Potanina-v-Potanin: Divorce Experts Share their Views

The recent Court of Appeal ruling in London has reignited global attention on one of the most high-value divorce cases in history. Natalia Potanina, ex-wife of Russian billionaire Vladimir Potanin, has won the right to pursue a multi-billion-dollar claim for 50% of his stake in Norilsk Nickel, along with dividends and a luxury Moscow property.

Having previously received less than 1% of marital assets following their 2014 divorce, Potanina’s successful appeal marks a significant shift in what has already become a closely watched case.

To unpack the potential implications of this ruling, we asked leading experts Peter Burgess, Sital Fontenelle and Sean Hilton for their views.

Peter Burgess, partner at Burgess Mee, says:

“Today’s ruling further cements London’s position as the divorce capital of the world. Mrs Potanina’s $6bn claim has been thrown a lifeline, by the Court of Appeal allowing the claim to proceed. For UHNW individuals who have been badly served abroad, this judgment will be very welcome. Aspiring “divorce tourists” may appreciate the opportunity to demonstrate connection to this country at the substantive hearing, rather than at an earlier stage. However, this particular long-running high-value dispute may still have some way to go as it remains open to Mr Potanin to seek a further appeal to the Supreme Court.”

Sital Fontenelle, Head of the Family Law team at Kingsley Napley LLP, comments:

“All lawyers to international HNWs have been watching this case, given it concerns the limits to divorce tourism and is the latest determined example of a wife testing England’s reputation for being a fair and generous forum.

The Court of Appeal has today granted Natalia Potanina’s application for leave to bring a Part III claim meaning she is permitted to bring a claim for financial remedies in this jurisdiction following a divorce and financial settlement decided after a long marriage in Russia.   

The Court of Appeal had little difficulty in concluding that Mrs Potanina has solid grounds to bring her application on the basis of her connections to this country and the ‘limited’ view of her husband’s assets that was taken in Russia. The Court even went so far as to note that it could be argued the size of her award in Russia meant her reasonable needs could not be met. It also observed she had only received a fraction of what she might have received in this country.   

This will no doubt be disappointing to her husband and will dismay those who feel our divorce courts should be dealing with more local and needy cases. As the Court of Appeal notes, this case has been running for nearly 7 years and has consumed substantial resources of the court.

Although today’s decision is, of course, fact specific, the key point is that the door is still open; it reinforces our reputation for being divorce capital of the world and importantly there was no narrowing of the test for other potential claimants who have the appetite to bring litigation here.  We will therefore remain an attractive jurisdiction for divorce cases. 

However, it is unlikely to be the end of the matter since Mr Potanin may still have the appetite to appeal further and request the Supreme Court considers the substance of this case (their original review was procedural).  

This is a blockbuster case in financial terms – with considerable £s at stake in the billions rather than millions – so we can expect it will continue to be hard fought for several years to come.”

Sean Hilton, Family Partner, Stevens & Bolton, commented:

“Today’s Court of Appeal decision in the Potanin case marks a significant moment for international divorce law in England. By allowing Natalia Potanina’s financial claims to proceed despite her divorce being finalised in Russia the court confirmed its ability to intervene where a spouse claims they have received insufficient provision from a foreign divorce. Mrs Potanina was found to have a real and meaningful connection to England – she held a UK investor visa, owned property here, and had been habitually resident for over a year. The Judge did not agree with Mr Potanin’s claim that his ex-wife was a ‘divorce tourist’.

“The court also commented that under the Russian divorce Mrs Potanina received a “tiny fraction” of the sum she would have received if she had divorced in England, and that this may be more significant when Mr Potanin is required to give disclosure of his assets here. In those circumstances the Judge commented that it would be appropriate for the court to make a further financial award to Mrs Potanina, the extent of which will need to be determined at a further hearing.   

“This decision may now open the door to a raft of applications that have been waiting in the wings for clarity. It is clear this ruling will shape how we advise international clients going forward. While the procedure for these applications has been tightened, the court have made clear that if jurisdiction is established and there’s a real prospect of success for a spouse with a meaningful connection to this country, claims may still proceed with a broad discretion afforded to Judges – perhaps supporting the view that England is the ‘divorce capital of the world’.”

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About Peter Burgess

Peter is one of the two founding partners at Burgess Mee Family Law.

Having trained at top family law firm Withers LLP, Peter founded Burgess Mee with in 2013, where he advises on the full spectrum of family law issues across the firm’s three offices. Peter is also an FMC accredited mediator.

Get in touch with Peter today:

• Email
• Call on – 0203 824 9952

About Sital Fontenelle