Culligan v Culligan (No 3) (Terms of Order) [2025] EWFC 186

Judgment date: 3 July 2025

https://caselaw.nationalarchives.gov.uk/ewfc/2025/186?query=culligan

MacDonald J. The court determined the terms of an order following a final hearing in January, which saw an equal division of the matrimonial assets following a 40-year marriage, including Wells sharing.

MacDonald J. The court determined the terms of an order following a final hearing in January (see summary here), which saw an equal division of the matrimonial assets following a 40-year marriage, including Wells sharing.

The primary issue between the parties was the Deed of Covenant or 'Phantom Share Agreement' regarding H's interest in Colendi, a financial services platform, the future benefits from which W had been awarded a 30% interest of at trial. The dispute centred around the definition of ‘Colendi Shares’ to be used in the order: should W have a 30% interest over the totality of H's c.13m Class B shares, or an interest over a ring-fenced 30% of his shares (i.e. c.3.8m Class B shares)? W's case was for the former, on the basis that H could choose to treat any ring-fenced portion of his shares differently. H was advocating for the latter, arguing that ring-fencing W's portion of the shares was more faithful to the clean break principle, in that it would afford both parties the freedom to treat their respective shares as they wished.

There were also a number of other issues relating to the draft order, including as to ownership of a £30k car, various provisions regarding the treatment of tax liabilities (arising primarily from H's sale of Bitcoin, and potential CGT liabilities arising on UK properties and H's Colendi shares), and the timeline for H to release W from the mortgage liabilities in respect of the parties’ property portfolio.

The court noted at [35] that, whilst ordinarily the court will be the final arbiter of the content of its own orders, so far as the Deed of Covenant was concerned:

‘The court cannot, however, force a party to enter into a contractual agreement on particular terms. The court can indicate its view on the issue between the parties and, where the parties dispute the meaning and import of the court’s judgment, provide clarification. However should the parties fail to accept the indication of the court, then the court will have to consider what alternatives orders within its power it can make to give effect to the judgment.’

The court determined that the definition of ‘Colendi Shares’ should be the totality of H's shareholding, and that in addition W must also be entitled to payment in respect of 30% of any non-cash benefits accruing. The judgment was clear as to the scope of assets to which the Wells sharing order related. Further, there had been no consideration at trial as to whether ring-fencing a portion of shares would have any impact on their value, i.e. the court had not been furnished with any evidence as to the consequence of H's proposals. The court concluded that H's proposal was in fact antithetical to the purpose of Wells sharing, being that the parties should so far as possible be sharing in the illiquid and risk-laden assets.

MacDonald J concludes by highlighting the obligation on parties under FPR 29.11(3)(a) to file draft orders no later than 7 days after the order was made. Failing this, MacDonald J says, ‘the court will draft the terms of the order and a sealed copy will be sent to the parties’.