In 2009, businessman Mr Oleksander Yedin signed a deed with his partner promising to make certain financial provision for her upon their separation. Mrs Iryna Yedina sought to enforce that agreement in November 2017, claiming that her ex-partner had repudiated the agreement and that she is entitled to damages as a result.
Following the breakdown of the relationship in 2008, Mrs Yedina “sought to secure her position in relation to property ownership and maintenance”. It was agreed by the couple that several properties would be transferred to her. They then entered into a deed which contained details of Mr Yedin’s promise to pay the mortgage on two of those properties and also detailed the maintenance arrangements of £220,000 per annum. He subsequently attempted to go back on this promise and indicated that he had no intention to honour that deed. Mrs Yedina sought damages for ‘repudiation’ and the case was brought before Mr Justice Mann at the Royal Courts of Justice in November 2017.
Regarding the properties to be transferred to Mrs Yedina, Mr Yedin argued that they were merely to be held in trust to “prevent claims being made” by his new partner. This was disputed by Mrs Yedina who claimed that it was agreed that the properties would be transferred to her “absolutely in her own right”. Mr Yedin’s argument was unsuccessful.
Mr Yedin sought to rely on a wide range of defences to convince the court that the deed as a whole was invalid, including non est factum and undue influence.
Non est factum
The judge set out the three key elements for a finding of non est factum:
The belief of the signer that the person is signing a document of one character or effect whereas its character and effect were quite different.
It was concluded that Mr Yedin knew exactly what financial provision for his wife meant and knew what type of document he was signing. He requested amendments to be made to the document and this demonstrates an understanding of its content.
The need for some sort of disability which gives rise to that state of mind.
The judge made it clear that ““unfamiliarity with language may amount to a disability for these purposes”. Mr Yedin argued that he could speak “conversational English sufficient to get by on a day to day basis” but that this was not good enough to “understand legal technicalities”. Mrs Yedina claimed that he is actually “fluent”, and their daughter reaffirmed this. The judge was satisfied that Mr Yedin understood what he was signing, particularly as he questioned the maintenance figure.
The plea cannot be invoked by someone who does not take the trouble to find out at least the general effect of the document.
The judge said that Mr Yedin is “not the sort of person who would ever sign anything without understanding what he was being asked to sign”. It was suggested that Mr Yedin would arrange his financial affairs in “such a way as to enable him to present those affairs in different ways depending on how it suited him”. He clearly understood the significance of the document and knew what he was signing.
Mr Yedin sought to rely on both actual and presumed undue influence in order to argue that the deed should be set aside. Regarding actual undue influence, he argued that Mrs Yedina had the capacity to influence him because she was the one raising their children. However, for actual undue influence to be found, there must be “overt acts of improper pressure or coercion such as unlawful threats” and this was not present in the current case. The judge highlighted in particular the amendments that Mr Yedin made to the agreement and explained that this is “inconsistent with the application of improper pressure”.
The judge concluded that the there was also no successful claim for presumed undue influence. The main argument put forward on behalf of Mr Yedin was that Mrs Yedina “had acquired a degree of “dominion” over him. The judge explained that, to prove presumed undue influence, Mr Yedin must “establish a relationship of confidence and a transaction which calls for an explanation for which no explanation is forthcoming”. He failed to establish either of these and it was stated that the couple were actually “independent of each other”. The maintenance in the deed was “not so extravagant” that it called for an explanation because Mr Yedin was extremely wealthy.
Mr Justice Mann came to the final conclusion that the deed was valid and enforceable. He stated that it has, as a contract, been repudiated and that the repudiation has been accepted. As a result he awarded Mrs Yedina over £2 million in damages. Mr Yedin’s attempt to argue a “large number of the textbook defences to an action on a contract” was unsuccessful and this demonstrates the courts’ unwillingness to set aside a contract without good reason. The deed in question contained a “fair and reasonable transaction” and Mr Yedin entered into it willingly. There was therefore no good reason to set aside a perfectly valid contract.