WITNESS STATEMENTS IN THE DOCK AGAIN: “DESPITE HAVING EXPRESSLY ADOPTED THE WITNESS STATEMENTS IN EVIDENCE IN CHIEF [HE] COULD NOT CONFIRM THAT IT REPRESENTED HIS EVIDENCE”

February 25, 2021 · by · in Civil evidence, Witness statements

The judgment of Mrs Justice Moulder in PJSC Tatneft v Bogolyubov & Ors [2021] EWHC 411 (Comm) provides a further example of the contention that obtaining witness evidence is  probably not part of the “stock in trade” of those who practice in the Commercial Court.

 

“He confirmed in cross examination that his witness statement was written by lawyers (who had previously interviewed him for that purpose) and not by him ….   This limits the value of that evidence not only because 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 CASE

The judge was hearing an action where the claimant sued as assignee of a debt, claiming US$294.3 million.   The  claimant was represented by four counsel (two QCs) and the trial took over four weeks.  The claimant failed, the judge finding that the action was statute barred under Russian law.

THE JUDGE’S ASSESSMENT OF WITNESS CREDIBILITY

The judge considered the evidence of one of the main witnesses called by the claimant.  One issue was the differences between the witness statement served and the oral evidence of that witness.  The witness “could not confirm” that the witness statement represented his evidence.

    1. Mr Syubaev was the Head of the Strategic Planning Department at Tatneft at the relevant time and is now a member of the management board of Tatneft. His duties at the relevant time included supervising Tatneft’s investments in UTN.
    1. It was submitted for Tatneft that he was a cooperative witness who “made every effort to assist the court” and his oral evidence was consistent with his written evidence (paragraph 949 of closing submissions).
    1. I do not accept that his oral evidence was consistent with his written evidence or that he made every effort to assist the court. He confirmed in cross examination that his witness statement was written by lawyers (who had previously interviewed him for that purpose) and not by him [Day 4 p11]. This limits the value of that evidence not only because 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.
    1. The following exchange took place:
“Q…The fact that S-K, under the 2007 commission agency contract, was also obliged to cover the debt from its own funds in case the ultimate buyer did not pay for the oil delivered was the reason why you did not wish to take an assignment from S-K of its rights against UTN?
A. As far as I remember, the principal reasons were in fact tax matters and accounting matters.
Q. Yes, you see, I was just reading to you paragraph 55 of your witness statement…
…
Q. Just before you look at it, I want to ask you this: this witness statement, which was drafted by lawyers, to what extent have you taken the time to check that it actually represents matters within your knowledge and represents your evidence?
A. I can’t answer to this.
Q. You can’t answer?
A. I don’t even know how to answer this question.” [Day 4 p68]
    1. A further example of his ignorance of his witness statement and apparent prevarication occurred on Day 5 [page 40] in this lengthy exchange to a question:
“Q. It is correct, isn’t it, Mr Syubaev, that by the time that you had — in June 2009, when you discovered that the payments either had been or were to be made by UTN to Taiz and Tekhno and that the intermediaries had changed hands, it’s true, isn’t it, that at that stage you were convinced that there was no intention that these monies should be repaid to Tatneft? You were convinced of that fact, weren’t you?”
A. Mr Howard, firstly we did not discover that the payments had been made. We received information that was worrying for them about the payments, that the payments were either made or could be made. Secondly, talking about my degree of confidence, then, yes, with a high degree of confidence I was leaning towards an opinion that, well, it’s unlikely that there are some bona fide intentions — that there are no bona fide intentions.
Q. And you were convinced that there was no intention to repay the money to Tatneft, weren’t you?
A. Yes, with a high degree of likelihood I doubted that the point was to repay Tatneft.
Q. I’m sorry, I missed that.
A. I had no grounds to suppose that that was made for that particular intention, in my judgment —
Q. Do you agree with me that you were convinced there was no intention to repay the monies to Tatneft?
A. With a high degree of likelihood I doubted that there was such an intention.
Q. I wonder why you’re finding it difficult. I was actually just reading out your witness statement which is at {B1/5/10}, paragraph 40. Those are the words you have set out there in the middle of the paragraph. You say: “We were convinced that there was no intention to repay the money to Tatneft.”
A. Yes, but — I might have used different words, but I said the same thing.
Q. Right. So you stand by what’s in your witness statement despite all the fencing we’ve had; correct?
A. Yes.”
    1. It is possible that this particular exchange may result from difficulties arising through interpretation (which, as submitted by Tatneft, may excuse or explain his apparent evasiveness). I also note that whilst Mr Howard criticised this witness for not answering questions the court intervened on one occasion on the basis that some of the questions put in cross examination were very lengthy and general [Day 6 p25].
    1. However, in my view there can be no general reliance by Tatneft by way of mitigation or explanation on the need for interpretation. It was not evident from his answers that he misunderstood material matters and before Mr Syubaev was sworn, the court expressly told Mr Syubaev that if he was asked a question and he did not hear it clearly or did not understand the question, he should make sure that he asked for the question to be put again.
    1. In my view no such explanation can account for the following inconsistency between his witness statement and his oral evidence: [Day 6 p117]
“Q. Yes. So when you heard that money was being paid by S-K’s debtor, UTN, to the assignors to S-K, Taiz and Tekhnoprogress, you must have thought that S-K had an interest in being told about that, a financial interest in being told about that?
A. I can’t tell you that I thought about it. First of all we didn’t learn. We received information –I personally received this information from Maganov, who in turn received it from Mr Fedotov, regarding possibly made or possibly planned payments.
Q. Yes. Are you telling us that the thought never crossed your mind or, as far as you’re aware, the mind of Mr Maganov that this information should be given to S-K? Is that what you’re telling her Ladyship, that thought never crossed your mind?
A. This thought never crossed my mind.”
    1. This is to be contrasted with the relevant paragraph of his witness statement (paragraph 64 of his first witness statement) which counsel directed him to which stated:
“Tatneft did not inform S-K of the alleged payments supposedly made by UTN since the information in possession of Tatneft was unofficial and Tatneft had no proof that the payments were actually made by UTN.”
  1. In my view this was an attempt by Mr Syubaev to support Tatneft’s case that Tatneft had not told SK of the payments but its credibility is thrown into doubt by the inconsistent nature of the evidence.
    1. These materials show that the evidence of Mr Syubaev to the court was untrue. Even if the court were wrong to infer that Mr Syubaev was evasive in the earlier answers referred to above and they should be attributed to difficulties of say translation, there was no misunderstanding in respect of the case advanced by Mr Syubaev in cross examination that he had “no explanation” as to how the assignment and liquidation of SK were related and that the idea of the assignment only occurred to Tatneft after the liquidation. In my view this evidence is shown to be false by the disclosure of the Akin Gump materials.
    1. Further this disclosure shows that his evidence in his first witness statement in 2016 and which was adopted for the purposes of this trial was also false. In that witness statement at paragraph 92 he stated:
“In May 2015 I learnt from Tatneft’s lawyers that S-K’s members had adopted a decision to wind the company up due to the deplorable financial condition – S-K’s net equity had been negative for three years, and the law required the members to so decide. This was not a surprise for me, as I remember, sometime in towards autumn of 2014 Maganov informed me of his call with Korolkov during which the CEO of S-K told him about the unavoidable liquidation of the company. In this regard, Ms. Boulton’s allegation in para. 131 of her Affidavit that “S-K’s liquidation may have been equally convenient for Tatneft” appears to be odd and unfounded. As I have already said, Tatneft’s pursuance of S-K’s liquidation was not in the best commercial interests of Tatneft, although Tatneft had had such an opportunity for several years.”
    1. Mr Syubaev confirmed the truth of his witness statements and even if it was drafted by lawyers adopted it as his evidence. He is a member of the management board of Tatneft. I am unaware of any reason which would suggest that this evidence was anything other than an attempt to conceal the steps that were taken to bring this claim through SK and none was offered in closing submissions (other than the limited submission referred to above).
  2. Although I acknowledge that it is possible for witnesses to lie in relation to some matters and to give truthful evidence on other matters, for the reasons discussed above, I approach his evidence both written and oral with considerable caution and look for corroboration from the written contemporaneous documentation.

