Akhmedov vs Akhmedova: The super yacht saga – what happened in Dubai

15 June 2018 | Applicable law: England and Wales

After 22 years, Mr and Mrs Akhmedova's marriage came to an end in 2015.  This was a marriage like few others.  It lasted two decades, it resulted in two children and during the course of their partnership, they built up vast wealth, including a plane, a helicopter and a 115m super yacht called Luna.

Regrettably, the divorce was bitter. Mr Akhmedov fought hard and dirty to avoid having to share any of the family wealth with his wife. It was found by the English High Court that he hid assets in a Bermuda Trust with the intention of evading his legal obligations to his wife and even went so far as to invent stories that they had already divorced in Russia, producing forged documents to the Court as 'evidence'.

Mr Akhmedov did not win. He was ordered to pay to his wife in excess of £350m plus the art collection worth, at the time, about £90m, an amount equivalent to 41.5% of the family's wealth. His Russian divorce was found to be a lie and the dispositions of assets and money into the Trust were set aside. The companies he had used to hide the family's assets were declared his "ciphers" and "alter egos" and any transfers to them were also set aside. Bank accounts and assets were frozen, pursuant to worldwide freezing orders obtained in England, Liechtenstein and the Isle of Man.

But Mr Akhmedov is not one to be deterred by something as trivial as the law. In defiance of the High Court judgment and in breach of the freezing orders, he transferred the family's money and artwork to Liechtenstein. He created debts to himself and his other alter ego companies from his asset holding companies. He sailed their super yacht, Luna, from Turkey to Dubai (possibly with the expectation that the Dubai legal system might offer a safe place of refuge).

It very quickly became clear that Mr Akhmedov was willing to play every trick in the book to avoid paying what he owed. He was even prepared to put himself in contempt of court to do so.

Piercing the corporate veil

Mr Akhmedov's prized asset is the family's 115m super yacht, the Luna, purchased from Roman Abramovich for €260m. At the time the court handed down its judgment, Luna was owned by a Liechtenstein Anstalt, 'Q', whose assets were the subject of the court's freezing order. In breach of that freezing order, and unbeknown to Ms Akhmedova or the judge, Mr Akhmedov had already transferred the Luna from Q to another Liechtenstein Anstalt, 'S'.

Realising that S was the new owner of Luna, Ms Akhmedova returned to the English High Court seeking (amongst other things) an order piercing S's corporate veil.

The court very rarely pierces the corporate veil to make a direct connection between the beneficial owner of a business and that business's assets, but can make orders to include those assets in an award. If Ms Akhmedova was successful in obtaining this order, it would make S directly liable and place its assets (namely, Luna) back on the table.

The court readily agreed to the order, stating that Mr Akhmedov had acted with "real impropriety" in deliberately seeking to evade his legal obligations by employing corporate devices to put legal obstacles in the way of enforcement of the judgment. Indeed, S's entire raison d'etre was evasion of the subsisting judgment. The order was clearly necessary in the interests of justice and the court gave judgment directly against S.

The DIFC court as a conduit jurisdiction

In the meantime, and prior to obtaining the judgment against S, Ms Akhmedova took steps in Dubai to ensure that the Luna could not be whisked away again.

Ms Akhmedova applied to the Dubai International Finance Centre ('DIFC') court for a freezing order against both Mr Akhmedov and S (which, at the time, was not a party to the English proceedings or any judgment). The intention was to use the DIFC court as a way into the Dubai Courts, which will recognise a DIFC court order on the basis of comity.

The DIFC court agreed with Ms Akhmedova and granted a freezing order over the assets of both Mr Akhmedov and S.

At a later hearing for the continuation of the freezing order, S sought to challenge the order on jurisdictional grounds. S defended saying, amongst other things, that it was not a party to any English court order that Ms Akhmedova was seeking to enforce and that, in any event, both S and Luna are outside the jurisdiction of the DIFC courts.

However, the DIFC court agreed with Ms Akhmedova, stating that, as a matter of "fundamental policy, the DIFC court, like any other court of justice, must be in a position to respond to fraud and deliberate evasion". It was not prepared to allow a known fugitive from justice to avoid enforcement of a judgment simply by placing his assets into a company located in a "secrecy" jurisdiction. Accordingly, the DIFC court confirmed that its jurisdiction to ratify and enforce foreign judgments extends to the making of orders against corporate entities such as S if it can be shown that they are ciphers or alter egos of the judgment debtor .

S subsequently appealed the finding against it to the DIFC Court of Appeal. However, since the English court had since both pierced the corporate veil and made S a judgment debtor, the Court of Appeal continued the freezing injunction in order to allow Ms Akhmedova to join S on that basis.

Enforcement in the Dubai court

Immediately after obtaining the DIFC court freezing injunction, Ms Akhmedova applied to the Dubai courts for a precautionary attachment of Luna. The Dubai courts, acting as a delegate of the DIFC court and on the basis of the DIFC freezing injunction, duly granted the precautionary attachment, detaining the Luna pending the outcome of the main proceedings.

What happens next…?

Running out of options, Mr Akhmedov has now filed a claim with the Joint Judicial Committee – a body set up to decide on potential conflicts of jurisdiction between the onshore Dubai courts and the DIFC courts. It is Mr Akhmedov's hope that he can persuade the JJC that his dispute with Ms Akhmedova is a matrimonial one and one which should therefore be determined by the Dubai courts in accordance with Sharia law. Ms Akhmedova's case is that this is a matter of pure enforcement of a judgment debt which is owed to her and it is therefore right that the case be heard by the DIFC Court .


The English High Court has welcomed and praised the DIFC court's willingness to assist a victim of the wrongdoings of a serial evader and fugitive from justice. By his words and actions, Mr Akhmedov has acted in contempt and open mockery of the English court.

In the meantime and while he still can, Mr Akhmedov elects for the self-defeating option of "letting the boat rot" rather than paying Ms Akhmedova what she is owed.

Withers was instructed by Ms Akhmedova to manage and coordinate the global enforcement efforts.

This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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