Neutral Citation Number:  [2009] EWHC 1733 (QB)
Case No:  HQ07X01481
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION

Royal Courts of Justice
Strand, London, WC2A 2LL

Date:  14 July 2009 

Before :

THE HONOURABLE MR JUSTICE EADY
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Between :

	BORIS BEREZOVSKY
	Claimant	
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	(1) THE RUSSIAN TELEVISION AND RADIO BROADCASTING COMPANY
(2) VLADIMIR TERLUK	

Defendants	

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Desmond Browne QC and Matthew Nicklin (instructed by Carter-Ruck) for the Claimant
The Second Defendant appeared in person
The First Defendant took no part in the proceedings

Hearing date: 2 July 2009
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Judgment

Mr Justice Eady : 

1.	On 2 July 2009, I heard the Second Defendant’s application to set aside judgment, entered in default of acknowledgment of service on 4 December 2008.  As the hearing concluded at 4.50 p.m., it became necessary to hand down my ruling on a later occasion.
2.	The judgment was entered in default pursuant to CPR 12.3(1).  The claim form and particulars of claim were deemed served on Mr Terluk, who resides in this country, on 4 June 2008 following service upon Ms Yvonne Stevens on 28 May.  She is a solicitor at a Law Centre who was giving him some help at the time.  I had directed on 20 May, in the light of the evidence before me, that this represented an appropriate mode of service.  
3.	There were thus 14 days from 4 June within which Mr Terluk should have filed an acknowledgment of service or a defence.  He did neither.  
4.	The present application is made under CPR 13.3, whereby the court has a discretion to set aside judgment if the defendant shows that he has a real prospect of successfully defending the claim or if it appears to the court that there is some other good reason why either the judgment should be set aside or the defendant should be allowed to defend.  It is clear that one of the factors the court can take into account in deciding whether or not to exercise its discretion is the extent to which the applicant acted promptly.
5.	The Claimant’s case may be summarised as depending upon two propositions:  first, it is said that the Second Defendant sat back and abstained from making any application until the last possible moment and, secondly, that he is unable to demonstrate that he has a real prospect of success.
6.	Mr Berezovsky complains of three meanings in relation to the defamatory television programme broadcast in April 2007, each of which he attributes to words uttered by Mr Terluk on the programme.  First, they are said to convey the meaning that Mr Berezovsky was a knowing party to a criminal conspiracy to avoid his extradition from the United Kingdom and to obtain political asylum here by procuring a false confession from Mr Terluk (first, by offering massive bribes and then, when he refused to comply, by drugging him).  This was to the effect that there was a plot by the Russian authorities to poison Mr Berezovsky (to which he, Mr Terluk, had been a party) and that he would be in mortal danger if he returned to Russia.  Secondly, it is said that the words convey the meaning that Mr Berezovsky was a party to the murder of his friend Mr Alexander Litvinenko in November 2006.  Thirdly, it is also pleaded that the words meant that Mr Berezovsky had been a party to threats which made Mr Terluk fear for his life.
7.	Ms Stevens, who was then (to a limited extent) representing the interests of Mr Terluk, told Ms Middleton of Carter-Ruck on 10 June 2008 that Mr Terluk “knew what was going on and didn’t want to be contacted”.  At that time, he claimed to be lying low for reasons of personal security.  She wrote on 7 July to the effect that she had been unable to serve the papers at that time because the Second Defendant had “failed to make direct contact with us”.  She added that she was no longer instructed and that Mr Terluk had a “new solicitor” called Abigail Evans of Wilson & Co.
8.	Ms Evans wrote to Carter-Ruck on 14 July 2008 and confirmed that she was acting for Mr Terluk but that she was not instructed to act “in relation to any claim for damages” (which, of course, this libel action is).  Documents have been obtained from Wilson & co, from which it emerges that Ms Evans was in communication with Mr Terluk and had sent him a letter from Carter-Ruck dated 10 July.  On 15 July Ms Middleton spoke to Ms Evans, who indicated that she would tell Mr Terluk that his failure to respond to the claim form meant that there was a risk that the Claimant would enter judgment against him.
9.	After judgment was entered on 4 December, the Claimant’s solicitors sent a copy of the order to Ms Evans on 10 December, asking her to draw it to Mr Terluk’s attention.  There was indeed a letter of 11 December, as it has now emerged, which demonstrates that he was given a copy of Carter-Ruck’s letter together with a copy of the order of 4 December.  Formal service was effected on 17 February of this year on Ms Evans, pursuant to an order I made on 3 February of this year, and Ms Evans wrote to Mr Terluk the day after, including the documents served.  The application was made on 3 March 2009;  that is to say, almost exactly three months after the judgment was entered.  
10.	Despite all this, in his first witness statement Mr Terluk has suggested that:
i)	He never saw the programme broadcast in April 2007 in respect of which the libel action was brought.
ii)	He has been under the protection of Scotland Yard since September 2003, when he informed the police of Mr Berezovsky’s dishonest attempt to falsify evidence in support of his asylum claim.
iii)	He is regarded by the Russian prosecuting authorities as a “victim”, in the sense that Mr Berezovsky is supposed to have brought pressure to bear on him to provide a false story in support of his asylum application, to the effect that he (Mr Terluk) had been instructed by the Russian authorities to assassinate Mr Berezovsky.
iv)	He was unaware of the dates of the previous court hearings in this litigation and only became aware of the judgment in default when he received the letter of 17 February from Ms Evans.
v)	Shortly before his application to set aside, he had a meeting on 27 February 2009 with representatives of the Russian prosecuting authorities, who wished to supply additional information to the English court relating to this litigation.
vi)	The Claimant, Mr Berezovsky, was attempting to impede the criminal investigation into his activities – not least by instituting these libel proceedings in England.
