In the recent case M v M [2 Financial Remedy Resulting Trust] the wife was awarded £53 million following a marriage of 17 years where she was a fully contributing wife. The wife was 48 and the husband 49. All the wealth had been created during the course of the marriage. This award has just beaten the substantial award given to Mrs Charman in the Case of Charman v Charman who received a mere £48 million.
Judgment was given on 14 August by Mrs Justice Eleanor King after a disputed hearing. Unusually this was an application by the wife for an order for financial relief following a foreign divorce under Part III of the Matrimonial and Family Proceedings Act 1984 following her divorce in Russia.
The wife’s legal team believed that the matrimonial assets amounted to some £107 million. Of that figure some £91.6million were represented by 11 commercial properties in Russia. Those were owned by the Pankratov Trust Ltd, a company originally wholly owned by the Respondent, but which assets were transferred to a newly created corporate structure in Belize during the course of the litigation.
Originally the husband was represented consecutively by two leading London firms of solicitors. However, in February 2012 his solicitors came off the Court record and the husband played no visible part in the proceedings.
However as the judge commented:
“The husband has, however, remained active behind the scenes removing company structures from offshore haven to offshore haven when the net cast with such skill and determination by Mr Dyer’s team (the QC leading the wife’s legal team) has closed in”.
In December 2012 the husband’s former solicitors came back on to the Court record not to resume representation for the husband but to represent the husband’s companies. This was an extreme case of non-cooperation and non-disclosure on the part of the husband. The husband failed to disclose assets, provide statements or attend Court for the final hearing.
The judge added:
“The case has been a fantastic charade with the husband a shady puppet master in the background. At fabulous cost, (£1.4m and counting) those representing the wife have crossed and re-crossed the globe in an attempt to trace the husband’s assets every penny of which has been acquired during the course of the marriage”.
The family had two children Vladimir (aged 19) he was at university and Anatolie aged 15 who attends boarding school in England. The husband and wife met in 1987 in the factory in which they both worked. The husband was a telephone technician and the wife worked in the factory’s cultural department. The parties started to live together in 1989. Around that time the husband began to import computers and thereby set up an electronics business at the beginning of 1991. Further businesses selling household goods followed. Rather than renting the premises the husband bought his commercial properties. The family had a lavish lifestyle. For many years they lived in a large 18th century house with accompanying household staff and holidays to match. From 1998 to 2000 the family lived in France.
In 2005 the family left Russia and moved to London. The husband then purchased various properties in London the first, was bought as a family home in the joint names of the husband and wife. The husband paid £3.825m for the property. Subsequent properties were registered in the name of Snowdon Properties Ltd a UK registered company in which the husband and wife each held one of the two issued shares and of which the wife was a company director. Unfortunately the marriage came under increasing strain in 2008, due the wife said in part, to the husband’s refusal to address the family’s immigration status. The marriage ended in the autumn of 2008. On 12 January 2009 the wife petitioned for divorce in Russia. However as she had been habitually resident in England and Wales since 2005 she could have petitioned for divorce in the UK but had not sought legal advice from an English solicitor and wrongly believed that as a Russian who had married in Russia she would have to divorce in Russia. A Russian divorce started in February 2009. The marriage was formally dissolved on 3 March 2009.
Although he continued to pay the childrens’ school fees after the separation the husband did not provide the family with any other support leaving the wife dependent upon a long time friend and the friend’s husband who paid her rent of £2,850 a week and £20,000 for living expenses plus living fees. By the time of the financial order the wife owed her friends a potential £5m.
During the course of the marriage the husband had routinely remitted money from offshore accounts to the family expenditure. The last voluntary spousal payment was made in September 2009 and in view of the withdrawal of his support and application was made for leave to commence financial proceedings in England following a foreign divorce and a Part III of the Matrimonial Family Proceedings Act 1984. Apart from the fact of the unusual lack of cooperation by the husband the other unusual feature of the case was as this was a Part III claim the award to the wife cannot exceed the award that would be made in a conventional financial remedy (ancillary relief) case. In this case the wife had received no financial provision from the Russian Court.
The wife had no independent earning capacity whereas the husband had an estimated rental income alone of $18m per annum. In addition to the judge awarding the wife the UK properties and the lump sum of £38 m the Judge ordered the husband should pay child maintenance at the rate of £20,000 per annum per child and make provision for school fees and university costs limited to first degree.