AB v CB (First Respondent) Trustees of the X Trust (Second Respondent)
| Jurisdiction | England & Wales |
| Judge | The Honourable Mr Justice Mostyn |
| Judgment Date | 25 June 2014 |
| Neutral Citation | [2014] EWHC 2998 (Fam) |
| Date | 25 June 2014 |
| Court | Family Division |
| Docket Number | Case No: FD12D04963 |
[2014] EWHC 2998 (Fam)
IN THE FAMILY COURT
Swansea Civil and Family Justice Centre
Caravella House
Quay West
Quay Parade
Swansea
SA1 1SP
The Honourable Mr Justice Mostyn
Case No: FD12D04963
AB, Litigant-in-person
Richard Anelay QC on behalf of the First Respondent
Richard Dew on behalf of the Second Respondent (Interveners)
This is my judgment on the wife's claim for ancillary relief following divorce. I use the old expression 'ancillary relief' rather than the neologism in the Family Procedure Rules of 'financial remedy', as ancillary relief is still the heading to that part of Part 2 of the Matrimonial Causes Act beginning at Section 22, where it sets out the powers of the Court and describes them as "ancillary relief in connection with divorce proceedings".
The application is made in the wife's divorce petition, dated the 15 th October 2012, on which a decree nisi was pronounced on the 17 th April 2013 and was formally activated by the wife's Form A issued on the 19 th November 2012 in the Principal Registry of the Family Division; and those proceedings were transferred to the Swansea County Court earlier this year.
The case was listed before the district judge in this Court for four days, but was allocated to me having regard to the nature of the dispute, I sitting in Swansea for this week and last week.
I have to say that the case has been conducted in a model way. The parties and the interveners filed very full skeleton arguments which obviated the need for any opening, evidence in chief was not permitted in accordance with the new prescription, we heard all of the evidence and final submissions in one day and I am giving judgment at 10:15 on day two.
The efficiency with which the case was done is a credit to all concerned and it should serve as a reminder to those who practise in this field that with goodwill and effort it is possible to do what are quite complex cases extremely economically, both in terms of time and money.
The applicant wife, and I will refer to her as the wife because that is the convention and because in fact she still is the wife, the decree absolute not having yet been issued, is aged 44. She is a journalist by profession, the daughter of a man who was a pensions manager.
When she and the husband first met in 1999 she had by then acquired her first home in Bristol, which she still has. That is pre-marital property and indeed by making further borrowings on that property she has bought another property in Pembroke Dock, which again is to be characterised as non-matrimonial property even though that latter property is in fact in negative equity. I will deal with her financial position in more detail a little later.
The husband is aged 41, being born on the 28 th July 1972. On paper he has almost no assets at all and his income is extremely modest. On paper his only asset is a plot of land called Plot A, in Pembrokeshire, with a net value after subtraction of notional Capital Gains Tax, of just under £38,000. His income from all sources, including from welfare benefits, is said to be just under £3,000 a month.
So on paper, and I emphasise on paper, he presents as somebody who is rather less well off than the wife. I perhaps should mention that in addition to Plot A he has a microscopic pension fund as well. However, that does not tell the true story by any means.
The husband is the third child of DB and VB. He has an older sister LB who is 46 and who lives in London, and an older brother EB who is aged 44, who is married and who has four children and who is a farmer in Pembrokeshire. The husband comes from a distinguished Welsh family which own substantial lands in Pembrokeshire and have done so for generations.
The family as a whole is obviously of great wealth and I heard evidence from EB, who confirmed that as a result of transfers, some of which I think have been relatively recent, from his father and possibly from his mother as well (although I did not enquire as to the precise origin of the donations) that he (EB) has assets net of borrowings of around £3,500,000 in farm land and property. That excludes the valuable home in which he lives, which happens to be owned by his father; his father living in another valuable home which happens to be owned by his wife.
