On 12th June 2013 the Supreme Court ruled in favour of the claimant wife against the companies in the appeal Prest v Petrodel & Ors. Mr Prest could not take part as he had broken earlier court orders, but he is now forced to have his offshore companies transfer London properties to his former wife.
The courts did not use the device of piercing the corporate veil, so declaring that the companies are the same legal entity as the respondent. But on the facts of the case, where the husband had deliberately disclosed almost no precise information or documentation, the judges filled in the gaps and declared that the companies owned the title of the properties only on trust for the husband, who could therefore have them transferred, as a result of the divorce process.
Advisors and divorcing couples will want to look very carefully at the documents where propery or other assets are ostensibly owned by a company or a trust. To protect wealth from future attack on divorce, Hunters recommend the use of pre-nuptial agreements, and also very careful preparation of all trust and company documentation which owns property, particularly the family home of a director, shareholder, trustee or beneficiary.
If you would like any further information please contact a member of our Family team.