Yasmin Prest v Michael Prest (First Respondent) Petrodel Resources Ltd and Others (Second to Eighth Respondents)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Moylan |
| Judgment Date | 04 October 2011 |
| Neutral Citation | [2011] EWHC 2956 (Fam) |
| Docket Number | Case No. FD08D01163 |
| Court | Family Division |
| Date | 04 October 2011 |
and
[2011] EWHC 2956 (Fam)
Mr Justice Moylan
Case No. FD08D01163
IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION
Royal Courts of Justice
Strand
London
WC2A 2LL
Counsel for the Applicant: MR TODD QC and MR TROWELL
Counsel for the First Respondent: MR POINTER QC and MISS DAVIDSON QC
Counsel for the Second, Fourth and Fifth Respondents: MR WAGSTAFFE QC
JUDGMENT APPROVED BY THE COURT
THE JUDGE: This judgment follows the hearing of the wife's ancillary relief application. The wife is represented by Mr Todd QC and Mr Trowell. The husband is represented by Mr Pointer QC and Miss Davidson QC.
A number of companies have been joined as respondents to the wife's application. They are: Petrodel Resources Limited, an Isle of Man company, as second respondent; Petrodel Resources Nigeria Limited as third respondent; Petrodel Upstream Limited, an Isle of Man company, as fourth respondent; Vermont Petroleum Limited, an Isle of Man company, as fifth respondent; Elysium Diem Limited, an English company, as sixth respondent; Petrodel Resources Nevis Limited as seventh respondent and; Elysium Diem Limited Nevis as eighth respondent. None of these respondents took any part in the proceedings until the final hearing when the second, fourth and fifth respondents instructed Mr Wagstaffe QC to appear on their behalf. At the commencement of the hearing Mr Wagstaffe made an informal application for these respondents to be discharged from the proceedings. It was informal in that there was no written application and it was unsupported by any evidence. I rejected the application.
The principal issues in the case are: (a) the extent of the husband's wealth including the nature and extent of his interest in the respondent companies and; (b) whether I can make orders directly against properties and shares held in the names of some of the respondent companies.
As to issue (a), to give a brief summary of the parties' positions in respect of the husband's wealth, in his Form E sworn on 1 st July 2008 the husband asserts that his liabilities exceed his resources in the sum of 48 million. He discloses assets with a combined value of approximately £1.5 million consisting principally of a property called 16 Elnathan Mews, London and shares in Elysium Diem Nevis Limited of which the husband is the sole owner. Set against these assets are liabilities totalling just under £50 million, consisting mainly of an alleged liability under a personal guarantee to the Guaranty Trust Bank Limited of US $100 million. The husband's section 25 statement dated 20 th May 2011 contains no account of his capital resources. He also states that since September 2010 he has had no regular income. In his closing submissions Mr Pointer produced an asset schedule totalling $4 million. This does not purport to be a schedule of the husband's resources but was clearly intended to give some indication of the wealth that may be available to him.
The wife contends that the husband is worth many tens if not hundreds of millions of pounds. She relies on documents and other evidence adduced on her behalf. It is also submitted that I should draw adverse inferences against the husband as to the likely level of his wealth. The wife relies in particular on an Information Memorandum which she found at the matrimonial home in London in February 2008 and on the evidence of a Mr Le Breton who first gave oral evidence under a witness summons in December 2010. In the Information Memorandum the Petrodel group of companies, which it is admitted the husband controls, was broadly stated to have a value of approximately $250 million. In his oral evidence in 2010 Mr Le Breton said that the husband had told him on occasions between 2001 and 2004 that he was worth in the region of $40 to $50 million.
As to issue (b), again to provide a brief summary of the parties' respective positions, the wife contends, as set out in her Points of Claim, that orders can be made direct against certain properties and shares held in the names of the respondent companies. Mr Todd relies on the following points in support of his submission that such assets are within the court's powers under section 24(1)(a) of the Matrimonial Causes Act 1973:
(1) that the corporate respondents hold the properties and shares as nominees for or on trust for the husband;
(2) that the companies are the alter ego of the husband who is, effectively, the sole owner and controller of the corporate respondents. Mr Todd relies on authorities including Nicholas v Nicholas [1984] FLR 285 as establishing that in such circumstances orders can be made directly against property held in the name of a company. He invites me not to follow the then Munby J's decision of Ben Hashem v Al Shayif [2009] 1 FLR 115 which decided that a corporate veil can only be lifted if impropriety is established. The husband does not dispute that he controls the corporate structure. He does not accept that he is the owner and has not put forward any clear positive case as to the extent of his interest in the Petrodel group;
(3) alternatively if impropriety is required, Mr Todd submits that it is established in this case in respect of all the relevant companies.
The husband and the represented respondent companies contend that the properties and shares are not held on trust for the husband or held by the companies as his nominee. They also submit that I should apply and follow Ben Hashem and decide that impropriety is not established in this case thereby preventing me from making orders direct against the properties and shares.
