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ENRC v Dechert – High Court judgment handed down

Published:

On 21 December, the High Court (Mr Justice Waksman) handed down judgment in the high-profile case between Eurasian Natural Resources Corporation Limited (ENRC), Dechert, Mr Neil Gerrard and the Serious Fraud Office.

This judgment relates to the second trial in the proceedings known as the “Phase 1A Trial” which ran from 6-9 and 13-16 March 2023. It deals with a number of items of causation and loss following on from the findings in the first trial held in 2021 (“the Phase 1 Trial”) which mainly concerned questions of liability in relation to ENRC’s claims against Dechert, Mr Gerrard and the SFO – see here.

In relation to the latest Phase 1A Trial, Mr Justice Waksman’s findings are summarised as follows:

(1) The SFO’s wrongdoing was an effective cause of the losses claimed by ENRC in respect of Unnecessary Work, Unnecessary Costs and wasted management time (WMT);

(2) But for the SFO’s wrongdoing, it would not have commenced the Criminal Investigation; the separate losses claimed by ENRC in this respect will have to be assessed at a yet further trial;

(3) The effect of the assessment of Quantum in relation to Unnecessary Work, Unnecessary Costs and WMT is that ENRC is entitled to significantly more by way of damages than Dechert and the SFO have contended, though not as much as ENRC has sought; the detailed implications of these findings, in terms of actual figures, will have to be worked out by the parties;

(4) The SFO’s claimed defences on the basis of remoteness as to reasonable foreseeability or novus actus, and failure to mitigate, are rejected;

(5) So far as contribution is concerned:

(a) In respect of liability for Unnecessary Work, Dechert and Mr Gerrard are 100% responsible and must indemnify the SFO accordingly on a joint and several basis;

(b) In respect of liability for Unnecessary Costs and WMT, where Dechert and Mr Gerrard sought a 50% contribution from the SFO, the just and equitable contribution from the SFO to the Dechert Defendants is 25%; the Dechert Defendants are therefore liable to contribute to the SFO, 75% of the Unnecessary Costs and WMT damages awarded, on a joint and several basis.

Clare Montgomery KC, Nathan Pillow KC (Essex Court Chambers), Anna Boase KC (One Essex Court), Jack Rivett (Erskine Chambers) and Freddie Popplewell (Essex Court Chambers) acted for the Claimants, instructed by Hogan Lovells.

For the full executive summary of judgment, click here

For the judgment, click here