vii)	He had enough evidence (presumably for the purpose of setting aside judgment) to support his side of the case and would be willing to produce it at any time.
11.	During the course of the hearing before me, Mr Terluk made it clear through his representative (Ms Margiani) that he wished to allege, by way of a defence of justification, that a false account had indeed been extracted from him in 2003 of the kind I have described.  He made it equally clear, however, that he had no evidence at all of Mr Berezovsky’s having been involved in the murder of Mr Litvinenko and therefore was not in a position to make any such allegation in these proceedings.  It is thus clear that the plea of justification he wishes to put forward does not extend to all the meanings pleaded against him.  
12.	During the course of the hearing, oral evidence was adduced from one of the Russian prosecutors who attended, apparently having come over from Moscow especially for the hearing, to the effect that there were witnesses who could give evidence in due course as to Mr Berezovsky’s supposed attempts in 2003 to extract false evidence from Mr Terluk.  It was not possible, however, to identify these as yet.  Mr Browne QC appearing for Mr Berezovsky suggests that this is simply a smokescreen.  From documents which have already been disclosed, it is clear that the Russian authorities have sought the assistance of the British authorities, at various stages from November 2006 onwards, with a view to interviewing potential witnesses who might have been involved.  No disclosure has been made, on the other hand, of any response from the authorities in London.  What is clear is that no interviews with those potential witnesses have so far taken place.  Mr Browne argues that this means that the British authorities are unimpressed by the merits of the case put before them on behalf of the Russian prosecutor.  I am, in the light of the information before me, unable to come to any conclusion about that.
13.	What matters, however, is that the Russians were prepared to identify a number of witnesses whom they wished (and still wish) to be interviewed.  There is, in Mr Browne’s submission, no reason to suppose that there are yet other persons who might be available as witnesses to the conspiracy (who remain unidentified).  Again, however, I am unable to come to a definitive conclusion about that in the light of the evidence before me.  I am prepared therefore to assume that there may be some persons who might be able to give evidence as to such a plot.
14.	In any event, of course, it is to be assumed for the moment that Mr Terluk himself would wish to give evidence in support of the threats alleged to have been made and/or bribes offered to him on behalf of Mr Berezovsky in 2003.  Mr Browne argues that I am already in a position to see that Mr Terluk is a liar and that any such charge is bound to be rejected.  Mr Browne makes this bold claim on the basis that the Metropolitan Police, in response to a witness summons, recently disclosed the only document in their possession relating to what Mr Terluk told them in November 2003.  He was interviewed at that time by two officers and, from the summary provided, it would appear that in fact he made no such allegation.
15.	Nevertheless, it seems to me that I am not in a position, on the basis purely of a partial documentary picture, to conclude that Mr Terluk’s case about the alleged misconduct in 2003 is bound to fail.  In particular, he disputes that the police summary fully or accurately records the account he then gave.  I understand Mr Browne’s scepticism and the strength of the points he makes, but it would be going too far in my judgment for me to conclude now that no credible evidence would be forthcoming.
16.	Quite apart from this, I have already drawn attention to the terms of CPR 13, which recognise that the court’s discretion to set aside judgment is a broad one, which may be exercised if there is considered to be “some other good reason why … the defendant should be allowed to defend the claim”.  Where an allegation is made which is as serious as this one, involving the suggestion that someone has been granted asylum on a false basis and in the light of evidence obtained by threats and/or by drugging a relevant witness, it seems to me plainly desirable (and indeed in the public interest) that the allegation should be given as full and fair a hearing as the circumstances permit.  
17.	I recognise that Mr Terluk has not acted promptly in his attempt to set aside judgment.  This may, for all I know, be attributable to a genuine perception on his part that he needed to remain in hiding.  I accept, on the balance of probabilities, that he has been aware of these proceedings and of the judgment in default rather longer than he is prepared to admit.  Notwithstanding this, however, it seems to me that it is important to avoid any suggestion of a “cover up” and the merits of any defence should, if possible, be fully investigated.
18.	It is also important to remember that the primary object of most libel actions is to achieve vindication of the relevant claimant’s reputation.  If Mr Berezovsky relies purely on a judgment obtained in default, it will be easy for those ill disposed towards him, for whatever reason, to undermine the effectiveness of that vindication.  It will be said that there was, or might have been, evidence available to support a plea of partial justification, but that the court refused to admit it without addressing the merits.  It is thus in the interests of both sides that this proposed plea of justification, so far as it goes, should be properly addressed.
19.	I emphasise, in setting aside the judgment, that it is incumbent upon Mr Terluk to take the necessary steps to defend the proceedings with reasonable promptitude from now on.  He should not assume that the court will be ready to indulge him in further delay or procrastination.  It is fundamental that he needs very shortly to serve a statement of case setting out clearly the basis for his defence of justification.  At the moment he is not legally represented, but he will no doubt explore the possibility of obtaining legal assistance.  I know nothing of his financial resources but, if appropriate, he could investigate whether advice might be available either on a pro bono basis or by means of a conditional fee agreement.  I have no idea whether this is feasible in practice, but for the very reasons I have given in setting aside judgment it seems to me that the further progress of this litigation must be approached with a sense of urgency.