JSC BTA Bank v Ablyazov

The court may vary a post-judgment receivership order to confer power to sell assets where that course is just and convenient. The former equitable-execution restrictions do not govern the exercise of the jurisdiction with full rigidity, particularly where the assets are already controlled by receivers. The discretion is flexible and should take account of practical convenience, delay, cost, expense, the risk of dissipation and the likelihood that the appointment will assist satisfaction of the judgment. A power of sale may be preferable to charging-order procedures where it gives the court effective control through receivers accountable to it.

The claimant bank applied to vary an existing receivership order concerning three properties beneficially owned by the defendant. The application sought to extend the receivership to the company holding one property and to empower the receivers to sell all three properties. The bank relied on findings made in related contempt proceedings, the judgment debt exceeding US$3.6 billion, the receivers’ existing involvement and the continuing costs of maintaining the properties.

The central issues were whether the court had jurisdiction to confer powers of sale under section 37 of the Senior Courts Act 1981, and whether the discretion should be exercised in the circumstances.

1. The court had jurisdiction under sections 37.1 and 37.4 of the Senior Courts Act 1981 to vary the receivership order and include powers of sale. The jurisdiction was not confined by the former Chancery restrictions on equitable execution.

2. The court should exercise the jurisdiction flexibly, considering all the circumstances. Relevant considerations included practical convenience, avoiding unnecessary delay, cost and expense, the risk that assets might be dissipated, and whether the receivership was likely to assist satisfaction of the judgment.

3. Those considerations favoured the order. The receivers were already in office, had substantial knowledge of the properties, could proceed more quickly than through charging-order procedures, and would remain accountable to the court. Their sale powers would also avoid procedural complications, including the need for a separate Part 8 claim and possible arguments concerning a receiver’s dual role.

4. The order was varied to appoint the receivers over the company holding Albert’s Court and to confer the requested powers of sale. No sale was to take place until a final charging order had been made.

5. An order was also made under rule 19.8A of the Civil Procedure Rules 1998, making the judgment binding on non-parties. Notice had been given to the defendant and all other interested parties.

First-instance application to vary the receivership order. The judgment itself records that findings concerning ownership of the properties had been upheld by the Court of Appeal, but gives no citation for that decision.