Ty v Xa (No. 3)

Hearing date: 29 July 2025

This is a further judgment in these proceedings under Part III of the Matrimonial and Family Proceedings Act 1984, and Schedule 1 to the Children Act 1989, in relation to which I initially heard evidence and submissions from both parties between the 9th and 16th May 2025. The parties are TY(now aged 41) and XA(aged 42), whom I shall continue to refer to in this judgment, conventionally, as the husband and wife.

I handed down a substantive judgment in the principal applications on 1 July 2025, after a draft had been circulated to the parties on 6 June. At the adjourned hearing on 29 July 2025 I have had to deal with a number of sequential issues such as timing and security, and the important issue of how the wife's costs are to be provided for – whether by a further lump sum to discharge them as a debt, together with other outstanding liabilities which she has, as she is seeking; or by way of a costs order, which the husband argues should require no more than the payment of the significant sums already paid under the various legal services orders.

As at the trial, the wife has been represented by Mrs Carew Pole KC and Vardags, and the husband by Mr Horton KC and Helen Pidgeon. The wife has attended court today, but the husband is absent on holiday – I have excused his non-attendance.

RELEVANT BACKGROUND AND CONCLUSIONS

This case concerned a 9-year marital relationship where two agreements had been reached, one being an Austrian pre-nuptial agreement and the other a later German Separation Deed, both of which were very clearly needs-oriented and determined the underlying basis upon which provision should be made to the wife. As set out in my substantive decision, this matter has an unfortunate history of protracted litigation both in Germany and in this jurisdiction. Here, there have been two set aside applications brought by the husband against the initial grant of permission under Part III, both heard by Moor J, as well as an FDR before Peel J, multiple directions hearings and a 6-day final hearing in May 2025 before me.

The parties ultimately agreed with the German Law Expert, Dr Cornelia Maetschke-Biersack, that the German Separation Deed is a “ valid and binding instrument and an authentic instrument for the purposes of Art 17 of the EU Maintenance Regulation” at the 18 October 2024 directions hearing. I accepted in my substantive decision that for the purpose of this case, to which the EU Maintenance Regulation applies, I was bound to act in a way which was not clearly contrary to its terms. By Art.21 of the Maintenance Regulation, I determined that a variation of the provisions contained in the German Deed would be permissible in the event of a sufficient change of circumstances, but that a consideration of the fairness of the original provision would not be. I was satisfied that the wife's current, and likely future, inability to work did constitute a sufficient change of circumstances to justify a reconsideration of the terms of the maintenance provision in the German Deed.

On the basis that the changed circumstances of the wife undermined the assumptions upon which the German Deed was calculated, I was clear that both an extension of the term for the provision of housing for the wife, and of spousal support for her, were warranted, as well as a reconsideration of quantum. I made the following provision:

a. A capitalised rental fund of £2,550,000 to meet the wife's housing needs, reflecting rent at the current level for the next 15 years, then reducing by a third for the rest of her life;

b. Maintenance payments for the children at a rate of £3,500pcm, or £42,000 per year per child, until the end of secondary education, with a remaining third then being payable to the wife whilst the children continue in tertiary education, such payments to be CPI linked. The husband was to be responsible for the children's educational costs, including extras, until the end of tertiary education;

c. Maintenance payments of £5,000pcm (£60,000pa) and additional payments of £3,000pcm (£36,000pa) for the wife's medical costs until she attains the age of 55 and thereafter reduced to a nominal level until further order. The total annual periodical payments for the wife (including medical costs) therefore amounted to £96,000pa, also to be CPI linked.

This outcome did not reflect the open position adopted by either party at the trial. At that point:

a. The husband offered to purchase a property, in his name, for the wife and children with a purchase price of up to £2.6m. This property would have a mortgage, for which he would be responsible, and the wife would have been permitted to remain in occupation of the property until 6 months after their younger daughter PA's 18 ^th birthday (1 February 2035), or when the children's full-time secondary education ceased, if later. The husband offered child periodical payments at £5,000pcm per child, or £120,000pa in total for both children (expanded along the lines of a Home Expenses Child Support Allowance or ‘HECSA’), plus school fees and extras to the end of secondary education by way of provision for them. No further provision of any sort was offered for the wife.

b. The wife sought a housing fund of £4.2m to enable her to purchase a property of £3.5m. The wife also sought a lump sum of capitalised maintenance of £2.3m, which she said would provide for c.£80,000pa for her for the rest of her life, with a nominal order for herself to avoid CMS problems; a further lump sum of £992,955 to clear her current debts (over £900,000 of which consisted of legal fees); a returnable lifetime fund of £755,607 to be made available to meet her future medical costs; and £50,000 for a car. The wife sought lower child periodical payments of £3,500pcm, but educational provision to the conclusion of tertiary education. The wife also sought to receive some contents from the parties' former homes in Europe.

The Issues at this Hearing

Reconsideration. I will begin with the argument which Mr Horton KC advances for the husband that I should now reconsider the substance of the orders which I determined to make at the May hearing. At that hearing, the husband's open position, which he had articulated in an open offer made as recently as March 2025, was as explained to purchase a property for occupation by the wife and the children during their minority, and in lieu of any continuing spousal maintenance, a higher level of child maintenance. He did not offer any further lump sum. This offer was said to be ‘subject to his ability to obtain a mortgage’, and he made reference to the impact on his finances and liquidity of the fall in the value of his Company E stock. His position at trial was that his net worth was now in the order of £16m. I finally took the figure of £17.3m for his net worth at that time.

Mr Horton now says that the husband's own proposals then ‘were simply not feasible, even on the known position in May’. By the time of trial, he makes the point that he was inviting the court to order maintenance to cover rent instead of a lump sum, given the husband's liquidity issues. He also asserted that his property, in prime West London, which was valued for that hearing at £11.5m, has been on the market for sale but has only so far had one offer at £9m. He blames this on the state of the high end London property market and the reported exodus from the UK in recent months of wealthy non-domiciled families. He also says that his property in Paris, valued for the trial at €10.5m, has also been marketed but has had only one offer at €6m. He states that his Company E stock has now gone, owing to the drop in prices and some collar hedge arrangements he has assertedly made earlier this year. Also down-valuing a number of other properties which he owns, he says that his net worth can today be counted as no more than £6m. He therefore suggests that a lump sum of £2.55m for lifetime rent, as ordered, now looks ‘wholly excessive’. He also cites a series of obligations and future financial commitments.

Since the handing down of my substantive decision, the wife was informed on 7 July 2025 by the children's school that the husband has not paid the school fees for the summer term, in breach of the order of Moor J dated 4 July 2023. The husband also remains in breach of the LSPO order made by me on 18 October 2024, having failed to pay the final instalment of £28,000 due on 1 May 2025. The husband has further openly sought advice on the enforceability of the final proposed order made by this court in France, in breach of the embargo on the draft judgment. Mr Horton KC has provided written submissions in which he acknowledged and apologised for the embargo breach, and I have decided that no further action would be taken in relation to this.

The husband has not sought to adduce any sufficient fresh evidence at this hearing in support of his arguments, other than an updated spreadsheet produced by his accountants, and some updating bank balances. He has made no formal application to set aside determinations within the judgment which I have handed down and to reconsider, ab initio, the appropriate order in light of what he says is this dramatic collapse in his financial position. Indeed, he has chosen not even to attend court for this hearing. The wife does not accept his financial presentation today. As I will explain, the costs in this matter are already out of control. What he is proposing would effectively require the complete relisting of the...