The wife seeks the following award: (a) a lump sum of £30.4 million; (b) an order transferring to her certain properties and shares held in the names of some of the corporate respondents with a declaration that those properties and shares are held by the companies on trust for the husband or that he is otherwise beneficially entitled to them; (c) these orders are sought on the basis that the wife will sell or realise the properties and shares, with the net proceeds being applied in part satisfaction of the lump sum save for Warwick Avenue which the wife will retain as her home (also in part satisfaction of the lump sum in the amount of its value, namely £4 million); (d) child maintenance of £24,000 per annum for each child plus educational and medical/dental expenses.
The husband proposes that the wife should receive: (a) a housing fund of £1.6 million; (b) a lump sum of $150,000 payable by December 2010; (c) a lump sum of $1.6 million payable by instalments over eight years; (d) a pension fund of £200,000; (e) periodical payments for the wife of £27,000 per annum until payment of the lump sum of $1.6 million plus the cost of a driver and housekeeper until July 2013; (f) all costs relating to the children, including the cost of education, to be paid direct by the husband.
Mr Todd submits that the husband has attempted to frustrate the proper determination of the wife's financial claims, "through a combination of obfuscation and outright lying". Mr Pointer acknowledges that there is, "huge controversy as to the assets in the case". He also acknowledges that Peter Jackson J has found the husband to be in contempt by failing to provide relevant and discoverable documents as ordered by the court. In making this determination Jackson J did not accept the husband's reliance on an order made by the Nigerian High Court, which I deal with later in this judgment. However, in any event, Mr Pointer submits that this determination was concerned with the production of documents and that this, "does not and cannot mean that the husband's account of the available resources is automatically or necessarily wrong".
When assessing the evidence in this case, I fully take into account that a party might lie or exaggerate in support of a true case and/or that they can be mistaken or confused about what happened or have simply forgotten what happened. If I decide that it is a lie and is material, I must also consider the possible reasons for the lie. People can lie for a number of different reasons including, as I have said, to bolster a true case. Further, the mere fact that a person lies about one or more points does not necessarily demonstrate that their whole case is or, indeed, other parts of their case are false.
This judgment has taken me far longer than it should have done largely because I have sought to make sense of the husband's factual case. Ultimately I have decided that this has been a vain task because the husband has failed so comprehensively to comply with his obligation to provide full and frank disclosure and to give clear evidence that his case does not permit of such an exercise. It became apparent to me that the evidence in this case is not such as would enable me to produce a comprehensive account into which all the various pieces of evidence could be fitted. Notwithstanding the quantity of documents which have been produced, there are far too many gaps for this to be an attainable objective. As I commented during the hearing, the result of the way in which the case has developed is that a great deal of energy has been expended by the husband on seeking to establish what he is not worth rather than the more conventional focus being on seeking to demonstrate what he is worth.
The first task which normally faces a court hearing a financial application under the Matrimonial Causes Act is to determine the factual background including crucially the...
To continue reading
Request your trial
- Gurbachan Singh Bagawan Singh v Vellasamy Pennusamy
-
SQ v TQ
...[2006] N.L.J.R. 916. Northern Bank Finance Ltd. v. Charlton (Unreported, High Court, Finlay P., 26th May, 1977). Prest v. Prest [2011] EWHC 2956 (Fam), (Unreported, High Court of England and Wales, Moylan J., 4th October, 2011). Prest v. Prest [2013] UKSC 34, [2013] 2 A.C. 415; [2013] 3 W.L......
-
Gillian Christine Hope (aka Lewis, formerly Krejci) (Applicant) Libor Stanislav Karol Krejci (First Respondent) Trustees of the Krejci Family Trust (Second Respondents) Damsonetti Holdings Ltd (Third Respondent)
...v. Nutritek International Corp and others [2012] EWCA Civ 808 (CA)). Further, the appeal from Moylan J's decision in Prest v Prest [2011] EWHC 2956 (Fam) will be heard shortly by the Court of Appeal. When granting permission to appeal ( [2012] EWCA Civ 325) Thorpe LJ stated at para 13: "Th......
-
Moher v Moher
...number of identified properties. At first instance, the canvas had been much broader as set out in my decision, reported as YP v MP [2011] EWHC 2956 (Fam). The husband's failure to comply with his disclosure obligations had been “so extensive that little attempt was made by him or on his b......
-
PIERCING THE CORPORATE VEIL AS A LAST RESORT
...should perhaps consider whether the alternative remedy to piercing the corporate veil is adequate. 1 Yasmin Prest v Michael Prest [2011] EWHC 2956 (Fam). 2 c 18. 3 Prest v Prest [2013] 2 WLR 557. 4 Prest v Prest [2013] 2 WLR 557 at 570. 5 Prest v Prest [2013] 2 WLR 557 at 605. 6 Prest v Pet......