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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Kremen v Agrest [2013] EWCA Civ 41 (05 February 2013) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2013/41.html Cite as: [2013] EWCA Civ 41 |
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ON APPEAL FROM THE HIGH COURT OF JUSTICE
FAMILY DIVISION
Mr. Justice Mostyn
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE THORPE
and
LORD JUSTICE MOORE-BICK
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JANNA KREMEN |
Claimant/ Respondent |
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- and - |
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BORIS AGREST |
Defendant |
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Mr. Christopher Stirling and Mr. John Hamilton (instructed by Richardson Smith Solicitors) for the respondent
Hearing date : 12th December 2012
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Crown Copyright ©
Lord Justice Moore-Bick :
"88. In my judgment where a transaction has been avoided under s37 Matrimonial Causes Act 1973 or s23 Matrimonial and Family Proceedings Act 1984 and the disponee then comes along seeking to reverse that very order by these means then the court is clearly in an exceptional situation quite outwith the situation where a bona fide creditor is seeking to recover his judgment debt.
89. Mr Feehan QC argues that no stain has been cast on GC's integrity by my judgment of 3 December 2010. I do not agree with that. I found that GC had not given me truthful evidence and that he was complicit in H's machinations (see paras 17, 23 – 26, 28 – 32, and 36). Moreover I found that GC would have no difficulty in recovering the Kyrgyzstani bonds from H (see para 39). That finding was challenged in the Court of Appeal and was dismissed by Wall P (see paras 24 – 26 of his judgment). Indeed, there is no evidence that GC has even asked H for the bonds back or otherwise to indemnify him for his losses. Mr Feehan QC stated that this was because GC did not know where H was but this is obvious nonsense as in August 2011 his solicitors were in detailed email correspondence with H concerning the negotiation of a consent order which provided for the sale of South Lodge.
90. In my judgment Mr Stirling is right to characterise this application as an abuse of the process. In his judgment Wall P quotes Sedley LJ as having said of GC's purchase of South Lodge "he bought a pig in a poke". His attempts to prevent a reversal of the transaction all failed, and this latest attempt must be dealt with in the same way. In any event I am satisfied that the equity of South Lodge is urgently needed to meet the needs of W and the children. Just as the considerable means of GC were relevant to the exercise of my discretion last time round, so they are this time. In para 13 of my judgment of 3 December 2010 I recorded him as having means of £16.5m. It would be a travesty if in the exercise of my discretion I were to make the charging order final immediately or even on a deferred Mesher basis."
"In deciding whether to make a charging order the court shall consider all the circumstances of the case and, in particular, any evidence before it as to—
(a) the personal circumstances of the debtor, and
(b) whether any other creditor of the debtor would be likely to be unduly prejudiced by the making of the order."
" . . . unless the transfer of the husband's share in the house to the wife is necessary to give her adequate protection so that she may have a home for herself and the children, it is difficult to see why the judgment creditor's undoubted rights should not take preference to the wife's claim to a transfer of property order."
"When considering the circumstances, the approach of the court should be to recall the statement of Sir Denys Buckley in the Hegerty case [1985] Q.B. 850, 866, that a judgment creditor is justified in expecting that a charging order over the husband's beneficial interest in the matrimonial home will be made in his favour. The court should first consider whether the value of the equity in the house is sufficient to enable the charging order to be made absolute and realised at once, as in Llewellin v. Llewellin (unreported), even though that may result in the wife and children being housed at a lower standard than they might reasonably have expected had only the husband's interests been taken into account against them. Failing that, the court should make only such order as may be necessary to protect the wife's right to occupy (with the children where appropriate) the matrimonial home. The normal course should then be to postpone the sale of the house for such period only as may be requisite to protect the right of occupation - a Mesher type of order - again bearing in mind that the court is holding the balance, not between the wife and the husband, but between the wife and the judgment creditor. If the judgment creditor asks, even in the alternative to his claim to an immediate order, for a Mesher type of order, then it seems to me that it would require exceptional circumstances before the court should make an order for the outright transfer of the husband's share in the house to the wife, thereby leaving nothing on which the judgment creditor's charging order can bite, even in the future."
"There will, of course, be cases (such as Llewellin v. Llewellin (unreported), 30th October 1985, Court of Appeal (Civil Division) Transcript No. 640 of 1985, which we heard immediately after this appeal) where the figures are such that even if the charging order is made absolute, and then the charge is realised by a sale of the house, the resultant proceeds of sale (including any balance of the husband's share after the judgment debt has been paid) will be clearly sufficient to provide adequate alternative accommodation for the wife and children."
Mr. Feehan submitted that the court should be concerned only with the provision of accommodation and not with wider financial needs. He argued that Ms. Kremen did not require the whole of the equity in South Lodge in addition to the sum in court in order to obtain adequate accommodation, even if that accommodation was of a standard lower than that to which they had been accustomed.
"88. In my judgment where a transaction has been avoided under s37 Matrimonial Causes Act 1973 or s23 Matrimonial and Family Proceedings Act 1984 and the disponee then comes along seeking to reverse that very order by these means then the court is clearly in an exceptional situation quite outwith the situation where a bona fide creditor is seeking to recover his judgment debt.
89. Mr Feehan QC argues that no stain has been cast on GC's integrity by my judgment of 3 December 2010. I do not agree with that. I found that GC had not given me truthful evidence and that he was complicit in H's machinations (see paras 17, 23–26, 28–32, and 36). Moreover I found that GC would have no difficulty in recovering the Kyrgyzstani bonds from H (see para 39). That finding was challenged in the Court of Appeal and was dismissed by Wall P (see paras 24–26 of his judgment). Indeed, there is no evidence that GC has even asked H for the bonds back or otherwise to indemnify him for his losses."
Lord Justice Thorpe:
"(5) In deciding whether to make a charging order the court shall consider all the circumstances of the case and, in particular, any evidence before it as to-
(a) the personal circumstances of the debtor, and
(b) whether any other creditor of the debtor would be likely to be unduly prejudiced by the making of the order."
i) the appellant had in his hands a copy of the order of Mr Jonathon Cohen QC at a time when he was not contractually bound to purchase South Lodge.ii) the appellant elected to convert the conditional contract into a binding contract with full knowledge of the wife's claim and the order which she had obtained.
iii) the appellant had presented a false case, claiming that he had no notice of the wife's claims or the relevant order until after he had enlarged the conditional contract to purchase into a binding contract.
The Chancellor: