Multinational couple argue over money before divorce begins

The wife of a multimillionaire hedge fund manager has been had her claim for interim maintenance and legal costs significantly reduced by the High Court.

 

Referred to as ‘W’ in the judgement, she had enjoyed some business success before becoming a stay-at-home mother. She and the husband – ‘H’ – were both from outside the UK. They married in London in 2017 and went on to have two children, now aged three and one. The husband was a citizen of three separate countries, while the wife had two nationalities. The siblings are UK citizens, but they too hold other citizenships.

 

The couple lived comfortable lives during their time together, explained Mr Justice Peel in the High Court:

 

The parties enjoyed a luxurious standard of living during their marriage, the court being satisfied that, prior to separation, W had largely unfettered access to funds from H enabling her to sustain a very high level of expenditure, in the region of £43,000 per month in the 12 months prior to separation.

 

The family left London and moved to another country in February 2021, but the husband and wife argued over whether this move would be a permanent or temporary one. Within a few months the marriage had broken down.

 

Since the separation, the husband had stopped all financial support and the wife has instead relied on substantial loans from friends. He began legal proceedings at the local courts, while she returned to the UK with the two children and issued a petition for divorce, arguing that the UK was her ‘habitual residence’ (usual residence for legal purposes), because she had only been in the new country for a short period. This move prompted the husband to apply for the return of the children under international treaty the Hague Convention on the Civil Aspects of International Child Abduction.

 

His application was unsuccessful, however, and the local courts also declined to take his divorce proceedings forward, on the grounds that habitual residence also remained the UK.

 

The wife then applied in the English court for maintenance pending suit and a legal services payment order. Maintenance pending suit is temporary financial support – also known as ‘interim maintenance’ – which can be paid by wealthier spouses to dependent ones in the run-up to a full financial settlement. A legal services payment order, meanwhile, is a requirement that the wealthier spouse provide funds to help pay the other’s legal fees during contested divorce proceedings.

 

Neither party had yet completed a Form E: the standard declaration of financial assets used in English divorce courts, instead providing only limited financial details in support of their respective cases.

 

The wife sought substantial sums– close to £1 million in maintenance and a little under £900,000 for legal fees resulting – not only for her current claim, but also from the husband’s previous Hague Convention proceedings and the ongoing divorce petition.

 

She claimed her estranged husband was worth around £100 million, but he disputed this, saying his only income at the time was investment dividends and insisted that he too was relying on financial support from family and friends

 

The pair argued over the value of particular investments the husband had made. She claimed he had made $20 million from a technology investment, for example, while he said he had made nothing on that investment to date and would not do so for several more years. The sale of a property in London for more than £4 million was an additional matter of contention, with the husband’s insistence that she had been fully aware of the sale denied by the wife and rejected by the court.

 

Mr Justice Peel noted that applications for interim maintenance are usually dependent on the quality of the evidence submitted. In this case, both parties claimed to lack access to ready assets while accusing the other of being wealthy. Caution and solid evidence would be required to make a judgement, he stressed.

 

The Judge considered the husband’s failure to provide much supporting documentation:

 

It seems to me to be directly relevant that W has provided a full run of bank and credit card statements which has allowed H and his legal team to analyse her finances in some detail. By contrast, H has provided none except for a summary balance and one bank statement. It has not been possible for W and her team to analyse his finances.”

 

He continued:

 

…it must have been obvious that in a case where everything is disputed, including the extent of his wealth and accessibility of funds, such documents would be necessary. Given the nature of his case, that he is unable to pay anything for W and the children, I find it extraordinary that he has not produced bank and credit card statements. It is, accordingly, more difficult for me to accept what he says at face value.

 

Mr Justice Peel added:

 

It is, in my judgment, significant that H cut off W and the children financially in mid 2021, at a time when the marriage was in terminal breakdown, and has not paid a farthing since. Until then, they had been fully supported in an expensive lifestyle with, so it seems to me, no indication of impending financial doom. On the contrary, whenever W asked for large sums of money, he provided them…It is likely that H stopped paying because he chose to, perhaps out of anger and frustration with W.

 

The husband’s financial decisions were telling, the Judge continued:

 

…during 2021 H invested millions of pounds into his business interests from the sale of the two London properties. That includes £4.3m from the sale of the property in [London] W8 which took place after separation and without W’s knowledge or agreement. Put simply, H during 2021 elected to prioritise his own interests over those of his family, and his actions in selling the W8 property deprived her of the opportunity to seek a share of the proceeds to meet her interim needs. He cannot complain if she now brings an interim application. Further, it seems to me to be highly unlikely, even on an interim evaluation, that H parted with millions of pounds into his businesses, knowing that (on his case) he would not have any monies left even for his own personal needs.

 

The Judge concluded that it would be appropriate to make a proportionate award to the wife. But he believed the budget included in the wife’s submission was “grossly exaggerated” and her continuing spending habits were “irresponsibly excessive”.

 

He therefore reduced her claim for maintenance pending suit by more than 50 per cent, plus school and nursery fees. This would, he explained, only be payable for the period following her claim, as prior to that she had elected to borrow money and spend extravagantly. The wife’s claim for current and future legal costs was also reduced significantly to more fairly balance financial responsibilities between the estranged couple.

 

The couple were firmly at loggerheads, the Judge noted:

 

This is a case where the parties agree on nothing. They each accuse the other of being bent on a path of destruction. They are utterly conflicted about the history of the marriage, the circumstances of its breakdown, where they are all habitually resident, the welfare of the children…”

 

Read the full ruling here.

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