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M v M [2011] EWHC 3574 (Fam) and [2010] EWHC 2817 (Fam)

Financial Provision under Part III of the Matrimonial and Family Proceedings Act 1984: Application by a wife for interim periodical payments where the husband had not supplied the court with any evidence of his wealth.

Application by a wife for interim periodical payments (including provision for legal fees award) under Part III of the Matrimonial and Family Proceedings Act 1984.  The question arose as to the correct interpretation of the test for interim periodical payments in Part III cases following the case of Agbaje v Agbaje [2010] UKSC 13.  The Judge also acceded to a preliminary Hadkinson application: the husband's legal representatives were prevented from participating in the hearing due to the husband's breach of previous court orders, including orders to file and serve evidence for the current hearing. 

Summary by Juliet Chapman, barrister, Lamb Building


[2011] EWHC 3574 (Fam) and [2010] EWHC 2817 (Fam)

Royal Courts of Justice
Tuesday, 19th October 2010



B E T W E E N :

M Applicant

-  and -

M Respondent

Transcribed by BEVERLEY F. NUNNERY & CO
Official Shorthand Writers and Tape Transcribers
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MR. Nigel DYER QC and MISS Juliet CHAPMAN (instructed by Mishcon de Reya) appeared on behalf of the Applicant.

MR. Tim SCOTT QC and MR. Brent MOLYNEUX (instructed by Farrer & Co.) appeared on behalf of the Respondent.


(As approved by the Judge)

1 This is an application by the wife for interim periodical payments following the breakdown of her marriage to her husband.  The wife's application for financial relief is made under Part III Matrimonial and Family Proceedings Act 1984, leave having been given by me for the wife to commence her application for financial relief on 20th July 2010.

2 At the hearing on 20th July, directions were given for the wife to file an affidavit in support of her application for interim maintenance, that affidavit to be filed by 7th September, and thereafter for the husband to file his affidavit in reply by 7th October 2010.

3 The case was listed on 20th July for hearing on 18th October 2010 (yesterday).  At the July hearing a freezing order was made against the husband in relation to a number of properties in London. Directions were given in the usual way at that hearing for the husband to file an affidavit of means.

4 The wife filed her affidavit in support of her application for maintenance a little late, on 9th September 2010.  The husband has not filed an affidavit in reply and offers no explanation for its absence.

5 The matter was listed for directions in front of Parker J. on 5th October.  The husband was represented by counsel but chose not to attend.  The matter came on before me yesterday afternoon.  The husband again chose not to attend.  I am told he "has an infection", but that was not given as the reason for his non attendance. No medical report has been produced.

6 The husband was and is represented by leading counsel and junior counsel.  No explanation has been offered for his failure to file an affidavit.  When the matter did not get reached until late in the day yesterday and the matter has, accordingly to go over until today, the husband did not take the opportunity to file an affidavit overnight.

7 Mr. Dyer QC on behalf of the wife indicated yesterday that it was his intention to submit to the court that under the principles in Hadkinson given the circumstances outlined above the husband should not be heard in relation to the application before me.

8 The brief background is as follows.  The parties are Russian nationals in their mid-40s who have lived in England since August 2005.  They married in Moscow in 1991.   Including pre-marriage cohabitation the marriage lasted for nearly 20 years.  There are two children of the marriage who are 16 and 12 years of age. Both the boys are educated in England and both are attending boarding school.  The parties each have a child from a previous marriage.  The wife's daughter is 25 years old and was adopted by the husband in Russia.  The family's connection with England started as long ago as 1998, when the wife's daughter was first sent to school in the UK.  The husband's son, is 23 years of age and he, it would appear from the limited information available to the court, is very involved with the husband in his business affairs.

9 It appears from documents which were obtained on the wife's behalf from Companies' House, that shortly after the parties separated, the wife's 50% share in a property holding company was transferred to the husband's son.  It is alleged by the wife that this was done without her knowledge and consent.  Indeed, Parker J. at the recent directions hearing ordered the husband to produce the transfer in order to allow the signature to be examined.  Parker J attached a penal notice to that order. I have not got a copy of the draft order and do not know not the date when the transfer was to be filed.

