Our team acted for the judgment creditors which had been defrauded by one of their directors, a Kazakh national. The main claim was filed in the English High Court of Justice and led to a judgment in favour of the companies and against the director for the amount of US$300 million. In Cyprus, ancillary proceedings were brought by the director’s spouse and other relatives who claimed to be beneficiaries of Cyprus International Trusts. The assets misappropriated by the Settlor had been transferred to the said Trusts. The Cypriot proceedings brought by the beneficiaries aimed to restrain the seizure of the Trust assets as part of enforcing the English Court judgment against the Settlor.
Various novel issues were raised in the proceedings before the Cypriot Courts, including questions as to whether the Cypriot Courts could have exclusive jurisdiction to decide matters about the validity of a Cypriot International Trust and whether the Settlor’s creditors could challenge fraudulent transfers of assets in the Trusts before the English Courts.
The Courts rejected the beneficiaries’ arguments that the Cyprus International Trusts Law conferred exclusive jurisdiction to the Cypriot Courts to decide all matters about the validity of the Trusts and the transfer of assets in the Trusts.
The Cypriot Courts upheld our arguments that the ex-parte orders were contrary to EU law and that the beneficiaries did not make full and frank disclosure. As a result, the anti-suit injunctions were cancelled in their entirety thereby allowing our clients (as creditors in the English Court Judgment) to continue their enforcement proceedings in England and to eventually recover assets worth around US$150 million.