Swiss media reported today that the Geneva Court of Appeal had issued its judgment on the merits of what has been dubbed “the divorce of the century”.
What has been reported
In accordance with the Hague Trust Convention, the Geneva Court of Appeal held that a trust was governed by the substantive law chosen by the settlor. In the present case, this meant applying Cyprus law to the 2 irrevocable trusts settled by Mr Rybolovlev in June 2005.
Accordingly, the Court took into account the value of the marital assets as of the date of their settlement into trust (1,2 billion CHF in June 2005), rather than on the date of the divorce filing (an alleged 8 billion CHF in December 2008). All the gains accrued within the trusts since 2005 were held beyond the spouse’s reach. Therefore, Mrs Rybolovleva was awareded a “mere” 564,7 million CHF (i.e. half of the 1,2 billion) and 2 properties, instead of the 4 billion CHF she claimed.
The Geneva Court of Appeal’s judgment was rendered on June 4th, but Mrs Rybolovleva has already announced her intention to appeal before the Swiss Supreme Court, so watch this space.
As we prepare to celebrate the 30th anniversay of the Hague Trust Convention of 1st July 1985, this is a welcome reminder of Switzerland’s recognition of foreign trusts.