“1. The Seller is a direct or indirect legal and beneficial owner of shares and interests in the companies (the “Companies”) set out in Schedule 1 to this Agreement (the “Shares”). 2. The Seller hereby agrees that it shall sell and transfer to the Buyer (or any other company nominated by the Buyer), all of the Shares in the Companies set out in Schedule 1, and the Buyer shall accept the Shares and pay the Purchase Price (as defined below) for them.”
“4. The Seller shall transfer 100% of the Shares in the Companies and the title therein to the Buyer no later than31 May 2010 . The transfer of Shares in the Companies (direct or indirect) shall be performed through an escrow agent against payment by the Buyer of the Second Payment. Simultaneously with the transfer of the Shares in the Companies the Buyer shall pledge the Shares in the Companies for the benefit of the Seller pending receipt by the Seller of the full Purchase Price pursuant to Clause 3 above. The details of the pledge shall be agreed by the Parties in the Restated Agreement (as defined below).”
“5.1 the Shares in the Companies are legally owned (directly or indirectly) by the Seller or will be so owned at the time of their transfer to the Buyer, and all such Shares shall be unencumbered with any pledge, encumbrance, pre-emption rights, claims or actions of any third parties, including business partners of the Seller;”
“6. The Parties shall, on or before20 May 2010 , in good faith agree and sign the now complete version of the sale and purchase agreement in respect of the Shares (the “Restated Agreement”), as well as other documents referenced in this Agreement. Pending signing of the Restated Agreement the current Agreement shall to the fullest extent regulate the obligations of the Seller and Buyer. Subject to Clause [9] below, failure to sign the Restated Agreement shall not affect the validity of this Agreement and obligations of the Parties hereunder. …”
“9. In the event … (2) the Seller avoids signing of the Restated Agreement within the term set out in Clause 6 of this Agreement, then the Buyer shall become entitled to unilaterally terminate this Agreement without any liability on its part or any penalties due, as well as to claim back and return any and all amounts paid by it to the Seller before termination date. 10. In the event of unilateral refusal by the Seller to enter into the Restated Agreement with the Buyer or perform the Seller’s obligations under this Agreement and/or Restated Agreement, the Seller shall, within ten (10) calendar days of receipt of written demand of the Buyer, return to the Buyer everything received under the terms of this transaction, as well as pay a fine of US$50,000,000 (fifty million) US Dollars.”
“Finally, at around 11 am on18 May 2010 , Igor Shifrin called me. He assured me that Midland was busy working on the SPA and checking that they would be able to give Luxe the warranties requested by it in the 14 May draft of the Restated Agreement. He also said that A&O were finalising the Restated Agreement and they would send it to me before 2 pm on19 May 2010 .”
“We hereby give you notice that Midland will not be able to agree and sign the Restated Agreement with Luxe on or before20 May 2010 as was contemplated by Clause 6 of the Agreement. Accordingly, and as contemplated by Clause 10 of the agreement, we have made the following payments to your account (SWIFT confirmations enclosed):”
“We kindly ask you to confirm the receipt of funds and that the return of the Advance Payment and the payment of the Fine shall be in full and final settlement of any and all obligations and/or liabilities of Midland under the agreement.”
“Our client is concerned that you intend to sell the Companies to another buyer. Kindly confirm (1) that you remain the owner of the Shares in the Companies (as represented and warranted in Clause 5.1 of the SPA) and (2) that you will not take steps to sell to another party or otherwise to deal with the shares in the Companies so as to obstruct or prevent a sale to Luxe. Our client reserves the right to seek injunctive relieve against you in the event that you do not provide satisfactory confirmation. In that regard, please nominate solicitors in London to accept service of such proceedings on your behalf.”
“We understand that, despite having given us less than a day to consider and reply to your letter, you have now written directly to Midland, threatening it with a potential injunction. It appears that your client's belief that it may be entitled to an injunction rests on two assertions made in your letter to Midland, being, in summary: i. That Midland is “not entitled” to terminate the SPA between our respective clients of4 May 2010 ; and ii. The two payments of$50 million each which Midland has made to Luxe pursuant to clause 10 of the SPA “are of no legal effect”
“We write to inform you that Midland has sold its interest in the Companies to which you refer to third parties.”