10 The parties moved to live in England, as I have already indicated, in 2005.  After a year or so living in rented accommodation they bought their first London home for approaching £4 million.  This property was and remains in the parties' joint names.  This is where their family life was conducted and it was to there that the boys returned to from boarding school during the school holidays. Before the breakdown of the marriage the family moved into rented accommodation whilst the former matrimonial homewas being renovated.

11 In the autumn of 2008 the parties separated.  The wife left the property they were then living in, and moved to rented accommodation where she still lives with the boys when they are not at school. 

12 The husband has remained living in London in a property in north London. .  He also spends some time living at a property in the West  country which he bought last year.  The husband has given the wife no financial support of any type since 10th September 2009.  His only financial contribution has been to pay the boys' school fees and to give the boys some form of allowance or gifts.  The wife has been living off the generosity of a wealthy friend and her husband.  That couple currently pay the rent on the property which in itself amounts to £12,000 a month. 

13 The husband has engaged with the litigation on only the most superficial level.  The order of 20th July required him to produce an affidavit in response to the freezing injunction, together with the relevant supporting documents.  These were to be produced by 31st August.  The wife agreed an extension of time to 7th September.  The wife's legal team were no doubt encouraged by a letter sent by the husband's legal team at Farrer & Co which said that "the affidavit for which you have just agreed an extension will not be limited to the matters in paragraph 5 of the injunction order.  It will be considerably wider in its scope and it will also respond to your wife's affidavit sworn on 13th July 2010."

14 Despite the promises, the affidavit did not arrive until 1st October 2010.  It had no supporting documentation whatsoever, and as Mr. Scott sensibly and realistically concedes on the husband's behalf, it is very limited in the information it gives.  In fact, it is more than limited; it gives the court absolutely no idea of the extent of the husband's wealth other than the properties already identified by the wife and frozen under the July order as being in the United Kingdom; he says that a Forbes estimate of his wealth at £150 million was an exaggeration.  Income is not even mentioned.

15 Meanwhile, the wife's team was also waiting for the affidavit in reply to the application for interim maintenance.  Once again, Mishcon de Reya were chasing that affidavit.  In a letter written on 12th October Farrer & Co., on behalf of the husband, were driven to saying as follows:

"I regret that I was unable to serve an affidavit of my client on 7th October in relation to interim maintenance.  Equally, I regret that I cannot tell you when I shall be in a position to serve it.  In the circumstances, I cannot suggest a particular period or date for an extension of time.  When I am in a position to serve an affidavit I will ask you to accept it and treat time as extended, or my client will have to apply to the judge for an extension."

16 That letter seemed to indicate that Farrer & Co , even as of 12th October (six days before the hearing) had not given up hope completely that they would be in a position to file an affidavit as ordered by the court.  It should be noted that there was no suggestion in that letter or any other correspondence that this court had no jurisdiction to make such an order.  Mishcon, now denied the affidavit for the foreseeable future, wrote back asking for a run of the husband's bank statements and credit cards.  None have been forthcoming.

17 The court therefore finds itself in a position whereby , three months after the hearing was listed, it has not had a single piece of documentary evidence from the husband as to his financial position and there has been no attempt by him to give the court any picture of his wealth, or, of particular relevance to this interim hearing, his income.  In the unsatisfactory affidavit he has filed, he did make reference to maintenance, but only to say that he believed that the wife had sufficient means of her own and that she would have asked him if she needed financial assistance.

18 Mr. Scott QC appears today, as he did yesterday, with junior counsel and with a partner from Farrer & Co.  He again came with no explanation or justification for his lay client's continued contempt, or any evidence with which to fill the void in the court's knowledge which would allow it properly and effectively to exercise its judicial discretion in determining the application of the wife.  Mr. Scott, as always, has been moderate and careful in how he has put his case in what must have been an extremely difficult position for him.

19 Mr. Scott seeks to argue that as a matter of principle no order should be made.  Mr Dyer, for his part, submits that the court should decline to hear the submissions of Mr. Scott and proceed to hear the application which has been listed before the court for three months and against the backdrop of a wife who has had no financial support of any type, shape or description from her husband for a year.

