The Court of Appeal shocked many lawyers and legal commentators when it ruled in October that Mr Prest did not have to give his former wife £17.5m worth of assets belonging to some of his companies.
The issue began in the High Court which highlighted some properties belonging to companies owned by Mr Prest.
The judge held that Mr Prest was the sole owner of these companies and in sole control of them. It therefore followed that he was the beneficial owner of their assets, which meant those assets could be included as part of the divorce settlement.
The judge ordered that Mr Prest should therefore hand over some of those properties, worth a total of £17.5m, to his former wife.
However, the Court of Appeal overturned that decision. It held that a company’s assets belonged to the company itself, not to its shareholders. This applied even if, as in this case with Mr Prest, all the shares were owned by one person.
Many lawyers have since expressed concern that the ruling would encourage divorcees to try to protect their assets from each other by sheltering them in companies which they own.
Jeremy Posnansky, QC, one of Mrs Prest’s legal team, said: “It’s a great pity that years of case law and practice which have enabled family law judges to do justice between divorcing couples have been overturned by this non-unanimous decision of the Court of Appeal.”
Mrs Prest is now taking her case to the Supreme Court. The hearing will be in March.
We shall keep clients informed of developments.
Please contact Charles Goodbody in our Warminster office on 01985 214444 or firstname.lastname@example.org if you would like more information about the issues raised in this article or any aspect of family law.