JSC Mezhdunarodniy Promyshlenniy Bank & Anor v Pugachev & Ors

Where the court has already ordered the sale of trust property, a prospective beneficiary seeking to join proceedings or obtain financial provision is not ordinarily entitled to advance notice of exchange of contracts merely to facilitate a possible application to interfere with the sale. Notice after completion may be appropriate, but the court should not facilitate interference with an existing order without a proper evidential basis.

Ms Julia Pugacheva applied to be appointed litigation friend for her two infant daughters, to join them as defendants, and to seek financial provision from the London Residence Trust. The application was made at a late stage and was unsupported by witness evidence.

The parties agreed that evidence should be filed and that the application should return when judgment was handed down on the validity and status of the trusts. The immediate issue was whether the claimants should give seven days’ notice before exchanging contracts for the sale of Old Battersea House, in addition to notice if the sale took place.

1. The application for appointment, joinder and financial provision was not determined at the hearing. Directions were given for supporting evidence to be filed by 8 August, with the application to return at or after judgment on the validity and status of the trusts. Ms Pugacheva was given liberty to apply.
2. The court had already ordered the sale of Old Battersea House, with conduct of the sale entrusted to the claimants’ solicitors. Although the judge was prepared to assume that Ms Pugacheva’s children were beneficiaries of the London Residence Trust, there was very little information before the court concerning the application.
3. Advance notice was sought to enable a possible application to stop or otherwise affect the sale. The court rejected the submission that this was merely a request for information. Since the sale order required the asset to be converted into money, the sale should proceed without the court facilitating possible interference.
4. Notice after the sale would cause no harm and was appropriate. No proper basis existed for requiring seven days’ notice before exchange of contracts. The order for advance notice was therefore refused.