SW v SH & Ors

The Wife gave her evidence in a measured way. Miss Hussey QC has suggested that she was ‘rehearsed’ but I did not find it rehearsed. I did find it had been considered. In my assessment she was broadly consistent in her evidence.

Importantly I did find her concerns about the Husband knowing her address in the future and her concern as to the risk of his taking action acting against her to be genuinely felt.

Some examples of her evidence that impressed me are given below.

Firstly, she asserted that the Husband owned a ‘castle’ and had ‘horses’ in [Lebanese town] and it was suggested by the Husband that this was pure invention. In fact the introduction of photographs and videos showed that the substance of the Wife’s assertions was broadly accurate and were certainly founded in reality. To my mind this significantly enhanced her credibility.

She stated, and I found convincing, that there was a photo in [a restaurant] in London of the Husband in the Castle with his horses. She stated and I found convincing that the Husband had photographs dating back to when the Castle was under construction. She stated that local people in [Lebanese town] referred to it as ‘[SH’s] castle’ hence her use of the word ‘castle’.

Secondly, I found her evidence in relation to completion of some of the Husband’s rental property rent books to be convincing, backed up as it was by entries in actual rent books in her own handwriting, see for e.g. EXB 120 and EXB 205 and the Husband’s attempts - both in cross-examination and in documents submitted subsequent to the evidence closing - to undermine this evidence was unconvincing. The Wife did not suggest that she was central to the business but, contrary to Husband’s evidence, I am quite satisfied she had some practical involvement in the business.

Thirdly it was suggested by the Husband that the Wife had ‘raided’ the joint Moroccan account to remove money in a cynical move to ‘warehouse’ money. In evidence she accepted that she had removed money unilaterally and had done so to ensure she had funds once she left S Court to move into a refuge. The Wife to my mind did not seek to misrepresent this action.

These are just some examples of the way in which her evidence impressed me.

The areas where I found her evidence to be less convincing were as follows:

I recognise that it is difficult to plan before the outcome of these proceedings is known and I do consider that it is not easy as a single mother within these very demanding proceedings to undertake research, but the absence of those investigations means that that I have had to treat her needs-based claims with some reservations.

I found her proposed housing need aspirations to be aspirational and unrealistic.

I was also doubtful that she was entirely unaware of the Husband’s Moroccan divorce proceedings given that her father had been served with papers in Morocco at the outset of that case. However, on this matter I was ultimately left unclear given the lack of corroborative evidence on the point.

The main challenge advanced against her were that she had lied about her knowledge of the Moroccan divorce and these challenges were largely based on certain dates and matters given by her in her written evidence. In particular:

Considering her evidence in the context of all the material before me I felt able to broadly accept her evidence and generally prefer it to the Husband’s where they differ.

I felt she was plainly focused on securing a safe future for C.

I have formed my own view of the Wife’s credibility, but I note in passing that Recorder Castle appears to have reached a similar conclusion.

I found the Husband to be intelligent, articulate, and at times extremely charming and charismatic. I also formed the view that he was very much focused on himself and his own interests and in getting his point over to the court rather than answering the question before him. As a result he became a witness who on many occasions exasperated the court by not answering the questions put to him. He was very argumentative and, whilst at times pleasant and charming, at other times arrogant.

When being asked about his failure to pay the maintenance pending suit he came very close to suggesting to me that he regarded the Moroccan court order as being the only valid obligation upon him and not the English orders. He then also suggested he could not afford the English order, but I was left with the impression that he was willing to operate tactically and in defiance of court orders.

I now set out some examples of the matters that have caused me to conclude that I must treat the Husband’s evidence with very considerable caution and that I cannot generally rely on his evidence.

In my assessment of Husband’s credibility, I take into account Recorder Castle’s assessment of him and the fact that the Recorder disbelieved his evidence on a number of important and serious matters.

Before me the Husband purported to accept the Recorder’s findings but, when this was explored, in reality he continued to deny many of them. He again denied the sending of revenge porn messages and other images to the Wife’s family that the Recorder found had been intended to pressure the Wife into abandoning these proceedings. He said he was in custody when they were sent and that the police had taken no action. His evidence contradicted the Recorder’s clear finding, and the Husband was unable to provide any alternative convincing explanation for who might have sent these images. He claimed that some texts were in fact sent by C’s maternal family which I found completely unconvincing as well as being contrary to the Recorder’s findings.

