“28 I cannot recall the precise content of the above calls, but by30 September 2019 we had agreed on the repayment plan, because the repayment plan has already been referred to on30 September 2019 . The general restructuring plan would be as follows: a. Integral would propose a payment schedule, which would provide for extended payment terms. The parties would discuss and agree this schedule. Integral would pay interest when it took it longer to repay the amounts advanced by GPB. b. The schedule would be such as to enable Integral, in its reasonable assessment, to take delivery of cargoes under current (i.e. non-expired) contracts, sell them and repay GPB. Alternatively, if it were not possible to repay GPB from those sources, enable Integral to make profit elsewhere (i.e. on transactions not financed by GPB) and repay GPB from those sources. c. There would then be the issue of the expired contracts, in respect of which GPB's financing was effectively blocked with producers. Here the parties envisaged that GPB could provide additional financing such that (i) Integral or its suppliers could conclude new contracts with producers (which required upfront payments); and (ii) funds blocked with the expired contract could then be transferred to those new contracts and utilised for the lifting of new cargoes. d. GPB's position was that it would not be able to provide any such additional financing until a formal restructuring were agreed by its credit committee in Moscow. Mr Derkatch also said that such a formal restructuring would later be needed to protect his own back, since GPB Luxembourg is effectively overseen and/or controlled by GPB Moscow. Hence the terms of the formal restructuring had to be negotiated and submitted to the credit committee in Moscow. This was, in my understanding, separate from our agreement on the extended payment terms.” [Emphasis added]
"I'll tell you the payment plan in an hour"
“12. In order for GPB to agree a restructuring of Integral's overdue debt, Integral, among other important elements, needed to demonstrate its ability to repay its debt and therefore that it would be in a position to enter a restructuring if that could be agreed (as opposed to a debt enforcement process)…” 13. One way that GPB expected this ability to make repayment to be shown was by Integral making repayments in accordance with interim repayment schedules that were exchanged between the parties on various occasions. Integral was told of this expectation by me and by others at GPB. This is why, in my communications with Mr Seitnepesov, I referred to the repayment schedules in connection with payments GPB expected to receive from Integral. It was very clear to Integral that this was the purpose for it complying with the interim repayment schedules. It was also very clear to Integral that the repayment schedules did not constitute an agreement on new terms for the repayment of the loans.” [Emphasis added]
"Alexander Zalivako explained in detail the importance for the Bank to have a confirmation of the cooperativeness of IPSA by obtaining a signed letter of Acknowledgment of Debt and Reservation of Rights without any kind of additional conditions as per the e-mail received on 06-11-2019 from Gavriil Vatnik with MS in copy. After a detailed explanation of the meaning of the above document MS agreed to remove all conditions related to the letter of Acknowledgment of Debt and Reservation of Rights by sending the relevant e-mail confirmation. MS informed that he would receive the signatures of the Guarantors to this document as well as soon as practically feasible." [Emphasis added]
“66 Mr Zalivako repeats that the signing of an Acknowledgment letter was a condition to continuing the negotiations. This is however not what was said at the7 November 2019 meeting in Luxembourg. It may have been necessary for the Moscow credit committee (and according to Mr Zalivako was a mere formality) but, quite separately from that letter, agreements on extended payment terms were reached both before that letter and after it. [Emphasis added]”
“Following the meeting on 7 November, there were detailed and on-going discussions between Integral and GPB on restructuring the debt under the Facility Letter. Suffice it to say that GPB never received all the information it was seeking from Integral, including confirmations that the assets financed by GPB remained available as security for GPB loans and as to how and within what time frames Integral would be able to restructure its contracts with the Turkmenistan Producers and start lifting commodities purchased with the loans of GPB. Therefore, GPB never got to the stage of being able to consider, let alone to agree, the terms of any restructuring agreement (e.g. those set out in Stage 2 of the 20 September Term Sheet).”
"Between20 November 2019 and11 March 2020 , Integral and GPB exchanged various versions of repayment schedules on at least 8 occasions."
