Wife of Russian oligarch awarded half his fortune

Divorce|May 20th 2014

The wife of a Russian billionaire has been awarded half his fortune by a Swiss court.

The Geneva Tribunal of First Instance has ordered Dmity Rybolovlev to pay his ex-wife Elena more than 4bn Swiss francs (£2.6bn). The settlement includes property in Switzerland, antique furniture, jewellery, and a  share of substantial assets transferred to Cypriot trusts in 2005. Her lawyer has described the award as “the most expensive divorce in history”.

Mrs Rybolovlev, who lives in Geneva, was also awarded custody of their 13 year-old daughter. The couple also have an older daughter, Ekaterina, who is now 24.

Mr Rybolovlev has announced plans to appeal. His lawyer said:

“There will definitely be a new appellate review and therefore this judgment is not final given the existence of two levels of appeal in Switzerland.”

The couple were married in Cyprus in 1991 after originally meeting in the Russian town of Perm. But they separated six years ago and have been arguing over the financial settlement ever since.

Her lawyer said Mr Rybolovlev had “put up strong resistance” to his wife’s financial claims but she had now been awarded “exactly” the sum she had sought.

Her ex-husband originally trained as a doctor but made the bulk of his estimated $8.8bn fortune through a controlling share in one of the world’s largest suppliers of fertiliser ingredient potash.

The oligarch now lives in Monaco and is owner of the AS Monaco football club. According to a report in The Guardian, his stake in the club, his later purchase of a private island from a member of the Onassis family and the purchase of a multimillion dollar New York apartment were all carried out via trusts formed in Ektaterina’s name. An asset freezing order obtained by Elena did not apply to the trusts acting for Ekaterina.

Mrs Rybolovlev may struggle to obtain access to funds now based in Cyprus, CBS reports, because Switzerland does not have relevant legal agreements with the Mediterranean island.

Placing assets in a trust or company is a well-known way to avoid them being taken into account in a financial settlement and escape payment.

In the annals of international divorce, this is certainly a whopper, but it is not yet clear just how much of her husband’s fortune Mrs Rybolovlev will walk away with when the case finally concludes. It does sound as though she may have won no more than a symbolic victory over her former husband at this stage, although it is certainly a ruling which sends a very clear message.

Would the English courts have reached a similar decision and would enforcement have been any easier? They may have been asked to divide the assets equally  – certainly the principle of sharing is fundamental over here to divorce rulings involving assets surplus to need. But the court could have departed from equality here too. They will do so in some circumstances – for example, if one partner is thought to have made an outstanding or ‘stellar’ contribution to the marital assets, one which it would be unfair not to acknowledge in a settlement. We saw an example of such a departure in the 2005 divorce of Sir Martin Sorrell, the chief executive of multinational advertising and public relations firm WPP. When he split from his former wife Sandra, she received only 40 per cent of their joint assets. Nevertheless, it was still a very significant settlement which included a £3 million pound Georgian townhouse and more than £23 million in cash.

This divorce has been ongoing for six years. But with the planned appeals and the sums involved, not to mention enforcement of the rulings, it is no doubt set to to rumble on for a lot longer yet. It makes you wonder though why, with such massive wealth, these two can’t reach agreement. Does wealth really does bring happiness in its wake?

Photo of Geneva by Schnäggli via Wikipedia under a Creative Commons licence 

Author: Stowe Family Law

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