Nichola Anne Joy v Clive Douglas Christopher Joy-morancho (First Respondent) Nautilus Fiduciary (Asia) Ltd (the trustee of The New Huertotrust) (Third Respondent) LCAL Anthology Inc. (Fourth Respondent)
| Jurisdiction | England & Wales |
| Judge | Sir Peter Singer,SIR PETER SINGER |
| Judgment Date | 28 August 2015 |
| Neutral Citation | [2015] EWHC 2507 (Fam) |
| Docket Number | Case No: FD11D03744 |
| Court | Family Division |
| Date | 28 August 2015 |
and
and
[2015] EWHC 2507 (Fam)
Sir Peter Singer
Case No: FD11D03744
IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION
Royal Courts of Justice
Strand, London WC2A 2LL
Mr Richard Bates (instructed by Sears Tooth Solicitors) for the Petitioner Wife
Mr Martin Pointer QC and Mr Nicholas Wilkinson (instructed by DWFM Beckman) for the First Respondent Husband
No representative appeared for either the Third or the Fourth Respondent
Hearing dates: 27 to 31 October, 3 to 7 November, 2 and 3 December 2014, 17 and 18 June 2015
Introduction
Between 27 October and 7 November 2014 I heard evidence over what was intended to be the final 10-day hearing of this long-running financial remedies application by Mrs Nichola Anne Joy (W). Although I had made provisional provision for the application to continue into the following week that was frustrated by the unavoidable commitments of counsel in the case, and their written final submissions orally supplemented could not be concluded until 2 and 3 December. On 26 February 2015 I distributed this judgment in draft form to Mr and Mrs Joy and by mid-May the process of sifting proposals for revision was completed. I heard further submissions in relation to the form of the order, costs and Mr Joy's appeal permission application on the earliest available dates, 17 and 18 June. My conclusions on those issues are appended to the main judgment which I now hand down. I impose no embargo on publication of this judgment which, I suggest, should for ease of identification be cited as Joy v Joy-Morancho and others (No 3) to differentiate it clearly from my two interlocutory judgments in March and April 2014 which have been published respectively as [2015] EWHC 455 (Fam) and [2014] EWHC 3769 (Fam).
Between December 2014 and February this year I considered carefully the extent of the issues and evidence necessary to establish my conclusions on the principal issue of fact I have to decide. That is whether or not the situation described by Mr Joy (H) is accurate so that he is in truth and in fact able for the foreseeable future to pay only modest periodical payments to W and their three children, but nothing whatever by way of capital award. That proposition and that outcome depend upon whether H really faces the financial ruin he maintains overwhelmed him as a result of what he describes as the day of reckoning imposed on him by the trustees of the New Huerto Trust (NHT). Those trustees now pursue him and all those assets to which he can lay claim (and more), so he will be left without substance. His debts therefore exceed by far any assets available or likely to become available to him. His case is moreover that he has been permanently and irrevocably excluded from any potential future benefits from NHT.
NHT is a trust H (as settlor) established in the British Virgin Islands (BVI) in December 2002. The trust had until recently as its trustee a Hong Kong based management company Royal Fiduciary Group (RFG) of which Tim Bennett (TB) is a director. RFG has merged with or been acquired by the Third Respondent, another offshore trust corporation of which TB has become a director, but there is no need to distinguish between the two for present purposes. TB does very clearly emerge as the human face and mind of the trustees, taking the lead in speaking for them and in informing and forming RFG's decisions in relation to NHT and H. I do not believe I will in practical terms commit any error if for shorthand I refer to the trustee of NHT either as RFG or as TB: and do not refer again by name to the Third Respondent which has come but latterly on the scene. The protector of the trust is a long-standing Dubai-based friend of H, Mr Richard Smith (RS).
Neither the NHT Trustees nor TB nor RS have responded to these proceedings by participating in them as parties or directly as witnesses. TB on behalf of RFG has however made available some, and withheld much other, information and documentation.
Only after resolving where I believe the truth lies on that primary issue of fact — whether H's plight is genuine or a contrived facade — can I proceed to consider the by no means straightforward question what capital provision, if any, in the context of a global award should be made for W; and then how she may be able to receive it if, as seems inevitable in the circumstances of this case, payment is not facilitated by those who may seek to delay or to thwart her.
