Tuesday, 11 December 2018

European Court of Justice makes landmark Brexit ruling as Fieldfisher prevails in $1.9bn Ukrainian banking dispute

Written by 
European Court of Justice makes landmark Brexit ruling as Fieldfisher prevails in $1.9bn Ukrainian banking dispute

As a crunch parliamentary vote on Theresa May’s Brexit deal looks to be postponed, the European Court of Justice (ECJ) has ruled the UK is free to unilaterally revoke its decision to a divorce from the EU.

The landmark ruling means that UK parliament can instruct the government to bring an end to the Brexit process, if it so wishes.

The dispute pitted a batch of Scottish anti-Brexit politicians, namely Andy Wightman, Ross Greer, Alyn Smith, David Martin, Catherine Stihler, and Joanna Cherry against the government, the Council of the EU and the European Commission.

As a result of the ruling, the argument from the two EU institutions that the consent of the other 27 member states would be needed for the UK to revoke its withdrawal was defeated.

Hogan Lovells’ public law partner Charles Brasted commented: ‘In the long-term, practical questions remain as to whether, if the circumstances were to arise, the option for the UK to outstay its welcome is politically realistic. In the more immediate term, confirmation that the UK can still choose to remain in the EU is likely to harden minds, and cause more entrenchment, on both sides of the political divide against the compromises presented by the government’s deal.’

A raft of lawyers were enlisted for the case, with the anti-Brexit politicians represented by Edinburgh firm Balfour + Manson, which instructed Matrix Chambers’ Aidan O’Neill QC as lead counsel. He was supported by Brick Court’s Maya Lester QC, and Jolyon Maugham QC’s Good Law Project offered crowdfunding support.

Blackstone Chambers’ Thomas de la Mare QC acted for the government, while London firm Bindmans advised MPs Chris Leslie and Tom Brake who intervened in favour of the anti-Brexit politicians.

Meanwhile, Fieldfisher has successfully represented Ukrainian oligarch Ihor Kolomoisky in a case against the eastern European nation’s largest bank, PrivatBank.

Kolomoisky, and fellow defendant Gennadiy Bogolyubov, had been accused by the bank of defrauding it out of $1.91bn, with PrivatBank subsequently attempting to impose a worldwide freezing injunction (WFO) on them. Both men were the majority shareholders in the bank prior to its nationalisation in Ukraine in December 2016.

In the High Court, Justice Fancourt dismissed the WFO after identifying ‘serious non-disclosure and misrepresentation’ by PrivatBank in its claim. As a result, Justice Fancourt ruled that the maximum possible value of PrivatBank’s claim should be slashed from $1.91bn to just $515m.

Fieldfisher partner Andrew Lafferty, who led on the case, told Legal Business: ‘Our client has always maintained that the bank’s claims were politically motivated and misconceived. The judge has found that at least three quarters of their claim was not arguable at all.

‘As a firm we may have hidden our light under a bushel when it comes to disputes, despite historically working on some big claims. It’s great to have our name associated with such a high-profile dispute.’

PrivatBank was represented by Hogan Lovells, while Bogolyubov was advised by Skadden, Arps, Slate, Meagher & Flom.

tom.baker@legalease.co.uk