JSC Commercial Bank Privatbank v Igor Valeryevich Kolomosiky & Anor [2026] EWCA Civ 658

[2026] EWCA Civ 658Case Nos: CA-2025-002963, 002972
IN THE COURT OF APPEAL (CIVIL DIVISION)
[2025] EWHC 1987 (Ch)
ON APPEAL FROM THE HIGH COURT OF JUSTICE, BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES, BUSINESS LIST (ChD)
Mr Justice Trower
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 22 May 2026
Before
LORD JUSTICE ARNOLDLORD JUSTICE NUGEESIR LAUNCELOT HENDERSON
Between
JSC COMMERCIAL BANK PRIVATBANKClaimant/(1) IGOR VALERYEVICH KOLOMOISKYDefendants/ Appellants(2) GENNADIY BORISOVICH BOGOLYUBOVAppellant
Mark Howard KC, Alexander Milner KC and Geoffrey Kuehne (instructed by Enyo Law LLP) for Second AppellantAlexander Milner KC (instructed by Fieldfisher LLP) for First AppellantAndrew Hunter KC, Daniel Saoul KC and Christopher Lloyd (instructed by Hogan Lovells International LLP) for RespondentHearing Hearing dates : 12, 14 May 2026
Approved JudgmentThis judgment was handed down remotely at 14.00pm on 22 May 2026 by circulation to the parties or their representatives by e-mail and by release to the National Archives..............................

Introduction

[1]At the time of the events with which these proceedings are concerned, the Claimant (“the Bank”) was Ukraine’s largest bank. It was declared insolvent by the National Bank of Ukraine on 18 December 2016, and was nationalised over the course of the following days. These proceedings were brought by the Bank in December 2017 against two of its founding shareholders, Igor Kolomoisky and Gennadiy Bogolyubov (the First and Second Defendants, now the Appellants), and six companies owned or controlled by them (the Third to Eighth Defendants, “the Corporate Defendants”) seeking compensation for loss caused by what the Bank alleged to have been their participation in a fraudulent scheme carried out prior to nationalisation. Between 2010 and nationalisation, the Appellants together owned a controlling stake in the Bank, although each of them held less than 50% of the shares, and they both sat on the Bank’s Supervisory Board.[2]The Appellants are Ukrainian nationals. At the time the proceedings were commenced they were both domiciled in Switzerland. Three of the Corporate Defendants are English companies, while the other three are incorporated in the British Virgin Islands. Unsurprisingly, in those circumstances, there was a significant dispute as to the English courts’ jurisdiction to hear the Bank’s claims, which this Court resolved in favour of the Bank in a judgment dated 15 October 2019 ([2019] EWCA Civ 1708, [2020] Ch 783).[3]After a 43-day trial which commenced on 12 June 2023 and concluded on 10 November 2023, Trower J handed down judgment on 30 July 2025 ([2025] EWHC 1987 (Ch)) and made the order under appeal. By that judgment and order the judge held that the Appellants were jointly and severally liable to pay the Bank US$1,911,877,385, less the real value of certain assets which had been transferred to the Bank. That value was subsequently agreed to be US$149,919,593. Accordingly, the principal sum for which the Appellants were held liable is US$1,761,957,792.[4]The basis for this order was that the judge found the Appellants liable under Article 1166 of the Ukrainian Civil Code (“UCC”) for harm caused to the Bank arising from the misappropriation of its funds, through a series of fraudulent drawdowns, in the amount of US$1,911,877,385 (“the Misappropriation”).[5]In very brief summary, the judge found as follows. The Appellants had procured the Misappropriation between November 2013 and September 2014, using their control of the Bank and a network of shell companies. They did so by instructing their associates at the Bank to effect 270 fraudulent drawdowns (“the Relevant Drawdowns”) to 50 borrowers (“the Borrowers”). Those funds were transmitted directly or indirectly to the Corporate Defendants purportedly pursuant to sham supply agreements (“Supply Agreements”).[6]In order to disguise the Misappropriation, the Appellants procured the Borrowers and the Bank to enter into sham loan agreements (“the Relevant Loans”). Each of the Relevant Loans was, as a matter of Ukrainian law, void ab initio. The Appellants also procured the Borrowers, the Corporate Defendants and numerous other companies that they secretly owned or controlled to enter into sham documentation to give the false impression that security had been granted for the Relevant Loans. A vast amount of paperwork was created to disguise the Misappropriation, including 134 “Relevant Loan Agreements”, 129 Supply Agreements, 53 “RSA Pledges”, 78 “LFSA Pledges”, 50 “Share Pledges”, 117 “Intermediary Loan Agreements” and 36 “New Loan Agreements” (all of these terms are defined in the judge’s judgment).[7]The Appellants were the ultimate beneficiaries of this fraudulent scheme: the funds extracted from the Bank ended up funding the Appellants’ businesses through a process of money-laundering so complex it was impossible to trace.[8]The judge found that, as a matter of fact and Ukrainian law, each fraudulent Relevant Drawdown amounted to harm to the Bank in the amount withdrawn, so that the harm for which the Appellants were liable under Article 1166 UCC was the net amount that had been misappropriated, taking into account the fact that some of the Relevant Drawdowns were themselves repaid by further Relevant Drawdowns, of US$1,911,877,385. As the Bank accepted, it had to give credit against this sum for the real value of assets transferred to it by way of security (“the Transferred Assets”).[9]The Appellants appeal with permission granted by Lewison LJ against the judge’s rejection of one of the defences advanced by the Appellants at trial, referred to as “the Repayment Defence”. This was pleaded and argued by the First Appellant, and adopted by the Second Appellant.[10]The essence of the Repayment Defence is that the Relevant Loans were almost entirely repaid, and therefore the Bank suffered no loss for which it could claim in tort. (The Appellants accept that a relatively small sum was not repaid.) The repayments took two forms: sums derived from Intermediary Loans and New Loans (“Cash Repayments”) and sums representing the book value of assets transferred to the Bank under mortgage agreements (“Asset Transfers”). The Appellants do not dispute on the appeal the judge’s finding that the funds purportedly used to repay the Relevant Loans were also fraudulently misappropriated as part of the scheme (in the case of the Asset Transfers, through the ascription of inflated values to the Transferred Assets). The Appellants contend that the Bank’s proper remedy was to bring claims either for the second set of misappropriations or for its overall loss, and that the Repayment Defence arises because of its decision, for jurisdictional reasons, to confine its claims to the Misappropriation.