He made a variety of very lurid and extraordinary allegations against the Wife’s sexual behaviour at the outset of their relationship in his first witness statement in these financial proceedings but did not pursue them. I was completely unconvinced that they were true and was satisfied he had included them to maximise embarrassment for the Wife.

In his counsel’s Opening Note he described the suggestion that he had a ‘castle’ in [Lebanese town] and ‘horses’ as baseless and effectively invented by the Wife. He asserted that all there was on this plot was a small burial ground when his parents were buried. I permitted the introduction of videos and photographs that he had sent to the Wife in courtship, and I am satisfied that these showed that there was a real basis for these suggestions. Prior to those videos being translated he denied that he referred in them to ‘his farm’ or ‘his house’ but when translated the Husband’s previous denials were shown to be untrue. He did indeed refer to it as ‘my house’ and ‘my horses’ and ‘my farm’. All of this very significantly damaged his credibility.

I am willing to accept that the [Lebanese town] building is subject to a planning permission dispute that goes back many years, perhaps as far as the Israeli occupation as he later told me when trying to minimise its value, but the photographs show it is a building much valued by the Husband.

My findings on the Hemain injunction are set out elsewhere but put shortly I am satisfied that the Husband deliberately disobeyed the Hemain injunction. He was entirely unable to identify any positive steps he had taken to seek to delay or suspend the Moroccan divorce proceedings to allow for an English ‘forum conveniens’ hearing and the independent Moroccan material contradicted his evidence that he was powerless to prevent that divorce.

For example, he suggested to me that it had been agreed between his lawyer and the Wife’s lawyer that they would see whether the court would order a stay but there was no credible evidence of this suggested agreement.

The Husband’s s credibility was further undermined by his failure to ensure that the Wife received the maintenance due to her under the Moroccan divorce order. An issue arose in the proceedings as to whether the Wife was able to access the maintenance paid pursuant to the Moroccan order which was being paid into a [Moroccan] bank account in Morocco by the Husband. Those same sums were then removed by a Ms L. It is now known that this person was an assistant of the Husband’s Moroccan lawyer, and the sums were then paid to that lawyer. The Husband only admitted this in his Replies [E38 / 400] provided shortly before the pre-trial review and asserted that it was necessary to do this to prove the maintenance was paid. This was evidence I found it impossible to accept because:

He sought to justify that he was at risk in Morocco if it was not possible to prove he made the payments but there was no real independent evidence to back this up and I found it lacked all credibility. It also showed how far the Husband would go to defy English orders and to make life difficult for the Wife.

The Husband’s Form E was originally served (no date is given in the hearing bundle for his Form E) without reference to a number of bank accounts and properties in Lebanon. This was only rectified after the Wife was able to find reference to the properties in Lebanese Land Registries and serve that evidence on the Husband. In evidence he told me that he hadn’t disclosed a [Lebanese city] property because it was a family home of his wider birth family, and it would have been unfair to sell it. I found that evidence very revealing.

He suggested that the Wife never had any part in the letting business and she had never completed any part of the rent books in which he recorded rental payments to him. As made clear above this was contradicted by the copies of the rent books in the exhibits bundle and the evidence was strongly inconsistent with the Husband’s evidence. I do not find that the Wife had any significant role in the business, but it is quite she clear to me that she was actively involved to an extent, contrary to the Husband’s assertions.

The Husband now contends that the Moroccan Villa was the parties’ family home and intended to be their ‘forever home’, but this is not consistent with:

His attempt later to present the Moroccan property as their home was inconsistent with the Moroccan court’s own material and further damaged his credibility.

The Husband’s credibility was further undermined in relation to his dealings with the Second Respondent which I address later but examples include:

Likewise in relation to R3 I found the Husband’s evidence further undermined his credibility and some examples are set out below:

He was understandably and predictably asked for copies of written advice from his accountant about the need to close his bank accounts and establish the lease agreement with R3. No such evidence from his accountants was produced that addressed the business need to take these steps and the letters from them addressed other matters of disclosure or, as per the letter at ExG10 simply describes the steps taken in relation to bank account closure but does not explain the underlying purpose. This to my mind defied all common sense, there must have been such advice to support the need for these changes to the banking arrangements.

Further I found it very concerning that in his initial witness statements and Form E he made no mention of the apparent issues with Licencing and being a rogue landlord with [London Borough 2]. His later introduction of this explanation was unconvincing.

