No rights in £40 million home
Posted: 24th September 2012
In the midst of extremely acrimonious divorce proceedings, a High Court judge has ruled that a husband has no interest in a £40 million London home which was bought during the course of the marriage but is held by a Cayman Islands trust.
The house was registered in the name of a nominee company prior to the execution of the discretionary trust under the original terms of which the husband and wife were granted life tenancies of the property. However, following the breakdown of the marriage, the trustee executed a deed which purported to exclude the husband from any beneficial interest in the property.
Rejecting the husband’s plea that he is entitled to a 50% beneficial interest in the house, Mr Justice Underhill ruled on the basis of the formal documentation that the entire beneficial interest in the house is held by the trustee.
The judge acknowledged that the exclusion of the husband from any interest in the property, without his consent, ‘may seem harsh’ in the light of arguments that the property was bought with family money generated by the husband’s business.
However, the judge observed that it had never been the husband’s intention to use the house as his primary home. He had also not objected to his wife’s view that the property would be held on trust, ultimately for their children, and that he would not have access to its capital value. The wife’s continued occupation of the property as life tenant was entirely consistent with the former couple’s joint intentions during the subsistence of the marriage.