The documentation prepared for this hearing was voluminous and extended by its conclusion (including some supplemental bundles from an earlier hearing for which I myself had asked) to over 20 ringbinders. The conduct of the case would have been more comfortable for all if I had required one or even two core bundles to be prepared, and I blame myself for not including a pre-trial direction to that effect. My purpose in mentioning this is not to rail but simply to explain how it is that to make sense of the rival contentions on what I have described as the primary factual question there are many issues which might be construed to point in one direction or the other. But there are others, more limited in their number, which seem to me to be incongruously inconsistent with what might be expected. It is upon the latter that I will concentrate. I will quote rather more extensively from transcripts of evidence and from documents than is normal in a judgment such as this, because so often the flavour of what is written and was spoken has contributed to my overall sense of what is credible and what is not.
To put these issues into context it is necessary for me to describe a good deal of a convoluted and complex history, both of the marriage and of events since its failure, which I will attempt to do as succinctly as is practicable. But before I recite salient aspects of the procedural history and the sequence of developments which have emerged I will attempt a thumbnail of the nature and range of the dispute.
The Parties' aspirations
As formulated at the conclusion of submissions, W sought a lump sum pitched at £27m for a clean break, on the basis that the matrimonial acquest was at least £54m.
In order to assist her in collecting such a sum she asked me to declare that a collection of vintage and other collectable motorcars (which I shall refer to as the Car Portfolio) is beneficially owned by H rather than by the Fourth Respondent, a BVI company, LCAL Anthology Inc (Anthology) which is wholly-owned by NHT. As an alternative route to the same destination W at a very late stage of pre-trial preparation (indeed shortly after the pre-trial review in September 2014) applied to set aside pursuant to section 37 of the Matrimonial Causes 1973 what she asserts were dispositions of cars within the Portfolio made in favour of Anthology by H. It was for the purposes of the avoidance of disposition application that the trustees of NHT and the company Anthology were joined as respondents, but neither was represented at the hearing nor actively participated in the proceedings. The value of the Car Portfolio on the open market has not been established, but seems likely to be of the order of £20m. If a section 37 order were made W would then seek orders for the transfer or the sale of the relevant cars; and would give credit against her lump sum award for any proceeds of sale she might realise.
With the same objective, to facilitate satisfaction of the lump sum award, W invites me to make an order securing it, subject to existing encumbrances, against what were referred to as the London Properties, namely 4–6 Milner Street and 32 George Street, both registered as owned by GPH Ltd, a BVI company which is also wholly-owned by NHT. Milner Street was, it seems, acquired in November 1999 and may have a negative equity; George Street was acquired in 2010. The residual value of these two properties might be of the order of £4.5m. No representative of GPH Ltd attended the hearing nor did that company participate in the proceedings.
W has not abandoned her attempt to demonstrate that NHT (or components within its structure) are susceptible as ante-nuptial settlements to variation pursuant to section 24(1)(c) of the 1973 Act.
The polarisation between the spouses' positions could not be more extreme. H's proposal is that a nominal spousal maintenance award is the only financial remedy W should receive, leaving it open to her to apply to the court for variation as and when H resumes employment.
The History
From that account of the parties' aspirations I turn to an outline of the course of their relationship, highlighting along the way some of the disputed financial and other factual issues.
H is now 56 and W 48. They first met in the spring of 2001 at a point when H had been living for some months in Bequia, an idyllic island in the Grenadines. Both his first childless marriage, his morale and his finances were at a low ebb. Although the state and the extent of H's relationship with his first wife Bobbie (W1) became the subject of some dispute before me in the context of the issue when it was that H and W's relationship became serious enough for marriage to be in contemplation, documents establish that W1 instituted divorce proceedings in England in March 2001 and that decree absolute dissolved their marriage and a clean break financial order was made in October of the same year.
After some years of living together (W says since 2001, with commitment even when apart from early on: H maintains intermittently only and not exclusively until 2003) they married in February 2006 but separated...
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