Michael McLaren QC, counsel for Bank GPB International SA, told the High Court that it was "inconceivable" that the Luxembourg entity and Integral Petroleum SA had orally agreed to extend payment terms.
The bank is seeking summary judgment ordering the immediate repayment of a number of loans totaling approximately $24 million in the face of allegations by Integral that Bank GPB sought to damage the trader's business.
Integral sued Bank GPB and others in 2020 for damages, alleging that the lender wrongfully obtained freezing orders in England and Switzerland with the aim of incapacitating its business. Four individuals and Sanoat Energetika, previously known as Jizzakh Petroleum, are also named in the lawsuit.
McLaren told the court that Integral has "no real prospect" of showing that, in the face of late repayments in 2019, the two sides had reached an oral agreement granting Integral a further 18 months to meet its debts and agreeing that it would no longer be in default
The existence of this oral agreement is "unsupported by any documents," and is "contradicted by correspondence between the parties," McLaren said.
When the two sides had previously made amendments to the repayment plan, it involved a written waiver request from Integral and its guarantors, a signature by Bank GPB and a fee paid by Integral, he continued.
It is "implausible" and "incompatible with the process that had been followed when extensions had previously been agreed" that Integral and Bank GPB would have made an agreement "behind the guarantors' back," McLaren said.
Christopher Hancock QC, counsel for Integral, sought to dissuade the court from granting summary judgment. The company's suit includes allegations that GPB had misused its confidential information, which needed to be investigated, Hancock told the court.
"Those allegations must be taken as well-founded," Hancock said. "They were breaches of duty by the bank, which led to loss and damage caused to claimant."
Integral claims these breaches directly led to a situation in which the company was unable to repay the loans it had taken out with GPB Bank. "These are questions of fact that are unsuitable for summary judgment," Hancock added.
Before the hearing, the two sides addressed the issue of sanctions following its invasion of Ukraine. Gazprombank, Russia's third-largest bank, has yet to be targeted.
McLaren said that the parent company, Gazprom, has been under sanctions since the annexing by Russia of Crimea in 2014, but this had not affected the provision of legal services. Judge Clare Moulder said there was no reason not to hear the case as long as both parties could be represented.
"If that were to change then we would have to address that as and when it happens," Judge Moulder said.
The hearing is expected to continue tomorrow.
Integral's suit alleges that the bank secured freezing orders in England and Switzerland — which were later discharged — so its affiliates would have less competition for tendered contracts.
GPB says in its defense that the bank's sole purpose in seeking freezing injunctions was to preserve Integral's assets by reducing the risk of their dissipation.
Integral's suit says that the two sides began a business relationship in 2017 when the lender agreed to finance its commodity trading transactions in Turkmenistan in Central Asia. The relationship soured in 2019 when Integral missed payments, the suit says. The bank then started accusing Integral of fraud on some transactions, according to the claim.
According to the claim, Bank GPB wrote to the claimants' counterparties and banks inviting them to block all transactions, which was not covered by the freezing order.
The suit also accuses GPB affiliates of spreading damaging information about the claimants in Turkmenistan, Switzerland and potentially elsewhere.
Integral Petroleum SA and the other claimants are represented by Christopher Hancock QC and Angharad Parry of Twenty Essex, instructed by Thomas Miller Law Ltd.
Bank GPB International is represented by Michael McLaren QC and Gillian Hughes of Fountain Court Chambers, instructed by Sherrards Solicitors.
The case is Integral Petroleum SA and others v. Bank GDP International SA, case number CL-2020-000486, in the High Court of Justice of England and Wales.
--Editing by Ed Harris.
For a reprint of this article, please contact reprints@law360.com.