Finally given my impression of K as a rather immature and potentially vulnerable young adult, now aged just 22, I found it wholly unconvincing that the Husband would effectively entrust and burden her with this onerous business responsibility. Indeed, given that R3 was incorporated in 2018 - when K was just 19 years old - this became even more difficult to accept. Operating a property lettings business in a sub-prime market must be a difficult and demanding operation, securing rental payments, addressing disputes over deposits, room conditions and it struck me as unconvincing that the Husband would leave this to K, especially given his concerns about her drugs use in late 2017.

Looked at the context of the material before me I found the Husband to be a witness on whose evidence I could not rely. I have formed my own view of him as a witness, but I note that Recorder Castle formed a similar view, and I recognised the Recorder’s description of the Husband as a witness.

I had significant reservations about the credibility of the Second Respondent for the following reasons:

Having had the advantage of seeing him be cross-examined and give his evidence and based on the totality of all the material, I found I could not rely on the Second Respondent’s evidence.

I have addressed my concerns as to the credibility of the Husband’s position in relation to the involvement and K and the Third Respondent and they have influenced my view of K as a witness.

In relation to the manner in which she gave evidence and the content of her answers I was left with the clear impression that she was not what she purported to be i.e. the driving force behind the R3 and the lease agreement with her father. Indeed I found her grasp of the business to be very limited.

Her inability to produce any evidence prior to the incorporation of R3, whether from accountants or from London Borough 2, to justify the lease agreement between R3 and the Husband seemed to me to defy common sense and strongly indicate that I was not being given an honest presentation.

She was by turns emotional, appearing bored, other times angry and upset and I was left with the impression that she lacked the maturity to take on the role the lease agreement gave her.

In cross-examination of K the Wife’s counsel raised an issue in relation to K’s previous use of illegal drugs and an incident where the police were called by K because the Husband had discovered K’s drugs and had become angry and, I was given the impression, violent. K was very critical of the Wife for not coming to her aid. The police were called and the Husband detained overnight. The Husband has criticised the introduction of this issue and it is right that K understandably found it upsetting. However it seems to me it was relevant and not unfair to raise it as the Husband’s counsel had suggested that K was a suitable person for the role she had adopted with R3. Given that this incident in relation to the drugs was less than a year before the lease agreement was entered into it does seem to me to be relevant. I observe in passing that K said it was just a small quantity of cannabis and I do not suggest otherwise, but the relevance is in the Husband’s strong reaction to finding it and the suggestion that several months later he would be content to entrust K with control of the rental income from his property portfolio.

She was also frequently very critical of the Wife and described her as being in essence a ‘gold-digger’ i.e. cynically looking to rob the family of wealth. She complained that the Wife never attempted to engage with the Husband’s family, and she complained that the Wife had not come to K’s help when the Husband reacted angrily, and possibly violently, to finding K with drugs in her possession in late 2017.

She referred to the Wife variously as a ‘witch’ and ‘a princess in a fairy tale’ and I was left in no doubt that K had a strong and deep antipathy towards the Wife.

In her closing submissions she read out a prepared speech and I was not satisfied that she had prepared it herself. This concern was reinforced when, having read it to the end, she said “I now want to say something for myself” or words to that effect. I found that troubling and overall I was left with the impression that she was simply doing her best to assist the Husband.

Having heard her give evidence and observe her over five days I did not feel able to rely on her evidence.

I now address some central factual matters.

No attempt was made to re-open these findings and it seems to me that I can and should take into account that:

I therefore take into account the following findings:

I further take into account that the Husband was found to have committed serious matters as follows:

It is clear from the Judgment of Recorder Castle that it is these financial claims that I am deciding that are the ‘proceedings’ to which the findings relate. In my view the Husband’s willingness to do these acts is not something I should or can properly overlook when considering whether he has been guilty of litigation misconduct with a view to defeating the Wife’s claims in these proceedings and, in particular in relation to:

However I remind myself that I must also form my own assessment of the evidence independent of the Recorder’s findings and that they are but one part of the overall evidential picture.

This is a central factor to be determined under s 16(2) of the 1984 Act.

The Husband’s case on this issue I summarise as follows:

In the Husband’s closing submissions I was very properly reminded of the following matters:

W’s position was that:

My central findings on this issue are as follows:

My reasons for these findings:

As to the Moroccan Villa:

The factual matrix is as follows:

In assessing this issue I have been referred to a number of translated Moroccan documents. I have had no expert evidence and have heard no evidence from the parties’ Moroccan lawyers. Piecing together the picture has not been entirely easy.

