Naftiran Intertrade Company (Nico) Limited & Anor v Greenland Limited & Anor

Permission to introduce a counterclaim after the defence requires the proposed claim to have a real prospect of success. The court may decide that issue on the application where the material is sufficient and an early decision serves effective case management. The summary-judgment test asks whether the claim is realistic rather than fanciful and more than merely arguable, but it does not permit a mini-trial. Factual assertions may be rejected where they lack substance or conflict with contemporaneous documents. Evidence reasonably expected at trial must be considered, although speculation that something may turn up is insufficient. Alleged open-ended commercial promises had no real prospect where they were unrecorded, contradicted by contemporaneous material, and unsupported by coherent pleadings or evidence. A claim unavailable to a dissolved company cannot continue.

NICO, subsidiaries of NIOC, sued Ferland and Mr Sokolenko in Claims 1 and 2 for unpaid crude-oil invoices and alleged misuse of assets said to be held on trust or subject to a charge. Ferland and Mr Sokolenko brought the New Claim, alleging that NICO had promised to continue hiring the Alexandra I, continue the Shah Deniz trade, and write off Ferland’s debts.

They sought to have the New Claim proceed as a counterclaim. NICO made a jurisdiction application under CPR 11.1. The court treated the Joinder Application as one for permission under CPR 20.4(2)(b) and considered whether the New Claim had a real prospect of success. Ferland’s dissolution meant that proceedings by or against it were a nullity. The central issue was whether any claim by Mr Sokolenko disclosed a real prospect of success.

1. Outcome. The court concluded that the New Claim disclosed no claim with a real prospect of success. Consequential relief was reserved for a further hearing.
2. The Joinder Application was, in substance, an application for permission under CPR 20.4(2)(b), because it was made after the defence. The court applied the approach in Amersi v Leslie [2023] EWHC 1368 (KB): permission to introduce a new claim should not be granted unless the proposed claim has a real prospect of success. The court treated that issue as common to both applications and appropriate for decision in the interests of the overriding objective and effective case management.
3. Ferland had been dissolved. Applying Peaktone Ltd v Joddrell [2013] 1 WLR 784, proceedings brought by or against it were a nullity. The court therefore considered the applications only so far as they concerned Mr Sokolenko. It used the real-prospect limb of the service-out framework identified in AK Investment CJSC v Kyrgyz Mobile [2011] UKPC 7 [2012] 1 WLR 1804.
4. The court applied the summary-judgment principles formulated in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) and approved in AC Ward & Sons Ltd v Catlin (Five) Ltd [2009] EWCA Civ 1098. A realistic claim must be more than fanciful or merely arguable. The court must avoid a mini-trial, but may test factual assertions against contemporaneous documents, consider evidence reasonably available at trial, and reject speculation that further material may emerge. The related principles in Swain v Hillman [2001] 2 All ER 91, ED & F Man Liquid Products v Patel [2003] EWCA Civ 472, Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550, Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 63 and ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725 were applied.
5. Promises to continue hiring the Alexandra I, continue the Shah Deniz trade and write off Ferland’s debts were not recorded in writing. The contemporaneous documents instead contemplated a sale or limited charter arrangements, continued reservation of NICO’s rights and further efforts to recover debt. The witness evidence did not provide real support for the pleaded promises. The court therefore held that those claims had no real prospect of success.
6. Read as a whole, the particulars did not disclose a claim for breach of Contract 2. In any event, such a claim could only be brought by Ferland and could not continue after its dissolution. The further case based on expectation or misrepresentation also had no real prospect: the communications showed discussions of possible future trading and repayment arrangements, not a binding commitment or actionable representation. The limitation arguments, including the issue under section 5 of the Limitation Act 1980, were not determined because they had become hypothetical or speculative.

This was a first-instance decision of the High Court (Commercial Court). Claims 1 and 2 were issued in the London Circuit Commercial Court and later transferred to the Commercial Court for case management with the New Claim. The judgment identifies no earlier merits decision or appeal.