Article 1166 UCC

[11]Article 1166 provides (in translation):
“General grounds for liability for property damage 1. Property harm caused by unlawful decisions, actions or omissions to the personal non-property rights of a natural or legal person, as well as harm caused to the property of a natural or legal person, shall be compensated in full by the person who caused the harm. 2. The person who caused the harm shall be exempt from paying compensation for the harm if he proves that the harm was caused not through his fault. 3. Any damage caused by any severe injury or any other personal injury or death of an individual as a result of acts of God must be compensated to the extent provided by law. 4. Harm caused by lawful actions shall be compensated in the instances provided by the Civil Code of Ukraine or other law.”
[12]It was common ground between the experts as to Ukrainian law that the elements of a tortious claim under Article 1166 are(i) unlawful conduct,(ii) harm,(iii) causation between the unlawful conduct and harm and(iv) fault. It was also common ground that the burden is on a claimant to prove the first three elements of the cause of action, but the burden is on a defendant to disprove fault in the event that those first three elements are established against him.

Grounds of appeal

[13]There are two grounds of appeal. Ground 1 is that the judge was wrong to find that, as a matter of Ukrainian law, the repayments did not extinguish the loss sustained by the Bank as a result of the Appellants’ torts. Ground 2 is that the judge was wrong to reject the factual premise for the Repayment Defence. As the Appellants accept, they need to succeed on both grounds. As counsel for the Bank submitted, ground 2 logically comes before ground 1.

