Altrad Investment Authority SAS & Ors v Peter D Protopapas & Ors

A foreign receivership will not be recognised in England and Wales unless there is a sufficient connection between the company and the foreign jurisdiction. Where a foreign process collaterally attacks binding English findings and causes serious harm, the court may grant declarations and anti-suit relief despite the resulting interference with foreign proceedings.

A settlement governed by English law is effective where it is complete, certain, supported by mutual releases and entered into by authorised parties. The court may declare that it extinguishes claims pursued in foreign proceedings. Relief may be directed personally against a foreign receiver, although an order restraining the English company itself may be refused for pragmatic reasons.

The claimants sought declarations and injunctions concerning a South Carolina receivership order appointing Peter Protopapas over Cape Intermediate Holdings Ltd, and third-party proceedings pursued by him against members of the Cape and Altrad groups.

The proceedings followed Cape Intermediate Holdings Ltd v Protopapas, in which Mann J held that the receivership was not capable of recognition in England and Wales. The present issues were whether an English-law settlement extinguished the claims advanced in South Carolina, whether the directors of Cape Intermediate Holdings Ltd retained authority to act, and whether declaratory and injunctive relief should be granted despite considerations of international comity.

1. Recognition of the receivership. Recognition of a foreign receivership requires a sufficient connection between the company and the jurisdiction in which the receiver was appointed. The findings in Adams v Cape Industries established that Cape Intermediate Holdings Ltd had no relevant presence in the United States through NAAC or CPC. Those findings therefore precluded recognition of the South Carolina receivership.
2. Declarations. The court had jurisdiction to grant declaratory relief under section 19 of the Senior Courts Act 1981 and rule 40.20 of the Civil Procedure Rules 1998. Applying the principles in Rolls Royce plc v Unite the Union, there was a real and present dispute, the parties were directly affected, and the declarations were an effective means of resolving it.
3. Although comity strongly militated against interference with South Carolina proceedings, it was outweighed by the need to protect the parties, the English jurisdiction, the Cape Scheme and claimants under that scheme. The South Carolina process was exorbitant, procedurally irregular and amounted to a collateral attack on the factual and legal conclusions in Adams v Cape Industries. This was an exceptional case in which English intervention was justified, applying the reasoning in Re Maxwell Communications Corp plc (No 2).
4. The Settlement Agreement was a valid English-law contract. Mutual releases and other reciprocal promises supplied consideration. The agreement was complete, certain and intended to create legal relations. It was not a sham or illegitimate device, and it extinguished the claims articulated on behalf of Cape Intermediate Holdings Ltd in the third-party claim.
5. Declarations were made confirming the effect of the Settlement Agreement and the continuing authority of Cape Intermediate Holdings Ltd’s directors. The court declined, for pragmatic reasons, to restrain Cape Intermediate Holdings Ltd itself from taking steps in the South Carolina proceedings. It nevertheless granted injunctions restraining Mr Protopapas personally from continuing the extinguished claims.

First-instance decision. The judgment records the earlier decision of Mann J in Cape Intermediate Holdings Ltd v Protopapas, [2024] EWHC 2999 (Ch), but this was not an appeal from that decision.