£200 million "freezer" modified
Posted: 28th January 2013
A £200 million asset freezing order issued in the context of the breakdown of the relationship between an extremely wealthy businessman and the mother of his children was excessive and has been substantially reduced. The High Court ruled that concerns that the businessman might seek to frustrate his ex-partner’s financial claims by dissipating his assets had been over-emphasised.
The interim "freezer" had been made on a without notice basis on the application of the woman who claimed that the businessman had promised her a share in various real property and other assets. The woman had also launched parallel proceedings under the Children Act 1989 to protect the interests of the former couple’s children.
The businessman argued that he had very substantial grounds for challenging the order. It was submitted, inter alia, that there had been delays in serving the order, that it should not have been granted on the merits and that there had been breaches of the duty of full and frank disclosure.
The court accepted that the woman’s lawyers had been justified in applying for the order without notice. There was evidence that the businessman was ‘under financial pressure’ and was facing competing claims from other creditors. His use of ‘obscure offshore structures’ to hold certain of his assets did not further the interests of transparency and the woman had legitimate concerns that her own financial claims could be given low priority.
However, in substantially reducing the value of assets frozen by the order, the court ruled that the woman had failed to establish ‘serious and strong evidence’ of a real risk that her ex-partner would dissipate his assets generally in order to defeat her claim. Whilst declining to discharge the entirety of the order, the court ruled that it should be limited to the value of assets specifically itemised by the woman’s lawyers, including a £5 million share in an English property and interests in two French villas to which the woman claims entitlement.