Blog Evidence Taking International Litigation

How UK High Courts Analyze Letters of Request

Taking proof pursuant to the Hague Proof Convention (HEC) is surrounded by a certain degree of thriller. Whereas the HEC’s procedures are clear enough and US courts have revealed a number of Letters of Request (LORs), we seldom hear about what occurs to LORs once they arrive in the applicable courtroom within the vacation spot country.

HEC procedure requires that the overseas courtroom hold a listening to, however the courtroom’s ruling on the evidence to be taken is never revealed when the request for proof is granted — and even when a request for proof is rejected such opinions are only sometimes revealed.

The rationale for this paucity of info is that abroad courts, like US courts, solely publish opinions that are typically noteworthy.

That’s the reason the 2019 case — Atlantica Holdings, Inc & Anor v Sovereign Wealth Fund & Ors, [2019] EWHC 319 (QB) — is of interest. It supplies a rare take a look at how a UK High Courtroom analyzes an LOR from a US courtroom.

A Temporary Overview of the Case

On this case, Pavel Prosyankin and John Howell (the Applicants) and the Second Defendant (BTA Bank/the Bank) sought to put aside J. Morris’ order (the Order) for the Candidates’ oral examination.

The Order was issued pursuant to §2 of the Evidence (Proceedings in Different Jurisdictions) Act 1975 (the 1975 Act) following the “receipt of two materially identical letters of request (LORs) issued on 6 December 2018 by the Honourable Judge Jesse M. Furman of the United States District Court for the Southern District of New York.”

The New York litigation involved securities fraud, wherein the Defendants have been alleged to have “diverted assets from BTA Bank over the course of two debt restructurings, at the expense of its international creditors, including the Plaintiffs.” Like all securities fraud instances, this case concerned a sophisticated financial transaction and the restructuring of BTA Financial institution.

Plaintiffs Request Evidence from UK Witnesses

The Plaintiffs sought to depose the two UK witnesses, Prosyankin and Howell.

Prosyankin served as the deputy head of the Recovery Sub-Committee overseeing BTA Financial institution’s restructuring. Particularly the Plaintiffs asserted that Prosyankin:

  • knew that BTA Financial institution was under-reporting its belongings,
  • instructed and assisted BTA Bank staff to arrange and use private Gmail accounts for business correspondences, and
  • had given testimony on this case that conflicted with testimony beforehand given in a related continuing. (See JSC BTA Financial institution v Soledchenko [2012] EWHC 1891 (Ch).)

Howell, then again, had served as an outdoor advisor to BTA Financial institution throughout its restructuring course of.  In accordance with the Plaintiffs, Howell had actual information that BTA Financial institution was under-reporting its belongings.

Witnesses Refuse to Produce Requested Evidence

Prosyankin and Howell refused to supply the requested proof on several grounds.

First, they asserted that the requests did not present adequate time for them to organize for his or her examinations. Additionally, they cited issues relating to confidentiality and the relevance of the requested proof.

The difficulty of relevance appears to be associated to the truth that the Plaintiff’s LOR did not embrace a schedule of particular inquiries to be requested of the witnesses. Fairly, the UK courtroom’s opinion only mentions that proof requested was by “topics listed in the LOR.”

As an excellent apply point, LORs ought to all the time embrace a schedule of particular inquiries to be asked of the witness(es) so as avoid witnesses asserting that the LOR is a “fishing expedition” (see under) and allowing the requested courtroom to blue pencil the LOR (see under). It seems probably that this litigation might have been prevented had the Plaintiff’s included a schedule of specific questions.

Rules Guiding High Courts’ Dealing with of LORs

High Courts are solely to offer help to abroad courts, when they’re glad that:

(a) the appliance is made in pursuance of a request issued by or on behalf of a courtroom or tribunal (“the requesting court”) exercising jurisdiction in another part of the UK or in a country or territory outdoors the UK

(b) the evidence to which the appliance relates is to be obtained for the needs of civil proceedings which either have been instituted earlier than the requesting courtroom or whose institution before that courtroom is contemplated[1]

The 1975 Act grants High Courts authority to order the manufacturing of proof (either written or oral) from witnesses to be used in overseas courts when it has jurisdiction. If the courtroom has jurisdiction, “whether as a matter of discretion it ought to make or refuse to make such an order.”

Underneath Rio Tinto Zinc Corp v Westinghouse Electric Corp,[2] a High Courtroom has jurisdiction when:

  1. There’s an software for an order for proof to be obtained in England and Wales.
  2. The appliance is made pursuant to the request of a courtroom exercising jurisdiction outdoors England and Wales.
  3. The proof to which the appliance relates is to be obtained for the purposes of civil proceedings which either have been instituted earlier than the requesting courtroom or whose establishment earlier than that courtroom is contemplated. As to this, as a matter of jurisdiction, within the unusual means and within the absence of evidence on the contrary, the English Courtroom must be ready to simply accept the assertion of the overseas Courtroom in its request that the proof is required for the purposes of civil proceedings in that Courtroom.