The husband told me that his trade or profession is as a copywriter, working in the field of media, but again that does not tell the whole story by any means. He works within the overall family enterprises as an agent for the family in advising on developments; he is a shareholder and director of the enterprise company that has been set up in order to undertake developments; and he is involved in other aspects concerning the economic life of the village, which have been explained to me and which I do not need to go into. On any view, although there is no sense of entitlement on his part, his position in terms of financial security is absolutely assured.
The parties, having met in 1999, moved to Pembrokeshire in 2002 and began living together in the husband's parents' home and they were married on the 8 th February 2003, having some months before that established a media consultancy company, a service company, in which they each held a 50% shareholding and through which they conducted their media consultancy work.
Shortly after the marriage in February 2003 the enterprise company, which I have just mentioned, was incorporated with four directors, the husband, his brother and his parents each holding a 25% share.
In March 2004 a property on the estate, a cottage, then derelict, was gifted to the husband and wife by the husband's parents and the parties worked hard in converting that property into a house, for which purpose they borrowed money, but in addition they invested considerable brawn in making it an attractive property fit for sale, and it was duly sold on the 30 th July 2004. There is a spreadsheet, which is not disputed, which has been produced by the husband which explains with some precision what happened to the proceeds of sale.
For my purposes all I need to note is that from the proceeds of sale certain sums were paid back to the parties to discharge their individual debts, but those individual debts were in truth joint debts, and nobody has disputed otherwise, leaving a surplus, and that surplus was used in three ways. First £15,000, money that was jointly owned by the husband and wife, was lent to the enterprise company; £21,000 was spent on their new home, which I shall describe in a minute, a farmhouse; and £21,625 was spent by the parties on buying things and living, and there is a list of that which descends even to things like cash at Tesco, which explains exactly how that money was spent.
In 2005, after the cottage had been sold, the parties moved into the farmhouse. It is on the public highway next to the dairy unit, which I think, at that point, although I may be wrong, was in disuse. It had been, in the past, used as a herdsman's accommodation. It had also been, in the past, rented out. It was not in good shape, and following the moving in significant renovation work was undertaken which was funded, in part, as I have just mentioned, from the proceeds of the cottage, that is the £21,000. So it can be seen at this point that even though the farmhouse, the title of which was held at that point by the husband's father and then later by the husband's father and mother, the parties applied their own monies which derived from the cottage. This unquestionably was their money, notwithstanding that it had been gifted to them by the husband's father.
In August 2007 SB, the parties' adopted child, was born. She was placed with the parties for adoption in December 2009 and adopted by them jointly on the 15 th March 2011.
In relation to this aspect I jump forward out of the chronology to explain that in December 2009 JB was born. He was placed with the parties for adoption on the 13 th March 2012. The parties applied to adopt him on the 13 th July 2012. However, they separated on the 1 st September 2012 and that separation inevitably caused a disturbance to the adoption application and, without going into too many details, notwithstanding opposition by the natural mother, which has included an appeal to the Court of Appeal, the consequence of the separation, among other things, was that JB has been adopted by the husband alone on the 13 th May 2014.
In relation to SB there is a joint residence arrangement between the husband and the wife.
On the 21 st April 2009 a trust was established in relation to the farmhouse. There is a factual dispute between the parties as to whether the wife had any knowledge of the creation of this trust at all and I will deal with that in a minute. The wife says that she only discovered the trust existed after the breakdown of the marriage when she was told about it, and at that point she went to the files in the family office and saw the deed of trust and only then realised that her home was held by a trust.
The husband's father, DB, has made two witness statements, to the first of which he exhibits the background paperwork leading up to the creation of the trust, and it appears that the process or the thinking that led to the creation of the trust began over two years before the actual execution of the trust, back in March 2007. That is apparent from an internal memorandum, written by DB's solicitor on that day, where it says:
"I confirm that I met with DB on the 9 th March. We agreed that given that he wants to keep the farm intact his only option, if CB is to be able to remain...
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