The long-running feud between the oligarchs Boris Berezovsky and Roman Abramovich, once best friends at the Kremlin, descended to an English courtoom yesterday with the $4 billion proceeds of Russia’s oil and aluminium riches at stake.

A gripping account of how the once-Communist nation’s mineral assets were divided up by a handful of men in chats at the Dorchester in London and Munich airport unfolded in a case involving allegations of intimidation, threats and duress.

One of the key players in the tale, the Georgian opposition leader and tycoon Arkady “Badri” Patarkatsishvili, was found dead of a heart attack at his country house in Surrey two months ago. Tests showed that he could have died at any time.

Mr Abramovich is accused of using his privileged proximity to President Putin to intimidate Mr Berezovsky by threatening that the Russian State would confiscate his oil shares.

But if he sold them to Mr Abramovich a close business ally would be released from jail in Russia, it is claimed. Speculation about the true relationship between Mr Berezovsky, now a refugee in Britain, and Mr Abramovich, the Chelsea Football Club owner, has provided fodder for biographers and Kremlinologists for years.

The hearings may finally produce evidence to help to solve the riddle of how Mr Abramovich rose from being a lowly street trader to one of the world’s wealthiest men in little more than a decade.

He was described in the High Court as non-domiciled in Britain but having organised his affairs to hold his interests outside Russia.

The case promises to shed light on how Mr Berezovsky, once regarded as the godfather of the Kremlin, fell out of favour with his young protégé and the rulers of Russia, resulting in his exile and loss of grip on the nation’s assets.

Mr Berezovsky is claiming $2.3 billion (£1.15 billion) from Mr Abramovich over the loss of his shares in the oil giant Sibneft and $1.75 billion losses from his stake in the aluminium company Rusal.

“For many years, the claimant and the defendant were extremely close business associates,” Mr Berezovsky’s court papers state.

In summer 1995, as President Yeltsin was creating the privatised oil company Sibneft by decree, Mr Berezovsky, Mr Abramovich and Mr Patarkatsishvili agreed how to divide the business among them.

By 1996, Mr Berezovsky had become more involved in Russian politics and Mr Patarkatsishvili was responsible for managing Russia’s largest and most politically influential TV channel.

Mr Abramovich proposed that the Sibneft shares held by the older men should be transferred legally to him or his entities, it is alleged.

The agreement was that the pair would continue beneficially to own the shares, held on trust by Mr Abramovich, and they would still be entitled to dividends and payments.

“By the summer of 2001, the claimant’s active opposition to the policies of President Putin resulted in an orchestrated campaign by the Russian State against the claimant’s interests,” Mr Berezovsky’s papers state.

“By contrast, the defendant was and remained at all times close to President Putin and part of his inner circle. In these circumstances, the defendant conducted a campaign of intimidation against the claimant.”

Mr Abramovich allegedly threatened that the older pair’s interests in Sibneft could be expropriated and made it clear they should sell to him “or face the consequences”.

Mr Berezovsky alleges that they were told that, if they sold, Nikolai Glushkov, their close business associate, would be released from prison in Russia.

It is claimed that Mr Patarkatsishvili rang Mr Berezovsky, who was staying at his villa in Cap d’Antibes in France, to pass on the alleged threats and it was conceded the pair had no option but to sell.

Mr Abramovich had intended to make Mr Berezovsky sell his shares undervalued and Mr Berezovsky complied, Barbara Dohmann, QC, for Mr Berezovsky, said.

In a curious twist, not mentioned in the court case, Mr Glushkov was not freed as a result of the deal, although an attempt was allegedly made to spring him from jail by Andrei Lugovoy. Mr Lugovoy is wanted by Scotland Yard on suspicion of the radiation poisoning in London of the dissident KGB spy Alexander Litvinenko.

Ms Dohmann said: “The court will investigate the relationship between the parties, between Mr Berezovsky and Mr Abramovich. Conduct and statements made by Mr Abramovich [were] unlawful and illegitimate. They amounted to a gross breach of trust.”

But Andrew Popplewell, QC, for Mr Abramovich, witheringly rejected the claim, describing it as completely incoherent nonsense that smacked of desperation.

“The arguability of the case depends wholly on oral conversations that are not documented or evidenced in writing at the time or indeed ever,” he told Judge Mackie, QC.

“They are unevidenced conversations which occurred a very long time ago. The defendant regards these claims as hopeless and a complete try-on.”

The hearing was adjourned.

Roman Abramovich

— Born to poor Jewish parents and brought up in the Arctic region. An orphan by age of 4; cared for by extended family

— He moved from selling plastic ducks to becoming a small-scale trader of oil from the refinery in Omsk

— Befriended by Boris Berezovsky in 1992, he moved into the inner circle of powerbroking oligarchs. After Berezovsky’s exile, Abramovich stepped into his mentor’s shoes

— He acquired control of oil company Sibneft and shares in Aeroflot and the aluminium giant RUSAL, surviving several corruption investigations

— He entered politics in 2000; became governor of Chukotka region and lavished his own money on improvement schemes. He bought Chelsea Football Club in 2003

— Abramovich later sold most of his holdings back to the Putin Government at well below their value

— Fortune estimated at £9.6 billion. One of the few oligarchs not to have faced criminal charges

Sources: Times archive; Forbes; Agencies

Boris Berezovsky

— Born to a family of Jewish intellectuals, Boris Berezovsky was an academic mathematician until the state stopped paying his salary in 1989

— He began supporting himself by selling cars to Moscow’s new consumer class and became the country’s first billionaire

— Bankrolling Boris Yeltsin’s 1991 election, Berezovsky was rewarded in Kremlin-controlled privatisations. He bought oil company Sibneft for $100 million – it was later valued at $1 billion

— Played kingmaker to the unknown Vladimir Putin, who later turned on his oligarch backers. Berezovsky fled Russia – and fraud and corruption charges – in 2000. The UK granted him asylum

— He called for the end of Putin’s rule, using his £800 million fortune to fund dissidents

— He has survived several assassination attempts, including one that decapitated his chauffeur, and lives in a Surrey mansion equipped with bulletproof windows and bodyguards

Sources: Times archive; Forbes

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