PJSC Tatneft v Bogolyubov & Ors

Under Russian law, limitation begins when the claimant knows, or should know, of the violation of its right. Before 1 September 2013, knowledge of the proper defendant was not required for time to begin running in a tort claim. Knowledge requires more than speculation and includes the wrongful act, the harm and the causal link, but it does not require evidence sufficient to prove the claim at trial or the ability to plead the claim in accordance with English practice.

A defendant may be prevented from relying on limitation where its bad-faith conduct directly prevented the claim being brought in time. The exception is narrow. Different foreign limitation rules are not contrary to English public policy merely because they may produce a harsh result.

PJSC Tatneft, as assignee of Kompaniya Suvar-Kazan LLC, claimed damages under article 1064 of the Russian Civil Code. It alleged that the defendants procured the diversion and dissipation of payments due for oil supplied to Ukrtatnafta JSC.

The defendants relied on the three-year Russian limitation period. The principal issues were the meaning of knowledge under article 200 of the Russian Civil Code, the effect of its 2013 amendment, whether Suvar-Kazan had actual knowledge before the claim was issued, whether reliance on limitation was an abuse of rights, and whether the relevant Russian rules offended English public policy.

1. Claim dismissed. The court held that the defendants had established, on the ordinary balance of probabilities, that Suvar-Kazan had actual knowledge of the alleged violation of its rights and, if necessary, the identity of the defendants before 31 August 2010. In any event, that knowledge existed before 23 March 2013.
2. Under article 200(1) of the Russian Civil Code, knowledge means knowledge of the wrongful act, the resulting harm and the causal nexus. It must be more than speculation, but it is distinct from evidence required to prove the case at trial. The claimant need not know every factual detail or the mechanics by which the harm was caused. Nor must it be able to plead the claim according to English procedural rules.
3. Before 1 September 2013, knowledge of the identity of the person who violated the right was not an additional requirement for limitation to begin in a tort claim. The authorities relied upon concerning knowledge of the wrongdoer concerned vindication claims and did not establish a wider rule for tort claims.
4. The court assessed the evidence as a whole. It gave greater weight to contemporaneous documents than to recollections of events many years earlier. It drew adverse inferences from the absence of material witnesses and documents, applying the principles in Wisniewski v Central Manchester Health Authority and Magdeev v Tsvetkov.
5. The defendants were not precluded from relying on limitation as an abuse of rights. Concealment or failure to admit wrongdoing does not suffice unless the conduct directly prevented the claimant from bringing its claim in time.
6. The Russian limitation rules were not contrary to English public policy. Limitation law involves a balance between the claimant’s ability to vindicate rights and the defendant’s interest in finality. An English court should be slow to substitute its own balance for that adopted by the foreign legislature.
7. Obiter, the court indicated that article 1064 would not extend to a claim based only on financial loss caused by failure to receive economic benefits which the claimant had a legitimate expectation of receiving.