20 In Hadkinson v. Hadkinson [1952] FLR 287 Denning LJ said:

"Those cases seem to me to point the way to the modern rule.  It is a strong thing for a court to refuse to hear a party to a cause, and it is only to be justified by great considerations of public policy.  It is a step which a court will only take when the party itself impedes the course of justice and there is no other effective means of securing his compliance … Applying this principle, I am of the opinion that the fact that a party to a cause has disobeyed an order of the court is not of itself a bar to his being heard, but if his disobedience is such that, so long as it continues it impedes the course of justice in the cause by making it more difficult for the court to ascertain the truth or enforce the orders which it may make, then the court may, in its discretion, refuse to hear him until the impediment is removed or good reason is shown why it should not be removed."

21 In Mubarak v. Mubarak [2004] 2 FLR 932 Ryder J. had before him an application to vary periodical payments in circumstances where the applicant was in contempt for failure to pay a lump sum.  In that case Ryder J., having held that a Hadkinson application remains available in the context of family proceedings and is Art.6 compliant, suggested that the following questions should be answered:

`(1) Is the husband in contempt? 
(2) Is there an impediment to the course of justice? 
(3) Is there any other effective means of securing compliance with the court's orders?
(4) Should the court exercise its discretion to impose jurisdiction having regard to the question? 
(5) Is the contempt wilful, i.e. is it contumacious and continuing?
(6) If so, what conditions would be proportionate? 

22 During the course of his judgment in Laing v. Laing [2007] 2 FLR 199 Sir Mark Potter indicated that he did not find the use of the expression utilised by Ryder J. in Mubarak of "contumacious" as a helpful one when applied to the wilful nature of the contempt relied on to found the Hadkinson jurisdiction.  He said: 

"I do not regard the word 'contumacious' as a useful addition or supplement to the threshold requirement that the contempt should be wilful in the sense of voluntary, deliberate, knowing, and continuingly breach by a person well able to comply with the order if he or she chose to do so.  Once that threshold is established, then in deciding whether and to what extent the right of the applicant to proceed with an application for variation or relief by imposition of conditions, it would be relevant for the court to take into account the level of defiance displayed as well as its effects." 

23 Relevant to the issue of refusal in Laing, Sir Mark Potter reminded those hearing this type of  application that:

"The mere fact that the husband may have a legitimate argument in support of his application for a reduction of maintenance based on the reduction of his own income does not legitimate his wilful failure to make payments due .. given his ample means to pay out of the current resources."

24 In the course of Laing the court considered the phrase "impede the course of justice".  Sir Mark Potter said at para.18:

"The touchstone in the power of the court to refuse to hear a party on which the power to impose conditions of continuance is founded is, as already stated, whether the conduct amounted to a contempt.  In this case the failure to pay under an existing order, is such that as long as it continues it impedes the course of justice in the cause by making it more difficult for the court to ascertain the truth or to enforce the orders it may make. That was accepted and restated in Baker (No 2) [1997] 1 FLR 148 and confirmed in Mubarak.  It is not a principle that depends on the size of the sums involved but upon the relevant situation of the parties, by the circumstances of the non payment and the effect of such non payment on the course of justice in the particular case …

"(30) As to Mr. Percival's point, it is plain that the judge did not ignore the requirement that the impediment to justice should be one which made it more difficult for the court to enforce the orders which it may make.  He specifically referred to that principle when he posed and answered question (c) in Mubarak in the course of his judgment by reference to the inutility of the only alternative, i.e. the issue of a judgment summons."

25 Mr. Scott makes a number of points in response to the application of Mr. Dyer:

(1) He accepts that his role will be limited.  The husband's evidence is circumscribed and the court is deprived, by his actions, of relying on matters upon which it could and should have been able to rely.  But, submits Mr. Scott, there are arguments of principle and of construction of the statute which he can and should make. 

(2) That Hadkinson cases have concerned applicants that came to court without clean hands in that they were themselves in contempt (although he subsequently accepted that there is at least one case, the second Mubarak case, where the husband was the respondent.).  That, says Mr. Scott, is a wholly different situation from a party who is, as here, responding to an application.  Even if, Mr. Scott says, Hadkinson is in principle Art. 6 compliant, the Art. 6 considerations are wholly different when defending an application, and the court should be slow to shut a respondent out.  He accepts that his ability to oppose is circumscribed, but submits that he should be permitted to make submissions about the issues of principle and statutory considerations raised in his position statement.  Mr. Dyer, for his part, reminds me that Hadkinson refers specifically to "a party to a cause" who has "disobeyed an order" and not to a respondent to a cause. 