Delay

[14]It can be seen from the dates set out in paragraph 3 above that the judge handed down his judgment over 20 months after the conclusion of the trial. The judgment contains no explanation (or apology) for this delay, but in a judgment on consequential matters delivered on 10 November 2025 ([2025] EWHC 2909 (Ch)) the judge explained at [128]:
“… I much regret the length of time which it took to produce the Judgment and it is right that my estimates from time to time of how much longer the task would take were significantly over-optimistic. It took so long to prepare because of the enormity of the task inherent in the nature of the case and the way it was litigated. The case was multifaceted, the submissions were voluminous and almost every issue had to be determined under a foreign law to be decided with the assistance of extensive expert evidence. Paragraph 203 of the Bank’s skeleton argument for the Second Consequentials hearing gives some flavour of the task. I would only add this to what is said there. Quite apart from their length and the level of detail they contained, the cross references in the parties’ closing submissions to earlier submissions, witness statements, expert evidence (including detailed appendices and numerous decisions of the Ukrainian and Cypriot courts) and handouts distributed during the course of the trial were voluminous and many of them had to be tracked down during the course of preparing the Judgment because there had been insufficient time to take the court to them during the course of oral argument. I also found it necessary to re-read all of the transcripts when considering and re-considering the evidence and the submissions (some on more than one occasion). This was a time-consuming exercise which provides a partial explanation for the delay, but it is important to appreciate that in my view this improved rather than undermined my ability to make a proper evaluation of much of the evidence. This may be reflected in the fact that the vast bulk of my findings are not challenged in the Defendants’ Grounds of Appeal.”
[15]We were not shown paragraph 203 of the Bank’s skeleton argument for the Second Consequentials hearing, but counsel for the Bank did inform us that the trial involved a bundle of over 35,000 documents, evidence from no less than 14 expert witnesses as well as six factual witnesses, over 1000 pages of written closing submissions and nine days of oral closing submissions. It is convenient to note at this point that among the experts were three experts on Ukrainian law whose combined reports ran to over 300 pages and whose joint statement ran to over 50 pages. The two principal experts were Oleh Beketov (called by the Bank) and Oleg Alyoshin (called by the First Appellant). Mr Beketov and Mr Alyoshin were each cross-examined for over two days.[16]A further metric of the scale of the task faced by the judge is provided by the length of the judgment, which runs to 2025 paragraphs and 490 pages.[17]The general rule is that judgments should be delivered within three months of a hearing even in long and complex cases (Bank St Petersburg PJSC v Arkhangelsky [2020] EWCA Civ 408, [2020] 4 WLR 55 at [78] and [84] (Sir Geoffrey Vos MR)), but this is not an inviolable rule (Phones 4U Ltd v EE Ltd [2025] EWCA Civ 869 at [323] (Falk LJ)). Delay in producing a judgment is not in itself a sufficient ground to impugn a judgment, but where there is a serious delay the appellate court must exercise special care in reviewing the evidence, the judge’s treatment of that evidence, his findings of fact and his reasoning (NatWest Markets plc v Bilta(UK) Ltd [2021] EWCA Civ 680 at [45] (Asplin, Andrews and Birss LJJ)).[18]Counsel for the Appellants submitted that this principle was applicable to the present case. I agree that the delay in producing the judgment was serious, but this does not assist the Appellants. As the judge noted, most of his findings are unchallenged. The appeal is confined to a narrow issue. So far as the Repayment Defence is concerned, counsel for the Appellants was unable to point to any aspect of the judgment which demonstrated that the delay had had an adverse effect on the quality of the judge’s reasoning. To the contrary, the relevant passages supported the judge’s statement that the time taken had been well used.