Doing the best I can I find as follows:

I find that:

The Husband’s deliberate and tactical commencement and prosecution of divorce proceedings in Morocco in August 2018 showed that he was operating tactically at this time with a view to putting obstacles in the way of the Wife’s likely English divorce. My findings as to his motive and purpose at this time inform my findings in relation to:

The nature and proximity of the timing of these events is relevant in my view as to understanding the Husband’s purposes in relation to them.

Under section 16 of the 1984 Act I must address the matters set out below, but I have already considered these in the preceding sections of this judgment and do not propose to address them again here.

I accept that the Wife was ordered to receive in the Moroccan divorce:

My understanding is as follows:

I take this non-compliance into account in my decision together with the Husband’s non-compliance with the English orders for maintenance and costs. It is clear to me that the Wife has faced formidable difficulties in enforcing orders made in her favour.

There is no evidence of any further process available to the Wife in Morocco I therefore regard this factor of limited relevance.

The bulk of the Husband’s wealth is in England.

Any order made by me is enforceable in this jurisdiction, where the bulk of the Husband’s wealth is situated.

The Wife has acted very promptly and there is no issue of delay.

Section 18(2) -

C’s welfare is my primary focus and, in particular, an outcome where he can thrive in the care of his mother, the Wife, in a secure and stable home.

I have set out the parties’ assets and liabilities earlier in this judgment.

I make the following additional comments:

The true income from the property portfolio is, I find significantly higher than the sum suggested by the Husband as received by him from the Third Respondent. The Wife has sought to create her version of an accurate table of the likely income which estimated the rental income at about £500,000 pa. However, she has rightly accepted that certain downward assessments needed to be made in the light of the cross-examination of the Husband and the evidence of room rates and occupancy levels.

I did not find the Husband’s denial of any detailed current knowledge of the true room rates and true income to be convincing. Likewise K’s understanding I found to be unconvincing and superficial.

Overall I was persuaded that the property rental income was significantly higher than the Husband and K had disclosed and I reached that view because:

I am satisfied that the Husband had the resources to meet his MPS obligations but chose not to meet them.

I am also satisfied that H will have a significant income in the future even after the impact of my orders. It will be a significant reduction from the current income as properties are sold or mortgaged to meet my orders but he will still be a position comfortably to meet his own needs.

I believe that the Wife will relatively quickly be able to establish her earning capacity. Her English is not perfect but is good and she is plainly well educated and has significant academic qualifications. In her evidence she felt she would need 2 - 3 years to find work in her chosen industry and will need time to recover from these proceedings. I address these issues later in this judgment.

This is a ‘needs’ case and I address these issues below when I consider the orders I make.

In a needs case this seems to me to be of limited relevance. I note that the parties travelled extensively, and the Husband has property internationally including the ‘castle’ in [Lebanese town]. However I also note that their marital home was relatively modest, with a value of £615,000, and is subject to a mortgage,

I have addressed these matters earlier in my judgment. It is important that this is a short marriage but that it nevertheless has generated significant long-term needs for C and the Wife.

The parties are in good physical health.

Given the findings made by Recorder Castle and my own findings and the exceptionally bruising nature of these proceedings I accept that the Wife will need some time to re-establish a degree of balance and stability into her life and this will impact on the speed at which she can develop her earning capacity.

The Husband has made the financial contributions of the available wealth. The Wife did make some modest contribution to the property portfolio, assisting with rent books etc - but this was to the running of the portfolio and not towards the creation of it and I regard it as irrelevant.

The Wife has already made significant past welfare contributions to C and will make large future contributions for many years to come. Given the 91(14) Order she is likely to have the entire responsibility for C’s future welfare.

I do have regard to the findings of Recorder Castle and to my own findings of litigation misconduct in relation to the Husband.

These matters do not in my judgment go to the size of the Wife’s award but are relevant as to whether she should be expected to accept Schedule 1-style provision (in whole or in part) or any provision under which the Husband would know of her future address.

This is not relevant.

It is agreed that the 1984 Act replicates in section 23 the law in relation to Section 37 MCA 1973, and the legal principles are the same. Under s 23(2)(b) - the court can set aside a disposition if it is made with the intention to defeat the Wife’s claims for financial relief. Financial relief is widely interpreted and means not just substantive orders but also claims for enforcement- see 23(1).

Under section 23(5) - there is a statutory presumption against the Husband if any transaction is made within 3 years of the financial claim. This presumption is engaged in this case.

