Fereshteh Habibollazadeh Behbehani v Falah Syed Hussein Syed Hashim Behbehani
| Jurisdiction | England & Wales |
| Judge | Lord Justice Longmore,Lord Justice Moylan,Lord Justice Baker |
| Judgment Date | 20 December 2019 |
| Neutral Citation | [2019] EWCA Civ 2301 |
| Date | 20 December 2019 |
| Docket Number | Case No: B6/2018/2168 |
| Court | Court of Appeal (Civil Division) |
[2019] EWCA Civ 2301
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
FAMILY DIVISION
THE HON MRS JUSTICE PARKER DBE
FD05D04818
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Longmore
Lord Justice Moylan
and
Lord Justice Baker
Case No: B6/2018/2168
and
James Pickering (instructed by Khokhar Solicitors) for the Appellant
Peter Shaw QC (instructed by Fletcher Day) for the Respondents to the appeal
The Respondent to the suit was not present nor represented
Hearing dates: 17 July 2019
Approved Judgment
On 18 November 2008, at the conclusion of a financial remedy hearing in divorce proceedings before Parker J, Mr Falah Syed Hussein Syed Hashim Behbehani was ordered to pay his former wife, Mrs Fereshteh Behbehani, a lump sum of £20m in full and final settlement of her claims. Eleven years later, despite repeated efforts by Mrs Behbehani and her representatives to enforce the order, not a penny of that sum has been paid.
On 21 July 2017, Parker J made an order without notice to any other person appointing receivers of shares held by two Irish companies in a Spanish company called Setubal 97 SL (“Setubal 97”). In her judgment delivered on 18 November 2008 (“the 2008 judgment”), the judge had found that Mr Behbehani was the beneficial owner of 99.14% of Setubal 97. On 17 May 2018, however, the judge set aside the receivership order on the joint application of Mr Taysir Al Sahoud and another Spanish company, Saltai 2001 SL (“Saltai”). Mrs Behbehani now appeals against the setting aside order, permission to appeal having been granted by King LJ on 26 February 2019.
Background history up to the 2008 judgment
Although Mr and Mrs Behbehani have been separated for many years, it is convenient to refer to them as the husband and wife.
Under the order dated 18 November 2008, the husband was ordered to pay the wife a lump sum of £20m by no later than 16 December 2018. Pending payment, he was ordered to pay monthly periodical payments in the sum of £14,000 from 6 July 2006 to the date of the order, and thereafter in the sum of £27,750. It was further ordered that, in the event of late payment of the lump sum, interest would run on the amount overdue, with credit to be given for sums paid by way of periodical payments. The husband was ordered to pay the costs of the ancillary relief proceedings on an indemnity basis. The order provided that the wife's other claims would be dismissed upon payment in full of all sums due under the order. The husband's claims for financial relief were dismissed from the date of the order.
To date, the husband has paid nothing due under the order, either by way of lump sum, periodical payments or costs.
The history of the marriage is set out in some detail in the 2008 judgment. In short, the parties were married in 1985 and had two children, both now in their early thirties. At all material times, during the marriage and subsequently, the husband has lived in Spain where, as the judge found, he has substantial business interests. During the marriage, the wife and the children spent much of the time in London, living in a property in St John's Wood. The judge found that the marriage had effectively broken down in 2000 when Mrs Behbehani discovered that her husband was having a relationship with her niece. In December 2003, the wife filed divorce proceedings which were unopposed and resulted in a decree nisi being granted in August 2004. In October 2004, the wife filed a Form A claiming financial remedies. That application took over four years to be determined, during which time the husband only occasionally participated in the proceedings and repeatedly failed to comply with orders for disclosure of his assets and income. The full history of his failure to comply with his obligations is set out in detail in the 2008 judgment.
