The “corrupt and illegal practices” of the Vote Leave campaign in the 2016 referendum undermine the validity of the decision to leave the EU, the high court has been told.

Relying on findings made by the Electoral Commission about overspending by the pro-Brexit campaign, British people living in Europe have launched a legal case arguing the referendum result should in effect be set aside.

“Breaches of spending rules are serious offences that vitiate the referendum result,” Jessica Simor QC, for the claimants, told the court. “Corruption and illegality in the course of an election or referendum must have a consequence. Corruption and illegal practices undermine the rule of law and democracy.”

There was significant overspending, data breaches and possibly Russian involvement in the referendum, she said. “The electorate can no longer be expected to respect the result.”

Simor criticised the decision by Theresa May not to act on the findings of the commission. “Her repeated refusals to take any cognisance of what was discovered is irrational.”

She acknowledged the court could not quash the result of the referendum because it was only advisory, but sought “declaratory relief” from the court.

The judicial review has been launched by UK in EU Challenge, which represents Britons living in France, Italy and Spain.

It argues the commission’s findings on BeLeave and Vote Leave, which resulted in two officials being reported to the police and fines being imposed, mean the 2016 EU referendum was not a lawful, fair or free vote.

The claimants are represented by Simor, Croft Solicitors and Patrick Green QC, all of whom acted for successful parties in the original article 50 case at the supreme court.

The government is resisting the action on the grounds that it is out of time and a similar challenge has already been dismissed.

The claimants maintain the claim is not out of time because the commission only found in July that BeLeave spent £675,000 which should have been declared.

Before the hearing, Sue Wilson, who lives in Spain and is the lead claimant, said the challenge was about making sure the law was fair.

“We know Vote Leave broke the law,” said Wilson. “We know that the overspending influenced the result of the referendum.”

If the court found in her favour, she added, it would probably be for parliament to decide what should happen next.

In written submissions to the court, Sir James Eadie QC, for the government, argued the application was out of time, having been made more than two years after the referendum. The 2015 EU Referendum Act, he said, provided that any judicial review challenge to the outcome had to be brought within six weeks.

The judge, Mr Justice Ouseley, reserved judgment on the application. He is expected to give his decision next week.