“I was present with A&O throughout these meetings which were almost non-stop.”
“On his behalf Mr. Millett has urged that although the relief which he is seeking is unusual, one has to go back to first principles, and if one goes back to first principles there is really no difficulty in the matter. He says that it is one of the standing doctrines of the court that upon a contract for the transfer of property being entered into the vendor or intending transferor becomes a trustee for the purchaser or transferee. Admittedly, it is a qualified trusteeship. It does not have all the usual incidence of a bare trusteeship for a cestui que trust, and of course the most glaring and obvious departure from such normal incidence is that the trustee has his own interest, in the shape of the receipt of the purchase money, to protect. Of course he has a lien on the property until he has been paid his purchase money in the normal course of events. But, says Mr. Millett, as to the basic relationship in regard to the land contracted to be sold or transferred, no matter what may be the case in relation to other collateral matters, such as moneys paid under a contract of insurance or receipts under derequisitioning procedures, there is no doubt at all that the property itself is held as by a trustee. That being the case, he says, if in fact before the contract comes to be completed the vendor wrongfully - as is the allegation here-sells the property then the purchaser is entitled, if he is so minded, to say that what has happened is that the vendor has sold trust property, and he is entitled under those circumstances to follow the trust property and say when it comes to the final performance of the contract that he will take the proceeds of sale instead of the property.”
“Authority appears to be silent on this save for one case which the industry of Mr. Millett has unearthed, a decision of Lord Eldon LC in Daniels v. Davison (1809) 16 Ves. Jun. 249. I can go straight away to the passage in the judgment of Lord Eldon LC on this point where he says, at p. 254: “My judgment on that point”- after dealing with other points in the case - "lays out of consideration the question, whether, taking Cole not to be affected with notice, Davison, the vendor, is to be considered in equity as holding the money, derived from the second purchase, viz. the difference between the prices, in trust for the person, to whom he had first agreed to sell the estate. The estate by the first contract becoming the property of the vendee, the effect is, that the vendor was seised as a trustee for him; and the question then would be, whether the vendor should be permitted to sell for his own advantage the estate, of which he was so seised in trust; or should not be considered as selling it for the benefit of that person, for whom by the first agreement he became trustee; and therefore liable to account. It is not however necessary to decide that point; . . .”
“Once one has undertaken the role of trustee then it is a role which, unless discharged by some external circumstance, one must carry out to the bitter end if so required by the other party to the contract. The vendor cannot be heard to say that because of her wrongful act in reselling the property she never was a trustee. She remained a trustee right down to the moment of resale, and accordingly is bound to hold the purchase price as trust property to transfer to the purchaser upon the purchaser completing the obligations on the purchaser’s part.” “My judgment on that point”- after dealing with other points in the case - "lays out of consideration the question, whether, taking Cole not to be affected with notice, Davison, the vendor, is to be considered in equity as holding the money, derived from the second purchase, viz. the difference between the prices, in trust for the person, to whom he had first agreed to sell the estate. The estate by the first contract becoming the property of the vendee, the effect is, that the vendor was seised as a trustee for him; and the question then would be, whether the vendor should be permitted to sell for his own advantage the estate, of which he was so seised in trust; or should not be considered as selling it for the benefit of that person, for whom by the first agreement he became trustee; and therefore liable to account. It is not however necessary to decide that point; . . .” “Daniels v. Davison shews that after a contract for the sale of an estate, if the vendor sells to another person for valuable consideration he is accountable for the money as a trust.”
“For centuries the Court of Chancery has, by virtue of its jurisdiction in personam, applied against parties to a contract or trust relating to foreign land the principles of English law, although the lex situs did not recognize such principles. The judgment of Lord Alvanley in Lord Cranstown v. Johnston asserts this in very strong language: “With regard to any contract made or equity between persons in this country respecting lands in a foreign country, particularly in the British Dominions, this Court will hold the same jurisdiction, as if they were situated in England.”
