Nordic Power Partners v Rio Alto Energia judgment 1st Apr

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  Nordic Power Partners P/S & Ors  v Rio Alto Energia, Empreendimentos E Participacoes LTDA & Ors [2026] EWHC 806 (Comm) (01 April 2026)

URL: https://www.bailii.org/ew/cases/EWHC/Comm/2026/806.html
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[2026] EWHC 806 (Comm) | | |
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| | | Neutral Citation Number: [2026] EWHC 806 (Comm) |
| | | Case No: CL-2025-000376 |
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
KING'S BENCH DIVISION
COMMERCIAL COURT

| | | Royal Courts of Justice
Rolls Building, Fetter Lane,
London, EC4A 1NL |
| | | 01/04/2026 |
B e f o r e :

THE HONOURABLE MR JUSTICE HENSHAW

Between:
| | (1) NORDIC POWER PARTNERS P/S
(2) NPP BRAZIL I K/S
(3) NPP BRAZIL II K/S | Claimants |
| | - and - | |
| | (1) RIO ALTO ENERGIA, EMPREENDIMENTOS E PARTICIPA??ES LTDA
(2) FUNDO DE INVESTIMENTO EM PARTICIPA??ES RIO ALTO ? MULTIESTRAT?GIA DE RESPONSABILIDADE LIMITADA
(3) FUNDO DE INVESTIMENTO EM PARTICIPA??ES CONJUNTO COREMAS ? MULTIESTRAT?GIA
(4) TMF BRASIL SERVI?OS DE ADMINISTRA??O DE FUNDOS LTDA | Defendants |

**Jessica Sutherland and Douglas Grant (instructed by Clyde & Co LLP) for the Claimants
The Defendants did not appear and were not represented

Hearing date: 20 February 2026
Draft judgment circulated to parties: 30 March 2026**

HTML VERSION OF APPROVED JUDGMENT ____________________

Crown Copyright ©

1. Mr Justice Henshaw:
2. | (A) | INTRODUCTION | 2 | | (B) | PROCEDURAL BACKGROUND TO THE PRESENT APPLICATION | 3 | | (C) | FACTUAL BACKGROUND | 5 | | (D) | THE PARTIES' STATEMENTS OF CASE | 10 | | (E) | APPLICABLE PRINCIPLES | 11 | | (F) | ANALYSIS | 13 | | | (1) The amount of the "Actual Investment" | 13 | | | (a) The loans | 14 | | | (b) The January 2023 Disbursement | 14 | | | (c) Interest | 15 | | | (2) Set-off | 15 | | | (3) "Unclean hands" | 16 | | | (4) Lack of power over the distribution of the Disputed Proceeds | 16 | | (G) | CONCLUSIONS | 17 |
6. (A) INTRODUCTION
7. On 20 February 2026 I heard the Claimants' application for summary judgment and/or to strike out the Defence of the First and Second Defendants (the " RAE Parties "). The application was supported by the evidence set out in and exhibited to the third witness statement of Lee Richard Bacon, a partner in Clyde & Co. LLP, the solicitors for the Claimants.
9. The First Claimant is a company registered in Denmark. It is a joint venture between European Energy A/S and the Danish Climate Investment Fund. The Second and Third Claimants are companies connected with the First Claimant and are also registered in Denmark.
11. The First Defendant (" RAE ") is a company registered in Brazil. RAE wholly owns the Second Defendant (" FIP Rio Alto "), a Brazilian investment fund through which RAE owns its interest in the Third Defendant (" FIP Coremas ") and, in turn, the projects referred to below. The RAE Parties are part of a group of companies known as the " Rio Alto Group ".
13. The Claimants' claim arises out of a Cooperation Agreement dated 23 December 2016 (the " Cooperation Agreement "), as amended, pursuant to which the Claimants and RAE agreed the terms on which they would jointly develop and operate three solar power plants in Brazil (the " Projects "). The Cooperation Agreement is governed by English law and contains an exclusive English jurisdiction clause in unequivocal terms (see clauses 15 & 16.2).
15. The Projects were sold to a third-party buyer last year. Following the completion of that sale on 4 November 2025, certain sale proceeds were received by FIP Coremas (the "Sale Proceeds "). The Fourth Defendant (" TMF ") is the manager and administrator of FIP Coremas and is responsible for the distribution of the Sale Proceeds. The Claimants' claim, in short, is that pursuant to the 'waterfall' mechanism in the Cooperation Agreement, they are entitled to 100% of the Sale Proceeds.
17. FIP Rio Alto, FIP Coremas and TMF were joined to the proceedings for the purpose of seeking injunctive relief, pursuant to the court's Chabra jurisdiction. FIP Rio Alto subsequently served a Defence jointly with RAE disputing the Claimants' claim, and the Claimants' present application extends to that Defence. FIP Coremas and TMF did not take an active part in the Claimants' application, which seeks no relief adverse to them.
