CL-2022-000456 - [2025] EWHC 1938 (Comm)

Mr Fenwick KC submitted that it was not open to the Banks or Tecnimont to argue that, even though Mr Melnichenko exerted no control at the level of EuroChem AG, he might do at the level of MCC EuroChem. Mr Fenwick KC said that this should have been specifically pleaded.

It is right that neither of the Banks specifically pleaded that EuroChem NW2 is under the control of Mr Melnichenko, via MCC EuroChem, even though EuroChem AG is protected from his control by the firewall. Tecnimont came closest to doing so in its Defence at paragraph 65F(4), although that focussed rather on the flow of funds to Russia via the UAE. However, the Banks and Tecnimont all certainly alleged that EuroChem NW2 is subject to Mr Melnichenko’s control.

The Claimants responded to this, in paragraph 21.c of their Reply, by alleging that Mr Melnichenko does not exercise legal control over EuroChem NW2, or de facto control “whether through [EuroChem AG], the Firstline Trust or anyone else.” This was a positive case, which was necessarily in issue at trial, that Mr Melnichenko did not control EuroChem NW2 through anyone – including MCC EuroChem (which, in the Reply, was positively alleged to be EuroChem NW2’s immediate parent). The result was that issue 12 in the agreed list of issues for trial was:

“12.

Is EuroChem NW2 a legal person associated with owned and/or controlled… by Mr and/or Mrs Melnichenko?”

Issue 12 therefore was not confined to control via EuroChem AG. It accommodated a case that Mr Melnichenko’s control was exerted only via MCC EuroChem.

That said, I should ultimately be less interested in the niceties of pleading than in the need for a fair trial. Mr Fenwick KC’s submission was that it would be unfair to the Claimants to allow the Banks or Tecnimont to run this case. Assessing fairness makes it necessary to take into account how the relevant case came to be run; when it became apparent to the Claimants that their opponents intended to run it; and what difficulties it has caused the Claimants that they only realised this at a late stage.

The case came to be run because the Claimants’ own case, in the Reply and in the evidence of their witnesses, made it apparent that, while there are firewall measures in place in relation to EuroChem AG, there are no such firewall measures for EuroChem NW2 and no control by EuroChem AG of either EuroChem NW2 or MCC EuroChem. The Claimants’ Reply contains a structure diagram very similar to Appendix 1 to this Judgment, which conspicuously failed to identify any of the directors or other people in charge of MCC EuroChem (thus presenting a very distinct contrast with EuroChem AG, AIM Capital and Linea). The Claimants’ witness statements (in particular, those of the EuroChem AG witnesses) all implied that the firewall operated only within the EU and that EuroChem AG had only limited control if any over companies in Russia; which then was duly confirmed by their oral evidence.

In short, it was the way that the Claimants presented their own case that gave the idea to the Banks and Tecnimont that Mr Melnichenko might exercise control at the level of MCC EuroChem. The Claimants’ case made it apparent that MCC EuroChem was not in reality controlled by EuroChem AG; ergo, it might very well be controlled by Mr Melnichenko.

Mr Fenwick KC said that it became apparent to the Claimants that the Banks and Tecnimont intended to run this case upon receipt of their written opening submissions. This was on 4 June 2025 – precisely one month before the final day of the trial. Given that the idea for this case was suggested by the Claimants’ own evidence, it is arguable that the Claimants should have foreseen the possibility somewhat earlier, especially given the open-ended terms of paragraph 21.c of the Reply. Be that as it may, it then falls to the Claimants to show that 4 June 2025 did not leave them sufficient time to respond.

That is where the Claimants’ argument really runs into the sand. It is commonplace in litigation that, as the trial goes on, points acquire a new significance, or new points emerge, and the parties respond with additional evidence. To persuade the court that it would be unfair to allow the Banks and Tecnimont to run the case that they wanted, Mr Fenwick KC would have had to give at least some indication of why it was not possible to provide the documentary evidence or to produce the witnesses that he otherwise would have. Mr Fenwick KC did not seek to discharge this burden and in fact there is no obvious reason why (for example) Mr Shiryaev or Mr Vanyushin could not have been produced to give evidence, if necessary, by videolink. Similarly, the Claimants could have produced further disclosure at any point during the weeks before the last day of the trial.

Rather than trying to establish real unfairness, Mr Fenwick KC instead confined himself to the contention that the point was simply not in play on the statements of case. Considered in this very limited manner, the Claimants’ objection is not tenable, in the light of paragraph 27.c of the Reply and issue 12 of the agreed issues for trial.