“The draft repayment schedules that were exchanged between the parties were to be used as one element of Integral demonstrating this. If Integral were to make payments in accordance with the draft schedules while the due diligence was being carried out, this evidence would assist in showing Integral's ability to repay and would be provided in support of any application to the relevant committees of GPB and GPB Moscow for approval of a restructuring.” [Emphasis added]
“50. In relation to the agreed payment schedule, Mr Derkatch said this: We agreed the schedule with you based on your own forecast of sales. We said, great!” 51. He also insisted that Integral provide certain documents, as discussed above. To this I said: "There is no deadline [for the documents] because nothing is (was) signed. It was just a conceptual arrangement". To this Mr Derkatch responded: "Yes, but in order to make this arrangement… Wait, this is the basis of our agreement. Not just a conceptual one but based on your own understanding". When I referred to the "conceptual agreement" and "deadline" I believe that was in relation to the documents that GPB had asked Integral to provide, not to payments. We did not agree (not to my recollection) to any deadlines for provision of documents. I do not recall ever having challenged at that time Integral's obligation to make payments in accordance with the agreed payment schedules.” [Emphasis added]
“Mr Seitnepesov acknowledged that the draft repayment schedules did not affect the parties’ legal obligations but set out his understanding, consistently with what GPB had been saying to him, that payments by Integral in accordance with the draft repayment plans would improve the prospects of a restructuring taking place. In particular, Mr Seitnepesov said that: i. “In preparation for this restructuring process, we are doing certain actions. From our side, the most important thing we can do is to pay the money.” (page 4 of the transcript). ii. “There is no deadline [for repayment of the loans] because nothing is signed. It was just a conceptual arrangement.” (page 5 of the transcript)”
“As to paragraph 46, Mr Zalivako takes the5 February 2020 call and the statements made during that call out of context. The discussion about the restructuring which “hasn’t happened yet” is in relation to the formal restructuring which had to be approved by Moscow (according to Mr Zalivako). Later on the same page of the transcript, Mr Derkatch says that the agreement in relation to the extended schedule and documents was “an agreement” and “not just a conceptual one”
“When, on that call, I referred to schedules having been "agreed" with Integral, I was referring to an agreement in the limited sense of GPB and Integral "agreeing" that it was necessary for Integral to demonstrate that it could comply with the interim repayment schedules in order to improve the prospects of GPB agreeing to extend the terms of Integral's loans as part of a restructuring of Integral's debt. This is because evidence of such repayments would need to be provided in support of an application to the various committees of GPB and GPB Moscow for approval of any restructuring proposal. Unless GPB's collective management bodies were satisfied of Integral's ability to repay, they would not grant such approval and therefore no restructuring could take place. I made this comment in the context of Mr Seitnepesov saying that there was no deadline for payment by Integral because nothing had been signed and that a restructuring had not been agreed.” [Emphasis added]
“The court may give summary judgment against a claimant or defendant on the whole of a claim or on a particular issue if- (a) it considers that- (i) that claimant has no real prospect of succeeding on the claim or issue; or (ii) that defendant has no real prospect of successfully defending the claim or issue; and (b) there is no other compelling reason why the case or issue should be disposed of at a trial.”
“i) The court must consider whether the claimant has a "realistic" as opposed to a "fanciful" prospect of success: Swain v Hillman[2001] 2 All ER 91 ; ii) A "realistic" claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel[2003] EWCA Civ 472 at [8]; iii) In reaching its conclusion the court must not conduct a "mini-trial": Swain v Hillman; iv) This does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel at [10]; v) However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5)[2001] EWCA Civ 550 ; vi) Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd[2007] FSR 63 ; vii) On the other hand it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. The reason is quite simple: if the respondent's case is bad in law, he will in truth have no real prospect of succeeding on his claim or successfully defending the claim against him, as the case may be. Similarly, if the applicant's case is bad in law, the sooner that is determined, the better. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd[2007] EWCA Civ 725 .”
“In my judgement, a defendant is not entitled to resist an application for summary judgement merely because it raises a set-off or counterclaim. The court must still enquire into the nature of such a set-off or counterclaim and consider whether the defendant has established that it has a reasonable prospect of successfully defending the claim or issue.”
"No final agreement on a repayment schedule was ever reached, with the parties exchanging various copies throughout the course of their restructuring negotiations."