19. After considering the evidence and hearing submissions, I concluded that the Claimants were entitled to summary judgment against the RAE Parties, and made orders to give effect to that conclusion, including declaratory relief and an order for specific performance to give effect to the Claimants' contractual entitlement under the Cooperation Agreement to receive 100% of the Sale Proceeds. I reserved questions of costs to a later hearing to be fixed. I indicated that written reasons for my decision would follow. This judgment sets out those reasons.
21. (B) PROCEDURAL BACKGROUND TO THE PRESENT APPLICATION
22. The Claimants' application was issued on 19 December 2025 and served on 22 December 2025. By the application, the Claimants contend that the RAE Parties have not articulated any defence with a realistic prospect of success because none of the matters relied on by the RAE Parties can constitute a defence to the claim.
24. After attempts by the Claimants to engage with the RAE Parties regarding exchange of evidence and the listing of the hearing of the application, the parties attended a listing appointment on 28 January 2026 at which the hearing was fixed for 20 February 2026 with a time estimate of 2.5 hours. The date of the hearing was also confirmed by email to the parties' legal representatives.
26. Despite various invitations to do so, the RAE Parties have not served any evidence in response to the application.
28. On 10 February 2026, i.e. only 10 days before the date listed for the hearing of the Claimants' application, the RAE Parties issued an application for a discretionary case management stay of these proceedings (including the Claimants' application) in favour of an ICC arbitration (the " ICC Arbitration ") which is pending between some of the parties to the present proceedings. The RAE Parties do not dispute that the court has jurisdiction to proceed with the present proceedings. In their evidence in support of the stay application, the RAE Parties propose that the stay application should be heard before the Claimants' summary judgment/strike-out application, though no formal application was made to adjourn the 20 February 2026 hearing. As of that date, the stay application had not been listed for hearing, and the exchange of evidence in relation to it was not yet complete as the Claimants had until 24 February 2026 to serve their evidence in answer to the stay application.
30. The claim in the ICC Arbitration concerns a Quotaholders' Agreement, by which the Second and Third Claimants claim that they validly acquired all of FIP Rio Alto's quotas in FIP Coremas pursuant to clause 3.3. of that Agreement. The essence of the claims in two sets of proceedings is summarised in the judgment of Lionel Persey KC in the present proceedings at [2025] EWHC 2875 (Comm):-
32. "13. The NPP Parties contend, however, that 100% of the Sale Proceeds should be distributed to them because:
33. > (1) In accordance with the First Amendment to the Cooperation Agreement, the NPP Parties are entitled to 100% of the Sale Proceeds in priority to the RAE Parties.
34. > (2) In any event, the NPP Parties have compulsorily acquired FIP Rio Alto's quotas in FIP Coremas (the "Disputed Quotas") by exercising their rights under the Quotaholders' Agreement and are therefore entitled to receive the Disputed Proceeds.
35. 14. Accordingly, in order to enforce their rights under the Quotaholders' Agreement and the Cooperation Agreement the NPP Parties:
36. > (1) have commenced the Arbitration, seeking a declaration (with retroactive effect) that the Disputed Quotas belong to the NPP Parties, with the consequence that the NPP Parties are entitled to any share of the proceeds to which FIP Rio Alto might otherwise be entitled; and
37. > (2) have commenced these English Proceedings to enforce their rights to the Sale Proceeds under the Cooperation Agreement."
38. I agree with the Claimants that the claim in the arbitration is accordingly legally distinct from the claim in the present proceedings, which concerns enforcement of the 'waterfall' mechanism in the Cooperation Agreement as against RAE. If the Second and Third Claimants were to succeed in the ICC Arbitration, they would be recognised as being, in substance, the 100% owners of the Projects. In practical terms, that would be likely to lead to the same result as the Claimants' claim in the present proceedings, namely an entitlement to 100% of the Sale Proceeds. Success in the present proceedings might well therefore render the claim in the ICC Arbitration redundant. However, that is not a reason to delay the resolution of the present proceedings, whose outcome does not depend on the outcome of the arbitration. To the contrary, it is a good reason for disposing of the present proceedings promptly if possible. Conversely, the course proposed by the RAE Parties would merely cause unnecessary delay.
40. Nor is there any reason to believe that proceeding with the Claimants' application will result in duplication of proceedings. If it succeeds, then the evident practical purpose of the claim in the arbitration will have been achieved, and the arbitration seems likely to be discontinued (cf the analogous case Stemcor v Global Steel Holdings [2015] EWHC 363 (Comm)? 16), resulting in a saving rather than duplication.
