An American woman must leave the former matrimonial home, the High Court ruled this week.
BR v VT concerned a former couple who married in 1998. The husband is English and the wife from California. They had two children, the second born during a stay in the United States. They currently live in London, where their son attends a prestigious public school and the younger daughter a prep school. The fees for both schools equal £56,000 per year.
In 2011, the couple bought a home, with a view also providing accommodation for the husband’s elderly mother. They raised a large mortgage and also used money borrowed from the husband’s mother, which was lent to them via the family via his sister. The family entered an agreement in which they were obliged to pay the latter sum back within five days of selling the house.
They then spent hundreds of thousands on renovating the house and on an unsuccessful small business established by the wife.
In a concise ruling at the High Court, Mr Justice Mostyn noted that:
“In addition to these capital expenditures it is obvious that the family was living and spending at a very high rate, as well as paying school fees.”
This lifestyle was funded by the husband’s high salary, further money borrowed from his wealthy mother and a large commercial loan.
The couple separated in August last year, at which point the husband moved into a rented flat. By that point, the family had spent all their capital, even money that should have been set aside to pay tax. He therefore had to had to borrow thousands from his business partner and sister to meet his tax obligations. A friend paid the husband’s rent, provided him with a car and lent him further money. In addition, the husband borrowed more than £43,000 from his employer.
Both the husband and wife proceeded to spend thousands on foreign holidays and incurred more than £321,000 in legal costs. The husband, meanwhile, owes more than £150,000 in taxes. He admitted to “reckless” spending.
After they separated the family agreed in vague terms that the wife and children would move to Los Angeles, but the father later changed his mind. The wife sought legal orders allowing this but was turned down because her plans were “far too imprecise”.
She then concluded that it would be in the children’s interest relocate to California in about four years’ time, declaring that their departure was a question of “when not if”. In the meantime, she and the children would remain in the former matrimonial home, she insisted, and existing plans to sell it would be suspended until their departure.
However the house was eventually placed back on the market. Following a multiple exchanges between the husband, the wife and their legal representatives, a buyer was found. The wife appeared enthusiastic but later withdrew her consent to their sale. As a result, the husband returned to court, seeking a legal order terminating the wife’s rights of occupation and possession so that the house could finally be sold.
Mr Justice Mostyn granted this, declaring:
“There is no alternative but that the home must be sold as soon as possible, and for this purpose the wife’s home rights must be terminated. Only in this way can the pressing debts, most importantly to HMRC, be paid and the revenue deficit eliminated. The future housing of the parties will have to be in rented accommodation.”
Read the ruling here.
It should not even be news that debts have to be paid in preference to either party keeping up the lifestyle s/he is accustomed to.