"… as Mr Derkatch says at paragraph 7 of his witness statement, he read my second witness statement and agreed with my evidence. In addition, Mr Derkatch has read Seitnepesov 1 and this statement in its final form. He has confirmed to me that: (i) he agrees with everything that I say in this statement and (ii) he maintains everything that he said in his first statement"
“I cannot recall the precise content of the above calls, but by30 September 2019 we had agreed on the repayment plan, because the repayment plan has already been referred to on30 September 2019 ”
"we got the plan, we need clarifications/details. Rustam and I plan to be in Geneva tomorrow or the day after tomorrow. I need a meeting with you. Can you do it?"
“I exhibit at [DD1/2-19] a copy of all WhatsApp messages that Mr Seitnepesov and I exchanged during October – November 2019 and an English translation of those messages. I confirm that I have reviewed this translation and I consider it is accurate. Aside from the above communication and the emails between other individuals at GPB and persons at Integral (into which I was copied), there were no other electronic or written communications between me and Mr Seitnepesov.”
"Restructuring is discussed only if IPSA meets the repayment schedule." [Emphasis added]
"ANDREY [Mazurin, Head of the Risk Management Department]: Murat, the thing is that if we take this Schedule to the Credit Committee, and then later the schedule won't be adhered to, we will run out of arguments. We need a realistic schedule. MURAT [Seitnepesov]: Yes, I understand. Let's do the following. Since this topic has taken already too long - we were planning for August, and it's been two months since then already. We are in different circumstances now, and the schedule needs to be updated, of course. I am in long-distance business trips until Monday, and it is quite inconvenient to manage all these things from here - it's always something missing here, either internet connection, or telephone, or something else. Therefore, probably, next week Tuesday or Wednesday we will run an internal session to discuss the update. In the meantime, Gavriil will work on drafting the new schedule, and we will deliver a new schedule, having taken into account all current realities, and not the ones that existed in August. Surely, there will be certain slip-offs in terms of deadlines, and I think that you should take the new updated schedule to the Credit Committee to be approved, and we will make every effort to adhere to it… RUSTAM: Do you think they'll arrive this month? MURAT: Well, we are expecting. Something will definitely arrive. The question is how much. DMITRY [Derkatch]: This is exactly the question here, Murat, because we rely on the Integral's statement - on your personal statements, which are not fulfilled later on. We are also unable to assess what the reasons of such unfulfillment are. I mean, why this happens - is it due to delayed shipments? What's the matter? MURAT: Yes, yes, the delay in shipments. DMITRY: It is only natural that this complicates our negotiations a lot, because as I've said you before, that restructuring can be discussed as an idea, in case the parties clearly fulfil their repayment obligations based on schedules. Constantly updated schedules are not a good thing here…"
"In paragraph 32 Mr Zalivako speculates on things about which he claims I should have been aware as at23 October 2019 . He says there was no agreement on any extended payments terms - this is wrong as discussed above. There was already an agreement by then and Mr Derkatch was chasing that I comply with that agreement. Mr Zalivako says that I do not mention any agreement to Mr Derkatch on the call - but Mr Derkatch himself mentions payments "under the existing agreements"
“In paragraph 41 Mr Zalivako says that 8 versions of the payment schedules in total were exchanged between the parties, but no agreement on a repayment schedule was reached. Again, this is incorrect. The payment schedules had to be updated for the reasons discussed above. However each relevant schedule was agreed, except for the latest ones proposed by Integral following GPB's attacks on Integral. Mr Derkatch chased me for payments under those schedules (which he called "existing agreements"), he then confirmed (and was happy) that the schedules have been fulfilled for 2019 and the beginning of 2020.”