42. Turning to the most recent events, at 14:07 on 19 February 2026, the afternoon before the hearing, my clerk received an email from the RAE Parties' counsel's chambers, in response to a message requesting their skeleton argument. The message, which was copied to counsel for the Claimants, stated: " Thank you for your email, please note we my instructing solicitors (Culbert Ellis) have now come off record and my counsel does not have instructions to attend tomorrows hearing and will not be in attendance. This notification is provided by way of courtesy to the courts and parties, apologies for any inconvenience caused ". No request was made by or on behalf of the RAE Parties to adjourn the hearing. Counsel for the Claimants informed me that the Claimants' skeleton argument was accordingly sent to the RAE Parties direct, but that nothing had been heard from them.
44. In all the circumstances, taking account by analogy of the factors identified by the Court of Appeal in R v Hayward, Jones and Purvis [2001] EWCA Crim 168, [2001] 2 Cr. App. R. 11 at ? 22.5, I concluded that:-
46. i) the RAE Parties had been given appropriate notice of the proceedings, the present applications and the hearing, and had been given ample opportunity to attend and/or be represented at the hearing;
47. ii) there was no reason to believe that an adjournment would be likely to result in the RAE Parties attending the hearing at a later date;
48. iii) there was no reason to believe that the RAE Parties wished to be represented at the hearing;
49. iv) the RAE Parties had voluntarily waived their right to appear or to be represented at the hearing, and were voluntarily absent; and
50. v) there was a public interest in the matter proceeding without further delay.
51. I therefore proceeded with the hearing.
52. (C) FACTUAL BACKGROUND
53. The Cooperation Agreement was originally made between the First Claimant and RAE. Its recitals explained that:-
55. "A. RAE is a developer and sole owner of three special purpose companies that, together with RAE, hold all the rights to develop approximately 210 MWp (installed capacity) solar PV power plant known as Coremas;
56. B. NPP is a joint venture formed between European Energy and Danish Climate Investment Fund, managed by IFU. NPP is active in development, construction and operation of wind farms and solar power plants;
57. C. The Parties intend to jointly develop, construct and operate photovoltaic solar installations based on the Power Purchase Agreements signed as a result of the Auction process according to the terms and conditions of this Agreement."
58. The commercial terms of the Agreement included a guarantee in clause 2.2 that the First Claimant would receive a minimum return on its investment of 14.59% plus IPCA (a Brazilian inflation index), calculated on a 20 year basis after local (Brazilian) taxes, to be implemented in accordance with Articles 2.3, 2.4 and 2.5 of the Agreement and to apply on an average basis to the Projects that reached Commercial Operation Date (as defined). It also included provision in clause 8.2 for tag and drag along clauses in specified terms to be included in the By-laws of each of the Special Purpose Vehicles referred to or contemplated by the Agreement, with the Drag Along Minimum Price entailing a discount of no more than 6% plus IPCA. Clause 11 imposed certain duties of care on the parties in relation to the performance of their obligations under the Agreement. Clause 15.1 provided that the Agreement was governed by the laws of England and Wales. Clause 16.2 provided that: "All disputes, other than Technical Disputes shall be settled by the Courts of England." A "Technical Dispute" was defined as: "means a dispute relating to the calculation or adjustment of the Financial Model or the Min Return or the financial model provided for in Article 4". The dispute in the present case is not a Technical Dispute.
60. The parties agreed an amendment to the Cooperation Agreement dated 13 March 2018 (the " First Amendment "). Recital C to the First Amendment indicated that the parties expected to implement a new corporate structure, under which one or two Brazilian FIP companies would become direct owners of the project companies and the parties would thereafter own the companies indirectly through the FIP companies. A Fundo De Investimento Em Participa??es or ' FIP' is a type of Brazilian investment fund. The parties also amended the terms on which any proceeds of a sale of the Projects would be distributed. The First Amendment sets out a mechanism (the " Waterfall Mechanism ") by which the proceeds of any sale of the Projects are to be distributed, including the express order and priority of distribution.
62. The First Amendment contains a definition of " Actual Investment ", which includes " any and all payments made by any of the Claimants or its Affiliates ", including loans advanced to RAE or its affiliates, " when related to or used by or in relation to one or more of the Projects ", as well as " Interest " (as defined), less payments " from the Companies, the FIP Companies, a RAE Party or otherwise originating from the Projects? received on a NPP Party's Danish bank accoun t". In full, the definition reads as follows:-
64. "'Actual Investment' means the accumulated amount of:
65. a) any and all payments made by any of the NPP Parties or its Affiliates, in the amount deducted from the respective NPP Party's (or its Affiliates') account, such as loans of any kind in its total disbursed amount, e.g. loans to the Companies, the FIP Companies, or loans to RAE, RAE Contractor or any of these parties' Affiliates, payments or other transfers of funds effectively performed by an NPP Party or its Affiliates when related to or used by or in relation to one or more of the Projects, the FIP Companies or the Companies, including _but not limited to costs, fees or expenses (regardless of their form) for the management. development, financing, construction, operation or maintenance of the Projects as well as costs, fees or expenses (regardless of their form) related to one or more Companies or FIP Companies, including but not limited to costs (including to legal advisers etc.) to incorporate, maintain and manage the FIP Companies and/or the Companies;
66. b) the Liquid Support in the amount deducted from the respective NPP Party's (or its Affiliates') account;
67. Amounts paid according to item a) above and this item b) shall jointly be referred to as "NPP Payments"
68. c) the Interest;
69. less
70. d) payments from the Companies, the FIP Companies, a RAE Party or otherwise originating from the Projects (including positive interest on the Liquid Support) received on a NPP Party's Danish bank account.
