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XO v YO [2022] EWFC 114
Big money - long marriage - H not engaging much after forms E or in final hearing - Conduct - Adverse inference - H had pre-marital wealth.
As said before trying to make a bitesize article from any judgement these days is like trying to pour the River Thames into a wine glass, best to save that vessel for pouring wine into !
The parties were Nigerian with homes in Nigeria, UK and USA (inherited mainly from H’s parents.)
H’s father created a popular medicine, rights to which H inherited, as well as a prominent position in the company. W also worked in a prominent position in the company so had knowledge of its affairs.
The parties also had interests in several companies, and H had many cars (W asserted £2m worth) and other assets.
At final hearing, H was aged 60, W aged 48, with children aged 15 and 18, who had had little or no contact with F for a few years.
W accepted on marriage she had little wealth and what wealth she has, has come from financial activities during the marriage. At trial she had interests in several companies.
H filed a form E, but did not engage in valuations, and did not answer W’s questionnaire.
In interim proceedings in December 2020, the court ordered (inter alia) against H, a LAPSO of £60,000, MPS £15,000 pcm, and a school fees order. H did not comply.
A limited company controlled by H, which owned one property was joined, but except for applying for dis-joinder (refused) did not engage.
As HHJ Hess (sitting as a Deputy High Court Judge) said ‘By disengaging from the proceedings … the husband has effectively prevented and thwarted any meaningfully detailed investigation into his corporate asset base and sustainable income. ‘
However W was able to reasonably allege that H ’s income was circa £1m per annum based upon her knowledge.
In March 2022 H was given an opportunity to re-engage but he failed to do so when applying for an adjournment in writing (refused).
At the final hearing in September, H emailed the judge on first day of the hearing, but did not appear. The judge did hold that his emails were admissible.
At the final hearing the wife had a costs liability of £219,388 left outstanding from legal costs bills now totalling £515,526[1].
In his judgement the judge recited and considered s25 and considered constructive trust law in Miami. In addition he reflected upon the law on adverse inference.
From J v J [1955] P 215 Sachs J (as he then was) he plucked:-
‘that a husband can hardly complain if when he leaves gaps in the court's knowledge, the court does not draw inferences in his favour.’
He gained further from the Court of Appeal in Moher v Moher [2019] EWCA Civ 1482 as follows:
When undertaking this task (valuation) the court will, obviously, be entitled to draw such adverse inferences as are justified having regard to the nature and extent of the party's failure to engage properly with the proceedings.
The court added:- The enquiry should not be disproportionate or speculative, and any conclusions should be properly drawn and reasonable.
“As Thorpe J said in F v F, although not the court's intention, better an order which may be unfair to the non-disclosing party than an order which is unfair to the other party. This does not mean, as Mostyn J said in in NG v SG, at [7], It reflects, as he said at [16(viii)], that the court must be astute to ensure that the non-discloser does not obtain a better outcome than that which would have been ordered if they had complied with their disclosure obligations.”
In this case the judge tabled the assets and concluded concluded that ‘I should treat the wife as having a strong sharing claim to 50% of the husband’s business assets.’ In addition to transferring two properties to W the judge ordered H pay W £39m.
The judge also took H’s conduct into account, and pondered the later requirement to use s39 Senior Courts Act 1981: and see Welch v Welch [2017] EWFC B32. An order can only be made once the documents which are required to be signed have been sent to the husband and he has failed to sign them. At that point the court can order him to sign them or in default a without notice application be made to the court.
