OFFSHORE CASE DIGEST: - Conyers Dill & Pearman

BRITISH VIRGIN ISLANDSsubsection 31(b) requires that a person be held out as adirector by the company. If a person holds himself out thenthe section would not be engaged. Further, subsection 31(1)(d) which dealt with ostensible authority and subsection 31(1)(d) applied when a company sought to challenge the validity ofa document issued by a director with actual or usual authorityto issue such a document. The Court went on to conclude thatthis section applied to documents issued by director de jure orde facto but not to documents issued by imposters. On section31 generally, it provides with a series of statutory defences toparticular specific attacks that may be made by the companyon the validity of transactions by which it is prima facie boundbut that the converse would not apply. In that it does not providethat a company cannot in any circumstances successfullychallenge the validity of a transactions by which it is primafacie bound. The Court also took the opportunity to considera question of procedure. Where a claim is undefended theclaimant seeking a judgment on the merits will have to “leapthe very high hurdle” of proving a negative - that the absentdefendant has no real prospect of defending the claim. He wasof the view that the better course in such situations would be toapply for judgment in default.FebruaryCOMPANIES – UNFAIR PREJUDICE – BVI BUSINESSCOMPANIES ACT S. 1841 – STAYTawney Assets Limited v East Pine Management Limited,Guildron Trading Limited, SI Capital Partners Limited,Rudy Amirkhanian and Elena Lokteva (CommercialDivision) (BVI) February 2012and third defendants are BVI registered companies. The courtwas asked to consider two applications one brought by thesecond defendant for a stay of the proceedings in favour ofcourts in Russia and the other on behalf of the first defendantto strike out the amended statement of claim. The court dealtwith the strike out first and found that although it will usually bea hard thing to strike out a pleading of an implied term, it is notdifficult where no basis for the need to make the implicationcould be found within the pleading and where the term soughtto be implied was itself was inconsistent with an expressterm of the agreement into which the terms is sought to beimplied. The claims in contract and tort were consequentlystruck out. The decision to strike out made the forum argumentredundant, however the Court heard argument as to whetherthe third, fourth and fifth defendant (who were not members,shareholders or directors) could be proper respondents toa claim for unfair prejudice under section 1841 of the BVIBusiness Companies Act. The court after considering thecases of Re a Company No: 5287/85 (1985) BCC 915, ReBSB Holdings Ltd [1992] BCC 915, Supreme Travels Ltd vLittle Olympian Each Ways- Ltd [1994] BCC 947, Re BalticReal Estates [1992] BCC 629, Re Fahey Developments Ltd(1996) BCC 320 held that while it was very difficult to extract aunifying thread of principle from the authorities a non-memberrespondent might be a party and could be compelled to providerelief in unfair prejudice proceedings.PROCEDURE – EFFECT OF NONPAYMENT OF COURTFEESAlexey Bobrov v Lenta Ltd (Commercial Division) (BVI)February 2012This case involved a claim for damages for conspiracy/procuringa breach of contract by Tawney Assets Limited (the Claimant)against East Pine Management Limited (the first defendant)arising out of a joint venture agreement between the claimantand the first defendant for the merger of two agriculturalmachinery businesses formerly carried on by them separatelyin the Russian Federation. The claimant and the first, secondIn the course of considering whether a matter should betransferred from the High Court to the commercial list, theCourt held that it had the jurisdiction to stay a claim on its owninitiative where it turned out that neither party had been payingthe court fees at the rate prescribed by the Commercial Claims(Fees) Order 2011. The court justified the stay as necessaryto give effect to section 8 of the Courts of Justice Fees Actconyersdill.com • 13