Husband secures financial settlement that protects his company assets
Tom (clients and respondent’s name changed for confidentiality reasons) came in to see us. He had solicitors already, but he was not entirely confident that they had a good understanding of his case. He was therefore looking to transfer solicitors. He spoke with several solicitors before choosing to instruct Saika.
Tom and his wife Gina married in 2007 and separated in 2022. They had two young children aged 10 and 8. Both Tom and Gina were still living in the family home while the court proceedings were ongoing.
Tom was concerned that Gina’s solicitors were extremely aggressive and had grossly inflated the assets. In divorce proceedings, a questionnaire is a document setting out a request for further information and documentation where information already provided by the other party is inadequate. Gina’s solicitors had raised a lengthy questionnaire that far exceeded the court’s guidance on the length of these documents.
How we helped
When we received Tom’s file from his previous solicitors, it became immediately obvious that Gina’s solicitors had misread, misunderstood or were “fishing” for information as to what his business interests and assets were. They were seeking extensive, completely unnecessary information and the valuations of seven different companies of which Tom was a shareholder, either currently or in the past. They were also seeking information on private trust documents between Tom’s family members and himself.
It was clear that robust court intervention and case management was required at the First Directions Appointment Hearing on the general direction of the case. There was a danger in this case of the rising costs becoming quickly disproportionate to the value of the assets.
At the hearing we were able to reduce very substantially the number of issues on the questionnaire for Tom to answer and limit company valuations to just the one company. Gina’s solicitors were insistent on a valuation of this company because it had a turnover of £15.5 million. However, they had completely overlooked the actual profit the company was making. They also rejected the company accountant’s valuation.
Gina’s solicitors were also making enquiries of family trust documents. However, on detailed consideration of these documents it was clear that Tom was only a trustee of the family trusts and not a beneficiary. This meant that he could not personally benefit from these trusts. The trusts were set up to prevent Tom’s future appointment as a beneficiary.
Final outcome
The formal company valuation undertaken jointly for both Tom and Gina by an independent accountant produced a lower valuation than the valuation proffered by Tom’s company accountant.
At the Financial Dispute Resolution Hearing we put forward a detailed settlement proposal which was in the main accepted by the judge.
There were extensive arguments over whether a minority discount should apply to Tom’s shares in the company. Gina was looking to make a claim on the shares and keep the family home.
We were able to achieve a successful outcome for Tom that allowed him to keep all his shares intact which was his first priority. Also, all claims on the properties in the family trust were dismissed. Gina kept the family home which is what Tom had offered to her in advance of the hearing.
Important Note
All our case studies are based on our real-life clients who have consented to the use of their information. However, to protect their identities we have changed their names and some of the factual details of their cases.
Further advice and information
If you are going through a divorce or civil partnership dissolution and need advice on the financial aspects of your case, do get in touch for a complimentary initial discussion with one of our solicitors.
