Mazurov: inquiry into damages on the way, after freezing injunction discharge

Mazurov: the saga continues

Earlier this year, on 28th May 2026, Deemster Corlett delivered substantive judgment in the long-running Mazurov litigation (see The “ancient” Fraudulent Assignments Act 1736 reviewed by Isle of Man High Court in Mazurov – Coren Law).

Post-judgment issues for the Court to resolve included:

• an application of 11th June 2026 to assess damages after the discharge of the WFO against Campino Ltd; and
• an application of 23rd July 2026 seeking to determine whether new expert evidence as to the airworthiness of the Bombardier jet aircraft at the heart of the litigation was admissible and/or relevant.

Deemster Corlett’s latest judgment of 26th October 2026 deals (amongst other matters) with three issues:

• the inter-relationship between admissibility of expert evidence and issue estoppel;
• issue estoppel in interlocutory proceedings; and
• the applicable test in the Isle of Man for a post-WFO inquiry into damages.

The Claimants sought to rely on a new expert report, dated 9th July 2026, on the aircraft’s airworthiness. Deemster Corlett noted (at § 15) that the report cast doubt on his own earlier judgment of 11th June 2024, but that the expert did not appear to have been made aware of this judgment, or to have appreciated obstacles placed by the Claimants in Campino’s way (see § 16). An “even more fundamental objection” (§ 17) was issue estoppel.

Issue estoppel in context of expert evidence application

Deemster Corlett based his ultimate decision to disallow further expert evidence, in large part, on issue estoppel.

He cited (at § 18) Lord Keith in Arnold v National Westminster Bank plc [1991] 2 AC 93:

“Issue estoppel may arise where a particular issue forming a necessary ingredient in a cause of action has been litigated and decided and in subsequent proceedings between the same parties involving a different cause of action to which the same issue is relevant one of the parties seeks to re-open that issue… [at p. 105E]

“Issue estoppel, too, has been extended to cover not only the case where a particular point has been raised and specifically determined in the earlier proceedings, but also that where in the subsequent proceedings it is sought to raise a point which might have been but was not raised in the earlier… [from p. 106B].”

Deemster Corlett also noted (at § 19) that:

“Lord Keith recognised that the rule is subject to exceptions, such as where there has been a change in the law or where there has been the subsequent discovery of new facts subsequent to the first decision. (see p 110 H to 111 B)”.

Issue estoppel was the subject of a significant recent Supreme Court decision in Skatteforvaltningen (The Danish Customs and Tax Administration) (“SKAT”) v MCML Ltd (previously known as ED&F Man Capital Markets Ltd) (“EDFM”) [2026] UKSC 19 (01.07.26) (see Supreme Court guidance on issue estoppel: impact for the Isle of Man – Coren Law).

Whilst Mazurov does not cite SKAT, the “special circumstances” exception in Arnold cited in SKAT (at § 17) is referred to in Mazurov (see the extract at § 19, cited above).

Issue estoppel in interlocutory hearings

At §§ 20-21, Deemster Corlett dealt with issue estoppel specifically in interlocutory hearings.

He cited dicta from Popplewell LJ in Koza Ltd v Koza Altin [2021] 1 WLR 170, including the following (at § 42):

“The Henderson and Hunter principles apply to interlocutory hearings as much as to final hearings. … [I]f a point is open to a party on an interlocutory application and is not pursued, then the applicant cannot take the point at a subsequent interlocutory hearing in relation to the same or similar relief, absent a significant and material change of circumstances or his becoming aware of facts which he did not know and could not reasonably have discovered at the time of the first hearing… There is… no general principle that the applicant in interlocutory hearings is entitled to greater indulgence; nor is there a different test to be applied to interlocutory hearings. In every case… within a single set of proceedings, a party should generally bring forward in argument all points reasonably available to him at the first opportunity, and … to allow him to take them serially in subsequent applications would generally permit abuse in the form of unfair harassment of the other party and obstruction of the efficacy of the judicial process by undermining the necessary finality of unappealed interlocutory decisions.”

