Court ends freezing injunction against wife and son

Family Law|October 20th 2015

The High Court has ruled that an injunction which prevented a property investor’s wife and son from running a business cannot continue.

Last June, the Cypriot businessman’s wife sought to end their marriage after 34 years. The couple, now in their sixties, had two sons.

Prior to the breakdown of their relationship, the wife and husband each had a 50 per cent share in two of the family businesses. In both companies, the wife and the couple’s youngest sons were directors. The husband claimed that the wife’s shares were held in trust for him “thereby making him the ultimate beneficial owner of each company”. He estimated that the value of his wife’s shares was around £32.2 million.

Once the wife had presented her divorce petition, she moved £12 million into an offshore bank account. The husband responded by removing her from the role of director and also suspending his 31 year-old son’s employment. The latter then set up his own business, which the husband contended was “operating in direct competition” to his own.

In response to these actions, the husband successfully applied for a freezing injunction against both his wife and son without informing them beforehand. This prevented either of them making a profit from any of the assets under their names. It also limited the son’s ability to operate his new business.

However, Mrs Justice Roberts declared that, while she was convinced that the judge who made the initial injunction “thought that she was directing the freezing order towards [the mother and son] in their personal capacities”, there had been no consideration of how it would affect the day-to-day operations of the companies in question.

The judge ruled that the freezing injunction was not within the Family Division’s jurisdiction. She added that even if it was, the court would not have made such an order if the other parties had been informed beforehand.

C v C and Another is available in full online here.

Photo by rjp via Flickr

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