The test for meeting ‘usual residence’ requirements for jurisdiction is the subject of a High Court hearing today over two Russian men’s battle over a stake in a billion-pound fishing company.
In Tugushev v Orlov & Others the English courts’ authority to hear the case is being tested, as is the validity of a worldwide freezing order. During the first day of a three-day hearing today it was submitted that in order to meet the test of residency a regular connection to the jurisdiction must be established.
The case concerns an ongoing battle between Vitaly Orlov and Alexander Tugushev over a stake in the $1.5bn (£1.2bn) Norebo Group. Orlov took control of Norebo in 2016 but Tugushev claims that his one-third interest in the company is not being recognised. An order against Orlov, freezing £270m of his assets, was granted earlier this year. Orlov is challenging the court’s authority on the basis that he is not resident in the UK.
However documents filed with the court on behalf of Tugushev claim that Orlov had purchased a £13m apartment overlooking the Thames which was intended to be a base for him to spend time with his children. Orlov’s lawyers claimed it was not a family home but a ‘rather soulless place’.
For Orlov, Christopher Pymont QC cited previous cases involving high-profile businessman including Chelsea owner Roman Abramovich, which all asked similar questions regarding residency. The cases in which residency was proven could not be compared to this one, he said.
In a skeleton argument seen by the Gazette, lawyers for Tugushev submit that Orlov acquired other properties in England, including a £4.5m home in Surrey and a flat in London’s Fulham district. All of Orlov’s four sons have been or are in education in England: the eldest works at Norebo’s UK office in Maidenhead while the youngest sons are at fee paying schools, the skeleton argument adds.
The document acknowledges that the property in Surrey was transferred to Orlov’s wife following his separation from her in 2008/09. However, it claims that after the separation Orlov kept a ‘significant connection’ [with England] for the sake of his sons. This included buying a flat in St George’s Wharf, Vauxhall. Tugushev’s lawyers submit that this is intended to be ’something long term’ in England where Orlov’s sons could stay.
However, Orlov said that in 2014 he moved to Russia and his family life in England was, from that point, over and therefore the case should not go ahead in London. Pymont submitted that Orlov's flat in Vauxhall is a ‘rather soulless place’. The claim, he said, ‘goes nowhere near’ to meeting test of resident.
The case continues.