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Broadlegal Successfully Defends £1.5 Million Third-Party Beneficial Interest in Financial Remedy Proceedings in the Central Family Court




W v H and 2 Intervenors [2023]


Background

The Wife (W) started financial remedy proceedings in the Family Court at East London seeking a property adjustment order for the matrimonial home to be transferred to her sole name. She also sought a share of two other rental properties purchased during the marriage. There were three properties in the marriage with a combined estimated value of £1.5 million.


The matrimonial home was purchased with cash in the names of H and W but at some stage, H asked W to remove her name from the title (at the behest of H’s parents) and W did so following independent legal advice, which was, in itself, an issue in the case.

The two rental properties were purchased in the names of H’s parents, one of which was paid for with the proceeds derived from the mortgage taken out on the matrimonial home.


H’s Argument

In defending the W’s application, Broadlegal argued on behalf of the H that although the matrimonial home was initially purchased in the names of the couple (prior to the W’s name being removed and it being held in the H’s sole name thereafter), H’s parents did, in fact, own 100% of the beneficial interest in the matrimonial home. The same applied to the other two rental properties. Our argument was on the basis that H’s parents paid for the matrimonial home in full, with no financial contribution from either the H or the W.


The matrimonial home and the issue of who owned the beneficial interest in it, played an important role in the proceedings because when the matrimonial home was mortgaged, the proceeds were used to purchase one of the rental properties (we will call this property 2). The other rental property was less contentious, as that property was purchased in the name of H’s parents, and it was less of a complex exercise in adducing evidence indicating that H’s parents provided the purchase funds (we will call this property 3).


W’s Argument

W conceded that H’s parents paid for the matrimonial home in full and that she made no financial contribution towards it, but that the property was a wedding gift, given that the property was purchased a few months after the couple’s marriage. The fact that the property was initially registered in the joint names of the couple was strongly in W’s favour. W argued that if she was entitled to a share of the matrimonial home, it followed that she was also entitled to a share of Property 2, which was purchased with funds derived from the mortgage taken out by H on the matrimonial home.


As to Property 3, the W asserted that it was purchased by H during the marriage and was part of the matrimonial assets. She contended that she was entitled to 50% of its net equity.


Court of First Instance

At the First Appointment hearing at the Family Court at East London, our team was able to persuade the judge to exclude Property 3 from the financial remedy proceedings. This was our first victory for our clients.


We also successfully sought permission from the Court to join H’s parents as Intervenors in the proceedings with the aim of defending their beneficial interest in both the matrimonial home and Property 2. From that point on, Broadlegal acted for the H and the Intervenors.

Given the complexity of the matter, following 18 months of highly contentious proceedings, the Court transferred the case to the Central Family Court sitting in High Holborn, London, in readiness for trial. The case was to be tried by a judge with particular expertise in this area.


Judgment at the Central Family Court

Following a 5-day trial with the four parties giving evidence, including the Intervenors who gave evidence through a Mandarin interpreter, the trial Judge rejected the W’s argument and ruled in favour of the Intervenors. Costs were also awarded to the Intervenors.


The implication of the ruling was that there were, in fact, no assets of any value between H and W and the proceedings were concluded by a clean break consent order.


This resulted in a satisfactory outcome for our clients (the H and the Intervenors) following two years of what was an extremely contentious and stressful case for our clients, with the Intervenors fearing that they would lose their properties.


 

How Broadlegal Can Help You

At Broadlegal, our family law experts are always ready to draw from their wealth of experience and expertise to help you secure a favourable outcome, regardless of whether your case is simple and straightforward, or as complex as the case above.


We regularly act for a range of clients including high-net worth individuals in very complex cases. Our goal is to help you succeed.


Telephone +44 (0)208 090 8363






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