Viki Natasha Maughan v Richard Michael Edmund Wilmot
| Jurisdiction | England & Wales |
| Judge | Mr Justice Mostyn |
| Judgment Date | 16 April 2020 |
| Neutral Citation | [2020] EWHC 885 (Fam) |
| Date | 16 April 2020 |
| Docket Number | Case No: TN99D00733 |
| Court | Family Division |
[2020] EWHC 885 (Fam)
IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Mostyn
Case No: TN99D00733
Jonathan Swift (instructed by Thomson Snell & Passmore) for the applicant/wife
Stephen Meachem, (solicitor-advocate of Law Tribe) for the respondent/husband
Vernon Dennis (of Howard Kennedy LLP) for the receiver
Hearing date: 8 April 2020
the hearing was conducted remotely by Zoom
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
This judgment was delivered in private. The judge has given leave for this version of the judgment to be published.
On 22 October 2019 I gave a judgment which I hoped would end this extremely long-running matter (“my October 2019 judgment”) 1. That was a forlorn hope. The orders reflecting my costs decision have never been made. Substantial costs have been incurred since then. Investigations have revealed that the factual footings on which I gave judgment were faulty. I have had to conduct another hearing, by Zoom on 8 April 2020, to try to get to the bottom of matters. As a result, in this judgment I must revise the disposition made in my October 2019 judgment.
The reason for this is that on 22 October 2019 I was misled by the husband about the true scale of his unencumbered liquid funds over which the freezing order would range. I granted a freezing order in the sum of £100,000 – see paragraph 23 of my October 2019 judgment. I did not specify over which assets the freezing order should range but I intended that it would be directed first and foremost to the funds held by Aegon. This was based on a representation and assurance given to me by Mr Meachem, the solicitor-advocate representing the husband. The assurance was that the pension funds held in both Curtis Banks Limited and Aegon/Hargreaves Lansdown were worth in excess of £350,000 and that the orders therefore needed only to be directed to Aegon, or its replacement Hargreaves Lansdown, and to Curtis Banks Ltd. It was implicit in the assurance that there were substantial funds in both places.
This may have been literally true, but it was not the whole truth. Subsequent investigations have revealed that while there were funds in Aegon/Hargreaves Lansdown worth about £370,000, these were not in any sense easily realisable. Only £25,369 could be easily extracted. The special nature of the product meant that the balance could not be accessed unless it was transferred to a flexible drawdown product offered by another provider. This would require the consent and cooperation of the husband, which, plainly, would not be given. The funds in Curtis Banks would have been easily accessible but these had fallen to a mere £93.
It is therefore clear that I was misled about the scale and liquidity of the funds held by both Aegon/Hargreaves Lansdown and Curtis Banks. Had I known the truth I would have made a freezing order in a materially larger amount to allow for the inevitable costs in achieving access to the remaining funds held in Aegon/Hargreaves Lansdown.
I make no finding that Mr Meachem knew the true facts when he made the representation/assurance to me on 22 October 2019. However, he should have been instructed by the husband what the true position was, and that should have been made clear to me.
The initial freezing order was made by Mr Justice Bodey on 5 December 2013. It froze the sum of £400,000, unencumbered, and extended to the funds held at Aegon. Paragraph 20 of the order provides:
“If the total value free of charges or other securities (unencumbered value) of the Respondent's assets restrained by the preceding paragraph exceeds £400,000, the Respondent may dispose of or deal with those assets so long as the total
unencumbered value of his assets restrained by the preceding paragraph whether in or outside England and Wales, remains above £400,000.”
It was obviously implicit in that order that if the husband made a disposition of his assets, he would have to give notice of that fact and explain how his remaining unencumbered assets exceeded £400,000. The figure of £400,000 was later reduced by me to £300,000.
In June 2015 £740,980 was moved by the husband from Aegon to Curtis Banks which offered a flexible drawdown facility. This was not notified by the husband to the wife at the time. The funds that were left behind were largely inaccessible for the reasons I have stated above.
On 29 September 2015 there was a hearing before me. No order has ever been drawn up reflecting my decision, as its terms could not be agreed between Mr Swift and Mr Bowen QC who was then representing the husband. Inexplicably, the matter was not referred back to me for resolution. However, on that occasion I was informed by Mr Bowen QC that the husband had moved £700,000 from Aegon to Curtis Banks.
On 22 October 2015 the husband wrote to an official at Curtis Banks and stated:
“Just to confirm, we established at court on September 29 th that the monies transferred to Curtis Banks are not subject to any freezing order or attachment. Please contact Mr Bowen to confirm.”
There is no transcript of what was said to me on 29 September 2015. However, Mr Swift has located his draft of the proposed order for that day. This provides:
“12. The freezing order dated 5 December 2013 (as varied on 12 December 2013 and 15 April 2014) and extended on 19 March 2015 relates to a total unencumbered sum of £300,000 and is not to be reduced whether for legal and /or living costs and paragraph 25 of the said freezing order is discharged.”
Mr Swift argues that this must reflect the decision I made on that day, and that must be right. The inaccessible funds left at Aegon would not qualify as “unencumbered”. They may not have been subject to formal charges, but they were literally encumbered by their inaccessibility. Therefore, it was not true to say that the monies transferred to Curtis Banks were not subject to the freezing order.
On the basis of the representation made by the husband on 22 October 2015 substantial sums were withdrawn from Curtis Banks in the husband's favour as explained in the receiver's witness statement dated 6 April 2020 at paragraph 19. This states:
“In particular, I would draw to the Court's attention the following:
19.1 the benefit request form signed by the Respondent on 14 July 2015 (the “Benefit Request Form”) (pages 38–43);
19.2 the payment of f71,394.20 to [Isle of Man] account number 12871621 [in the name of the husband] on 30 September 2015 shown on the Curtis Banks Transaction Log (the “September 2015 Drawdown Payment”) (page 15);
19.3 the monthly payments [of £3,500] to account number 12871621 from November 2015 to January 2019 shown on the Curtis Banks Transaction Log (the “Monthly Drawdown Payments”) (pages 15–18);
19.4 the payment of £40,000.00 to account number 12871621 on 06 August 2016 shown on the Curtis Banks Transaction Log (the ‘August 2016 Drawdown Payment’) (page 16);
19.5 the payment of £15,300.00 to account number 12871621 on 19 July 2017 shown on the Curtis Banks Transaction Log (the “July 2017 Drawdown Payment”) (page 17).”
None of this was known either to the wife or to the receiver. Pursuant to an order made by me on 23 March 2016 the receiver drew down £291,929 on 25 August 2016 and £196,668 on 7 March 2018. As far as the receiver was concerned these were the only removals that had been made from Curtis Banks. He was not aware that any other sums had been taken by the husband. My order of 23 March 2016 provided at paragraph 10 that:
“Curtis Banks Limited shall not pay any amount of funds received from Scottish Equitable plc to the Respondent or any other party save in accordance with the terms of this order or further order.”
It is clear to me that these sums removed from Curtis Banks by the husband, reducing its balance effectively to nil, were in breach of the original freezing order inasmuch as he had not...
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