Test for a post-WFO inquiry into damages

At §§ 22-29, Deemster Corlett went on to consider the test for an inquiry into damages:

“22. … the Court applies a different test when it considers a fortification application as opposed to when it comes to an [inquiry] as to the damage suffered from the grant of a discharged WFO.

23. The fortification test is that set out by me in Sochin v Baranov [2018] MLR 90, whereas the inquiry into damages test is now well established to that applied in a case of breach of contract.

24. In [SCF Tankers Ltd v Privalov [2016] EWHC 2163 (Comm)] Males J summarised the law at [§§] 47 and 48:- 

“47. ‘ … ‘ the defendants’ are entitled to recover damages for the losses suffered by them as a result of the freezing orders (not as a result of the litigation), assessed by reference to ordinary contractual principles, including principles of causation, mitigation and remoteness, although these principles may need to be applied with some flexibility to take account of the fact that the analogy with breach of contract is not exact: Abbey Forwarding Ltd v Hone [[2014] EWCA Civ 711],* paras 38-44 and 63.

48. … the freezing order need not be the sole or exclusive cause of the loss in question, but must be an effective cause; the burden is on the party who obtained the freezing order to demonstrate a failure to mitigate; and the type of loss (but not the particular loss within that type: … Abbey*… para 66) must be within the reasonable contemplation of the parties.”

25.  … [T]he Court of Appeal affirmed [Males J’s] decision. Beatson L.J. stated at [§] [41]*:-

“[41] If the court decides to enforce a cross-undertaking, the decision… in Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd (1981) 146 CLR 249 has been influential in relation to… causation and the burden of proof. Mason J stated at p 325 that it is “for the party seeking to enforce the undertaking to show that the damage he has sustained would not have been sustained but for the injunction”… The approach in… Ansett… has been followed… in Energy Venture Partners Ltd v Malabu Oil and Gas Ltd [2015] I WLR 2309… [A]s to what was required to enforce the undertaking itself, Tomlinson LJ stated, at para 54, that “As to causation, it is sufficient for the court to be satisfied that the making of the order or injunction was a cause without which the relevant loss would not have been suffered.”

[42] The person who seeks to do so must show that the loss would not have been suffered “but for” the order”.

27. … [Abbey] confirms, at [§] [31]* that a cross-undertaking is given to the court, not the respondent against whom the injunction is granted, and in consequence it does not create a cause of action in favour of the respondent but rather entitles the respondent to apply for compensation.

28. As Judge Pelling QC stated at [§] [23], the effect of the case law is to incorporate into this area of law by analogy the principles relating to causation, remoteness and mitigation that are applied to claims for damages for breach of contract.

29. … [T]he [JCPC] has applied the breach of contract test to the assessment of damages where an undertaking is enforced. See Ennismore Fund Management Ltd v Fenris Consulting Ltd [2022] UKPC 27.

[* above denotes amendment of judgment case citation]

As to the above-cited extract (at § 28), it should be noted that Judge Pelling QC was speaking at first instance. Beatson LJ put matters a little differently in the Court of Appeal in Abbey. He first cited (at § 29) Lord Diplock in Hoffmann-La Roche & Co. AG v Secretary of State [for Trade and Industry] [1975] 1AC 295, 361:

“The court has no power to compel an applicant for an interim injunction to furnish an undertaking as to damages. All it can do is to refuse the application if he declines to do so. The undertaking is not given to the defendant but to the court itself. Non-performance of it is contempt of court, not breach of contract, and attracts the remedies available for contempts, but the court exacts the undertaking for the defendant’s benefit. It retains a discretion not to enforce the undertaking if it considers that the conduct of the defendant in relation to the obtaining or continuing of the injunction or the enforcement of the undertaking makes it inequitable to do so, but if the undertaking is enforced the measure of the damages payable under it is not discretionary. It is assessed on an inquiry into damages at which principles to be applied are fixed and clear. The assessment is made upon the same basis as that upon which damages for breach of contract would be assessed if the undertaking had been a contract between the plaintiff and the defendant that the plaintiff wound not prevent the defendant from doing that which he was restrained from doing by the terms of the injunction…”

and then went on to say (at § 63-64):