26 I accept, of course, that the order sought is draconian.  I further accept that the situation needs even more anxious consideration where the party in respect of which it is submitted should not be heard, is the respondent to the application.  But in the present case, the respondent husband's contempt has been directed specifically at undermining the very application before the court. The husband has set out to deprive the court of the information which it needs and to which it is entitled and the provision of which is in his gift.  In those circumstances, in my judgment, the fact that the contemnor in the present case is the respondent, as opposed to the applicant, does not preclude the court from declining to hear him, nor does it fall foul of Art. 6.

27 Mr. Dyer further reminds me, with considerable force, that this is an interim hearing and so does not lead to the prejudice against the husband which must inevitably arise in a final hearing.  The solution, he says rightly, is in the husband's hands.  He could comply with the order; he could file an affidavit and thereafter apply to vary any order I make today.

28 I turn, then, to Ryder J.'s principles as set out in Mubarak:
(i) Is the husband in contempt? 

(ii) Does this contempt impede the course of justice?
It almost goes without saying as here that where there is an application by a wife, who does not work outside the home and has, throughout her marriage, been wholly reliant upon the husband financially to support her very considerable lifestyle, then a wilful refusal on his part to provide the court with financial information will impede the course of justice.  As Mr. Dyer submitted, this court can have no idea whether the very substantial sum (over £500,000 per annum) which is sought by the wife by way of interim provision is, at one extreme ludicrously aspirational, or, at the other, wholly reasonable when taken against the backdrop of the family's wealth.

Similarly, it renders enforcement extraordinarily difficult when the only assets above the radar are the London properties held in the names of various companies, and the court has no information about other assets or any other liquid assets – in particular, bank accounts which may have substantial amounts held in them.

(iii) Is there any other effective means of securing compliance? 
The lack of teeth available that a court has in effecting the enforcement of its orders is well known.  It is hard to see what order could be made which would be effective in ensuring compliance, given the level of defiance the husband has exhibited to date.  I will come to conditions in a moment.

Technically, the wife could issue contempt proceedings.  But, like judgment summonses, such applications are notoriously cumbersome and largely ineffective and, in the present case, would no doubt cause deep distress to the parties' two sons who see their father regularly.

(iv) Is the contempt wilful? 
Looking at Sir Mark Potter's analysis in Laing, I have no hesitation in concluding that "the contempt is wilful in the sense of voluntary, deliberate, knowing and continuingly in breach by a person well able to comply with the  order if he or she chose to do so."  This husband has one of the country's most elite teams of matrimonial finance lawyers at his disposal.  Instructing them, as he does, to appear today having failed to comply with the court's order and offering it no explanation, shows an unfortunate arrogance and a complete disrespect for the court process. 

29 I am satisfied, therefore, that the wife's Hadkinson application succeeds in principle.  I have thereafter to consider what response is proportionate in the exercise of my discretion.  In argument before the short adjournment,  Mr. Scott said in terms that he does not seek an adjournment.  He made no offer of future compliance on the husband's part, or assurances of disclosure forthwith if the matter was held over. 

30 Over the short adjournment, Mr. Scott drew my attention to a further judgment of Bodey J. in the second Mubarak.  In that case, as here, he concluded that the Hadkinson criteria had been satisfied but concluded that it would be wrong at that stage to bar the husband from participating, taking into account that he was a respondent and that there were jurisdictional issues to be considered.  Instead, the judge imposed terms.  Failure to comply with the terms would lead to the husband being debarred from participating at a further hearing. 

31 I therefore re-entered court after the short adjournment anticipating that further thought had been given by the husband to his position, and, that upon instructions, Mr. Scott was going to going to make some sort of offer to the court whereby there would be the imposition of sanctions on the basis of an adjournment, giving the husband a further opportunity to file an affidavit and to take part in the proceedings.  Far from it, Mr. Scott's instructions remain the same.  No offers have been made, no explanations have been made.  The court, therefore, remains in exactly the same position as at the start of the hearing.

