Filatona Trading Ltd & Anor v Navigator Equities Ltd & Ors

A person who signs a commercial contract as agent may confer contractual rights on the principal, even where the principal is not named. Clear words are required to exclude that result. Naming parties, identifying beneficial owners, an entire-agreement clause and restrictions on transfer may be relevant, but do not necessarily amount to unequivocal exclusion. The court must assess the contract and surrounding circumstances together. An arbitral tribunal may exercise remedial powers agreed by the parties, including a buy-out remedy available to the court of the company’s incorporation, where the arbitration clause is intended to provide a one-stop resolution of disputes.

The judgment concerned conjoined claims arising from a joint venture relating to a Russian textile company and its Moscow site. The principal factual issue was whether Vladimir Chernukhin, rather than Lolita Danilina, was the true beneficial owner of Navigator Equities Limited and the undisclosed or disclosed principal of the contractual arrangements with Oleg Deripaska.

The court also determined a challenge under sections 67 and 68 of the Arbitration Act 1996, a claim concerning an alleged 2007 asset-sharing agreement, and related issues concerning the tribunal’s power to make a buy-out award, oppression and valuation.

1. TGM claim and section 67 challenge. The court found that Chernukhin was the true joint venture partner and beneficial owner of Navigator. Danilina had signed the shareholder agreement as his nominee or agent, and Deripaska knew that. The extrinsic evidence outweighed the contractual descriptions naming Danilina.
2. Agency and contractual exclusion. The ordinary rule permitting a principal to enforce an agent’s contract applied. The question was whether the shareholder agreement clearly confined rights and obligations to the named parties. The description of Danilina as beneficial owner, clause 2.2, the entire-agreement clause and the transfer restriction did not unequivocally exclude Chernukhin. Clause 2.2 instead supported the commercial purpose of binding the true beneficial owner. The section 67 challenge therefore failed.
3. Family Assets claim. The alleged detailed 2007 agreement to divide family assets was not proved. The evidence established an intention to make financial provision for Danilina through the Sanderson Trust, but not the contract alleged. The claim was dismissed. The court declined to determine an alternative protector-duty claim without proper argument, leaving directions to be sought if it had been pleaded.
4. Section 68 challenges. The tribunal had power to make the buy-out award. Clause 12 referred all disputes connected with the shareholder agreement to arbitration and was intended to provide a one-stop dispute resolution mechanism. The tribunal had not prejudged oppression and had addressed valuation evidence. Mere disagreement with its factual reasoning or valuation did not constitute serious irregularity. The section 68 challenge was dismissed.
5. Orders. The section 67 and section 68 challenges, Danilina’s TGM claim and her claim based on the alleged 2007 agreement were dismissed.

The judgment was a first-instance decision. It determined a rehearing-based section 67 challenge to an arbitral tribunal’s jurisdiction and related section 68 challenges, rather than an appeal from the tribunal’s findings.