[2025] EWHC 1368 (Comm)

First, there is the “Unallocated Metals Account Agreement” (“UMAA”) dated 22 April 2002 between JPMCB and VTB. The signature block identifies the signatory as JPMCB London.

The UMAA provides for an account to be opened for VTB at the JPMCB London branch for precious metals, which would record the amount of precious metal which either party could call on from the other (depending on the state of the account at the relevant time). Withdrawals from the account could be made by “transfers” to another precious metal account (which would have the same effect as a “transfer” of funds, namely a negative adjustment in the balance of the UMAA account and a positive adjustment in the balance of the transferee account) or by VTB collecting the relevant precious metal from the JPMCB London branch vault. In the latter event, JPMCB London branch was “entitled to select what bars are to be made available to you”. JPMCB London branch was entitled to refuse to execute transfer instructions if in its opinion they were or might be contrary to any applicable law.

There was provision for termination of the UMAA which stated that the Unallocated Account would remain in being if redelivery or repayment arrangements which were acceptable to JPMCB London branch were not made.

The UMAA is governed by English law. Clause 14.2 (“the UMAA Arbitration Agreement”) provides as follows:

“Arbitration. Any dispute arising out of or in connection with this agreement, including any question regarding its existence validity or termination, shall be referred to and finally resolved by arbitration under the rules of the London Court of International Arbitrators, which rules are deemed to be incorporated into this clause”.

There is no provision in the UMAA to suggest that any third party is intended to be able to enforce any of its terms under the Contracts (Rights of Third Parties) Act 1999 (“the 1999 Act”), although the operation of the 1999 Act is not expressly excluded. However, clause 13.3 provides “this agreement is for the benefit of and binding upon us both and our respective successors and assigns” and requires JPMCB’s written consent for any assignment by VTB (but not vice versa).

It was suggested by VTB that the obligations to pay any credit balance in the Unallocated Account to it, or for it to pay any debit balance, did not arise under the UMAA but as a result of “general legal principles”, it being suggested that the “UMAA was premised on [a] common law liability”. The UMAA is a contract creating and regulating a bank account. The UMAA provides the terms on which that account is operated, as reflected in the introductory paragraph:

“This agreement sets out the terms under which we will provide those services to you and the arrangements which will apply in connection with those services”.

The UMAA makes it clear that the account records “the amount of that Precious Metal which either we or you, as the case may be, have a right to call upon the other party to deliver to it”, and it regulates the circumstances in and manner by which VTB can make deposits, and make a demand for a payment in its favour. The suggestion that the right to withdraw or the obligation to deposit arises somehow at common law and not under the UMAA makes no sense, no more than the suggestion that the entitlement to the credit or obligation to pay any debit arising on the closing of a conventional bank account would. Reflecting that fact, clause 10.3 provides that termination “shall not affect rights and obligations then outstanding under this agreement which shall continue to be governed by this agreement until all obligations have been fully performed” (emphasis added) and clause 13.6 provides that the UMAA “supersedes any previous agreements between us relating to the subject matter of this agreement.” On VTB’s case, it was wholly unexplained what the legal source of the rights and obligations relating to withdrawals and deposits is, what type of legal rights these were said to be and what law governed them. While VTB points to clause 13.6 reserving JPMCB’s rights arising outside the UMAA (notably set-off and any lien), there is no similar provision for VTB.