“The fact that a dispute relates to foreign land or involves interests in foreign land, which a court of equity in this country recognises, but the courts of the foreign land would not, has never been a bar to the English court exercising jurisdiction over a person amenable to the jurisdiction, for example by being present in England. As was stated by the Earl of Selborne LC in Ewing v Orr Ewing (1883) LR 9 HL 34 at page 40: ‘The Courts of Equity in England are, and have always been, courts of conscience, operating in personam and not in rem; and in the exercise of this personal jurisdiction they have always been accustomed to compel the performance of contracts and trusts as to subjects which were not either locally or ratione domicili within their jurisdiction. They have done so as to land, in Scotland, in Ireland, in the Colonies, in foreign countries: Penn v Baltimore 1 Ves Sen 444.’ In Deschamps v Miller[1908] 1 Ch 856 at page 863, Parker J described the obligation which the Court will enforce as depending: ‘… on the existence between the parties to the suit of some personal obligation arising out of contract or implied contract, fiduciary relationship or fraud, or other conduct which, in a view of the Court of Equity in this country, would be unconscionable, and do not depend for their existence on the law of the locus of the immovable property.’” ‘The Courts of Equity in England are, and have always been, courts of conscience, operating in personam and not in rem; and in the exercise of this personal jurisdiction they have always been accustomed to compel the performance of contracts and trusts as to subjects which were not either locally or ratione domicili within their jurisdiction. They have done so as to land, in Scotland, in Ireland, in the Colonies, in foreign countries: Penn v Baltimore 1 Ves Sen 444.’ ‘… on the existence between the parties to the suit of some personal obligation arising out of contract or implied contract, fiduciary relationship or fraud, or other conduct which, in a view of the Court of Equity in this country, would be unconscionable, and do not depend for their existence on the law of the locus of the immovable property.’”
“If A provides money to B, both being resident in England, to purchase landed property in his own name but for and on A's behalf, and B does so, the consequences of that transaction are governed by English law. It would be absurd if they were governed by the law of the place where the property in question happened to be located. Such a rule would lead to bizarre results if, for example, A's instructions were to buy properties in more than one jurisdiction, for the consequences of the same arrangement might then be different in relation to the different properties acquired. It would also lead to bizarre results if A left it to B's discretion to choose the property to be acquired, since that would give B the unilateral power to decide on the legal consequences of the transaction which he had entered into with A.”
“There is a light sprinkling of cases where courts have made orders having the same effect as an order for an account of profits, but the courts seem always to have attached a different label. A person who, in breach of contract, sells land twice over must surrender his profits on the second sale to the original buyer. Since courts regularly make orders for the specific performance of contracts for the sale of land, a seller of land is, to an extent, regarded as holding the land on trust for the buyer: Lake v Bayliss[1974] 1 WLR 1073 . In Reid-Newfoundland Co v Anglo-American Telegraph Co Ltd[1912] AC 555 a railway company agreed not to transmit any commercial messages over a particular telegraph wire except for the benefit and account of the telegraph company. The Privy Council held that the railway company was liable to account as a trustee for the profits it wrongfully made from its use of the wire for commercial purposes. In British Motor Trade Association v Gilbert[1951] 2 All ER 641 the plaintiff suffered no financial loss but the award of damages for breach of contract effectively stripped the wrongdoer of the profit he had made from his wrongful venture into the black market for new cars. These cases illustrate that circumstances do arise when the just response to a breach of contract is that the wrongdoer should not be permitted to retain any profit from the breach. In these cases the courts have reached the desired result by straining existing concepts. Professor Peter Birks has deplored the "failure of jurisprudence when the law is forced into this kind of abusive instrumentalism"; see "Profits of Breach of Contract" (1993) 109 LQR 518, 520. Some years ago Professor Dawson suggested there is no inherent reason why the technique of equity courts in land contracts should not be more widely employed, not by granting remedies as the by-product of a phantom "trust" created by the contract, but as an alternative form of money judgment remedy. That well known ailment of lawyers, a hardening of the categories, ought not to be an obstacle: see "Restitution or Damages" (1959) 20 Ohio SLJ 175. My conclusion is that there seems to be no reason, in principle, why the court must in all circumstances rule out an account of profits as a remedy