32 I take note that in his position statement Mr. Scott has raised what he regards as an issue of jurisdiction.  I take into account, however, that whilst there appears to be no reported authorities on the subject, applications for interim maintenance in Part III cases are commonplace.  I in this, as in all applications have to be satisfied that I have the jurisdiction to make the order sought.  I take into account, as Mr. Dyer has forcefully and correctly submitted, that this is an interim hearing and that the husband may at any stage choose to re-engage in the process, to file an affidavit, and to make any application he may wish to vary any order I make.

33 In those circumstances in the exercise of my discretion, I accede to the application of Mr. Dyer. 

H's Counsel then left the Court (leaving behind a representative from Farrer & Co to take a note of the proceedings)

34 The wife seeks orders for interim maintenance enhanced under the principles in  A v A (Maintenance Pending Suit for Legal Fees)  [2001] 1 WLR 605 to  cover her costs up until the financial dispute resolution type hearing which has been ordered to take place next year by Parker J.

35 Any court must be satisfied that it has jurisdiction and that it is appropriate to make any order a party may seek. In the present case, that order is an interim maintenance order. Mr Scott QC advertised in his note his contention that this wife does not meet the statutory criteria which would enable me to make an order for interim maintenance, either at the level she seeks or at all.

36 Having said that, Mr Scott accepted in his oral submissions in relation to Mr Dyer's Hadkinson application, that if the court held that the wife does fall within the sub-section, then he on behalf of the husband, would be unable to challenge either the wife's assertions as to the standard of living enjoyed by the parties during the marriage or the husband's ability to maintain the wife at such a level.

37 Mr Dyer QC has addressed me on jurisdiction and the principles which apply in relation to his application.

38 Section 14 of Part III provides as follows:

14 Interim orders for maintenance
(1)     Where leave is granted under section 13 above for the making of an application for an order for financial relief and it appears to the court that the applicant or any child of the family is in immediate need of financial assistance, the court may make an interim order for maintenance, that is to say, an order requiring the other party to the marriage to make to the applicant or to the child such periodical payments, and for such term, being a term beginning not earlier than the date of the grant of leave and ending with the date of the determination of the application for an order for financial relief, as the court thinks reasonable

39 In order to assist me in interpreting the section, Mr Dyer took me to the Law Commission report (Law Com.No117) of 20 October 1982: Financial Relief after Foreign Divorce.   The report recommended as follows:

"2.4 We also propose that on granting leave the court should be empowered to make interim orders for maintenance, in favour of the applicant or any child of the family where they are in immediate need of financial assistance."

40  Following the report of the Law Commission, a draft bill was published which contained provision for interim orders of maintenance in the same terms as are now found in s14. The explanatory notes attached to the bill referred to section 27(5) of the Matrimonial Causes Act 1973: interim orders in cases of failure to maintain as an analogous provision.

41  I note for completeness that section 5 Interim Orders the Inheritance (Provision for Family and Dependants) Act 1975   uses the same terminology namely 'immediate need of financial assistance'

42 The language adopted for Part III is therefore somewhat different from that found in section 22 Matrimonial Causes Act 1973 (as amended) which makes provision for maintenance pending suit in the context of domestic divorce.

22 Maintenance pending suit
On a petition for divorce, nullity of marriage or judicial separation, the court may make an order for maintenance pending suit, that is to say, an order requiring either party to the marriage to make to the other such periodical payments for his or her maintenance and for such term, being a term beginning not earlier than the date of the presentation of the petition and ending with the date of the determination of the suit, as the court thinks reasonable.

In other words, under s22 the court may make such order as it thinks is reasonable.

43 The question therefore, as posed by Mr. Scott, is whether s14 of Part III imports a higher hurdle than that that found in s22 MCA 1973: put another way does the word 'immediate' have connotations of urgency and is 'need' limited in its scope given that it unlike s22 MCA 1973, is not balanced by the various considerations found in s25 MCA 1973.

