AP v ALP

In financial remedy proceedings, the court must assess all the circumstances under Matrimonial Causes Act 1973, section 25. Equal contributions do not require equal division of every asset in its existing form. The court may divide liquid and illiquid assets differently where that produces a fair result and may reject a proposed sharing arrangement that is impractical or would prevent a clean break.

Alleged non-disclosure permits adverse inferences only where they can properly be drawn. Add-back for dissipation requires clear evidence of gross, obvious and wanton dissipation. Risk-taking investments are not necessarily dissipation merely because they have failed. The court may nevertheless assess their value and draw inferences from inadequate accounts or unexplained transfers.

The applicant wife sought financial remedies following the breakdown of a long marriage to the first respondent husband, a businessman whose wealth had arisen from banking and insurance businesses. The proceedings concerned substantial assets and investments held in several jurisdictions, alleged non-disclosure, alleged dissipation, transfers to the husband’s adult sons, and the practicality of sharing illiquid Russian business interests.

The husband disputed the wife’s valuation of the available assets and relied on extensive business expenditure and losses. The court also considered responsibility for possible French tax arising from the sale of property, a bank guarantee, education costs and the transfer or sale of foreign property. The central issues were the proper valuation and division of the assets, whether hidden resources or wilful dissipation had been established, and whether a form of Wells sharing was appropriate.

1. Statutory approach. The court applied sections 23 to 25 of the Matrimonial Causes Act 1973. The minor child was the first consideration, without disregarding the interests of the adult child. The parties’ contributions were equal, consistently with White v White [2001] 1 AC 596, but fairness did not require each asset to be divided equally in specie.
2. Disclosure and inferences. The burden of proving disputed facts remained on the party asserting them. The husband owed a duty of full and frank disclosure. Following J v J [1955] P 215 and Baker v Baker [1995] 2 FLR 829, material shortcomings could justify adverse inferences, but the court had to draw only inferences properly supported by the evidence. The husband had initially given woeful disclosure and had lied on some matters, but the wife did not establish a substantial concealed fund.
3. Dissipation. Under section 25(2)(g), conduct had to be inequitable to disregard. The authorities required gross and obvious conduct, or wanton dissipation, before spent assets could be notionally added back: Miller/McFarlane [2006] UKHL 24, Martin v Martin [1976] Fam 335, MFP v MAP [2015] EWHC 627 (Fam) and Vaughan v Vaughan [2007] EWCA (Civ) 1085. The husband’s unsuccessful Russian investments were not wilful dissipation, although their poor disclosure justified inferences about their value and profitability.
4. Asset division. The court valued the Russian business interests and loans, but awarded the husband those interests because they were illiquid, difficult to police and central to his future income. A Wells-style sharing order was distinguished as impractical and unfair. The wife received the London property, the Belgian property, Radost, other specified assets, the joint FLB funds and half the net proceeds of Villa Bellissima.
5. Other orders. The husband was ordered to indemnify the wife against any French tax liability connected with the Paris property, applying CH v WH [2017] EWHC 2379. He was responsible for the bank guarantee, ordered to pay £20,000 per year for the minor child, and ordered to meet the children’s education costs. The wife’s additional £13 million lump-sum claim was refused.