Banque Cantonale De Genève v Sanomi, Court of Appeal - Commercial Court, December 21, 2016, [2016] EWHC 3353 (Comm)

Issuing Organization:Commercial Court
Actores:Banque Cantonale De Genève v Sanomi
Resolution Date:December 21, 2016
 
FREE EXCERPT

Case No: CL-2016-000176

Neutral Citation Number: [2016] EWHC 3353 (Comm)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

COMMERCIAL COURT

Royal Courts of Justice, Rolls Building

Fetter Lane, London, EC4A 1NL

Date: 21/12/2016

Before :

MR JUSTICE BLAIR

- - - - - - - - - - - - - - - - - - - - -

Between :

- - - - - - - - - - - - - - - - - - - - -

- - - - - - - - - - - - - - - - - - - - -

CLARE REFFIN (instructed by Sutherland (Europe) LLP) for the Claimant

PAUL TOMS (instructed by Clyde & Co LLP) for the Respondent

Hearing dates: 14 December 2016

- - - - - - - - - - - - - - - - - - - - -

JudgmentMr Justice Blair:

  1. This is a claim for summary judgment on two promissory notes. Both are dated 24 September 2015, and are in identical terms save as to amount. In one case the amount was US$18m, and in the other case it was US$4m. The form of the first note is annexed to this judgment. The claimant, Banque Cantonale de Genève, seeks to enforce the promissory notes as such.

  2. The defendant, Mr Igho Charles Sanomi, resists the application for summary judgment on the basis that:

    (1) Despite their terms, the notes are not in fact promissory notes.

    (2) Prior to signing the documents, the defendant was assured by Mr Nicolas Demierre, Vice President, Head of Commodity and Structured Finance, on behalf of the claimant bank, that the claimant would make no demand under the promissory notes.

    (3) No consideration was given for any promise on the part of the defendant to pay.

    (4) Alternatively, liability is not in the face value of the notes, that is US$22m, but whatever was the outstanding indebtedness of the defendant's company Taleveras in respect of two transactions being i) finance in relation to a cargo of gasoline on board the vessel MT ``Two Million Ways'' (the larger of the notes) and ii) finance provided by the claimant to Taleveras to pay freight for the chartering of a LPG vessel by Taleveras' chartering division, a company called Tadema.

    The facts

  3. The claimant is a bank incorporated in Switzerland, which among other things provides trade finance. The defendant is a businessman and a founder of Taleveras Petroleum Trading Ltd (a BVI registered company) which trades and markets crude oil and petroleum products.

  4. The facts of the case are set out in some detail in a judgment given by Mr Simon Bryan QC (sitting as a Deputy Judge of the High Court) on 29 July 2016 on the claimant's application for the continuation of a freezing order. It suffices in this judgment to set out a summary.

  5. In his evidence, Mr Sanomi explains that at the material time, Taleveras' oil trading business related to purchase and supply arrangements with two Nigerian state entities. Taleveras sold gasoline to and purchased crude oil from these entities.

  6. The business suffered substantial losses in 2015 caused by the general collapse in oil prices, and a review ordered by an incoming Government in Nigeria into existing contracts held by counterparties with the Nigerian state entities.

  7. Taleveras had done a number of trade finance transactions with the claimant bank of which two are particularly relevant for present purposes.

  8. One related to a cargo of gasoline on board the vessel ``Two Million Ways''. Unfortunately, when the vessel arrived at Lagos in May 2015, there was no buyer for the gasoline. The claimant bank provided finance in June 2015 in the sum of $16,286,250. Separately in June, the bank provided finance to Taleveras in respect of freight for the chartering of a LPG vessel by Taleveras' chartering division, a company called Tadema Shipping and Logistics Ltd. A sum of $4,000,064.52 was provided by way of finance by the bank.

  9. By the end of August 2015, Taleveras had been unable to find a buyer for the gasoline, and was incurring huge demurrage liabilities in the sum of $24,000 per day.

  10. It is clear that the claimant bank was becoming very concerned about its exposure, and some of the main points in factual terms appear in a chronology set out in the defendant's skeleton argument. The subject of a personal guarantee of his company's indebtedness was first mooted by Mr Sanomi at a meeting on 21 August 2015.

  11. On 26 August 2015, the bank indicated that it accepted this suggestion, stating as the ``simplest solution'' the giving of a promissory note signed by Mr Sanomi.

  12. On 26 August 2015, the claimant bank proposed the issue of four promissory notes. Each related to particular shipments.

  13. Mr Sanomi demurred at this suggestion, pointing out that two of the transactions were fully secured.

  14. On 27 August 2015, the bank responded to the effect that four separate promissory notes were proposed ``which will be cancelled after each reimbursement''. In the event, repayment was made in respect of two of the cargos, which left the ``Two Million Ways'' and Tadema financing outstanding.

  15. Drafts of the promissory notes had been emailed by the bank on 28 August 2015, and in due course these were reviewed by the defendant's lawyers.

  16. A meeting was arranged between the defendant and the claimant bank in Geneva on 25 September 2015.

  17. The two draft promissory notes were emailed in advance under a letter of 23 September stating:

    ``We refer to our outstanding financings to Taleveras Petroleum Trading BV (``the BCGE Financing'') and our meetings of 21 August 2015 and 9 September 2015 pursuant to which you offered to issue promissory notes as security for the performance of the repayment obligations of Taleveras Petroleum Trading BV with respect to the outstanding amounts under the BCGE Financing.

    Please find attached two draft promissory notes corresponding to such outstanding amounts: (i) the USD4 mios freight payment financing and (ii) our financing of the unsold floating cargo MT Two Million Ways.''

  18. What happened at that meeting is in dispute between the parties.

  19. Mr Sanomi's account of what was said in respect of this matter is set out in the Defence: ``Nicolas Demierre told the Defendant that the Claimant had no intention to draw down on the promissory notes. He advised the Defendant that the promissory notes were being obtained by him in order to keep senior management within the Claimant happy. Nicolas Demierre told the Defendant that his superiors needed some comfort because of the current level of indebtedness of Taleveras. He said the purpose of the notes was to give the impression that there was security for the indebtedness of Taleveras in respect of the Two Millions Way and Tadema Finance. Nicolas Demierre told the Defendant that the Claimant would make no demand under the promissory notes. The Defendant then signed the promissory notes and handed them to Nicolas Demierre''.

  20. In his evidence, he says, ``I explained to Nicholas (sic) Demierre that I did not like the demand clause and that I would not agree to something that they could simply...

To continue reading

REQUEST YOUR FREE TRIAL