71. Amounts paid according to a) and b) above are calculated in BRL based on the foreign exchange rate agreed in the forward exchange contract for the respective transaction."
72. In simple terms, therefore, the " Actual Investment " is any and all money the Claimants put into the Projects, together with " Interest " (as defined), less any money they actually received back into their or their affiliates' bank accounts.
74. " Interest " is defined as:-
76. "an effective annual interest of 14.59% (fourteen point fifty nine percent) plus IPCA, after Taxes, accruing on a daily basis from the date an NPP Payment has been deducted from an NPP Party's (or an Affiliate's) account until the date such amount is fully repaid and registered on an NPP Party's account, and calculated and compounded on a quarterly basis. Interest for any period shall be calculated on the basis of a year of three hundred and sixty (360) days and paid on the actual number of days elapsed, from and including the first day thereof but excluding the last thereof."
77. " IPCA " is defined as:-
78. "the annual rate of inflation based on the official Brazilian inflation index called "Indice Nacional de Pre?os ao Consumidor Amplo" (National Consumer Price Index), as published by "IBGE -Instituto Brasileiro de Geografia e Estat?stica", the Brazilian Institute for Geography and Statistics. The exact rate for a given period shall be calculated based on the IPC-A (IBGE) rate as published by the Brazilian Central Bank ("Banco Central do Brasil") on the following link (using real data and not a forecast): https:/lww2.ibge.gov.br/home/estatistica/indicadores/precos/inpc ipca/defaultseriesHist.shtm"
79. Clause 2 of the First Amendment replaces the Minimum ('Min') Return provisions of the original Cooperation Agreement. Clause 2.2, setting out the Waterfall Mechanism, provides that:-
81. "? All net proceeds, income, gain, profits or other monetary value arising out of or in connection with the Projects, including but not limited to payments to the Companies under the Pawer Purchase Agreement (leading to e.g. distribution of dividends or repayment of loans) and/or the sale of one or more of the Projects (including indirectly by the sale of one or more of the Companies) (a " Payment Event "), shall be distributed and attributable to the Parties in the following order and priority:
82. a) The NPP Parties shall receive an amount corresponding to the Actual Investment after Brazilian Taxes.
83. b) Following the NPP Parties' receipt of the Actual Investment and a sale of the Projects, RAE shall receive a payment of 100,000.00 BRL {one hundred thousand Brazilian Reais) per MWp being subject to a sale, summing up to a total compensation of 9,300,000.00 BRL (nine million three hundred thousand Brazilian Reais) in case all Projects are sold."
84. (my emphasis)
85. Clause 2.3 of the First Amendment provides that:-
87. "? For the avoidance of doubt, RAE and its Affiliates shall in no event be entitled to receive any proceeds, income, gain, profit, remuneration or other form of payment arising from or related to the Projects, the Companies or the FIP Companies prior to the NPP Parties receipt of the Actual Investment."
88. Clause 3 of the First Amendment provides for payments to be made as soon as possible upon a Payment Event.
90. Clause 8 of the First Amendment provides for the Second and Third Claimants to become parties by a Deed of Adherence, and that was done. Thus all three of the Claimants, along with RAE, are now parties to the Cooperation Agreement (as amended).
92. A Second Amendment to the Cooperation Agreement was entered into, dated 2 July 2018 (the " Second Amendment "). Clause 2.1 of the Second Amendment provides that:-
94. "? RAE shall take any and all actions, or shall cause the member of FIP RAE's Investment Committee to take any and all actions, to:
95. ?
96. f) take any and all other actions,
97. as required for the compliance of? (iii) RAE's obligations and liabilities under the Cooperation Agreement, as amended herein, including but not limited to:
98. ? (y) the approval of distribution of proceeds by FIP RAE to RAE as soon as FIP RAE has received proceed from FIP Coremas for RAE to fulfil its payment obligation to the NPP Parties under the Cooperation Agreement ?"
99. As envisaged by recital C to the First Amendment and recital B to the Second Amendment, the parties subsequently altered the ownership structure such that the Projects would be owned through a FIP. The ownership structure adopted was as follows:
101. i) each of the three Projects is owned by single-purpose vehicle (the " Coremas SPVs ");
102. ii) the Coremas SPVs are owned by a holding company, Newco S.A. (" Newco ");
103. iii) in turn Newco was owned by FIP Coremas, save for 1% equity share which was owned by the First Claimant; and
104. iv) FIP Coremas is owned by the Second and Third Claimants and by FIP Rio Alto (which is wholly owned by RAE).
