In financial disputes there is something known as ‘The Millionaire’s defence’. This means that if one party to the proceedings is very wealthy then they could avoid having to provide detailed financial disclosure if they concede that they have the ability to meet any reasonable order the Court might make.
This is not appropriate in every case involving a wealthy individual. However, in some cases it can be a useful and cost effective way to avoid the provision and analysis of mountains of paperwork which, more often than not, will have little or no impact on the likely outcome of a case and instead only serves to increase legal costs on both sides.
The usefulness of this defence was highlighted recently by the High Court in a case where this firm acted for the wife.
In this case it was the husband who was extremely wealthy, with the vast majority of his wealth being held in offshore trust vehicles. The husband provided disclosure by way of Form E and a very limited Questionnaire. It was then agreed between the parties that the husband would concede that he had the ability to meet any reasonable order the Court might make, on the basis that the wife conceded that her financial claims would be limited to her reasonable needs i.e. that she would not advance financial claims based on sharing or compensation.
In the Judgment the High Court Judge commented that, whilst it is obviously important to establish a broad outline of wealth, the approach adopted by both parties was ‘sensible, proportionate, and cost effective’.
In this case it allowed the parties’ to focus on the issues at hand, to give careful consideration as to the best way to approach a financial settlement, and to focus on formulating the wife’s needs based case, rather than becoming buried in unnecessary paperwork at the client’s expense.