Ground 2: the factual premise for the Repayment Defence

[19]It is common ground on the appeal that, as noted above, the Relevant Loans were, as a matter of Ukrainian law, void. It is important to appreciate, however, that at trial this was disputed by the Appellants. It is also common ground that, as a result, the Borrowers were under restitutionary obligations to repay the Relevant Drawdowns. It is also common ground that the Bank’s books show that sums were credited to the relevant accounts, purportedly as repayments of the Relevant Drawdowns, which derived either from Intermediary Loans and New Loans in the case of the Cash Repayments or from Asset Transfers. The question at this stage is whether these purported repayments discharged the Borrowers’ restitutionary liabilities in respect of the Relevant Drawdowns.If they did, the question which would then arise under ground 1 is whether, as a matter of Ukrainian law, that in turn reduced the harm that could be claimed from the Appellants under Article 1166 (i.e. as tortfeasors).[20]The judge considered the Repayment Defence with conspicuous care at [1027]-[1181]. He held that the purported repayments did not discharge the Borrowers’ restitutionary liabilities in respect of the Relevant Drawdowns for reasons which can be summarised as follows. First, the Appellants’ pleaded case was that the credits automatically extinguished those restitutionary liabilities, but that case had been abandoned in closing submissions if, as he found, the Relevant Loans were void. Secondly, in closing submissions the Appellants had advanced an unpleaded case based on a choice by the Bank, maintained after nationalisation, to allocate the credits to settlement of the Borrowers’ restitutionary liabilities, but no application to amend the Appellants’ Defences had been made and permission would have been refused if an application had been made because the Bank would be prejudiced by the lateness of the application. Thirdly, the new case based on choice was not supported by the evidence in any event.[21]The Appellants contend that the judge was wrong first to hold that the case they advanced in closing submissions had not been pleaded, and secondly to conclude that it was not supported by the evidence. The Appellants do not challenge his conclusion that, if the case advanced in closing submissions had not been pleaded, permission to permit the Appellants to advance it should be refused.[22]So far as the first contention is concerned, the judge was entirely correct to conclude that, as he put it at [1027], the case was “pleaded as one of automatic extinction of the Bank’s loss by reason of the repayment of the Relevant Loans, whether or not they were void”.[23]Paragraph 15 of the First Appellant’s Defence pleaded that, with two exceptions, “all of the Relevant Loans were repaid”. The particulars given relied purely upon the relevant ledger entries in the Bank’s books. Paragraph 55C pleaded (so far as relevant, footnote omitted):
“Mr Kolomoisky’s primary defence to the claim is that all of the USD 1,911,877,385 claimed by the Bank was repaid save for USD 25,149,021 (‘the Repayment Defence’). (1) It is denied that the Bank can ignore repayments funded by Intermediary or New Loans. Any loss caused by Relevant Drawdowns has been extinguished to the extent it was repaid. (2) It is denied that the Bank is entitled unilaterally to ignore the credits granted to the Borrowers in return for the … Transferred Assets transferred to the Bank by third parties having taken no steps to set aside the relevant transactions. …”
[24]Furthermore, this was confirmed in paragraph 135 of the First Appellant’s written opening submissions (footnotes omitted):
“(1) The Bank claims to have suffered loss as a result of making particular advances of funds – Relevant Drawdowns. (2) When a Relevant Drawdown is repaid (by whatever means), any loss caused by it is reduced or extinguished. (3) If the Relevant Loan was valid (or voidable), the Relevant Drawdown gave rise to a debt which was straightforwardly repaid by automatic operation of law, pursuant to Article 1049(3) [U]CC. (4) If the Relevant Loan was void ab initio, the Relevant Drawdown gave rise to a restitutionary obligation to repay the amount of the drawdown which, again, has been performed. (5) Accordingly, if the Bank had a cause of action in tort in respect of the loss that had been caused by the Relevant Drawdown, that cause of action was extinguished by the repayment because an essential element of the claim under Article 1166 is that the Bank demonstrate a loss, and the loss has been extinguished. (6) If another loan - an Intermediary Loan or New Loan - was advanced in order to repay the Relevant Loan, then the Bank has a cause of action against the Intermediate/New Borrower either (a) in contract; or (b) in restitution if the contract is void or has been avoided. (7) If the Intermediary/New Loan was obtained unlawfully and a third party is to blame, then the Bank may have a claim in tort against that third party for the loss caused by the Intermediary Loan. (8) However, any loss caused to the Bank by the Intermediary/New Loan is different (in the sense of being separate and distinct) from the loss caused to the Bank by the Relevant Loan. (9) The Bank has chosen not to sue for loss caused by the Intermediary/New Loans and has confined its claims to loss caused by the Relevant Loans (which has been extinguished). Accordingly, the Bank’s claim must fail.”
