Fraud trial prevents divorcing couple being granted a consent order

The Court of Appeal recently upheld a decision to deny approval of a consent order for a divorcing couple due to an ongoing fraud claim against the husband that threatened to deplete all his assets.?

Background of the Case?

The couple, both Ukrainian nationals, experienced a marital breakdown in 2016. Initially governed by a pre-nuptial agreement, their financial settlement was revised in February 2017, awarding the wife ￡95 million. At the time, the husband’s wealth was estimated at ￡1 billion. However, in December 2017, a bank initiated legal proceedings against the husband, accusing him of fraud and seeking $1.91 billion plus interest. The bank also obtained a worldwide freezing order on his assets.?

The Consent Order Application?

As the fraud trial was scheduled for June 2023, it was acknowledged that a successful claim by the bank could eradicate the husband’s assets. Despite this, the couple sought to convert their settlement agreement into a court-approved consent order. The bank intervened, requesting a stay on the financial remedy proceedings until after the trial.?

Court’s Decision?

The judge refused to approve the consent order, adjourning the financial remedy proceedings. He determined that it would be inappropriate to sanction an order that might later prove unenforceable. Under the Matrimonial Causes Act 1973, the judge considered all relevant factors, including the bank’s interests, which were safeguarded by the freezing order.?

The wife argued that the judge had improperly prioritized the bank’s interests. Nevertheless, the Court of Appeal upheld the judge’s decision, emphasizing the court’s discretion under the Act regarding consent orders. While the court respects agreements between couples on financial arrangements, the pending litigation against the husband meant there were no guaranteed assets to distribute.?

Conclusion?

The Court of Appeal concluded that adjourning the consent order application was the prudent course of action, given the unresolved fraud allegations against the husband.?

Contact us

For more information or advice on family law matters, readers are encouraged to contact the legal team at southgate solicitors at 02080040065 or [email protected]. It’s important to note that the content of this article is general information and not legal advice, and readers should seek independent expert advice for their specific situations. Our experienced team at southgate solicitors is here to provide expert guidance and support.?