23(4) A third party can escape set aside if they can establish that:

I have considered the guidance provided in Kremen v Agrest [2011] 2 FLR 478 and, in particular I conclude that to succeed on the s 23(4) defence the Second Respondent must satisfy all three of the conditions and not simply one of them.

Pursuant to Kemmis v Kemmis & Others [1988] 2 FLR 223 - the intention to defeat does not have to be only intention for entering into the transaction, but it must be one of them. Further ‘notice’ does not need to be ‘actual’ but can be constructive notice, per Hunt v Luck [1901] 1 Ch 45 and the cases considering ‘constructive notice’.

Here the transaction in question is a charge executed by the Husband in favour of his brother the Second Respondent and entered into on 14.11.19 and over S Court. The sum secured is £227,390. The three-year presumption clearly operates against the Husband, but it was argued that it does not operate against the Second Respondent and that the burden of proof is on the Wife as against the Second Respondent.

In Kremen v Agrest it was made clear by Mostyn J that the evidential presumption does operate against the Second Respondent:

“Although there is a formal legal burden on W to demonstrate the negative of the matters referred to in para [9](iv) above, I take the view that for obvious reasons (having to prove a negative; lack of knowledge) there is an evidential burden shifted to LF to establish this exception. If he does not establish all three limbs of the exception then the defence will not arise.”

I adopt these observations as well as the observations as to ‘sham’ transactions. However, I have reached my view below based on the evidence and, even were the burden of proof to fall on the Wife, I would have reached the same decision. The key dates of this transaction are these:

Moreover in the meantime the Husband had secured the removal of the Wife’s Matrimonial Homes Act rights over S Court - without the Wife being informed by the Land Registry. He was able to do so because of the Moroccan divorce had ended the marriage. As a consequence the Wife’s Occupation Order was not sufficient protection and not effective against the Second Respondent.

On 14.5.20 the Husband executed a further charge over C Square to secure further borrowing for these proceedings of £150,000. No application has been made to set aside the C Square charge under section 23 of the 1984 Act.

On 6.8.20 HH J Evans-Gordon made a final order in the child arrangements proceedings ordering there be no direct contact and a 91(14) Order.

On 10.8.20 (2 days later) the Second Respondent opened correspondence with the Wife’s advisers and subsequently commenced possession proceedings against the Wife.

I am satisfied that the Husband and the Second Respondent both acted in bad faith to the Wife in entering into this charge over S Court and with the intention of:

Even without the statutory presumption against the Husband and the evidential burden against the Second Respondent (per Kremen) I would be satisfied that this was the case.

At the outset of the case the Wife’s counsel indicated that there was no evidence that the later monies - i.e. the sums provided to the Husband to meet his litigation obligations, actually emanated from the Second Respondent. Over the course of the hearing I am told that bank statements were provided that did demonstrate this fact.

I am satisfied that this charge over S Court was intended to defeat the Wife’s claims and has the effect of impeding her enforcement opportunities and should be set aside and I do so for the following reasons:

Counsel for the Second Respondent suggested that the central plank of the Wife’s case was the Husband was effectively recycling his own money and not genuinely borrowing the Second Respondent’s money. I agree that in the final analysis this point was not strongly pursued by the Applicant but it seems to me that the need to satisfy all of the requirements of section 23(4) are more pertinent and my central findings are that (i) the Husband the Second Respondent were working together with the primary intention of maximising the difficulties for the Wife to pursue her claims and so there is bad faith in relation to both of them and (ii) the original £109,000 was not the Second Respondent’s money and so he has not provided full valuable consideration. They did not act with good faith, and I have no hesitation in finding that the Second Respondent had actual notice of the Husband’s intention to defeat the Wife’s claims. Even if I am wrong about this I am satisfied the timing of the charge and the possession proceedings fixes the Second Respondent with constructive notice of the Husband’s bad faith. I am further satisfied the Second Respondent has not discharged the evidential burden that he carries in relation to this transaction.

I ask myself whether I should exercise the discretion to set aside the S Court charge? I have concluded that I should for the following reasons:

The charge over C Square is not affected by this Order as no application has been made in relation to it.

I will not repeat here my summary of the law as set out above in relation to the Second Respondent.

The transaction that I am concerned with here is the creation of a Guaranteed Rent Contract dated 19.10.18 and created between the Husband and R3 a company wholly owned by K. It is my understanding that under the lease agreement:

The date of the Guaranteed Rent Contract means the statutory presumption against the Husband is fully engaged and the burden of proof to establish that this was not entered into in order to defeat the Wife’s claims shifts to him. The evidential burden also passes to K and the Third Respondent per Kremen.

