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No escaping the tangled web…

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15th July, 2020

It has usually been the case that the family court will strive to provide parties with a final resolution based upon the known assets and resources they each hold at the time of their divorce and financial remedies proceedings.

This concept has now been explored further in the recently reported case of AW v AH.

The case revolved around the Wife’s claim that the Husband had not provided full and frank disclosure of his assets, in particular his multiple, opaque business interests. At the time of the hearing this year neither party owned (on the face of it) any real assets nor received an income. The parties married in 2001 and enjoyed an extremely extravagant lifestyle after the Husband sold his business in 1997 for £81million. This, however, was not to last after the Husband engaged in spread betting and a number of failed investments leading to his bankruptcy in 2011.

During the course of the proceedings the Husband claimed that he was still worth very little. The Wife, however, argued that the Husband had not provided full and frank disclosure and that the Husband held an undeclared beneficial interest in a company and its subsidiaries. The Judge ruled that there was a major failing with the Husband’s financial disclosure which had a negative impact upon the Wife’s financial position. This included hiding proceeds of sale, drawing money from his pension without permission and rearranging his companies to stop them from falling into the Wife’s hands.

Due to the Husband’s proven dishonesty throughout the process, the Judge decided that to leave the Wife with nothing, despite a lack of liquid assets, would not be fair. The aspect of this case which is particularly striking is the order that the wife’s claims for lump sums and property adjustment claims were to be adjourned for 7 years, thus enabling the Wife to bring the case back to court within that timeframe if the Husband’s true position became apparent. This was referenced to the Judge’s belief that the Husband would strive to improve his future financial position once the case had been resolved. The Husband was also ordered to pay 60% of the Wife’s legal fees as a consequence of his litigation misconduct.

This case has provided judges with succour to justify adjourning aspects of a claim based on the possibility that one of the parties has the means to improve their finances within a set timeframe.

This means that those going into financial remedy proceedings claiming that they have no liquid resources with which to pay their spouse, can no longer guarantee that the case will be resolved fully, based on those facts.

This reiterates the need for parties to provide full and frank disclosure from the start of a case and to provide proper explanations when assets have been dissipated or where a lifestyle is inconsistent with declared resources.

Lorraine Saunders

Family Law

Partner
Email: [email protected]
Tel: 01244 405 573

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