An opening of the floodgates – cementing London as the divorce capital of the world – or a case which highlights the fairness of English law to financially weaker spouses?
That is the question most family lawyers are grappling with following the reported decision of the Court of Appeal in Potanina v Potanin.
Vladimir Potanin, chief executive of Norlisk Nickel, the world’s largest palladium producer and a major producer of refined nickel, divorced his ex-wife Natalia Potanina in 2014.
The couple, who are both Russian and lived in Russia for the entirety of their 31-year marriage, had built up a huge fortune. However on divorce, the wife received just 1% of their wealth, which would be unheard of in England and Wales after such a long marriage. Still, according to her lawyers, this was worth $41.5 million.
In 2016, Natalia Potanina moved to England, which is well-known internationally as a jurisdiction which does not discriminate between the “breadwinner” and the “homemaker” in divorce cases and is generous in reallocating assets amassed during the relationship accordingly.
There is provision in law for a spouse to bring an application in this jurisdiction where insufficient provision has been made in another country following a divorce overseas. Permission is required to bring such an application and the wife’s application for permission was initially refused in 2019.
One might think it should not be open to a party to relocate following their separation in one jurisdiction which they called their home to another in order to secure a more favourable settlement than that ordered by the courts in their home country. Indeed, the husband accused his ex-wife of just that – “divorce tourism” – and concerns have been raised that this may open the door to more claims by international couples, stretching the resources of the courts further.
However, the Court of Appeal has reiterated the broad discretion in these cases. The wife was able to demonstrate a genuine connection to this jurisdiction and that she had a realistic prospect of success.
The reality is that the ultra-wealthy have always had the resources to litigate such issues, and it will always be worthwhile them doing so with such vast sums at stake.
In any event, we are yet to see whether Mrs. Potanina will succeed in her substantive claim which she has only been given permission to pursue. The actual outcome has yet to be determined and the years-long litigation rumbles on.
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Adam Maguire is a partner in the Clarke Willmott family team. Adam advises clients in all aspects of private family law including co-habitation, separation, divorce and related financial issues, nuptial agreements and disputes concerning children. For more information on divorce please request a consultation.
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