In a 3-2 split decision, the Supreme Court yesterday allowed the appeal of Vladimir Olegovich Potanin in a longstanding, multibillion dollar court battle with his ex-wife, Natalia Nikolaevna Potanina.
The parties had married in Russia in the early 1980s, with the husband then amassing a $20 billion fortune in the 1990s. They divorced in 2014, leading to claims in Russia, the USA, and Cyprus. Granted £30 million in Russia, Potanina then sought half of Potanin’s assets. She attempted to apply for financial relief in England and Wales under Part III of the Matrimonial and Family Proceedings Act 1984 in 2019, with a High Court judge granting the permission, later allowing Potanin’s application to set aside the permission as he was not represented in the initial hearing. The Court of Appeal allowed Potanina’s subsequent appeal, with Potanin then appealing to the Supreme Court.
Yesterday’s judgment ruled in favour of the husband on the basis that he was not given a chance to object at the initial ‘without notice’ hearing, but did not dismiss the wife’s claim. The claim now returns to the Court of Appeal which will decide grounds of appeal as raised by the wife.
Managing Partner Katie McCann commented on the ruling:
“Part III of the Matrimonial and Family Proceedings Act 1984 has always been a controversial tool. It basically means that even though a divorce and all the financial implications of the same have been dealt with in another country, if one of the parties can satisfy certain criteria then the court can then effectively reopen the matrimonial finances in our courts. The main purpose of this legislation though is to alleviate hardship in cases of foreign divorce.
“While the wife’s claim has not been dismissed, today’s decision is a common sense one and takes us one step closer towards shedding the label of London being the divorce capital of the world.
“Such a decision will act as a warning to parties with significant wealth that an application in this jurisdiction is not necessarily a meal ticket.”
Katie’s comments were published on 31 January 2024 in The Law Society Gazette here, Today’s Family Lawyer here, and Business Fast here.
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