Spiridonov v Stepanov - [2020] NZHC 3271

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

I TE KŌTI MATUA O AOTEAROA AHURIRI ROHE

CIV-2018-441-82

[2020] NZHC 3271

BETWEEN
ANDREI IVANOVICH SPIRIDONOV

Plaintiff

AND

IGOR VIKTOROVICH STEPANOV

Defendant

Hearing: 2 December 2020

Appearances:

G J Beresford for the Plaintiff S A Keall for the Defendant

Judgment:

10 December 2020

JUDGMENT OF COOKE J

[1] On 27 February 2020 the Krasnogorsk City Court of the Moscow Region gave judgment in favour of the plaintiff against the defendant in the amount of RUB 2,956,000, together with interest of RUB 1,058,000 and costs of RUB 28,270.1 The judgment related to a loan made to the defendant by the plaintiff on 6 November 2015 that was allegedly not repaid. Both parties are citizens of the Russian Federation, but the defendant is also a New Zealand citizen who has been present in New Zealand at material times.

[2] In these proceedings the plaintiff seeks to enforce the Russian judgment. The defendant resists enforcement on the grounds the judgment was obtained in breach of the principles of natural justice. The proceedings were first advanced by way of summary judgment, but that application was subsequently discontinued, and the proceedings now proceed before the Court as an ordinary proceeding in reliance on

1 Case No 2-863/2020.

SPIRIDONOV v STEPANOV [2020] NZHC 3271 [10 December 2020]

the Court’s inherent jurisdiction. It was agreed, however, that the evidence would be received by the Court by way of affidavit without cross-examination from either party.

[3] I also record that at the commencement of the hearing Mr Keall sought to pursue a security for costs application on behalf of the defendant. It had earlier been noted by the Associate Judge that the defendant might do so. I declined to award security or consider the application in a full way. It would have led to the proceeding being further adjourned if security had been awarded, and assessing whether security for costs should be awarded would inevitably involve considering the underlying merits of the claim. Both these factors suggested that dealing with security for costs at that late stage was not an efficient way to deal with the proceeding.

Factual background

[4]The relevant facts are largely not in dispute.

[5] Whilst the defendant acquired New Zealand citizenship in 2002 he was resident in Russia in 2015 and on 6 November 2015 entered into a loan agreement with the plaintiff in the amount of USD 40,000 and RUB 400,000 repayable on 6 November 2016. Interest was payable at 36 per cent.

[6] The defendant says that he repaid USD 24,000 to the plaintiff. The plaintiff denies that. The plaintiff accepts that payments were made to him by the defendant totalling this amount, but says that these related to other matters, and not this loan.

[7] In late 2016 the defendant left Russia and arrived in Auckland in November 2016 at around the same time as the loan was repayable. The plaintiff says he was unable to locate the defendant in Russia, and…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Spiridonov v Stepanov

Details

AGLC: Spiridonov v Stepanov [2020] NZHC 3271
Case: [2020] NZHC 3271
Decision Date: 10 December 2020

CaseChat Overview and Summary

The High Court of New Zealand was asked to determine whether a Russian court's judgment, granted in default and subsequently affirmed, should be enforced in New Zealand. The plaintiff, Andrei Ivanovich Spiridonov, sought to enforce a Russian judgment against the defendant, Igor Viktorovich Stepanov, who contested enforcement on the grounds that the judgment was obtained in breach of the principles of natural justice. The court was required to decide whether the judgment could be enforced in New Zealand, considering the principles of natural justice and the doctrine of comity of nations.

The court considered whether the defendant had been given a proper opportunity to participate in the proceedings and whether there had been a significant breach of natural justice that would render enforcement inconsistent with fundamental concepts of justice. The defendant had not appeared in the Russian court despite being given notice of the hearings, and he did not pursue an appeal he had lodged. The court found that the Russian court had followed an approach consistent with procedural fairness and that the defendant had not presented a compelling case for a breach of natural justice. The court emphasised that the defendant could have taken steps to participate in the Russian proceedings, such as instructing local lawyers, and that the failure to do so did not constitute a breach of natural justice.

The court held that the Russian judgment could be enforced in New Zealand, and it granted the plaintiff's claim. The plaintiff was awarded costs, with a process outlined for determining the amount if the parties could not agree. This outcome upheld the principle that foreign judgments should be enforced in New Zealand unless there are clear and significant breaches of natural justice or other exceptional circumstances.

Orders