I have concluded that this Guaranteed Lease Contract was intended to defeat the Wife’s claims and has had that effect, as was intended. There are insufficient non-property resources to meet the Wife’s claims and it was, in my assessment, always clear that the Husband’s property portfolio would be a target for the Wife’s claims and this contract has the effect of complicating the enforcement options against the Husband’s property portfolio.

I have reached my conclusion for the following reasons:

Given her close relationship with her Father I am satisfied that K has full awareness of the Husband’s desire to frustrate the Wife’s claims and, indeed, that she too shares that wish.

Even if some element of the motivation for the contract was caused by any difficulties the Husband had with [London Borough 2], I am satisfied that the Husband’s desire to frustrate the Wife’s claims was still a significant motivation for this arrangement.

For all of those reasons I was entirely satisfied that the scheme had been intended to defeat the Wife’s claims. I am confirmed in that view by the statutory presumption that operates against the Husband and the evidential burden in relation K and the Third Respondent which they have not discharged.

I have a discretion whether or not to set aside this contract. I am clear that I should set it aside so as to simplify the enforcement arrangements available to the Wife to secure the sums that I order be paid below.

The central features of this case are in my judgment as follows:

In addition, an important and striking feature of the case is that the Husband has misconducted himself to a very troubling extent as detailed earlier in this judgment including:

In particular the Husband’s deliberate breach of the Hemain injunction means that the court was deprived of a ‘forum non conveniens’ hearing as described earlier in this judgment. Had there been such a hearing this would, in my assessment, have probably been a London divorce. I take that into account in my assessment of the criteria under the Part III jurisdiction.

I recognise and agree that per Agbaje and per Lord Justice Collins in particular the court should not award more than an English court, nor should I fall into the error of seeking to ‘top up’ the Moroccan award to an ‘English’ level.

A central feature of the Wife’s needs is the need to discharge her very large litigation loan before she can address her housing needs and other claims. In relation to the very large size of that loan it seems to me that broadly:

I recognise that the Husband was ordered to pay only one-third of the Wife’s costs of the child arrangements proceedings and there was no order in relation to the balance. If I order the Husband to discharge the Wife’s litigation loan in full this would have the effect of going behind that costs order. That does present difficulty given the Wife’s lack of other resources. However, I must do the best I can in an attempt to arrive at a fair outcome.

Had the Husband litigated the financial issues reasonably the costs allowance orders made against the Husband would in my view have been sufficient to take this matter to a conclusion and would be likely to have avoided the need for the Wife to borrow so heavily by way of her litigation loan.

I recognise that the Wife has been provided an award in Morocco and that it appears to have been a proper Moroccan award. However, I do consider that it is both fair and necessary to make a further ‘needs-based’ award in favour of the Wife that focuses largely, but not exclusively, on her needs as C’s mother and I do so because:

The fair application of the Part III jurisdiction as defined by the case-law is in my assessment as follows:

I have concluded that the Wife’s needs should be assessed in London, and I reject the suggestion that the Wife’s neds should be assessed by reference to her being based in Morocco in the future.

I recognise that I had reservations about the Wife’s evidence as to her future needs and her future earning capacity. I also recognise that her concerns about the Husband are genuine and that this might incline her to move away from London and possibly from England to limit the risk of there being unwanted contact with the Husband in the future. Nevertheless, I have concluded that the Wife’s needs should be based on a future in London and my reasons are as follows:

Unless this is re-paid in full I cannot provide for the Wife and C’s housing needs. I would have wished to have been able to adopt a more nuanced approach to reflect the fact that not all of the Wife’s legal costs can be said to have been the responsibility of the Husband. The Husband has significant resources, but his wealth is not ‘stellar’ and so this is a difficult issue. However, I have concluded that the Husband should discharge the litigation loan in full, and should so speedily to prevent further interest accruing for reasons including the following:

The Wife’s proposal is that she should have £775,000 to purchase a three- bedroom property in the [area of London] area. She has provided sample property particulars and has suggested she needs a three-bedroom property to accommodate an au pair as well as herself and C. The Wife also contended that she needed to be close to her current GP, current Social Services support and so in or close to the Westminster Borough.

The Husband contends that the Wife should either rent or have the use of the Husband’s property at C House.

I consider that the Wife’s needs are for a secure home, purchased without mortgage, and that it would not meet her needs, or reflect her past and her future contributions, for her to rent.