44 The Oxford English Dictionary includes in the definition of 'immediate' the following: Of time: Present or next adjacent; of things: Pertaining to the time current or instant.  Co-incidentally, given the issue before me, the example given in the OED is:  1748 SMOLLETT Rod. Rand. viii, Some loose silver for our immediate expenses.

45 Whilst the word 'immediate' can of course mean 'urgent', in my judgment having read the Law Commission report and bearing in mind also the Inheritance (Provision for Family and Dependants Act) I have no doubt that the word 'immediate' should be construed to mean 'current' as opposed to 'urgent'; (although it could be both).

46 Section 14 of Part III requires the court once it is satisfied that a party is in "immediate need", to make such order as is reasonable. I accept the argument of Mr. Dyer that the approach described in the authorities in relation to applications for interim maintenance under MCA 1973 applies also to s14. Mr Dyer drew my attention to a recent judgment of Charles J in an unreported case: A v M of 6 September 2010 where Charles J took just such a view in a similar application.

47 Mr. Dyer points out that although applications for interim maintenance are ordinarily made under s14 of Part III, the wife could, on a strict construction of s17 of Part III, equally have made an application for interim periodical payments via that route as opposed to an application under s14.
48 S 17  provides:

(1)     Subject to section 20 below, on an application by a party to a marriage for an order for financial relief under this section, the court may—

(a)     make any one or more of the orders which it could make under Part II of the 1973 Act if a decree of divorce, a decree of nullity of marriage or a decree of judicial separation in respect of the marriage had been granted in England and Wales, that is to say—

(i)     any order mentioned in section 23(1) of the 1973 Act (financial provision orders); and
(ii)     any order mentioned in section 24(1) of that Act (property adjustment orders);

49 S23(1)(a) MCA 1973 allows the court on granting a decree of divorce, to make an order for periodical payments for such term as may be specified; it follows therefore that  the court can under the provisions of s17 of Part III, make  an interim periodical payments order.

50 In my judgment the limitations imposed by s14 are as follows :

i) no order for interim maintenance will be made until leave to make a Part III order has been given and,
ii) under s14(2), the jurisdiction must be founded on domicile or habitual residence (as opposed to an interest in a former matrimonial home in this jurisdiction).
iii) The applicant must be in 'immediate need' and the provision is to be reasonable.

There is not in my judgment a gloss on the words 'immediate need' or a further requirement which imports a requirement that a party should establish that he or she is in urgent need of funds.

51 If I felt in need of reassurance that the approach I take is in tune with the philosophy of and contemporary interpretation of the Act, I need go no further than  Agbaje v Agbaje [2010] 1 AC 628 where the Supreme Court  reviewed the law in relation to financial provision following a foreign decree. The Supreme Court made it clear that neither hardship nor injustice is a precondition for the exercise of the jurisdiction [72] nor is it only appropriate for the English court to intervene with financial relief to the minimum extent necessary [63].

52 In Agbaje the Supreme Court anticipated cases where a wife would receive the same provision as if the divorce proceedings were in England. [64]. Such an approach is not consistent with there being a higher hurdle under s14 of Part III for a wife (or husband) to clear before she (or he) is awarded interim maintenance than that under s22 MCA 1973 (or it would seem, illogically and inconsistently, under s17 of  Part III).

53 The question therefore remains as to whether this wife has demonstrated 'immediate need', that is to say does she currently stand in need of financial assistance. In his freezing order affidavit the husband says that the wife had not asked him for money and that he presumed she was living on her own assets. It is noteworthy that he did not go on to say that had she asked he would have made appropriate provision for her.

54 I accept the submission made by Mr Dyer. This wife has been wholly financially dependant upon her husband throughout their married life. As of September 2009 he stopped all financial support and put her (and the children), in a situation where she has to live in rented accommodation (albeit expensive accommodation in a fashionable part of London), and support the family on loans from a friend. The husband cannot now, submits Mr Dyer, use the  generosity of those friends who have no obligation, whether moral or financial, to provide any financial assistance, to pray in aid  an argument that the wife has no 'immediate need' for maintenance and that he should as a consequence be allowed to shirk his obligation towards her and his children.

