JSC BTA Bank v Ablyazov & Anor [2016] EWHC 3071 (Comm) (09 December 2016)

JSC BTA Bank v Ablyazov & Anor [2016] EWHC 3071 (Comm) (09 December 2016)

The court found that the transfer was intended as a genuine gift by Mukhtar Ablyazov to his son Madiyar to enable him to obtain a UK investor visa, and not as a sham or a transaction to defraud creditors. The presumption of advancement applied and was not rebutted by the evidence. The Section 423 claim failed as the transfer was not made with the substantial purpose of prejudicing creditors.

Citation
[2016] EWHC 3071 (Comm)
Parties
Claimant: JSC BTA Bank; First Defendant: Mukhtar Ablyazov; Second Defendant: Madiyar Ablyazov
Jurisdiction
England and Wales
Judgment Date
09 December 2016
Procedural Posture
Commercial Court Claim / Judgment After Trial
Outcome
Claim dismissed; declaration granted to Second Defendant
Legal Topics
Resulting Trusts, Presumption of Advancement, Transactions Defrauding Creditors, Section 423 Insolvency Act 1986, Asset Tracing, Freezing Orders
Trusts Insolvency Fraud Banking Resulting Trusts Presumption of Advancement Transactions Defrauding Creditors Section 423 Insolvency Act 1986 +2 more

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Parties

JSC BTA Bank

Claimant

Mukhtar Ablyazov

First Defendant

Madiyar Ablyazov

Second Defendant

Procedural Posture

Commercial Court Claim / Judgment After Trial

Legal Issues

  1. 1 Whether the £1.1 million transfer from Mukhtar Ablyazov to Madiyar Ablyazov was a gift or held on resulting trust
  2. 2 Whether the transfer was a transaction defrauding creditors under section 423 of the Insolvency Act 1986
  3. 3 Whether Madiyar is entitled to a declaration of outright ownership of the fund

Ratio Decidendi

The court found that the transfer was intended as a genuine gift by Mukhtar Ablyazov to his son Madiyar to enable him to obtain a UK investor visa, and not as a sham or a transaction to defraud creditors. The presumption of advancement applied and was not rebutted by the evidence. The Section 423 claim failed as the transfer was not made with the substantial purpose of prejudicing creditors.

Court Disposition

Claim dismissed; declaration granted to Second Defendant

Orders

  • BTA Bank's claims (Trust and Section 423) are dismissed.
  • Declaration granted that Madiyar Ablyazov is the beneficial owner of the fund paid into court.