Earlier this year the Supreme Court (at [2026] UKSC 29) held that a bankruptcy petition under the Insolvency Act 1986 could be founded upon a sum awarded under an unrecognised foreign judgment. In so holding, they overturned the judgment of the Court of Appeal (Lord Justice Newey, Lord Justice Popplewell, and, as he then was, Lord Justice Snowden) (at [2025] EWCA Civ 62) which had held to the contrary.
The consequence of the Supreme Court allowing the petitioner’s appeal was that the case was remitted to the Court of Appeal for it to decide upon the three other grounds of appeal (which Charles and Bláthnaid’s client, Mr. Drelle, had advanced before it), but which it had not determined in view of Mr. Drelle’s then success before it on the unrecognised judgment point.
The Court of Appeal (Lord Justice Newey, Lady Justice Falk, and Lord Justice Miles) has today (30.10.26) allowed his appeal on those remitted grounds, holding that the unrecognised judgment sum debt is, in any event, disputed on genuine and substantial grounds, namely that there is a genuine and substantial case that the Russian Arbitrazh Court judgment on which the petition was based is impugnable for fraud or breach of natural justice or is contrary to the public policy of the English court. A link to the judgment, which is reported at [2026] EWCA Civ 1390, is below.
In so holding the Court of Appeal made clear (at [100]) that on a bankruptcy petition, an allegation of fraud or breach of natural justice is tested by a single question: has the debtor raised a genuine dispute on substantial grounds? The court can weigh how likely or unlikely corruption, bias or procedural impropriety is in the context. But there is no special, higher threshold just because the debt rests on a foreign judgment.
The Court of Appeal also (at [101]) rejected the respondent’s argument, based on the case of Maximov v. Open Joint Stock Company Novolipetsky Metallurgichesky Kombinat [2017] EWHC 1911 (Comm) (at [15(3)]), that Mr. Drelle had to show the Arbitrazh Court deliberately reached a wrong decision. The Court of Appeal gave three reasons:
1. Maximov was a case where bias was inferred only from how wrong the judgment was, unlike the present case where there was specific evidence of pre-determination by the Arbitrazh Court. The context in Maximov was different.
2. The point does not seem to have been argued in Maximov.
3. The proposition, as expressed, could not be correct A biased judge may well aim to produce a correct decision that survives appeal, because that best serves the favoured party. But such a judgment would still be impugnable because it had been predetermined.
So where the allegation is that the foreign judge decided the case in advance, there is no need to show the judge deliberately reached a wrong decision.
The Court of Appeal judgment can be accessed here.
Charles Samek K.C. and Bláthnaid Breslin acted for the successful appellant, Mr. Drelle. They were instructed by Navdeep Kaur Gill and Nozima Rakhimjonova at Sterling Law.