I have however formed the view that the Wife’s housing claim is too high for the following reasons:

I have considered the property particulars advanced by the Husband but:

I have had regard to the C House property with a view to assessing the quantum of the Wife’s claims (not with a view to the Wife occupying that property). It is a 2-bed flat with no garden in a largish block and is valued at £415,000. In my view the Wife should have accommodation that is somewhat more attractive than the C House property, but it is not an unrealistic example of a future property.

I have no property particulars addressing the gap between C House and the Wife’s proposed particulars in [area of London].

Doing the best I can the Wife’s fund should be sufficient to buy a two-bed property, ideally with some outdoor space for C, and she will have to find a property in an area that my award permits. I consider that a housing fund of £575,000 will meet this need. If the Wife seeks a three-bedroom property she can move to a cheaper area. The sum of £575,000 will meet the cost of purchasing and equipping a modest property mortgage free.

I have not found this particular issue to be easy. I certainly do not think it fair or appropriate that the entirety of the Wife’s housing award should revert to the Husband on C becoming an independent adult. But I have considered very carefully whether I might order that a part of the Wife’s housing fund - for example 1/3rd - could revert to the Husband on C reaching independence. Had I done so I might have been less conservative in the quantum of the Wife’s housing award.

However, I have decided against such an approach and direct that the award be outright with no reversionary element inter alia for the following reasons:

Even if it is somehow possible to create a secure Schedule 1-type of award whereby the Wife’s address was not traceable by the Husband I would, and do, on balance decide against that approach looking at the case as a whole because, inter alia:

I would have preferred for the Wife’s income needs to be met by monthly payments from the Husband’s income rather than by way of a capitalised award. However, I have concluded that the spousal claims must be met by way of a capitalised award, because of the difficulties the Wife would face enforcing monthly payments, inter alia for the following reasons:

The Wife seeks a needs-based capitalised income lump sum award of £225,000 based on:

I agree that an au pair or some significant child support will be necessary in the short-term. I do not think a live-in au pair is necessary and the Wife will have to make adjustments.

I have considered the Wife’s income needs ‘budget’ and I have taken into account the shortness of the marriage, the Wife’s limited income before the marriage and the marital standard of living. I have concluded as follows:

The lump sums that I order the Husband to pay are as follows:

I make the following further orders.

I will need to decide after hearing submissions on the appropriate costs orders to be made, and in particular, in relation to the Wife’s outstanding costs of these proceedings which I understand to be about £143,000 odd.

There will need to be appropriate agreements and undertakings to address outstanding costs orders and outstanding maintenance orders both in England and Morocco.

That concludes this judgment. I regret the delay in this judgment that has been caused by securing appropriate listing arrangements in order to deliver it orally at an earlier date.

At the conclusion of this hearing I am invited to consider what further orders I should make in relation to costs having handed down judgment today. In particular, I am asked by Mr Perrins that the husband be ordered to pay the wife’s outstanding costs in full and by Miss Hussey QC to make no order as to costs.

The background I will not deal with in any detail. We had a final hearing over 5 days in which the evidence was completed and then two additional days for written and oral submissions and judgment handed down today. In my judgment I made orders providing for lump sums to the wife for her housing together with a sum for capitalised maintenance and I ordered the husband to discharge the wife´s litigation loan. This loan included not just the wife’s financial remedy costs but also her Children Act costs where he was ordered to pay 2/3^rds of her costs. The litigation loan also covered the Family Law Act costs. 

I made that order in relation to the litigation loan because I was concerned that without making that order I would not be able to meet the wife’s and child’s needs and I took into account the scale of the husband’s resources, and my assessment that the wife had not misconducted herself and had behaved reasonably within the litigation, whereas I found that the husband had significantly misbehaved.

I am invited by both parties to take a broad and pragmatic approach to costs and avoid the delay of any detailed assessment and the costs that would generate.

I am not attracted to the submission that there should be no order as to costs in relation to the outstanding sums. I am fully cognisant of the strong submissions made by Miss Hussey QC that a party must litigate reasonably and openly, and a party cannot operate with a blank cheque even in a ‘needs’ case such as this. I am well aware of, and have regard to, the authorities Miss Hussey QC refers to in this regard.

Under FPR 2010 r.28.3 Part III applications are expressly included as financial remedy proceedings. I have reviewed those provisions and bear in mind the general rule that there should be no order as to costs, but that the court can nevertheless make orders to reflect the conduct of the parties.