"It was agreed that a working group of GPBL shall visit the office of IPSA on 19-21 November 2019 to discuss in detail the current status of each transaction financed by GPBL. As a result of this visit a detailed action plan shall be elaborated in a written form, allowing GPBL to formalize forbearance measures in according with the applicable regulatory requirements." [Emphasis added]
“…In 2019 there were delays at the producing facilities in Turkmenistan, as a result of which Integral was late in repaying GPB’s financing. GPB and Integral orally agreed to restructure the debt / extend payment terms, but then GPB demanded that it put its own director on Integral’s board who would have veto powers over all of Integral’s decisions and be copied on all of Integral’s correspondence with its relevant counterparties. GPB also demanded that Integral sign an acknowledgment of debt prior to any restructuring being agreed. Upon being promised a restructuring later, Integral signed the acknowledgment.” [Emphasis added]
“26. Integral was not in a position to repay some of the financing provided by GPB maturing in September 2019 and onwards. In the spring/summer of 2019 there were delays/stoppages at the Turkmen production facilities as a result of which Integral did not receive the cargoes financed under the Facility from the Turkmen state entities on time. 27. Since this was not an issue of Integral’s creditworthiness, but merely one of operational delays beyond Integral’s control, the parties entered into negotiations with a view to agreeing a restructuring and extending the repayment terms. As at September-October 2019, when the delays started, the total amount of financing provided by GPB to Integral wasUS$24,662,178.70 . A general agreement was reached between Mr Derkatch (CEO and Chairman of the board of GPB) and Mr Seitnepesov to the effect that Integral's payment terms would be extended and GPB would provide financing for Integral's other trades and would otherwise facilitate Integral's business.” [Emphasis added]
“30. …The allegation of a "general agreement" between Mr. Derkatch and Mr. Seitnepesov is vague, not understood and too unparticularised for GPB to plead fully in response, but in any event denied. After20 June 2019 , GPB never concluded any agreement with Integral for any extension to the maturity dates of Integral's loans.”
“22. …Over a series of conversations up to and during October to November 2019, Mr Derkatch on behalf of GPB and Mr Seitnepesov orally agreed that mutually acceptable terms for restructuring would be agreed if Mr Seitnepesov signed the Acknowledgment Letter. These terms included that: (i) there would be an extension of term to repay over 18 months, and (ii) thus Integral would not be in default as of October/November 2019. After the Acknowledgement Letter was signed, the repayment schedule that had been exchanged between Integral and GPB was confirmed, and for that very reason, Integral started making payments to GPB.”
“…However, as set out at paragraphs 35.2, 36 and 39.2 below, no agreement with GPB was concluded in connection with the restructuring of the repayment of Integral’s debt.”
“… 12.2. It is admitted that Integral made payments to GPB after7 November 2019 . These were made in accordance with the oral agreement reached between Mr Seitnepesov and Mr Derkatch, and also in accordance with ongoing communications between Mr Derkatch and Mr Seitnepesov as to when payments could be made. 12.3. It is denied that no agreement was concluded in connected with the debt restructuring. An agreement was reached between Mr Seitnepesov and Mr Derkatch. This is corroborated by: (i) WhatsApp correspondence where the individuals discussed monthly payments between Integral and GPB, and (ii) the fact that between November 2019 and April 2020, Integral repaid to GPB a total of USD 3,244,010.06. These payments were not made randomly.” [Emphasis added]
“The oral agreement was reached over time before Mr Seitnepesov signed the Acknowledgement Letter and is confirmed by WhatsApp correspondence between Mr Derkatch and Mr Seitnepesov (provided in the Claimants' Initial Disclosure List of Documents), and by repayment schedules and restructuring proposals that were exchanged between GPB and Integral on20 September 2019 and15 October 2019 and around the time when the Acknowledgement Letter was signed. …” [Emphasis added]
"27. During this meeting [on 7 November] Mr Derkatch and Mr Predtechensky insisted that the Acknowledgment was a mere formality and that they needed the document in order to run the official request for restructuring past their colleagues in Moscow and extend the payment terms. They said that it was important for them to know that the borrower (i.e. Integral) is cooperative and is not refusing to repay GPB. Subject to that, they would be happy to offer extended payment terms. 28. If payment terms were extended than Integral would no longer be in default and, on the basis of GPB's assurances, I agreed the acknowledgment and provided a personal guarantee for amounts covered in the acknowledgment on7 November 2019 . 29. I proposed that a solution could have been for the amounts financed by GPB to be repaid within approximately 24 months, regardless of the delays with the contracts financed by GPB. This could be achieved even if we only paid GPB from the profits we made on transactions not financed by GPB. 30. Mr Derkatch, CEO of GPB, said they were fine with this solution in general, and while it was being finalised Integral should keep paying what it could. He also said that GPB would be satisfied with an 18-months extension (instead of the 24 months I proposed initially)."
