Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

This case is an extremely factually complex one and in this post we’ll therefore be covering the facts and the points of law in a rather selective fashion. The case of Gaydamak v Leviev concerns a dispute over a contract purportedly agreed in 2001 regarding the splitting of Mr Leviev’s and Mr Gaydamak’s business assets in Angola between them, and whether there was an enforceable Settlement Agreement reached at a later date (and what the terms of that agreement were). The High Court determined that a contract had been agreed and signed by both parties, that there was an enforceable Settlement Agreement in place relating to the dispute, and that General Kopelipa had not made false representations to Mr Gaydamak to entice him to sign the Settlement Agreement. Mr Gaydamak’s claim was therefore dismissed.

The facts in Gaydamak v Leviev

As stated above, this case is quite factually complex. We’ll therefore stick to dealing with an outline of the facts. Mr Gaydamak and Mr Leviev (“the Parties”) had, and have, substantial business interests in Angola. In 2001 the Parties agreed to split their respective Angolan businesses 50/50 between them. An agreement was drawn up as to this effect, allegedly signed, and handed to the Chief Rabbi of Russia for safe-keeping. Mr Leviev later stated that he never signed such an agreement and that the agreement handed to the Chief Rabbi was a manuscript agreement committing Mr Gaydamak to make regular charitable donations to Jewish communities.

The second issue in the case was the “drop hands” Settlement Agreement relating to litigation over the previous contract that was agreed by the Parties in 2011. Mr Gaydamak alleged that he was offered $500 million to compensate him for his losses, with $50 million to be paid up front. Mr Leviev stated that he never offered anything of the sort and that he had instructed General Kopelipa, attending on his behalf, that he would not pay any money. The issue therefore arose as to what instructions Mr Leviev had given, whether General Kopelipa had made a fraudulent representation, and, if so, whether General Kopelipa had actual or apparent authority to make such a representation.

The law relating to creating contractual agreements

As every law student knows, a contract is composed of four elements: offer, acceptance, consideration and intention. In order to avoid insulting the intelligence of our readers we will therefore deal only briefly with these points.

An offer is an indication by one person that they are prepared to deal with another person on certain terms. This is different from an “invitation to treat” (i.e. a tender) where negotiations are opened, offers are sought from a variety of sources, and the “best” offer selected for the contract.

Acceptance is, obviously, indicated when the other party consents to the terms offered. This is as opposed to a counter-offer, whether the other party amends the terms and submits them for the party’s deliberation. Acceptance of an offer must generally be communicated by words or action – silence is not to be deemed acceptance (Felthouse v Bindley).

Consideration has been described as the “price of a promise”. It can be absolutely minimal (hence the term “peppercorn rent”) but it must exist. It is essentially what party A is transferring to party B for the use of or ownership of the property.

The position on whether the parties to the contract intended to create legal relations depends on the circumstances in which the contract came into existence. If it is a commercial venture then the presumption is that there is an intention to create legal relations. If it is a “domestic” agreement then the presumption is that the agreement is not legally binding. The party seeking to enforce the agreement must then seek to persuade the court that there was such an intention.

The High Court’s decision in Gaydamak v Leviev

On the first issue – whether the partnership agreement had been signed – the High Court found that the agreement was signed in a meeting between the Parties in December 2001. The High Court relied on the evidence that had been put before it in deciding this, particularly on the statements of Mr Gaydamak and Mr Dagan as to the significance of the greeting “mazel u’bracha” (meaning “good fortune and blessing”) which was used on the day that the agreement was allegedly signed in December 2001. Further, the High Court preferred the evidence of Mr Gaydamak to that of Mr Leviev.

On the second issue – whether there was an enforceable Settlement Agreement – the High Court found that there was. The Parties had signed the 2011 agreement and acted in reliance on it. Of particular significance was the fact that Mr Gaydamak was provided with an Angolan diplomatic passport – something that he had been promised by General Kopelipa upon the signing of the Settlement Agreement. Further, Mr Gaydamak’s defence that there was not a date specified on the front of the 2011 Settlement Agreement (and that it was therefore not yet in force) was dismissed as relatively weak, seeing as Mr Gaydamak had signed and dated the Settlement Agreement in his own hand on 6 August 2011.

Finally, the High Court dismissed the contention that General Kopelipa had made representations of fact relating to payments outside of the Settlement Agreement but accepted that General Kopelipa had been Mr Leviev’s agent. However, General Kopelipa would not have been acting with actual or apparent authority if he had made such representations as the Settlement Agreement stated that Mr Leviev would not make such payments and the Settlement Agreement contained an entire agreement clause.

