Transfer Of A Yacht In Breach Of A Freezing Order And Contempt Of Court

In a recent judgment concerning proceedings by Russian Commercial Bank (Cyprus) Ltd ('RCB') against Fedor Khoroshilov and companies controlled by him, Judge Mackie QC found that Mr Khoroshilov was in contempt of court as he had transferred his yacht for nominal consideration in breach of a freezing order.

The freezing order was obtained by RCB in the context of proceedings in the Commercial Court and at the LCIA against Mr Khoroshilov and companies owned or controlled by him. These companies had borrowed substantial amounts from VTB and RCB in 2005-2007. Two of the loan agreements were subject to English law and jurisdiction, which led to parallel claims by RCB in the Commercial Court and the LCIA in 2009. These and related proceedings are at the stage of enforcement, including through insolvency procedures in Russia. Media reports have suggested that Mr Khoroshilov may have obtained loans from VTB and RCB by exaggerating the value of oil rights held by his companies, and misappropriated the loan funds for his personal benefit (in particular, by...