“I must say, if I take the Professor’s reports at face value, I believe they can be read in the manner proposed by Mr Silverleaf. Indeed, I am not at all sure that Professor Oswald’s explanation in his fifth report really faces up to the true scope of his evidence in the third and fourth reports. However, what I am sure about is that I cannot say on this application, on the summary basis and without having heard the Professor in the witness box, that his evidence lacks all credibility. No matter how much I may doubt that the Professor has faced up to the problems with his evidence I am quite satisfied that it would not be right for me to rule on a summary application that his evidence is so doubtful as to lack all credibility. For that reason I will not accede to the defendants’ application.”
“In August 2019, at Integral’s request, Integral and GPB began to discuss the possibility of agreeing a restructuring of Integral’s debt...”
"any term of the Finance Documents may be amended or waived with the agreement of the Borrower and Lender in writing."
"As to paragraph 57(a), I do not agree that the extended payment schedules were not in writing. They were in excel spreadsheets. The oral agreements between me and Mr Derkatch are recorded/mentioned in GPB's own telephone transcripts and in WhatsApp chats"
“16. The enforcement of No Oral Modification clauses carries with it the risk that a party may act on the contract as varied, for example by performing it, and then find itself unable to enforce it. It will be recalled that both the Vienna Convention and the UNIDROIT model code qualify the principle that effect is given to No Oral Modification clauses, by stating that a party may be precluded by his conduct from relying on such a provision to the extent that the other party has relied (or reasonably relied) on that conduct. In some legal systems this result would follow from the concepts of contractual good faith or abuse of rights. In England, the safeguard against injustice lies in the various doctrines of estoppel. This is not the place to explore the circumstances in which a person can be estopped from relying on a contractual provision laying down conditions for the formal validity of a variation. The courts below rightly held that the minimal steps taken by Rock Advertising were not enough to support any estoppel defences. I would merely point out that the scope of estoppel cannot be so broad as to destroy the whole advantage of certainty for which the parties stipulated when they agreed upon terms including the No Oral Modification clause. At the very least, (i) there would have to be some words or conduct unequivocally representing that the variation was valid notwithstanding its informality; and (ii) something more would be required for this purpose than the informal promise itself: see Actionstrength Ltd v International Glass Engineering In Gl En SpA[2003] 2 AC 541 , paras 9 (Lord Bingham), 51 (Lord Walker)." [Emphasis added]”
"18. That makes it unnecessary to deal with consideration. It is also, I think, undesirable to do so. The issue is a difficult one. The only consideration which MWB can be said to have been given for accepting a less advantageous schedule of payments was (i) the prospect that the payments were more likely to be made if they were loaded onto the back end of the contract term, and (ii) the fact that MWB would be less likely to have the premises left vacant on its hands while it sought a new licensee. These were both expectations of practical value, but neither was a contractual entitlement. In Williams v Roffey Bros & Nicholls (Contractors) Ltd [1991]1 QB 1 the Court of Appeal held that an expectation of commercial advantage was good consideration. The problem about this was that practical expectation of benefit was the very thing which the House of Lords held not to be adequate consideration in Foakes v Beer(1884) 9 App Cas 605 : see, in particular, p 622, per Lord Blackburn. There are arguable points of distinction, although the arguments are somewhat forced. A differently constituted Court of Appeal made these points in In re Selectmove Ltd[1995] 1 WLR 474 , and declined to follow Williams v Roffey Bros &Nicholls (Contractors) Ltd. The reality is that any decision on this point is likely to involve a re-examination of the decision in Foakes v Beer. It is probably ripe for re-examination. But if it is to be overruled or its effect substantially modified, it should be before an enlarged panel of the court and in a case where the decision would be more than obiter dictum." [Emphasis added]
"Integral would pay interest when it took it longer to repay the amounts advanced by GPB."
"it depends not upon their subjective state of mind but upon a consideration of what was communicated between them by words or conduct, and whether that leads objectively to a conclusion that they intended to create legal relations and had agreed upon all the terms which they regarded or the law requires as essential for the formation of legally binding relations."