“63. .. the law as to the recoverability of loss suffered by reason of a cross-undertaking is as stated by Lord Diplock in… Hoffmann-La Roche, but with this caveat. Logical and sensible adjustments may well be required, simply because the court is not awarding damages for breach of contract. It is compensating for loss for which the defendant “should be compensated” … The court is compensating for loss caused by the injunction which was wrongly granted. It will usually do so applying the useful rules as to remoteness derived from the law of contract, but because there is in truth no contract there has to be room for exceptions.

64…. the law also meets the justice of the matter. A defendant wrongly injuncted should be compensated for losses that he should not have suffered, but a claimant should not be saddled with losses that no reasonable person would have foreseen at the time when the order was made, unless the claimant knew or ought to have known of other circumstances that was likely to give rise to the particular type of loss that occurred in the case at hand. A claimant may, however, find himself liable for losses which would not usually be foreseen in particular cases. One such case may be if a loss, not usually foreseeable, arises before a defendant has had any real opportunity to notify the claimant of the likely loss or sensibly to apply to the court for a variation.”

Deemster Corlett summarised the position as follows (at § 30):

“30. … Firstly, interlocutory decisions are still final decisions, albeit on an interim basis. Secondly, where an issue has been determined in interlocutory proceedings, a renewed application can be made but only if genuine new grounds in the sense of new events or a change in the law have occurred. As the White Book affirms at [§] 3.1.17.2, there is a public interest in discouraging a party who makes an unsuccessful interlocutory application from making a subsequent application for the same relief. Thirdly, it appears to me that the issue as to the practicality of the removal of Campino’s aircraft from Russia was dealt with and decided by me after hearing evidential and legal submissions. The Claimants had ample opportunity to adduce evidence such as that now sought to be adduced two years later in the form of Mr Cooke’s report.”

Disposal

After considering the content of the expert report, Deemster Corlett concluded:

“41. … Mr Cooke’s report does not assist the court in determining the issues properly now before it, which concern the assessment of any damage caused by the WFO. This evidence is not, in terms of Rule 8.51, “that which is reasonably required to resolve the proceedings.” …

46. … [T]he report of Mark Cooke dated 9 July 2026 is inadmissible in so far as it is inconsistent with or relates to matters already determined by me in my judgment of 11 June 2024. Permission to rely upon it is therefore refused in terms of Rule 8.54 of the [RHCJ]. As noted above it may well be that this conclusion denudes the report of any evidential value, save for the very limited part which addresses the aircraft’s value at certain dates (section 2.3 A a-e). This is not to say that the Claimants are prevented from making submissions and challenging the evidence adduced by Mr Wilson [on behalf of Campino] by cross examination at the eventual hearing to assess damages”.

Note for practitioners: The latest Mazurov decision discusses issue estoppel (in the context of admissibility of further expert evidence); and also the test applicable to a post-WFO discharge inquiry into damages. On issue estoppel, see also: Supreme Court guidance on issue estoppel: impact for the Isle of Man – Coren Law. On WFO’s, see also: Freezing Injunctions in the Isle of Man – Practice and Procedure | Coren Law.

Disclaimer: professional advice should be sought before applying any information in a given case.

For advice on Isle of Man civil procedure, or on enforcement, contact Coren Law.

See other Coren Law Legal Updates on civil procedure and enforcement.

See also Coren Law’s Isle of Man civil procedure portal: Click On | Coren Law.

Photo credit: Niklas Jonasson