Discretion exists underneath three sections as outlined under:

  • Part 2(1) confers the facility on the High Courtroom to make an order for obtaining proof to provide effect to the request.
  • Part 2(2) specifies the varieties of order which may be made, subject to the restrictions in the section, including the examination of witnesses (s 2(2)(a)).
  • Nevertheless, s 2(three) prevents the courtroom from making an order requiring any specific steps to be taken until they’re steps which could be required to be taken by method of acquiring proof for the needs of civil proceedings in the courtroom making the order.

Accordingly, an

English Courtroom will ordinarily give effect to a request from a overseas Courtroom for help as far as is proper and practicable to take action, and to the extent that’s permissible underneath English regulation. This precept reflects judicial and international comity in addition to the UK’s worldwide obligations beneath the Hague Convention.[3]

Distilling the above points, the 1975 Act embodies the next rules:[4]

  • First, there’s the question of the width of the request. If the width of the subjects for questioning is just too large — or uncertain or obscure — it might be refused on the grounds that it is oppressive to the witness: First American Company v Zayed, supra, p1167. Additionally, such a request may lead to the inference that, ‘the letter of request was designed to elicit information which might lead to the obtaining of evidence rather than to establish allegations of fact, and that would amount to an impermissible fishing expedition’: Smith v Philip Morris Corporations Inc [2006] EWHC 626 (QB), [37]-[40].[5]
  • Second, if the request is taken into account to be too broad ranging, the courtroom retains a discretion whether to grant the request and may ‘blue pencil’ — however not redraft — the request. The courtroom has no energy to redraft a question or supplement the request as a result of it considers it expedient to do so: State of Minnesota v Philip Morris Inc [1998] 1 LPr 170, [50]-[51].
  • Third, there’s the query of relevance, which Cockerill J referred to in Allegan Inc v. Amazon Medica [2018] EWHC 307 (QB), [54] as the ‘fundamental building block’ on which the right strategy to an software beneath s 2 should be based mostly. An English Courtroom can solely require relevant evidence to be given,[6] and this limitation is imported into the mutual authorized assistance context by s 2(three).
  • Forth, if the letter of request states that a specific individual is a needed witness then the English courtroom shouldn’t itself embark upon an investigation as as to if the requesting courtroom is right for the purpose of figuring out prematurely whether the proof is relevant and admissible.[7]
  • Fifth, High Courts shouldn’t order an examination the place it will be oppressive to the proposed witness. The courtroom should hold a fair stability between the pursuits of the requesting courtroom and the pursuits of the witness: United States of America v Philip Morris Inc and others [2004] EWCA Civ 330, [17].[8]

UK High Courtroom Addresses Witnesses Reasons for Refusal

In making use of these rules to the litigation at hand, the High Courtroom first addressed every of the witnesses purported causes for refusing to supply proof in the type of oral examinations.

Causes 1 & 2: Oppression & Confidentiality

The Courtroom categorically dismissed out of hand that witnesses where not being given adequate time to organize. The Courtroom additionally dismissed the witnesses’ assertions of a scarcity of confidentiality because depositions have been to be taken pursuant to the privileges of the US and UK, as well as a protecting order, which offers “a range of protections during, and after, the litigation.”

Cause 3: Relevance

Subsequent the courtroom addressed relevance. The Courtroom was conscious that the LOR did explicitly articulate the usual for relevance that it was using. Then again, the High Courtroom was conscious that the US courtroom had already held a number of preliminary hearings regarding evidentiary points. Accordingly, the High Courtroom said that the US decide had

thought-about the query of relevance for himself and was glad that the subjects on which the Candidates are to be examined are related to the issues arising in the US Proceedings. He did not merely rubber stamp the Plaintiffs’ assertion that the subjects have been related. In these circumstances, it will be contrary to comity, and to the right strategy indicated by the instances that I mentioned earlier in this judgment, for me to embark upon a course of of making an attempt to second guess whether he was right or improper in his determinations…  I utterly reject the suggestion that I ought to infer he merely rubber-stamped the Plaintiffs’ software without applying his thoughts to the merits… In conclusion, I’m solely glad that the difficulty of relevance was thought-about on the deserves by Decide Furman and the subjects discovered by him to be related, and thus that as a matter of comity I need to respect that willpower as a result of he was in the perfect position to guage relevance.

The High Courtroom thus concluded that it “refused the applications to set aside the Order.”

The Significance of a Properly-Written LOR

The important thing cause that the above litigation occurred facilities across the LOR initially issued. Had the LOR been ready properly — together with a schedule of particular inquiries to be asked — the witnesses wouldn’t have been capable of request the ensuing Order be put aside in the first place.

At LLS, our group of attorneys and paralegals has years of experience in drafting LORs and supporting and defending US evidentiary requests before overseas courts in addition to a long-standing status for efficiently taking testimony from reluctant witnesses situated abroad. In the event you require assistance writing a well-written LOR, contact Authorized Language at this time.