Recorder Rhys Taylor. Evidentially complex final hearing in needs-based case involving verbal Daniels v Walker application, abandoning of SJE report, disclosure inadequacies, and an intervenor being removed.

H & W cohabited from 2008, married 2018 and separated in 2021. Three minor children and one young adult, living with W. Petition March 2022.

At PTR, lack of compliance with directions was evidence including preparation of letter of instruction to SJE. Recorder Taylor decided to forgo the SJE report given the factual disputes between the parties.

Disclosure inadequacies

H asserted that all the capital in the case emanated from him and his family; W countered that her parents had also assisted in paying down H’s business debts. Numerous transactions flowing between H and his parents. ‘Making sense of them now is confounding and something of a fool’s errand.’ H received an inheritance but transaction evidence was hard to follow. Overall, H was contumacious in his attitude to disclosure. H’s director’s loan accounts were ‘shoddy’. His stated income of £12,000 pa was at odds with his lifestyle and Recorder Taylor found that he was confident that he was being lied to about H’s income. H’s personal accountant gave evidence. He was not qualified or regulated and his evidence was materially at odds with the contemporaneous documents.

Intervenor removed

H’s mother (his father having died) intervened in the proceedings in relation to ownership of the FMH. However, taken at its highest, her pleadings did not assert a beneficial interest in a property but rather an assertion that H or both H&W owed her £185,000. The unsatisfactory nature of the H’s and his mother’s evidence and their accountant’s evidence, together with a lack of sufficient supporting evidence meant that Recorder Taylor did not accept that H’s mother was owed £185,000. If there were any loans, they were soft loans. Her ‘doomed intervention was ill conceived’. H’s mother was thus removed as a party under FPR 9.26B(2).

W had her own companies but H also used her name in incorporating a number of companies in which he was the driving force. W was on universal credit and had a part-time job earning £8,280 pa; total income £21,828. Her earning capacity was limited by the children and was around £25,000.

Walker v Daniels application

FMH value was agreed at PTR and recorded as recital, but un-agreed at final hearing when H made a verbal Daniels v Walker application (without D11 and supporting witness statement) on first day of final hearing, to admit unilaterally obtained surveyor’s report. This application was considered and approached per GA v EL [2023] EWFC 187, but dismissed.

After all ‘the sound and fury’, the assets comprised some £595,236 net. Both parties had received financial support from families for their legal costs. There was insufficient for these to be repaid. W also had a litigation loan and credit card/store card debts.

Outcome

FMH to be sold; sole conduct of sale to W; H to receive £100,000 and W the balance. W’s housing need for her and the children was a tight (for the area) £500,000. H did not have overnight staying contact with the children and his housing need was lower. He might have to rent if his assertions about his income were correct.

W to transfer her shares in ABC Properties Ltd to H and H to indemnify her against any loans from his mother and of the companies of which she has been a director acting as H’s nominee (a ghost employee for tax purposes). W’s claims for lump sum open until FMH returned to her in good condition; thereafter a clean break.

Overall split 75.5% to W. W took more than half because of clean break and H having significant resources at his disposal given that he had a lifestyle at odds with his declared income. Provision for W enabled her to clear her hard debts, and buy a house with a modest mortgage.

Costs submissions invited, preliminary view was H to pay £20,000 to W.