A series of transactions were concluded between the parties, the true economic substance of which amounted to the transfer of 51% of shares with a market value of no less than two hundred million rubles for their nominal value, in exchange for an obligation to finance the project. This obligation was never fulfilled.
The courts of first instance and the court of appeals dismissed the claim seeking the rescission of the single complex of transactions and the return of the shares, citing the expiration of the statute of limitations and the independent nature of each individual contract.
The RussianLegal team swiftly developed a cassation appeal strategy based on:
- The unified nature of the interrelated transactions;
- A material breach of the financing obligation;
- An incorrect calculation of the statute of limitations from the moment the breach became evident. The business partner had been creating the appearance of performing the obligation.
During the cassation hearing, The Law Office's team successfully argued that the disposal of shares at a reduced price, followed by the subsequent failure to provide financing, constitutes a single material breach of obligations by the share purchaser. The circuit court agreed with these arguments and remanded the case for a new trial.