The High Court therefore dismissed the claim on the basis that there was an enforceable Settlement Agreement that covered the litigation.

Our specialist commercial solicitors’ thoughts on Gaydamak v Leviev

This is an interesting and, it has to be said, rather exotic case. What it demonstrates is that clear and precise notes of meetings should be taken and that agents, if instructed, should be provided with written instructions to clarify the limits of their authority. Further, it demonstrates that ambiguity in commercial relationships can be damaging and extremely costly.

If you have a commercial dispute then contact Redmans‘ commercial dispute resolution team.

Want to talk to an expert employment law solicitor?

You'll receive a callback from a specialist within an hour

Share →

Our awards

Request a callback

    Your first name (required)

    Your last name (required)

    Your email (required)

    Your telephone number (required)

    Brief details of your enquiry

    Testimonials

    4.80 Average

    320 Reviews

    Anonymous

    Efficient and quick service!

    Posted 2 days ago

    Karen B

    Quick response very helpful Issue raised dealt with very quickly

    Posted 5 days ago

    Carmen T

    Redmans give Great service and advice on reading contracts. They can explain all the solicitors jargon into words that you can understand. I received excellent service an I will use them again and again.

    Posted 1 week ago

    Anonymous

    Very grateful for Mel’s efforts in handling my case from start to finish which I would have found very stressful without it. She was very professional, friendly and we had a positive outcome. Highly recommend.

    Posted 4 weeks ago

    Nalin W

    Mel Chin was my Legal Executive when I engaged the services of Redmans Solicitors to help with a redundancy matter. She was incredibly approachable and professional from start to finish. Specially I have to mention regarding prompt reply to all my email queries, It was super quick. I would thoroughly recommend Mel Chin. Many Thanks

    Posted 1 month ago

    Anonymous

    I'd highly recommend Redmans Solicitors. Mel was very helpful and assisted me throughout my case.

    Posted 1 month ago

    Anonymous

    Sacha was very thorough and very helpful, with great advice on when to act and when to wait on my case.

    Posted 1 month ago

    Anonymous

    I have been very pleased with the support I got from Redmans Solicitors on my case with my employer. Caroline has always helped me to put things in perspective and showed me different scenarios ultimately to help me taking the right decision. She was very professional and always available when I needed, and at the same time also emphatic which I found also really important to establish a strong relationship. Will definitely recommend!

    Posted 1 month ago

    Anonymous

    Prompt and efficient response to my enquiries. Excellent negotiating skills with my employer which considerably improved the terms of my settlement agreement.

    Posted 1 month ago

    Anonymous

    Very quick and professional service , Rana was very helpful

    Posted 1 month ago

    James G

    Very professional, knowledgeable and kept me informed at every stage of my case. I would highly recommend Redmans.

    Posted 2 months ago

    Pravina P

    Chris was really good and help solve my issues with current company. I would recommend him to anyone.

    Posted 2 months ago

    Paul L

    Sacha was extremely helpful in my matter. I would not hesitate you use Sacha or Redmonds again. Everyone was very helpful.

    Posted 2 months ago

    Monique N

    I had Mel Chin helping me with a settlement and she was very professional and reliable throughout my case. Mel provided me with a good understanding of what was happening and gave suggestions on routes I could take. My case was resolved and closed promptly although the opposing side were very difficult to deal with. A very big thank you to Mel and Chris.

    Posted 2 months ago

    Jackie C

    My first ever experience needing the services of a solicitor; cannot speak highly enough of Mel and Chris’s personable, reassuring and straight to the point advice in dealing with my settlement agreement. They put me at ease during an extremely stressful time. I am equally as happy with the outcome, as l am their professional services.

    Posted 2 months ago

    ""

    Really happy with the service. All very efficient. Mel rattled through things very fast, however was great whenever I needed to stop and ask a question! Would definitely return to Redmans if I ever needed Legal advice.

    Posted 2 months ago

    Peter F

    Very helpful and clear advice, would highly recommend.

    Posted 2 months ago

    William A

    Second time I have had to use Redmans. They did not disappoint. They are fast , efficient and friendly. I have already recommended them to friends and colleagues. I hope I dont have to use them again but if I have to , they are the solicitors for me.

    Posted 2 months ago

    Fleeta C

    Great service with tantastic communications. The solicitor responsible is extremely knowledgeable and was responsible for bringing a timely and desired solution.

    Posted 2 months ago

    Veronica M

    Extremely helpful, starting from a request for advice at very short notice, to dedicating time for me to understand and review all documents thoroughly.

    Posted 2 months ago

    Sophie R

    Very efficient and professional service. Chris was very empathetic, knowledgeable and personable. Highly recommended.

    Posted 2 months ago