AAZ v BBZ & Ors

In my judgment dated 15^th December 2016 (citation number [2016] EWHC 3234 (Fam)) I granted AAZ (‘W’) financial relief in respect of her divorce from the respondent BBZ (‘H’) in the sum of £453,576,152. I set out the factual background to H’s financial affairs in paragraph 66 onwards. I summarised the relationship of H to the second and third respondents, C Ltd and P Ltd. In paragraph 92 onwards, I explained why the March 2015 disposition fell to be considered under s.37 of the Matrimonial Causes Act 1973 and s.423 of the Insolvency Act 1986 as a disposition at an undervalue designed to put H’s assets beyond the reach of W and/or in order to prejudice her interests. For the reasons given in my judgment, I ordered that the relevant transactions relating to the March 2015 disposition should be reversed, re-vesting the assets in question in H.

On 15^th December 2016, following the handing down of the judgment, H’s personal lawyer, S, attended court pursuant to a witness summons. S gave evidence and was cross-examined by counsel for W, Mr Dyer QC, in relation to two matters in particular: firstly, the collection of modern art, secondly, P Ltd’s portfolios of cash and other financial assets (see my judgment of 15^th December 2016 passim). In the course of cross-examination, S revealed that both the modern art collection and P Ltd’s assets had been transferred by H from a central European country to another European country in November, shortly before the commencement of the ancillary relief trial before me on 29^th November 2016.

S, under cross-examination, revealed details of which entities in the European country now held the modern art collection and P Ltd’s assets. He named an entity called
‘O 1’, a financial institution, and a bank called ‘L Bank’ in the same European country as now holding these assets. As I explained in my ruling in relation to S’s evidence dated 20^th December 2016 (citation number [2016] EWHC 3349 (Fam)), the recent transfer of the modern art collection and P Ltd’s assets to the European country appears to be another deliberate attempt by H to hide his assets and prevent enforcement of this court’s orders in relation to W’s claim.

Recent investigations have been carried out by W’s advisors in the European country which have revealed that there are two ‘O’ financial institutions in the European country called “O 1” and “O 2” financial institutions, both of which were established on the same date, 21^st October 2016, by X Trust, the European country. I infer, as I am invited to, that “O 1” and “O 2” are closely connected, and form part of the latest scheme by H to hide his assets.

There is no evidence that P Ltd was paid any consideration for the transfer from the entity holding the modern art collection and P Ltd’s financial assets in the central European country to “O 1” or “O 2”. It is quite apparent that this transfer was at an undervalue, or a nil value, and was simply the latest part of H’s attempts to avoid his liabilities by purporting to transfer his assets to new entities in a new jurisdiction and thereby making enforcement more difficult.

For similar reasons given in my judgment dated 15^th December 2016, in particular paragraph 66 onwards, I find that “O 1” and “O 2” are no more than ciphers and the alter ego of H. For these reasons, I order that all dispositions of the modern art collection and P Ltd’s financial assets to “O 1” and/or “O 2” in or around November 2016 are set aside, so that at all material times those assets vest in H and continue to do so. In those circumstances, those assets remain immediately available for the aforesaid enforcement of the judgment of this Court granting W ancillary financial relief in the sum set out in my order dated 20^th December 2016.