Debt Collect London Ltd & Anor v SK Slavia Praha- Fotbal A S

Summary judgment may be granted where the defendant has no real prospect of successfully defending the claim. The hearing is not a trial, and the court should not make findings of fact. A foreign-law defence based on shareholder duties will not resist summary judgment where the evidence gives no real prospect of establishing the factual conditions required by that law. An assignment does not, on the facts, constitute concerted conduct merely because the assignee seeks repayment of the assigned debt. A binding agreement on interest may be established from correspondence and contemporaneous company accounts where the evidence offers no real prospect of defeating that conclusion.

Debt Collect London Ltd sought summary judgment for debts assigned to it by ENIC, comprising loans and a discounted funding agreement. The agreements were governed by English law. The defendant resisted judgment principally by relying on alleged Czech company-law duties owed by a former shareholder or persons said to have influenced the company. It also disputed the alleged agreement that interest under the discounted funding agreement would accrue at the same compounded rate as under the loans.

The court considered whether the foreign-law defence had a real prospect of success and whether the correspondence and company accounts established the alleged interest agreement.

1. Summary judgment. Under CPR 24.2, the question was whether the defendant had a real prospect of successfully defending the claim. The hearing was not a trial, and the court made no findings of fact.
2. The alleged Czech-law defence depended on establishing that ENIC, directly or through SARL, had substantial influence over the defendant’s business at a material time. The evidence provided no real prospect of establishing that fact. The provisions relied on therefore had no application. Nor was there a real prospect of showing that the enforcement of the debts was without justification or amounted to oppressive or disloyal conduct.
3. The court also rejected the suggested application of Czech provisions concerning concerted conduct. On the evidence, the assignment of the debt from ENIC to DCL could not realistically be characterised as concerted conduct attracting those provisions.
4. For conflict-of-laws purposes, the court accepted the three-stage analysis described by Staughton LJ in McMillan v Bishopsgate Trust Plc (No 3): characterise the issue, select the relevant conflict rule and connecting factor, and identify the legal system connected with that issue. The court did not need finally to determine the wider characterisation argument.
5. The exchange of emails in June 2008, the agreed schedule and the defendant’s audited accounts gave no real prospect of defeating the claim that the parties had agreed interest on the discounted funding agreement at the same rate and with the same compounding as under the loan agreements.

Judgment was entered for the claimant as sought.

The judgment records an earlier jurisdiction decision in the same proceedings: [2009] EWHC 2726 (QB). The present decision determined the summary-judgment application on the merits.