Wednesday, 28 November 2012
"Cheat's charter" is bad news
Our family law expert has hit out at a ruling that could help wealthy husbands to hide their assets during a divorce.
Nadia Davis leads our family law team and said the ruling by the Court of Appeal that an oil baron's companies did not have to hand over their assets to his ex-wife was a dangerous development.
"It's clear that this ruling could encourage wealthy businessmen to shelter their assets in companies and trusts that are beyond the reach of their wives, which is just unfair.
"I believe this should be looked at again as soon as possible, in order to protect wives in high value divorce cases who may otherwise not get the payout they are really entitled to."
The Court of Appeal said that the "corporate veil" could not be lifted unless there were exceptional circumstances, and said the oil baron's companies could not be considered as his own property.
"In many instances this ruling has been referred to as a 'cheat's charter' and gives unscrupulous husbands all the opportunity they need to protect their assets," said Nadia.
"This decision by the Court of Appeal, which was not unanimous, means family law judges can no longer ensure that justice is done on both sides in a divorce.
"For me, this is an extremely dangerous route to have taken and it will create real uncertainty in any forthcoming cases.
"Surely the wisest move would be to reconsider the ruling and to introduce legislation that safeguards a wife's right to receive a fair payout and that prevents assets being hidden away.
"Divorce is a difficult enough experience at the best of times for anyone involved, and to have introduced a method where precious assets can be taken out of the equation is only adding to the stress."