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Ben Oldman Special Situations Fund LP -v- Karver Investments Limited et al (BVIHC (Com) 135 of 2016 (Delivered on the 31 October 2017))

October 2017 Companies

BRITISH VIRGIN ISLANDS

SUPREME COURT

BVI LITIGATION AND RESTRUCTURING – COMMERCIAL LAW – ALLEGED BREACH OF LOAN AGREEMENT – STAY OF BVI PROCEEDINGS – FORUM NON-CONVENIENS – BVI DEFENDANTS – APPROPRIATE FORUM FOR THE COMMISSION OF TORT

The Claimant, Ben Oldman, Special Situations Fund LP (“BOSS”) was the assignee of a lenders’ rights under a 2007 Loan Agreement (“Loan Agreement”) entered into with a Russian Company, CJSC VMZ Red October (“Red October”), whereby US$80 million was advanced to Red October. Red October allegedly defaulted on the Loan Agreement and was in liquidation. The Claim alleged that Red October breached the Loan Agreement by causing another Russian company to acquire shares in Stupino (a third Russian company) with funds obtained under the Loan Agreement. It was further alleged that the Sixth and Seventh Defendants (individuals domiciled in Russia) were the Controlling Persons behind the alleged scheme and were the parties who ultimately caused Red October’s insolvency.

The allegations against the four companies incorporated in the BVI (“BVI Defendants”), were that they were nominees of the Controlling Persons and that they now held the Stupino shares on constructive Trust or Quistclose trust for the benefit of the Claimant or Red October itself. The Claimant therefore sought, inter alia, an Order that the BVI Defendants convey the Stupino shares, or any interest therein, held by the BVI Defendants to the Claimant or alternatively to the receiver of Red October. The BVI Defendants, represented by Conyers, brought an application for a stay on the ground that BVI was not the appropriate forum for the trial of the dispute (forum non conveniens). The stay was granted by Adderley J.

 

To continue reading full articles in PDF format:
Ben Oldman Special Situations Fund LP -v- Karver Investments Limited et al (BVIHC (Com) 135 of 2016 (Delivered on the 31 October 2017))

 

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