105. The relationship between the Second and Third Claimants and FIP Rio Alto is governed by a Quotaholders' Agreement dated 17 August 2018 (the "Quotaholders' Agreement "). The Quotaholders' Agreement is governed by Brazilian law and contains an arbitration agreement providing for ICC arbitration, seated in London.
107. There was a Third Amendment to the Cooperation Agreement in September 2018, but the amendments made are not relevant to the present application.
109. On 24 January 2025, FIP Coremas and the First Claimant entered into a sale and purchase agreement (the " SPA ") for the sale of Newco (and therefore the Projects) to a third-party buyer, China Energy Overseas Investimento Gest?o e Servi?os do Brasil Ltda.
111. Thereafter, a dispute emerged as to how the Sale Proceeds would be distributed. The Claimants' position is that the amount of their " Actual Investment " exceeds the amount of the Sale Proceeds, such that they are entitled to 100% of the Sale Proceeds in accordance with the terms of the Waterfall Mechanism. The RAE Parties contend that they are entitled to the Sale Proceeds in proportion to their 'Quotaholding' in FIP Coremas, said to be approximately 13.85% (the " Disputed Proceeds ").
113. In August 2025, it became apparent that TMF, not being a party to the Cooperation Agreement, might distribute the Sale Proceeds in accordance with the RAE Parties' wishes. Further, the Rio Alto Group was undergoing a restructuring process and might enter insolvency. There was therefore a risk that, if the Disputed Proceeds were distributed to the RAE Parties, the Claimants would not be able to recover them by way of a damages claim.
115. The Claimants therefore applied without notice for injunctions to restrain the Defendants from distributing the Sale Proceeds pending trial. An injunction was sought in support of the present claim (case CL-2025-000376), as well as in support of the ICC Arbitration brought by the Claimants under the Quotaholders' Agreement (in case CL-2025-000373).
117. By orders dated 15 August 2025, Robin Knowles J granted both injunction applications. The orders of Robin Knowles J were continued by Mr Lionel Persey KC (sitting as a Deputy High Court Judge) by orders dated 19 September 2025, on modified terms (identical in both orders) whereby:-
119. i) the term " Sale Proceeds " was defined as "any proceeds received by [FIP Coremas] from the sale of Newco S.A. pursuant to the sale and purchase agreement dated 24 January 2025 ? less ordinary administrative, legal and other expenses incurred by FIP Coremas ", and " Disputed Proceeds " were defined as " the 13.85% proportion of the Slae Proceeds to which the Rio Alto Parties assert an entitlement "; and
120. ii) FIP Coremas and TMF gave undertakings to the court to pay the Disputed Proceeds into escrow pending trial or further order of the court; and the RAE Parties were restrained from seeking to obtain the Disputed Proceeds.
121. The SPA was completed on or around 4 November 2025. There is no dispute that the total Closing Consideration as defined in the SPA was R$ 361,844,201.78. 15% of the Closing Consideration is held in escrow in accordance with Clause 3.5 of the SPA (the " SPA Escrow Amount "). The balance of R$ 313,829,201.78 was released to FIP Coremas. Of that amount, FIP Coremas has retained/used R$ 11,059,460.40 for incurred and future expenses, leaving a 'net' amount of R$ 302,769,741.38. FIP Coremas has paid the Disputed Proceeds into escrow in accordance with the orders made by Mr Persey KC.
124. (D) THE PARTIES' STATEMENTS OF CASE
125. The claim was commenced on 13 August 2025. In summary the Claimants allege as follows:-
127. i) The effect of the Waterfall Mechanism is clear: upon the sale of the Projects, the Claimants are entitled to receive an amount corresponding to the " Actual Investment " in priority to the RAE Parties.
128. ii) The " Actual Investment " as at 15 July 2025 was R$ 713,308,839.79, as detailed in the Annex to the Claimants' Particulars of Claim. Correspondence from the Claimants indicates that by 4 November 2025, the date on which the SPA closed, the " Actual Investment " had risen to R$ 837,695,432. The exact calculation of that figure is not formally in evidence. However, the difference between the two figures is not material, because on any view the amount of the " Actual Investment " far exceeds the Sale Proceeds of R$ 361,844,201.78, with the result that the Claimants are entitled to 100% of the Sale Proceeds.
129. iii) The basis upon which FIP Rio Alto asserts an entitlement to a share in FIP Coremas greater than 13.85% is not explained and is not understood. In any event, however, under the Waterfall Mechanism any such entitlement would not affect the Claimants' right to receive 100% of the Sale Proceeds.