for breach of contract. I prefer to avoid the unhappy expression "restitutionary damages". Remedies are the law's response to a wrong (or, more precisely, to a cause of action). When, exceptionally, a just response to a breach of contract so requires, the court should be able to grant the discretionary remedy of requiring a defendant to account to the plaintiff for the benefits he has received from his breach of contract. In the same way as a plaintiff's interest in performance of a contract may render it just and equitable for the court to make an order for specific performance or grant an injunction, so the plaintiff's interest in performance may make it just and equitable that the defendant should retain no benefit from his breach of contract. The state of the authorities encourages me to reach this conclusion, rather than the reverse. The law recognises that damages are not always a sufficient remedy for breach of contract. This is the foundation of the court's jurisdiction to grant the remedies of specific performance and injunction. Even when awarding damages, the law does not adhere slavishly to the concept of compensation for financially measurable loss. When the circumstances require, damages are measured by reference to the benefit obtained by the wrongdoer. This applies to interference with property rights. Recently, the like approach has been adopted to breach of contract. Further, in certain circumstances an account of profits is ordered in preference to an award of damages. Sometimes the injured party is given the choice: either compensatory damages or an account of the wrongdoer's profits. Breach of confidence is an instance of this. If confidential information is wrongfully divulged in breach of a non-disclosure agreement, it would be nothing short of sophistry to say that an account of profits may be ordered in respect of the equitable wrong but not in respect of the breach of contract which governs the relationship between the parties. With the established authorities going thus far, I consider it would be only a modest step for the law to recognise openly that, exceptionally, an account of profits may be the most appropriate remedy for breach of contract. It is not as though this step would contradict some recognised principle applied consistently throughout the law to the grant or withholding of the remedy of an account of profits. No such principle is discernible. The main argument against the availability of an account of profits as a remedy for breach of contract is that the circumstances where this remedy may be granted will be uncertain. This will have an unsettling effect on commercial contracts where certainty is important. I do not think these fears are well founded. I see no reason why, in practice, the availability of the remedy of an account of profits need disturb settled expectations in the commercial or consumer world. An account of profits will be appropriate only in exceptional circumstances. Normally the remedies of damages, specific performance and injunction, coupled with the characterisation of some contractual obligations as fiduciary, will provide an adequate response to a breach of contract. It will be only in exceptional cases, where those remedies are inadequate, that any question of accounting for profits will arise. No fixed rules can be prescribed. The court will have regard to all the circumstances, including the subject matter of the contract, the purpose of the contractual provision which has been breached, the circumstances in which the breach occurred, the consequences of the breach and the circumstances in which relief is being sought. A useful general guide, although not exhaustive, is whether the plaintiff had a legitimate interest in preventing the defendant’s profit-making activity and, hence, in depriving him of his profit. It would be difficult, and unwise, to attempt to be more specific.”
“I must also sound a further note of warning that if some more extensive principle of awarding non-compensatory damages for breach of contract is to be introduced into our commercial law the consequences will be very far reaching and disruptive. I do not believe that such is the intention of your Lordships but if others are tempted to try to extend the decision of the present exceptional case to commercial situations so as to introduce restitutionary rights beyond those presently recognised by the law of restitution, such a step will require very careful consideration before it is acceded to.”
“This was because the shareholders were undecided whether the asset should become part of the Metinvest Group, on-sold to a third party at some point, or, possibly, contributed into joint venture with other potential buyers interested in the [Z] Group.”
“… if there is a good arguable case that the defendant has acted fraudulently or dishonestly (eg being implicated in an ingenious scheme for misappropriation of funds belonging to the claimant), or with an unacceptably low standard of commercial morality giving rise to a feeling of uneasiness about the defendant, then it is often unnecessary for there to be any further specific evidence of risk of dissipation for the court to be entitled to take the view that there is a sufficient risk to justify granting Mareva relief.”