The Court of Appeal has recently applied Russian Law to dismiss Mr Vladimir Slutsker’s appeal that he has a beneficial interest in a London property.
Vladimir Slutsker v Haron Investments Ltd & Summit Trustees
The dispute surrounded the ownership of a family home bought by Vladimir and Olga Slutsker using an offshore trust. The Court heard that the property had been purchased by the first Defendant, Haron Investments Ltd, as nominee for Mrs Slutsker. An offshore Trust was then created, for which the second Defendant, Summit Trustee (Kaman) Ltd, was appointed Trustee; this held the beneficial interest on a discretionary basis for Mr and Mrs Slutsker, their children and others.
Mr Slutsker challenged a decision by the Trustee, exercising their discretionary power, to not to assert him a beneficial interest in the property absolutely, following the failure of the marriage.
Mr Slutsker claimed a half share in the beneficial interest under English law.
Mr Slutsker asserted that as the purchase monies were joint in origin they were therefore divisible in equal shares, thus giving him a one half interest in the property on a resulting trust basis. He relied on the two jurisdictions to further his case, firstly applying the English law to suggest that he had a right to the property his money had been used to purchase and secondly relying on Russian law to establish his right to the purchase money in the first instance and thus a beneficial interest in the property.
The Defendants applied Russian law suggesting that ownership of the money itself did not necessarily lead to a beneficial tenancy in common under the English law. In response to Mr Slutsker’s use of the Russian law, contended that he had consented to the monies being used for that purpose and that he had not challenged the disposition within the required time frame.
On that point, the Court of Appeal followed the decision of the Trial Judge, that although Mr Slutsker may not have known or perhaps realised the power of the Trustee to exclude him as a beneficiary, that overall he was aware of the use of the Trust. Mr Slutsker could not show that he did not consent.
The Court of Appeal held that under Russian law Mr Slutsker’s claim was “time barred” under the Russian Family and Civil Code, which the resulting trust’s interest argument submitted by Mr Slutsker must fail as it was a reference to English law based entirely on a point to be determined by Russian law. The Court of Appeal dismissed Mr Vladimir Slutsker’s claim.
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