130. The Claimants therefore seek a declaration that they are entitled to 100% of the Sale Proceeds (including any part of the SPA Escrow Amount that may in due course be released to FIP Coremas) directly from FIP Coremas and in priority to the RAE Parties. The Claimants also seek specific performance of RAE's obligation under clause 2.1 of the Second Amendment to: "take any and all actions? as required for the compliance of? (iii) RAE's obligations and liabilities under the Cooperation Agreement?", which the Claimants say includes an obligation to ensure that the Sale Proceeds are distributed in accordance with the Cooperation Agreement.
132. In their Defence, the RAE Parties admit the effect of the Waterfall Mechanism in the Cooperation Agreement (Defence ?17(b)). However, they advance the following arguments:-
134. i) The RAE Parties contend that the amount of the " Actual Investment " is " likely due to be considerably less " than claimed by the Claimants.
135. ii) The RAE Parties say they may plead (but have not pleaded) a counterclaim overlapping with their defences in the ICC Arbitration, which they claim to be entitled to set off against the Claimants' claim.
136. iii) The Claimants are not entitled to relief because they have come to equity with " unclean hands ".
137. iv) No order for specific performance should be made because the RAE Parties have no power over the distribution of the Disputed Proceeds.
138. (E) APPLICABLE PRINCIPLES
139. The Claimants apply for summary judgment pursuant to CPR 24.3 on the grounds that: (i) the RAE Parties have no real prospect of successfully defending the claim, and (ii) there is no other compelling reason why the case or issue should be disposed of at trial. In the alternative, the Claimants apply to strike out the RAE Parties' Defence pursuant to CPR 3.4(2) on the basis that it: (a) discloses no reasonable grounds for defending the claim and/or (b) is an abuse of the court's process.
141. The principles applicable to an application for summary judgment are well-established. They were summarised by the Court of Appeal in The LCD Appeals [2018] EWCA Civ 220, quoting with approval the following considerations taken from passages in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) and Swain v Hillman [2001] 1 All ER 91 at 94:-
143. i) the court must consider whether the claimant has a " realistic " as opposed to a " fanciful " prospect of success: Swain v Hillman [2001] 1 All ER 91;
144. ii) a " realistic " claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] EWCA Civ 472? 8;
145. iii) in reaching its conclusion the court must not conduct a " mini-trial ": Swain v Hillman;
146. iv) this does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel? 10;
147. v) however, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550;
148. vi) although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 3;
149. vii) on the other hand, it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. If it is possible to show by evidence that, although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725; and
150. viii) a judge in appropriate cases should make use of the powers contained in Part 24. In doing so, he or she gives effect to the overriding objective as contained in Part 1. It saves expense; it achieves expedition; it avoids the court's resources being used up on cases where this serves no purpose; and it is in the interests of justice. If the claimant has a case which is bound to fail, then it is in the claimant's interest to know as soon as possible that that is the position: Swain v Hillman [2001] 1 All ER 91? 94.
151. The fact that a respondent fails to file and serve such evidence (having been given ample opportunity to do so) may be indicative of the absence of any arguable defence to the claim: National Highways Ltd v Persons Unknown [2023] 1 WLR 2088 at [34], [40]-[41] per Sir Julian Flaux C.
153. Where the defendant has no realistic prospect of defending the underlying facts or matters which are the subject of a claim for a declaration, it is unlikely to be in accordance with the overriding objective to require a full trial in order to decide whether the court should exercise its discretion to make the declaration: Abaidildinov v Amin [2020] 1 WLR 5120 at [46]-[49], per Mr Robin Vos sitting as a Deputy High Court Judge.
155. There is overlap between the test for strike out and that for summary judgment. CPR 3.4(2)(a) and (b) " cover statements of case which are unreasonably vague, incoherent, vexatious, obvious ill-founded and cases which do not amount to a legally recognisable defence ". Unlike CPR 24, the court is generally concerned only with the statements of case (see White Book notes 3.4.1 and 3.4.21).
157. (F) ANALYSIS
158. (1) The amount of the "Actual Investment"
159. The evidence indicates that the " Actual Investment " as at 15 July 2025 was R$ 713,308,389.79. Interest continued to accrue on that amount up to 4 November 2025, when part of the Sale Proceeds was distributed to the Claimants. As noted earlier, the Claimants calculate that, as that date, the total " Actual Investment " was R$ 837,695,432, but it is unnecessary to reach a firm conclusion as to the precise figure.
161. The RAE Parties' case, as set out at Defence ?24(e), is that: "The Actual Investment was no more than BRL 572,181,125.32, and is in fact likely due to be considerably less given that the RAE Parties dispute the amounts of interest due on the balance of the remaining amounts. This dispute will be fully particularised in the Arbitration in due course."
