JSC Commercial Bank Privatbank v Igor Valeryevich Kolomoisky & Ors

The construction of a court order is a single coherent process. The court considers the language of the order in the circumstances known to it and the parties, including the reasons for making it. Where an order both removes restrictions on the permitted use of ring-fenced funds and gives a judgment creditor liberty to enforce against them, those consequences must be read together. Unless the order preserves payment priority for liabilities incurred before the relevant event, unpaid legal fees lose the benefit of the ring-fencing when the event occurs. The creditor’s enforcement rights then extend to the relevant fund as a whole.

The claimant had obtained judgment for approximately US$3 billion against the first and second defendants. A consequential order restricted enforcement against specified ring-fenced funds pending the second defendant’s appeal and permitted payments for defined purposes, including legal costs. A related worldwide freezing order contained corresponding provisions.

The Court of Appeal dismissed the appeals. It determined that the ring-fencing under sub-paragraph 3E(6) of the consequential order had come to an end and referred to the High Court the dispute concerning legal costs incurred before dismissal but unpaid at that time. The issue was whether those costs could still be paid from the New Enyo Accounts.

1. The application was refused. The court construed the consequential order by applying the approach in Sans Souci Ltd v VRL Services Ltd [2012] UKPC 6 at [13]. The order had to be read as a coherent instrument, in the light of the circumstances and the reasons for which it was made.

2. Sub-paragraph 3E(6) had two linked effects when a disapplication event occurred. First, sub-paragraphs 3E(1) to (3) no longer applied, so the restrictions governing the purposes for which the ring-fenced funds could be used terminated. Secondly, the claimant became entitled to take any enforcement step it considered appropriate against the ring-fenced funds.

3. The relevant disapplication event occurred when the Court of Appeal handed down its judgment dismissing the appeal, rather than when the formal order was later made. The Court of Appeal’s determination of 4 June 2026 was treated as confirming that construction.

4. The order did not preserve a priority for legal fees incurred before the disapplication event but unpaid at that time. Its language referred to the purposes for which payments could be made, not to the continued protection of liabilities already incurred. The claimant’s enforcement right therefore extended to the whole of the New Enyo Accounts and deposits, without deduction for unpaid fees.

5. The competing construction would have introduced uncertainty as to the amount available for enforcement and required a limitation on the claimant’s expressly unqualified enforcement liberty. The continuing notification provisions in sub-paragraph 3E(5) did not preserve any payment priority. The construction was commercially coherent despite placing an incentive on the second defendant’s lawyers to bill and receive payment promptly.

• Court of Appeal: dismissed the first and second defendants’ appeals against the underlying judgment. It determined that the ring-fencing under sub-paragraph 3E(6) had ended and directed the parties to resolve the dispute over unpaid costs by application to the High Court if necessary.
• High Court (Business List): refused the second defendant’s application and held that unpaid legal costs did not remain protected after the disapplication event.