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Wife fails in attempt to increase award of £51.4 million plus share of business assets

CoA gives weight to pre-marital agreement

Camilla Versteegh has failed in her attempt to increase the High Court's award in financial remedy proceedings against her husband, Gerard Versteegh.

The order by Sir Peter Singer gave Mrs Versteegh approximately half the non-business assets (£51.4m) together with a 23.41% interest in a business called H Holdings, which business had been created by and was run by Mr Versteegh under a trust structure.

Lady Justice King, giving the lead judgment in Versteegh v Versteegh [2018] EWCA Civ 1050, noted that the costs to date (excluding the costs of the appeal) were in excess of £4m.

The court had to address extensive arguments about, inter alia, the impact of a pre-marital agreement, non-matrimonial assets and the sharing principle. However, the main focus of the hearing was upon (i) the judge's finding that he was unable to determine the value or future liquidity of H Holdings, the major business asset and (ii) his decision to make a so called Wells order whereby, rather than receiving a lump sum representing her interest in H Holdings, the wife received her interest in specie in the form of ordinary shares.

Lady Justice King found that:

"[T]he case was a 'sharing case' in that the provision made went beyond that which would provide for the needs of the wife. That that was the case does not, in my view, catapult a court to the conclusion that the only fair distribution of the assets is now an equal division of the assets, subject only to an appropriate adjustment to reflect the pre-marital assets of the husband. In my judgment, an effective PMA [pre-marital agreement] is another example of a case where, upon a proper consideration of all the circumstances of the case (per s.25(1) MCA 1973), a court can conclude that (notwithstanding that the husband does not seek to enforce the PMA in full, and that there is now a sharing element to the case, needs having been exceeded) the assets should be divided unequally. This to use the words of Lady Hale in Radmacher represents a "modification of the sharing principle"[178]."

In respect of the non-matrimonial assets, Lady Justice King said:

"[T]he judge was entitled, and really had no option, but to give weight to the non-matrimonial assets in a more general way as part of the totality of his discretionary exercise. This involved consideration of not only the non-matrimonial assets, but the PMA and all the circumstances of the case before he ordered that the wife should receive 50% of the non-business assets and 23.5% of the business assets."

On the question of valuation, she said that notwithstanding that a total of £2m has been spent on experts, the court was in my judgment, justified in coming to the conclusion that it was unable to make even a "conservative estimate" as to the value of H Holdings.

In making a Wells order the judge had not made an error of lawnor had her erred in the exercise of his discretion.

The appeal was dismissed.

Whilst Lord Justice Holroyde expressed doubts about the judge's inability to value the company, he concluded that the making of a Wells order was within the permissible range of the judge's discretion.

Lord Justice Lewison, also agreeing that the appeal should be dismissed, commented upon the consequences of a pre-marital agreement and valuation issues.

Henry Hood, Head of the Family Department at Hunters Solicitors, commented on the judgment:

"The Court of Appeal has found comprehensively against Camilla Versteegh in her attempt to improve on the High Court's award to her of £90m. It rejected her arguments to give no weight to the pre-nuptial agreement signed the day before the wedding, as to the extent of the inherited and premarital assets that he brought to the marriage, and the fact that the award was made up of a minority holding in the husband's company because they were so difficult to value. It was a bad day in court for her. The judgment is also interesting in that it sided with Moylan LJ (against Mostyn J) in the in the ongoing debate between the "arithmetical" and "impressionistic" approach to identifying marital assets to be divided."

For the judgment, click here.