163. In order to calculate their figure, the RAE Parties have deducted from the sum of R$ 713,308,389.79:-
165. i) R$ 102,565,634.76 referable to loans advanced by the Claimants (the " Loans "); and
166. ii) R$ 38,562,079.72 relating to a disbursement in January 2023 (the " January 2023 Disbursement "), paid in order to fund the final project phase.
167. It is notable that even if those deductions were made, the amount of the Actual Investment would still easily exceed the Sale Proceeds. However, for the reasons given below, I do not consider that either deduction should be made.
168. > (a) The loans
169. In addition to direct equity injections by the Claimants, the Claimants lent certain amounts to the RAE Parties for use in the development and operation of the Projects. Those loans form part of the " Actual Investment " unless and until they are actually repaid: see the contractual definition of " Actual Investment " quoted earlier.
171. The RAE Parties suggest that the loans do not, in fact, form part of the " Actual Investment " because the Claimants have sought (unsuccessfully) to recover those debts by way of separate enforcement proceedings and the Claimants are not entitled to obtain " double recovery ". Thus, the RAE Parties contend that the definition of " Actual Investment " " should be read to mean only such loans as made by the Claimants not subject to live enforcement proceedings " or " that such language should be implied into Clause 1.1 ": Defence ?14(b).
173. I reject that contention. On the wording of the contract, the loans do not cease to form part of the " Actual Investment " until actually repaid: they do not cease to count merely because the Claimants have brought enforcement proceedings. There is no evidence or suggestion that the Claimants have in fact recovered any of the sums owed. There has been no double recovery. Nor can a term properly be implied to the effect proposed by the RAE Parties: the term would be neither necessary nor obvious, and would contradict the express terms of the definition of " Actual Investment ".
175. The RAE Parties also argue that promissory notes which were issued as security for their obligations under the Loan Agreements should have been cancelled, such that those amounts do not fall to be included in the " Actual Investment ": Defence ?24(a). However, even if (which is disputed) the promissory notes should have been cancelled, it would not follow that the amount of the underlying loans ceased to form part of the " Actual Investment ".
177. > (b) The January 2023 Disbursement
178. The RAE Parties argue that (a) the January 2023 Disbursement was necessitated by the Claimants' breach of contract (delay in providing funding), and (b) on a proper construction of the Cooperation Agreement and/or pursuant to an implied term and/or pursuant to the law of damages, the definition of " Actual Investment " does not include sums advanced " for the purpose of mitigating and/or remedying the Claimants' own breaches of the Agreements ": Defence ?14(c).
180. However, even if (which is disputed) the January 2023 Disbursement were necessitated by breaches by the Claimants, that would not as a matter of construction result in it being excluded from the definition of "Actual Investment", nor is there any basis for implying a term to that effect. The relevant Defendants will retain any rights of action (e.g. claims for damages) that might arise from any such breach. That does not preclude the Claimants from recovering the Sale Proceeds pursuant to the agreed Waterfall Mechanism.
182. > (c) Interest
183. The RAE Parties also plead that they " dispute the amounts of interest due on the balance of the remaining amounts", which dispute will be " fully particularised in the Arbitration in due course " (Defence ?24(e)).
185. However, the Interest is explicitly included as an element in the definition of the " Actual Investment ", and the RAE Parties would have needed to plead any ground for disputing it in their Defence to the present proceedings. They have not done so, and nor have they filed any evidence on this (or any other) point in response to the Claimants' application. The Claimant are entitled to bring their present claim under the Cooperation Agreement before this court, which has exclusive jurisdiction to resolve any such dispute.
187. In any event, the RAE Parties' Statement of Counterclaim in the ICC Arbitration, served on 10 February 2026, merely repeats the unparticularised statement that they dispute the interest due.
189. Under the Cooperation Agreement (as amended), " Interest " accrues on the principal amounts in accordance with the contractual formula in the First Amendment, i.e. at the rate of 14.59% p.a. + IPCA, compounded quarterly. I am satisfied that the Claimants' calculations are consistent with that formula (save that, as was indicated at the hearing, the Claimants in fact slightly understated the Interest because their calculation ended at December 2024 rather than July 2025).
191. (2) Set-off
192. The RAE Parties " reserve the right to seek to set off against the Claimants' claim by way of a Counterclaim in these proceedings, so as to reduce it or extinguish it altogether ": see Defence ?29(b). The envisaged, but unpleaded, Counterclaim appears be a claim for damages for the Claimants' alleged breach of clause 8.2.4 of the Cooperation Agreement in selling the Projects at an undervalue: see Defence ?4 & ?21(c) and the RAE Parties' notice dated 16 November 2025. Any such Counterclaim, based as it would be on the Cooperation Agreement, would be subject to the exclusive jurisdiction of the English court and, if to operate as a counterclaim, would need to be made in the present proceedings. No such counterclaim has been made.
194. In any event, there are two reasons why any such counterclaim would not be available as a set-off against the Claimant's claims.
