Avaz Nazarov

The claim was reportedly filed by VIS Trading Co Limited (VIS; incorporated in Belize). Defendants listed include Nazarov as well as a number of companies: Ansol Limited (Ansol; incorporated in Guernsey under Nazarov’s control) and Open Joint Stock Company Sotsinvestbank (SIB; a Russian bank in which Nazarov held a controlling interest between 2003 and 2008). Dmitry Neverov, SIB’s former general director, was added as a fourth defendant.

According to RAPSI, VIS claims that Ansol was contractually obligated to repay the loans, and further alleges that Nazarov is liable in tort for fraudulently inducing the loan by falsely representing his intention to provide effective security for the loans, and/or deliberately rendering the security provided ineffective. VIS also claimed unjust enrichment against Nazarov with respect to one of the loans.

On December 24, 2004, on what was described by the court as “a bad day for Mr. Nazarov,” the businessman was en route to a meeting with famed Russian oligarch Oleg Deripaska when he was informed of what he believed to be a kidnapping heist about to be attempted against him. He promptly fled the country, ultimately ending up in London. He has never returned to Russia or Tajikistan.

Nazarov claims that the alleged kidnapping attempt was part of an ongoing conspiracy between Russian aluminium giant RUSAL and certain high-ranking Tajik government officials to oust Ansol and Nazarov as trading partners for the Tajik Aluminium Plant (TadAZ). Between the late 1990s and the early 2000s, Nararov had provided raw materials and financing to TadAZ in exchange for finished aluminium.

In 2003, Ansol and Rusal established a joint venture to provide together the services formerly provided to TadAZ by Ansol exclusively. According to Nazarov, between 2004 and 2005 RUSAL fully supplanted Ansol’s role in the venture in collaboration with TadAZ. A series of lawsuits transpired between the various companies, all of which were settled by late 2008.

According to the judgment, “these events imposed a huge strain upon Mr. Nazarov’s financial resources. Between 2005 and 2009 he was to fund what must have been very costly litigation whilst being unable to do business.” This personal financial crisis is what gave rise to the loans at the centre of the present case.

In January 2005, Nazarov asked Vorobyev for a $10 mln loan for legal costs connected with the TadAZ litigation. From this point onward, a series of loan agreements were executed between Vorobyev and Nazarov. Each such loan agreement was complicated by supplementary agreements and promissory notes, oftentimes accompanied by changing security pledges and carried out in the name of various offshore companies.

In March 2008, various of these loans came due. At some point after November 2008, Vorobyev learned that Nazarov hadn’t come out of the TadAZ settlement with any financial gain. At that point, he began to consider how he might enforce the loans against Nazarov only to discover that the properties used to secure the July and November 2005 loans were no longer owned by the companies that had pledged them. Thus the loans were unenforceable against them.

In March 2009 Vorobyev wrote to Nazarov reminding him that he still owed $23,844,020.44, and requesting a resolution of the matter by April 2009.

In April 2009, Nazarov replied to this letter with a proposal for yet another deferment, guaranteeing payments of at least $2.25 mln each month starting that September, vowing to repay the principal by January 2010, and the accrued interest within the second quarter of 2010.

The court established that Nazarov’s April 2009 letter constituted an “offer” in accordance with the legal definition under Russia’s Civil Code.

Thus the court held that Ansol became liable to pay off the series of debts in accordance with the April 2009 letter.

With regard to the properties pledged as security for the loans, the court further held Nazarov liable in tort to pay damages to VIS for the loss of the benefit of security promised for the July 2005 loan.

The court held the same against Nazarov with regard to the November 2005 loan, or in the alternative for inducing VIS to make that loan based on misrepresentation.