Findings made against the claimant’s witnesses in the recent High Court decision of PJSC Tatneft v Gennady Bogolyubov and others  EWHC 411 (Comm) underline the importance of taking the correct approach to oral and written witness evidence.
The Claimant, Tatneft, a Russian producer of crude oil, sold oil to a Ukrainian oil refining company called Ukrtatnafta JSC (UTN) through a series of intermediary companies. In 2007, Tatneft stopped supplying oil to UTN and UTN stopped making outstanding payments for the oil that had previously been supplied.
A string of claims between companies in the supply chain (to which neither UTN nor Tatneft were parties) followed before courts and arbitral panels in Russia and Ukraine in 2007 and 2008, before Tatneft brought this claim against four individuals in 2016, three of whom are Ukrainian oligarchs. In this claim, Tatneft alleged that the defendants arranged that the sums outstanding under the oil contracts were paid away by UTN to various intermediary companies before being removed from those companies by a series of sham transactions for the benefit of the defendants.
The parties to the claim agreed that the dispute was governed by the law of Russia. The key issue that the judge, Mrs Justice Moulder, was required to determine was whether the claim had been issued before the expiry of the limitation period. Limitation is a concept that exists in many legal systems (including that of England and Wales), and provides that claims cannot be brought after a certain period of time has elapsed. Claims that are brought after the expiry of the limitation period are said to be “time barred”, which is a complete defence to the claim.
In Tatneft Mrs Justice Moulder ultimately dismissed the claim on the basis that it was time barred as a matter of Russian law. To reach that conclusion, it was necessary for her to determine when time began to run for limitation purposes. This required her to make a ruling on the time that certain information about Tatneft’s claim was known to Tatneft, which in turn required careful consideration of contemporaneous documents and the evidence of key witnesses. The evidence given by Tatneft’s witnesses at trial caused the judge serious concern.
The claimant’s witness evidence
Following a detailed analysis of the witness evidence adduced by the claimant, the judge made a number of important findings.
Of the witness statement of Mr Syubaev, the Head of Strategic planning at Tatneft for example, the judge commented that:
“on occasion, he appeared not to know what was in that statement but somewhat surprisingly, despite having expressly adopted the witness statements in evidence in chief, could not confirm that it represented his evidence”.
The quality of Mr Syubaev’s oral witness evidence was found by the judge to be equally unimpressive. During the trial, Mr Syubaev gave oral evidence which contradicted his witness statement. Tatneft sought to argue that any confusion between Mr Syubaev’s witness statement and the oral evidence he gave could be explained by his need for interpretation. However, the judge’s view was that there was no evidence that Mr Syubaev had misunderstood material matters and that he had been reminded that he should ask for questions to be asked again in the event that he failed to hear it clearly or did not understand it. Rather than being lost in translation, the judge concluded that Mr Syubaev’s oral evidence was, in certain material respects, false.
In addition to inconsistencies between written and oral evidence adduced by Tatneft’s witnesses, the judge found that there were contradictions between oral witness evidence and documentary evidence, and situations in which, in the case of one witness in particular, there was “an unwillingness to answer even the most straightforward question”. Finally, the judge found that many of Tatneft’s witnesses gave answers that were calculated to be attempts to support Tatneft’s case on various matters, rather than an accurate reflection of the witnesses’ memories of a particular event.
Outcome and commentary
In her judgment Mrs Justice Moulder made clear her conclusions on the claimant’s knowledge, and therefore on limitation, were not based on her findings in respect of any particular witness. Instead she relied on the inferences she was able to draw from the contemporaneous documents that were before the court and the background circumstances.
However, the effect of the shortcomings in the witness evidence meant the judge gave little or no weight to much of Tatneft’s witnesses’ oral evidence. Had the judge been unable to reach a decision based purely on documentary evidence, the findings in relation to witness evidence might have been the difference between success and failure. Furthermore, the court’s findings in respect of Tatneft’s witnesses, made in open court and set out in a publicly-available judgment, could have an effect on whether they are viewed as trustworthy by commercial counterparties in future. Finally, witnesses must remember that they are giving evidence under oath, and making knowingly false statements could lead to proceedings for contempt of court being brought against them.
Solicitors and litigants in England and Wales will need to get to grips with very significant changes to the rules regarding trial witness statements in the majority of trials in the Business and Property Courts from 6 April 2021. One reason for the change in the rules is to eliminate situations where witnesses were unable accurately to recall the content of their own written statements (such as the situation that Mr Syubaev found himself in). The changes will be discussed in detail in a forthcoming Stevens & Bolton briefing note.
However, most of the findings in respect of witnesses' evidence in this case serve as an example of “what not to do” for prospective witnesses in all cases. Above all, they should provide a truthful and accurate testimony, not one that is designed to further the case of the party on whose behalf they are giving evidence, or to frustrate the purpose of court with reticence. The success of a piece of litigation, and the reputations and potentially even criminal records of witnesses, could depend upon it.