 50:6 50:9 51:5 56:10 74:25 123:1

told ( 16 ) 58:25 65:14 77:17 89:5 96:2 98:8 99:18 101:1 101:4 110:11 112:4 118:7 118:14 120:1 127:23 144:15

Tomorrow ( 3 ) 149:14 150:4 150:9

too ( 10 ) 6:22 60:7 60:10 64:2 70:9 70:10 114:13 116:3 148:5 149:23

took ( 4 ) 54:13 59:22 107:16 113:25

torts30:16 total36:13

totally ( 2 ) 67:2 78:15 touch ( 2 ) 12:6 64:20 touched127:16 Toulson ( 5 ) 5:1 5:12

6:13 7:2 21:13 towards ( 2 ) 34:24 38:5 tracks ( 4 ) 23:1 108:10

108:16 108:20 trailing 7:4

Trak118:24 transaction ( 6 ) 25:19

39:5 39:19 48:21 73:23 140:5

transactions ( 4 ) 75:3 77:22 116:23 128:6

transcript ( 8 ) 2:15 61:18 78:25 82:24 83:7 122:14 123:15 134:8

transcripts ( 2 ) 56:7 121:25

transfer ( 10 ) 57:16 58:15 64:10 74:7 74:11 96:5 129:21 130:7 141:8 141:22

transferees75:11 transferred ( 5 ) 40:24

75:12 104:7 118:25 139:22

transferring143:9 transfers ( 14 ) 50:8

56:19 60:2 70:22 70:24 77:1 88:4 96:4 96:8 107:20 111:20 116:13 119:14 120:2

translated125:10 translation135:25 transmission 92:24 transparent101:21 transpired120:14 trees65:18

trial ( 5 ) 35:19 71:1 78:7 85:23 118:9

trick33:1

tried ( 4 ) 33:1 43:7 55:14 131:13

trouble102:1

true ( 12 ) 13:19 15:5 29:18 29:22 29:24 45:5 59:11 68:23 92:23 119:3 121:3 127:11

trust ( 4 ) 74:22 121:10 124:19 127:6

trusts121:1

truth ( 2 ) 118:8 123:4 truthfully144:16

try ( 3 ) 70:17 88:1 115:18

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tune13:17

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131:1

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turning ( 3 ) 23:14 36:1 103:4

turns ( 2 ) 38:11 143:13 turpi ( 4 ) 4:24 15:15

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ultimate ( 2 ) 75:2 75:13 ultimately ( 2 ) 71:24

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94:21 94:21 103:14 uncomfortable ( 2 )

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69:7 126:11 134:22 135:2

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understands21:24 understood ( 4 ) 71:7

71:8 73:6 127:7 undertaken57:6 undervalue ( 5 ) 72:8

76:19 117:1 137:16 141:4

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unify ( 4 ) 77:3 81:2 108:22 125:15 unifying ( 2 ) 109:4

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78:12 unruly6:22 unsatisfactory ( 2 )

85:2 92:17 unscrupulous ( 2 )

32:23 126:25 untainted11:24 untested ( 2 ) 119:17

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useful ( 2 ) 19:18 52:22 uses ( 2 ) 110:1 120:15 using ( 4 ) 7:21 96:9

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valid ( 3 ) 11:22 34:16 110:23

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71:15 108:18 valuations ( 9 ) 1:17

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value ( 119 ) 1:16 2:24 10:15 11:15 12:22 16:12 16:13 17:13 17:16 17:17 17:18 17:19 18:6 18:16 19:6 19:15 19:22 20:2 22:19 22:20 23:2 23:5 23:23 24:16 24:18 24:23 25:5 25:16 25:21 26:14 26:21 26:22 27:7 27:8 27:9 27:16 27:16 27:21 28:12 28:13 28:20 28:24 29:3 29:7 29:8 29:10 29:20 29:21 29:22 29:24 32:12 34:17 34:17 34:23 35:13 36:13 36:17 36:25 37:4 37:17 43:19 43:21 43:22 43:25 44:8 44:12 44:22 44:25 48:14 48:18 49:17 50:6 50:11 50:24 51:1 60:3 71:11 71:20 71:23 71:24 72:1 72:5 74:3 77:1 77:4 78:1 80:15 99:3 101:24 102:13 102:15 103:8 103:11 103:11 103:12 105:16 106:4 106:7 108:15 108:19 113:24 114:3 115:17 115:23 116:15 125:15 129:8 129:11 129:13 131:7 131:16 135:1 135:18 135:21 137:3 137:3 137:21 140:16 141:13

value’40:5

valued ( 2 ) 23:11 42:23 values134:8

valuing27:20

various ( 17 ) 1:11 2:1 8:16 29:11 50:6 51:6 51:7 57:7 57:8 70:8 70:22 76:15 85:17 93:20 108:10 124:13 144:23

vast ( 2 ) 42:25 43:3

VECTOR ( 2 ) 109:8 111:17

vehicle94:2 venture118:20 versions65:8

vessels ( 2 ) 57:25 58:3

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weight ( 3 ) 85:11 119:20 126:2

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weren’t ( 6 )56:2 56:21 56:24 81:19 114:5 140:19

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whole ( 15 ) 14:6 28:11 28:11 60:14 88:3 97:2 99:20 111:20 114:5 118:8 133:22 138:18 144:20 145:10 146:8

wholly132:2

whom ( 2 ) 6:24 51:9

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wider ( 4 ) 5:21 31:16 70:21 134:16

willing93:22

win ( 2 ) 9:21 31:12 wise86:22

wish 53:3 wished104:14 wishes29:20 witness ( 13 ) 75:17

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witnesses ( 15 ) 35:1 37:8 59:13 60:19 74:19 85:1 85:2 85:3 85:9 93:20 96:4 102:6 103:15 142:13 146:18

witnesses’s100:6 won’t ( 3 )9:8 50:9 65:7 wonder ( 3 ) 117:9

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wondered ( 2 ) 138:9

138:12 woodwork112:11 work ( 5 ) 2:13 47:11

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134:15 world 115:12 worried121:25 worse51:16 worsened138:10

worth ( 9 ) 19:20 25:1 25:2 25:13 25:20 25:22 90:16 106:7 134:5

writing ( 5 ) 127:2 145:14 145:23 145:24 148:14

written ( 20 ) 1:9 2:6 35:4 35:10 36:21 39:1 39:14 52:3 53:18 55:10 59:17 61:20 88:10 107:9 107:10 130:22 145:2 145:4 148:16 149:1

wrong ( 11 ) 23:22 37:15 45:7 66:24

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year ( 3 ) 96:16 112:11 112:13

years ( 6 ) 103:10 103:10 106:8 106:13 106:14 116:25

Yesterday ( 17 ) 1:6 1:16 2:11 2:23 31:7 31:9 31:20 33:5 34:21 35:4 35:7 36:20 38:4 45:6 51:25 61:16 71:6

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you’ve ( 7 )19:22 28:8 52:16 60:17 111:9 139:7 149:10

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100 ( 4 ) 25:1 25:6 63:18 122:5

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111 ( 2 ) 67:22 67:24

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122 ( 2 ) 107:11 107:14

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130 ( 2 ) 88:9 88:13

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148 ( 4 ) 122:7 122:12 133:14 133:18

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154 ( 3 ) 133:21 133:24 133:25

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2009 ( 4 ) 96:1 134:7 134:21 135:3

2011 ( 3 ) 107:22 140:19 141:24

2013118:25

2015 ( 2 ) 56:14 56:22

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412 ( 2 ) 39:13 40:17

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