CHANGES TAKING PLACE IN APRIL

Whether the changes to the requirements for witness statements would make a difference. The duties placed on the solicitor to certify the statement complies with the rules  and they have explained this to the witness means any lawyer preparing a witness statement must have detailed knowledge of the rules, practice directions and relevant principles relating to evidence.

FROM APRIL 6th THE SOLICITOR’S NECK IS ON THE LINE

In the Business and Property Courts every witness statement must be accompanied by a Certificate from the “relevant legal representative”.

“I hereby certify that:

  1. I am the relevant legal representative within the meaning of Practice Direction 57AC.
    2. I am satisfied that the purpose and proper content of trial witness statements, and proper practice in     relation to their preparation, have been have discussed with and explained to [name of witness].

    3. I believe this trial witness statement complies with CPR Practice Direction 57AC and paragraphs 18.1 and 18.2 of Practice Direction 32, and that it has been prepared in accordance with the Statement of Best Practice contained in the Appendix to CPR Practice Direction 57AC.

“The purpose and proper content of the trial witness statements and proper practice in relation to their preparation have been discussed with and explained to… the witness”

I believe this trial witness statement complies with CPR Practice Direction 57AC and paragraphs 18.1 and 18.2 of Practice Direction 32, and that it has been prepared in accordance with the Statement of Best Practice contained in the Appendix to CPR Practice Direction 57AC”

 

LEARNING THE NEW RULES – A WEBINAR

I have prepared an in-house webinar that deals with these new rules and the steps that litigators have to take to comply, protect their clients and protect themselves. This has already been given to several firms of solicitors.

Details are available at g.exall37@btinternet.com

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