55 In the early, dark days following separation, families and friends frequently help wives out financially until, either by agreement or court order, finances are sorted out and the husband assumes his obligations to maintain his family.  Such temporary assistance should not subsequently be used as a basis for resisting the making of an order for interim maintenance which would otherwise be appropriate. The fact that the sums involved in this case are very considerable matters not; this is a family who lived at a very high level, as do their friends and acquaintances.

56 The wife's initial budget as exhibited to her affidavit comes to a total of £577,969.44 pa (£48,164.12 pcm). This can be broken down as follows:
Rent                                      150,168
Former Matrimonial Home           9,892
General Living                         262,305
Children                                   39,480
Wife's daughter                       116,124
Total                                       577,969

57 The wife has during the course of submissions sensibly withdrawn the element of maintenance sought for the her daughter who is in her early 20s and not currently in education. That leaves the budget at £461,845 of which £150,168 is the rent on rented property.

58 The rent is a flagrant waste of family money; the former matrimonial home is held in the joint names of the parties. The wife continues to pay the standing charges in relation to the property. It was the family home. It is empty and the wife would like to move back in with the boys. The husband refuses and has changed the locks. The wife has no idea what sort of condition the flat is in given that the family originally moved out of the property on a temporary basis prior to the breakdown of the marriage in order for it to be refurbished. The wife has consequently been driven to make an application in the County Court for a declaration that she is entitled to occupy her own property. The husband opposes the application on the basis that the flat should be sold and the proceeds of sale be divided between the parties.

59 As a result of the actions of the husband, the wife is living, at considerable cost, in a smaller, rented property which is nonsense when there is an empty, larger property, owned by the parties and which is mortgage free. The lease on the rented property comes to an end on 31 October 2010; the husband however maintains his refusal to allow the wife to move back into the former matrimonial home and the County Court proceedings continue. The wife and children have no alternative therefore but to remain at the rented property and the husband will have to pay for his intransigence as the wife's maintenance will have to provide not only for rent but also for the essential recurring charges in relation to the former matrimonial home.

60 That leaves for consideration general living expenses of £301,785 (262,305 + 39,480) or £25,148 pcm.  I am conscious that I have not had the benefit of an affidavit from the husband and that the wife seeks a very substantial sum by way of interim maintenance. The failure of the husband to comply with the court's order to file an affidavit in response to the wife's application means that he has deprived the court of the opportunity adequately to carry out an analysis of both sides' contentions when  exercising  its' discretion.

61 In Al-Khatib v Masry [2002] 1 FLR 1053 the court was faced with the same predicament. Mr Justice Munby (as he then was) relied then, as I do now, on what he called the classic passage in J-PC v J-AF [1955] P 215 where Sachs J said at P 227

"in cases of this kind, where the duty of disclosure comes to lie on a husband; where a husband has – and his wife has not- detailed knowledge of his complex affairs; where a husband is fully capable of explaining and has the opportunity to explain, those affairs, and where he seeks to minimise the wife's claim, that husband can hardly complain if, when he leaves gaps in the court's knowledge, the court does not draw inferences in his favour. On the contrary, when he leaves a gap in such  a state that two alternative inferences may be drawn, the court will normally draw the less favourable inference – especially where it seems likely that his able legal advisers would have hastened to put forward affirmatively any facts, if they had existed, establishing the more favourable alternative"

62 He continued at page 229

"…. The obligation of the husband is to be full, frank and clear in that disclosure. Any shortcomings of the husband from the requisite standard can and normally should be visited at least by the court drawing inferences against the husband on matters the subject of the shortcomings – insofar as such inferences can be properly drawn."

63 Mr Dyer has highlighted eight matters which he submits would, in the present case, enable the court draw the inference that the husband's assets and income are such as would justify the court in making an interim maintenance award of the size sought by the wife.

They are as follows:

iv) The husband has on his own admission spent £15.5m on property in London since 2005. All those properties are unencumbered.
v) On his own account he has spent well in excess of £1m on refurbishment.
vi) None of the properties are let out and so are not income producing. He must therefore have other income.
vii) When dealing with the source of the funds to buy the properties in each case he has said that the purchase price had been funded by 'savings' from Russia -  implying substantial liquidity.
viii) In his affidavit he indicates he has sold his commercial properties in Russia. He gives no figures.
ix) The boys are being educated at an expensive boarding school.
x) The husband has within the last few years bought the wife a ring costing £250,000 and a watch costing £100,000; an indication of his disposable income.
xi) The husband has bought, at a cost of £2.35m, a small hotel in the country which is being extensively refurbished. He says there is a substantial loan on the property and yet there is no charge registered on the title.