The final hearing in November 2008 had been listed for ten days, but in the event lasted for a considerably shorter period because the husband was neither present nor represented. The evidence before the judge included written statements and oral evidence from the wife, limited written evidence from the husband, and expert reports and oral evidence from a forensic accountant, Mr Anthony Levitt. At the start of her judgment, Parker J summarised the case in these terms:
“The wife asserts that the husband is a man of considerable wealth. He asserts that he has no significant wealth of his own and that he is dependent upon the generosity of others. His lack of disclosure and cooperation with the court process has compelled the wife through her legal team to look with scrutiny at the limited disclosure provided by him and to instruct a private investigator and forensic accountants to try to piece together the limited information given in the hope of presenting a true picture to the court. It has been conceded from the outset by the wife's legal team that achieving a complete understanding of the extent of the husband's wealth would be almost impossible within the course of these proceedings.”
At paragraphs 24 to 25, the judge summarised the parties' respective positions as follows:
“24. It is the husband's case that he has virtually nothing of his own and everything has been owned by others which might otherwise be attributed to him, members of his family and his associate Mr Taysir Al Sahoud.
25. It is the wife's case that the husband is a very substantial property developer in Spain but that he has concealed his assets behind a series of companies, some of which are holding companies in respect of various entities, in order to distance himself from his true ownership and the various transactions which are carried on by him and the various business operations which are carried on by him.”
The judge proceeded to consider the evidence concerning the husband's business activities and his involvement with a number of companies, including the two Spanish companies, Setubal 97 and Saltai, and two Irish companies, Viveca Limited and Areish Enterprise Limited. Foremost amongst the husband's business activities scrutinised by the court was his involvement with the development of a substantial golf resort in Marbella, ultimately known as the Santa Clara development. The husband's case was that he had no interest in that development, that the interests in it were held by Setubal 97, and that the ultimate owner was Mr Al Sahoud. Records adduced in evidence showed, however, that 99.14% of the shares in Setubal 97 were held by the two Irish companies and only the small balance of 0.86% held by Mr Al Saloud, and that the shares in the two Irish companies were in turn held by Saltai. Mr Levitt's expert opinion, which was based on an analysis of the limited evidence provided by the husband and by the reports of the private investigator instructed by the wife, was that the husband was the beneficial owner of 99.14% of the shares in Setubal 97. His opinion was substantially supported by the testimony of the wife herself. Amongst the evidence adduced by the wife were tape recordings of conversations between her and the husband in which he had described his interests and developments in terms consistent with Mr Levitt's subsequent analysis. At one point in the conversations, the husband was recorded as saying: “I hide money very good”. It was the wife's evidence that Mr Al Sahoud did not own any of the companies but was merely an intermediary used by the husband.
The judge then analysed the limited evidence provided by the husband, in particular an affidavit sworn by him in March 2008, and identified many inaccuracies and inconsistencies in that document.
The judge concluded that the husband was the true owner of 99.14% of the shares in Setubal 97 (and the beneficial owner of the two Irish companies and Saltai). Her reasons for those conclusions are summarised in paragraphs 102 to 105 of the judgment. The judge further found that the description of the husband's financial position in his Form E and affidavit was untrue; that the true level of his income was well in excess of the £200,000 claimed; that he had many undisclosed accounts in various countries across the world; that he had embarked upon a determined process for a number of years to conceal the extent of his wealth with the assistance of others, in particular Mr Al Sahoud; and that Mr Al Sahoud was not the owner of the assets but, rather, involved in an administrative capacity for which he received a commission in the form of a small percentage.
The judge found as a fact that the husband was worth “at least £44 million and it could be very much more”. She then recorded (paragraph 112):
“Mr Cohen QC and Mr Love [the wife's counsel] have, as a cross check, set out … the way in which a needs claim might be formulated on behalf the wife. They say that a reasonable starting point is £250,000 per annum, which comes out on a Duxbury basis as a capitalised sum of £6.219 million. They say that this is a reasonable starting point in the light of what has been provided historically and the wife's budget to which I have already referred. I accept the submission. I have to say, however, that if – as I have found – this is a case where the assets far outweigh what might be awarded on a needs basis, that needs basis becomes subsumed within the sharing principle and therefore the needs calculation is to be regarded as no more than a cross check or as a starting point.”
It was argued on behalf of the wife that the husband's assets were worth at least £60m, probably £100m and maybe more. The judge took a more cautious approach. Mr Levitt had calculated the identified assets to be worth...
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