Home Information Cases Joint Stock Co “Aeroflot - Russian Airlines” v Berezovskaya & Anor (2014)

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Joint Stock Co “Aeroflot - Russian Airlines” v Berezovskaya & Anor (2014)

Summary

Receivers' valuation of an estate was to be used in an application for a grant of administration of that estate where an issue had arisen as to the use of confidential information in that application.

Facts

The appellants (P) appealed against a decision (Elenin (aka Berezovsky) (Deceased), Re [2014] EWHC 70 (Ch)) that an executor of an estate (B) was permitted to rely on confidential information contained within an agreement between P and B in an application for a grant of administration of the estate.

B's father (F) had appointed B and her mother (M) as executors of his estate. B applied for a grant of administration of the estate. Parties (X) claiming to be creditors of the estate issued proceedings seeking to pass over B's probate so that the court-appointed receivers could be appointed as administrators. X claimed, on the basis of the receivers' reports, that the estate was insolvent and that the receivers were best placed to act as administrators for the creditors' interests. It was B's case that the receivers' reports had not taken into account payments due to the estate under a confidential agreement with a family (P). P, claiming that the information was highly confidential, unsuccessfully opposed B's application to rely on the information in that agreement as evidence of the estate's solvency. The judge ordered that although X's legal team could view the information, X could not. The judge held that the information was likely to be highly material to the substantive application and permitted B to rely on it, with restrictions. X indicated that it would not challenge the receivers' new valuation, based on the confidential information, but later contended that the new valuation should be taken into account at the substantive hearing, rather than relied upon entirely.

P submitted that B did not need to rely on the information as the estate's solvency was irrelevant to the issue of who should administer the estate; X had agreed to P's position; the receivers had seen the information and B was prepared to accept their valuation.

Held

It would be proportionate and appropriate to decide the substantive application without deciding the relevance of the solvency issue. The judge had made it clear that he had not decided the point. The evidence of the settlement's value should be limited to the receivers' figures for the following reasons: the receivers were independent officers, appointed by the court; even if solvency was relevant, the judge would not be able to make findings on the extent of the estate's solvency and would have to take a broad stroke approach; X's standing was in issue; the limited evidence as to the value of the settlement would achieve a practical and effective balance between P's rights under European Convention on Human Rights 1950 art.8 and the other parties' rights to a fair hearing under art.6; X had not appeared before the court even though the issue had been raised in previous skeleton arguments; P's position in relation to challenging the valuation evidence had been equivocal; and M's proprietary claim did not bear on the issue of the information's deployment. The instant decision was effectively a case management decision that the judge could have made.

Judgment accordingly

Court of Appeal
Sir Terence Etherton (Chancellor), Kitchin LJ, Sir Stanley Burnton
Judgment date
4 March 2014
References

LTL 4/3/2014