However, I also consider that I have a power to make a further substantive award under Part III to reflect needs. The wife’s outstanding costs were £143,000 and are now, I am told, £178,214. I am satisfied in the broad sense that I will be looking at a costs order and limited by r.28.3. 

I address the relevant factors in r.28.3(7), such as (a) any failure to comply with the rule and (b) any open offer to settle. The wife was criticised for not making an earlier open proposal on the basis of her needs case prior to trial. That criticism is significantly misplaced when this case cried out for the husband to make an open offer, either on a Schedule 1 basis in part or on an outright basis, to realistically meet a modest housing award and modest income award. The husband failed to make any sensible proposal and worse still made it very difficult for the wife to formulate an open proposal by the way he conducted himself.

There is some limited merit in the argument that the wife was unaware of the valuation of the husband’s properties until shortly before trial and did not have the detail of the husband’s replies, but it was apparent at an early stage that the husband had significant means and resources and she was aware of the length of marriage. It is said she should have made an earlier open proposal and there is no reason not to do so. However, this is not a significant criticism of wife. I consider it to be of limited force in relation to the issue of costs.

Under sub-(c) whether it was reasonable for a party to pursue or contest a particular allegation, I prefer to deal with this under sub-(d) and the manner in which a party has pursued or responded to the application or a particular allegation or issue. I remind myself of the all the findings I have made in my judgment both in relation to the application and the husband’s conduct generally, including those findings made by Recorder Castle. In particular, his conduct in relation to the s.37 application, the breach of the Hemain injunction, his non-payment of the English court orders and to my mind the husband´s overall approach has been strikingly unhelpful and intend to make this litigation as difficult as possible for the wife. I am reminded of the very unpleasant actions of the husband, as found by Recorder Castle, to discourage her from pursuing her claims.

These have all weighed in my mind in relation to the issue of costs. There is a very clear and marked imbalance in misconduct by the husband.

So far as any other aspect of a party’s conduct is concerned, under sub-(e), I did not take this into account in the quantum of the award, but in relation to the structure – whether the award should be outright or whether there should be an element on Schedule 1 terms. I adopted an outright award but assessed needs conservatively for the reasons I explained.

In relation to sub-(f), the financial effect on the parties of any costs order, without a costs order the wife’s housing and income needs will not be met. That might be fair in a case in which a party had litigated unreasonably, but I have found that the wife has litigated reasonably and therefore it will be a very difficult and unfair outcome for her if no order as to costs is made and the impact of this of in reducing her award by some £178,000.

I take into account that the husband does not have infinite resources, but he has significant resources. I have in mind the CGT the husband has to pay on disposal of property and this is why he should have made a very early offer to settle the case, rather than placing obstacles in the way, and such an offer would have protected him and encouraged the wife to settle these proceedings. But in my judgment he took a completely different approach and made things more difficult for the wife.

I consider that I have the power to order a lump sum to reflect needs, but that this is a case where the husband should be ordered to pay the wife’s outstanding costs of these financial remedy proceedings and on an indemnity basis. It seems to me that the misconduct of the husband crosses the threshold into the indemnity standard and that it is the sort of conduct that the court should mark its disapproval of. The misconduct has also made it very difficult for the case to be resolved.

I am troubled by the disproportionate overall litigation costs of some £600,000, but over £131,000 of that is interest on the litigation loan and the wife cannot be criticised for that. Also it is difficult for Miss Hussey QC to criticise the wife when the husband’s conduct has inevitably driven costs up. In fact, each party’s financial remedies costs are similar and the husband’s slightly more than the wife’s. That is a powerful point.

It seems to me that the husband should pay the wife’s outstanding costs on an indemnity basis but that there should be no overlap in relation to any existing costs orders.

The criticism levelled against the wife can be met by a percentage approach and that is what I am being invited to do. There were some errors in one of the wife’s witness statements and in letters prepared by her previous solicitors, which she should take responsibility for. She overstated her housing claim in producing property particulars of 3 bedroom properties in [an area of London] and, although I take Mr Perrins’ point that they were all in the bracket, in my judgment the wife over pitched her claims.  The issues in relation to the single joint expert evidence as to the value of the Lebanese properties are limited given my conclusions.

I consider that the right order is to order the husband to pay 90% of the wife’s outstanding costs on an indemnity basis or £150,000, whichever is the higher, in the event there is a detailed assessment which either party could seek. There is to be no overlap with the existing costs order.