Financial Remedies on Divorce and the Role of Freezing Orders

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As solicitors we often see complex issues frequently arising in high-value divorces, such as when either or both parties have a beneficial interest in assets owned by a third party. 

In the recently reported case of Crowther v Crowther, the parties married in 1996 and ran a successful shipping business together, enabling them to enjoy an affluent lifestyle.

However, they separated in 2018 leading to a bitter divorce. Mrs Crowther had secured a freezing order preventing various parties from the disposing of or charging four vessels in the business. This was discharged on appeal then reinstated pending her appeal.

It was common ground that legal title to the vessels was held by companies controlled by one of the respondents, but Mrs Crowther argued that both she and her husband were entitled to the beneficial interests in those vessels.

An immediate issue for the court was whether it should send the case back to the Family Division for a fresh hearing or to determine itself whether there should be a freezing order against the second to sixth respondents in the case (the owners of the four vessels) and, if so, on what terms because of the unsatisfactory way the judge had dealt with it. The appeal judges decided it would deal with the issues themselves in the “extremely urgent” circumstances.

The court observed that the judge had been right to say that prior arrangements concerning the assets, which were concluded in 2012, had nothing to do with any attempt by Mr Crowther to put assets beyond his wife’s reach or to defeat any financial remedy claim in the event of a divorce – at that time their marriage was continuing to thrive.

However, the court concluded that there was now a risk that assets would be put beyond reach of any judgment and justified a freezing order. The court allowed the appeal but on specific terms which would permit one vessel to be sold or for them to be charged as security. This was on the basis that if nothing had been done, the risk was that the vessels would have had to be sold for no more than scrap value, which would not have been in either party’s interests.

The freezing order would continue but on the terms set out in the schedule to the judgment. 

If you are considering divorce or are looking for assistance in respect of finances surrounding your divorce, why not contact one of Alexander JLO’s expert divorce lawyers for a free, no obligation consultation and see what we can do for you.

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