[25]It was also confirmed in counsel for the First Appellant’s oral opening submissions on day 6:
“Our primary defence in relation to this part of the case is the repayment defence, and the essence of that defence is that, to the extent that any loss arose upon making of the relevant drawdown, that loss has been extinguished by the repayment or discharge of the liability of the borrower in respect of the funds drawn down. That extinguishment of the liability took place through … payments, credits via drawdowns from intermediary loans and drawdowns from new loans and also asset transfers.”
[26]Nowhere in either the Defence or the written opening or the oral opening was any mention made of any choice by the Bank to treat the Borrowers’ restitutionary liabilities as discharged. Still less was it suggested that this was a question of fact to be determined at the trial. Nor was any such issue included in the List of Issues for trial.[27]The judge was also entirely correct to say that, as he put it at [1088], the First Appellant’s written closing submissions “made clear that it was no longer Mr Kolomoisky’s case that where the loan was void, repayment automatically extinguished any liability in tort for harm caused by the original transfer”.[28]In support of this, the judge quoted in [1087] a passage from paragraph 51(2) of the written closing submissions which I shall put in context (footnotes omitted): “50. The effect of the repayments is not significantly different on the alternative premise that the Loans are void rather than valid. 51. The key distinction between these scenarios is the following:(1) With a valid loan, the borrower has a contractual liability to repay the loan under Article 1049(1) of the Civil Code. That liability is automatically extinguished when a payment is made into the Borrower’s account, by operation of Article 1049(3) of the Civil Code.(2) With a void loan, the borrower has a restitutionary liability to return the amount of the loan, under Article 216 of the Civil Code. Such a liability is not automatically extinguished by a repayment: instead the creditor can choose whether to account for the payment as a discharge of the restitutionary liability, or of some other liability. It is a question of fact what choice the creditor has made. 52. Crucially, however, void loans are no different from valid loans in the sense that, if the loan monies are repaid and the liability of the borrower is discharged, then any tortious loss is also extinguished.” (1) With a valid loan, the borrower has a contractual liability to repay the loan under Article 1049(1) of the Civil Code. That liability is automatically extinguished when a payment is made into the Borrower’s account, by operation of Article 1049(3) of the Civil Code. (2) With a void loan, the borrower has a restitutionary liability to return the amount of the loan, under Article 216 of the Civil Code. Such a liability is not automatically extinguished by a repayment: instead the creditor can choose whether to account for the payment as a discharge of the restitutionary liability, or of some other liability. It is a question of fact what choice the creditor has made.[29]The judge also quoted in [1089] the following passage from the written closing submissions (footnote omitted):
“84. If the Relevant Loans are void then the effect of Mr Beketov’s evidence is that the Bank has suffered no loss in respect of the Relevant Loans if and to the extent that it has chosen to accept payments as discharging the Relevant Borrower’s liabilities to return the sums drawn down under the Relevant Loans, as opposed to other liabilities in respect of later loans. 85. The key question on this analysis is therefore a factual one, namely whether the Bank has indeed made that choice. The answer to that is self-evidently ‘Yes’ …”
[30]As the judge correctly held, the case advanced in closing submissions was a new and unpleaded case based on a choice having been made by the Bank which the First Appellant himself said gave rise to a factual question.[31]Given that the pleaded case based on automatic extinction was abandoned, that no application to amend to plead the new case based on choice was made and that it is not disputed that the judge was at least entitled to conclude that any such application should be refused as being too late, the Appellants are precluded from contending that the judge should have held that the factual premise for the Repayment Defence was established.[32]Strictly speaking, this makes it unnecessary to consider the Appellants’ second contention, but nevertheless I shall do so. This is based on two submissions. The first is that it had never been disputed that the Bank had chosen to treat the Borrowers’ restitutionary liabilities as discharged. The second is that, in any event, this was established on the evidence.[33]The judge considered the first submission with respect to the Cash Repayments in detail at [1038]-[1050] and rejected it. Among other points, he noted at [1040] that paragraph 27 of the Bank’s Reply pleaded in response to paragraphs 15 and 55C(2) of the First Appellant’s Defence:
“… it is denied that the drawdowns of US$1.91 billion under the Relevant Loans … have been the subject of genuine repayment by way of Cash Repayments after the Relevant Period and before February 2016 or at all. The so-called Cash Repayments identified in Schedule 1 to the D1 Defence were procured by D1 and D2 and caused by and/or made using funds derived from the Intermediary Loans. As such, the purported repayments fall to be disregarded …”

The judge reached the same conclusion in relation to the Asset Transfers at [1162]-[1163].

[35]On the appeal, counsel for the Appellants emphasised that, as is common ground, the Bank’s books contain ledger entries showing the Relevant Drawdowns as having been repaid, a position which remains unchanged since nationalisation. Furthermore, it had never been suggested that the Bank had applied the credits to discharging other liabilities of the Borrowers. As the judge recognised, however, that is not sufficient to show that the Bank made a choice to treat the Borrowers’ restitutionary liabilities as discharged. That was a question which depended on evidence as to the Bank’s decision making, and not merely ledger entries.[36]As for the second submission, counsel for the Appellants relied upon a passage from the cross-examination of Sergiy Oleksiyenko, a member of the Bank’s Supervisory Board since nationalisation, as demonstrating that the Bank had indeed chosen, after nationalisation, to treat the Borrowers’ restitutionary liabilities as discharged by the repayments. The problem with this submission is that the judge quoted the relevant passage at [1103] and [1112] and considered it together with a number of other pieces of evidence at [1096]-[1123]. He concluded at [1123]:
“… even if it had been appropriate to permit the Defendants to advance an unpleaded case on free choice at this stage, I am satisfied that they have not proved that anything done by the Bank post-nationalisation amounted to a choice by the Bank to accept payments as discharging the Borrowers’ liabilities to return the sums drawn down under the Relevant Loans, so as to preclude it from continuing to allege that it suffered the loss claimed in these proceedings. I therefore conclude that, in so far as it relies on what were called the Cash Repayments, the Defendants’ Repayment Defence fails.”
[37]The Appellants’ reliance upon the evidence of Mr Oleksiyenko is a classic example of island-hopping when the judge had regard to a broader canvas of evidence. No serious attempt was made to show that the judge’s conclusion in [1123] was rationally insupportable.[38]That conclusion concerned the Cash Repayments. So far as the Asset Transfers are concerned, the judge reached the same conclusion at [1173]-[1174]. Again, no serious attempt was made to show that it was rationally unsupportable.

Ground 1: Ukrainian law

[39]Since I have rejected ground 2, it is unnecessary to consider ground 1. I will therefore confine myself to saying that I am not persuaded that this Court would be justified in interfering with the judge’s finding given that:(i) Ukrainian law is a civil law system which is quite different law to common law systems, meaning that the judge’s finding was close to a pure finding of fact;(ii) it is common ground that no Ukrainian court has ever decided the issue which divides the parties, and thus the issue is what the apex Ukrainian court would decide if confronted with the issue;(iii) the judge had the advantage of seeing the experts cross-examined on a range of issues for a substantial period of time;(iv) the judge found Mr Beketov to be a reliable expert, whereas he found Mr Alyoshin’s evidence to be unsatisfactory in a number of respects; and(v) counsel for the Appellants accepted during the course of argument that the judge’s finding is supported by his analysis of Mr Beketov’s evidence, but submitted that this Court should nevertheless conclude that it was wrong, a submission which only has to be stated for it to be revealed as an ambitious one.

Conclusion

[40]For the reasons given above I would dismiss the appeal.[41]I agree.

Sir Launcelot Henderson:

[42]I also agree.