196. First, as an unliquidated damages claim, the mooted Counterclaim could at most be the subject of an equitable set-off. However, the defence of equitable set-off is available only where it would be manifestly unjust to enforce the claim (see, e.g., Geldof Metaalconstructie NV v Simon Carves Limited [2010] 1 CLC 895 at [43]). It would not be manifestly unjust to enforce the Claimants' claim in the present case, since the Cooperation Agreement contemplates that the Claimants will recoup their investment immediately on the sale of the Projects directly from FIP Coremas
198. Secondly, and in any event, the suggested Counterclaim would not reduce the Claimants' claim. The RAE Parties' case in the ICC Arbitration is that the true value of Newco was approximately R$ 573 million (?20 of the RAE Parties' submissions on amounts in dispute in the ICC Arbitration dated 18 November 2025). However, as indicated earlier, the " Actual Investment " at sale was something in excess of R$ 713 million. Thus, even if Newco had been sold for the alleged true value of approximately R$ 573 million, the sale price would still have been much lower than the " Actual Investment ", so the Claimants would still be entitled to 100% of the Sale Proceeds.
200. (3) "Unclean hands"
201. The RAE Parties contend that the Claimants: " come to Court with unclean hands, in the sense that the relief they now seek ? namely an order for specific performance as regards the Sale Proceeds ? is a direct result of contributing to the Rio Alto Parties financial position by seeking to enforce the Loan Agreements in breach of their terms and / or having forced a sale of Newco at a significant undervalue, in a manner prejudicial to the rights of the RAE Parties " (Defence ?22(c)).
203. The equitable principle thereby invoked is relevant to the Claimants' claim for specific performance, albeit (as the Claimants accept) similar considerations may inform the exercise of the court's discretion to grant declaratory relief: see Kireeva v Zolotova [2024] EWHC 552 at [66]-[74].
205. However, the 'unclean hands' principle applies in " exceptional cases where those seeking to invoke it have put themselves beyond the pale by reason of serious immoral and deliberate misconduct such that the overall result of equitable intervention would not be an exercise but a denial of equity ": CF Partners (UK) LLP v Barclays Bank Plc [2014] EWHC 3049 (Ch), per Hildyard J at [1133]; Grant and Mumford " Civil Fraud " (1st ed) ? 22-024. It has been said that the misconduct or impropriety must have " an immediate and necessary relation to the equity sued for" or it must be shown that the claimant is seeking to "derive advantage from his dishonest conduct in so direct a manner that it is considered to be unjust to grant him relief ": Royal Bank of Scotland v Highland Financial Partners LP [2013] 1 CLC 596, per Aikens LJ at [159].
207. The conduct complained of is " seeking to enforce the Loan Agreements in breach of their terms and / or having forced a sale of Newco at a significant undervalue?". Even if established, such conduct would not amount to anything close to " serious immoral and deliberate misconduct " or " dishonest conduct ". Moreover, there is no " immediate and necessary relation " between the conduct complained of and the relief which the Claimants seek. In my view, the 'unclean hands' principle could not arguably affect the Claimants' entitlement to the relief sought.
209. (4) Lack of power over the distribution of the Disputed Proceeds
210. The Claimants seek specific performance of RAE's obligation to ensure that the Sale Proceeds are distributed in accordance with the Waterfall Mechanism. Specific performance may be granted where the defendant may not be good for the money: Gravelor Shipping Ltd v GTLK Asia M5 Ltd [2023] 1 CLC 272, per Foxton J at [99]. In the context of the Injunction Applications, Lionel Persey KC was satisfied that there was: " at least a significant risk that the Rio Alto Group and the RAE Parties will go out of business?" (Judgment ?37). RAE has not adduced evidence to contradict this. As at the date of the hearing before Lionel Persey KC, a potential buyer of the Rio Alto Group had recently withdrawn its interest. The Rio Alto Group subsequently identified a new potential buyer, ST Energy. However, on 14 February 2026, ST Energy informed the Brazilian court that it was unable to proceed with the transaction.
212. The RAE Parties suggest that they have no power over the distribution of the Sale Proceeds. However, the evidence indicates that the RAE Parties have actively sought to prevent the distribution of the Disputed Proceeds to the Claimants. If the RAE Parties withdrew their objections and/or instructed TMF to distribute the Sale Proceeds to NPP, there is reason to believe that TMF would do so. The RAE Parties' objection based on lack of power accordingly does not provide a cogent reason to refuse the relief sought.
214. (G) CONCLUSIONS
215. For all the reasons set out above, I consider the RAE Parties to have no real prospect of successfully defending the claim. Further, there is in my view no other compelling reason why the case should proceed to trial. Summary judgment should therefore be granted. It is unnecessary in those circumstances to consider the application to strike out. Further, I am satisfied that it is appropriate to grant the declaratory relief sought.

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