64 I would add to that list that the husband does not suggest in his affidavit in response to the freezing order that he is short of money despite that fact that the affidavit was filed after he had received and read the affidavit of the wife.

65 Mr Scott accepted in his submissions that it was not open to him to make submissions as to either budget or affordability.

66 Absent any disclosure from the husband I accept the submissions made by Mr Dyer and I will therefore make an order for interim maintenance in the sum of £460,000pa  of which  £150,000 is specified as being for rent.

67 It seems likely that the wife will be tied into another 12 month lease on the rented property given that the renewal date is imminent. In case the husband regrets his decision and changes his mind about the wife moving back into the former matrimonial home, I should make it clear that the husband cannot unilaterally stop paying the figure equal to the rent. The wife would have wished, and still does wish to move back into former matrimonial home.  However given that she has no idea what sort of condition the property is in, the order I intend to make although specifying a figure for rent, will continue to be payable in full unless there is an agreement or a court order varying the quantum or terms.

Legal fees funded by interim maintenance
68 In considering the application for legal fees for the wife I again apply the same principles as those which apply in domestic divorces. It follows therefore that I bear in mind in particular the judgement of Lord Justice Wilson at paragraphs [20] to [22]  in Currey v Currey (No 2)  [2007] 1 FLR 946.

69 I bear in mind also that whilst I have a discretion, it would not be appropriate to make  a costs allowance unless the wife has demonstrated that such assets as she has cannot be reasonably deployed to pay legal fees and that she cannot reasonably procure legal advice and representation by any other means.

70 The position as to alternative legal funding is as follows:

(i) Loans from the friend: I do not think it is reasonable to expect the wife to have to depend on the continuing generosity of her friend for funding. There is no obligation for the money to be paid and it is impossible to speculate as to when the friend may take the view, as she is entitled to do, that 'enough is enough'. Were that to happen the wife would be left in a most vulnerable position of being without legal representation at what might be a crucial stage of the litigation.

(ii) The wife's solicitors do not accept payment on a Sears Tooth charge and, as was recognised in Moses Taiga v Moses Taiga [2006] 1 FLR 1074 by Lord Justice Wilson, the type of firms of solicitors who specialise in this type of case do not accept legal aid work even if the wife was eligible.

(iii) The wife has a valuable unencumbered flat in Russia. She cannot raise a loan on the property as she has no credit rating in Russia and it is impossible to estimate how long it would take for her to sell it. She needs funds now. It would not be reasonable to expect the wife to sell that property significantly under value for an early sale. I take the view that such a sale would not be reasonable deployment of that asset on the facts of this case. The husband is neither maintaining his family nor engaging in the litigation.  The flat is the family's base in Russia and it is one of the few assets held in the sole name of the wife.

(iv) The wife has made enquiries as to the availability of a litigation loan. Where there is an ongoing dispute about jurisdiction, (as has been confirmed by the husband in his freezing order affidavit), the banks will not offer a loan facility to the wife.

(v) Finally the wife owns a half share in the matrimonial home, again the wife faces considerable, if not insuperable, difficulties in getting a bank to lend her money secured on that property given the jurisdictional dispute and again I do not think it is reasonable deployment of her one asset within the jurisdiction for it to be used to fund the litigation.

(vi) Accordingly I take the view that there should be an element for legal fees in the order I make. I have looked at the costs schedule which has been carefully worked by reference to each stage of the  litigation until the FDR type hearing in about 10 months time.  I accept the rolled up estimate of £112,000 to that  hearing to be  reasonable given the complexities of the case and will make an order for legal fees  at the rate of £10,000 pcm until the date of the FDR.

(vii) Mr Dyer also sought to incorporate in the order the sums spent on legal fees to date, most of which has been paid, courtesy of the wife's friend.  I do not accede to that submission but I will back date that part of the order which relates to legal fees to the date that I gave leave to commence the proceedings that is to say 20 July 2010.