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Family Law

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28 APR 2014

Joy v Joy [2014] EWCA Civ 520

(Court of Appeal, Patten LJ, 28 March 2014)

Financial remedies - Order requiring delivery of vintage motor car - Application for stay

The full judgment is available below.

The stay of an order requiring delivery of a vintage motor car was lifted on the basis of the balance of convenience and risk.

During financial remedy proceedings the court ordered the husband to deliver up a vintage Bentley car which was currently at the husband's home in the South of France in order for the car to be transported to England and stored pending further order including an order for costs in favour of the wife.

The husband applied for a stay of the order before proceedings continued and, therefore the ordinary appeal process would have taken too long. By the time of the hearing the car had been pledged to the husband's solicitors to secure his liability for costs and had been made the subject of an order in the French court on the application of a trust that had provided security for a loan to the husband.

The wife opposed the application on the ground that a stay would make it difficult for her to argue that the order in France should be lifted and that there was a strong possibility that the husband might remove the car to another jurisdiction to avoid enforcement of the English orders.

The stay was lifted. The judge considered the application on the basis of where the balance of convenience and risk lay. He held that the court should not make an order that made it more difficult for the car to be freed from the French order.

The fully referenced, judicially approved judgment and headnote will appear in a forthcoming issue of Family Law Reports. A detailed summary and analysis of the case will appear in Family Law.

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Neutral Citation Number: [2014] EWCA Civ 520

Case No: B2/2014/0773 A

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE HIGH COURT

FAMILY DIVISION

(SIR PETER SINGER)

Royal Courts of Justice

Strand

London, WC2A 2LL

Friday, 28 March 2014

B E F O R E:

LORD JUSTICE PATTEN

‑ ‑ ‑ ‑ ‑ ‑ ‑

JOY

Applicant

‑v‑

JOY

Respondent

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(DAR Transcript of

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Martin Pointer QC & Kyra Cornwall (instructed by DWFM Beckman) appeared on behalf of the Applicant

Morgan Sirikanda (instructed by Sears Tooth Solicitors) appeared on behalf of the Respondent

J U D G M E N T

LORD JUSTICE PATTEN:

[1] This hearing this morning comes about in slightly unusual circumstances. On 11 March I was presented as a matter of urgency with an application by the husband, Mr Joy, for a stay of an order which Sir Peter Singer had made in ancillary relief proceedings between Mr Joy and his former wife that were ongoing in the Family Division. As part of the order which the judge made on 5 March, he directed that the husband should deliver up to the wife's agent a vintage Bentley motor car, currently located at the husband's home in the South of France, together with the keys and ownership documentation, so that that car could be transported and stored in England to await the further orders of the court in the ancillary proceedings which included (and this is really the relevance of the car) an order for costs in the wife's favour.

[2] The grounds upon which the stay was sought are essentially jurisdictional. I do not propose to say anything further about that this morning, save to observe that it seemed to me that, having regard to the fact that the ancillary relief application was to return in due course to Sir Peter Singer for further hearing (as indeed it has done), it was imperative so far as that could be achieved for the jurisdictional challenge to his para 3 order to be resolved in this court as speedily as possible. To that end, rather than attempting to decide the issue of permission to appeal, which, on the papers before me, was not possible, and in order to avoid unnecessary interim hearings on the issue of permission, I granted the stay but directed that the husband's application for permission to appeal against the judge's order for delivery up should be heard expeditiously (and I said in my order 'as expeditiously as possible') at a rolled‑up hearing at which the court would consider not only whether permission should be granted, but if permission were granted or is to be granted, would then proceed immediately to hear the appeal.

[3] As everybody in court appreciates, the normal practice of the court at such a hearing is to hear the arguments in full and then, having heard the arguments, to decide whether or not to give permission and, if so, to determine the appeal on the basis of the arguments which it has heard. The effect, therefore, of that order is that there will be a single hearing in front of the full court which will resolve the matter one way or the other definitively.

[4] It was my expectation that with the order for expedition it should have been possible for that hearing to take place relatively speedily and in all probability before Sir Peter Singer gave judgment at the further hearing which has now taken place. He would therefore have had the advantage of being in receipt of the Court of Appeal's judgment and knowing whether or not he could deal with the car in accordance with his earlier order.

[5] Unfortunately, as it has transpired, the court has not been able to accommodate the appeal within the timeframe that I had originally envisaged and I am told by counsel that the best that the court can currently offer is a hearing around about the last week in May. The consequence of that is that the Family Division ancillary relief proceedings, which have been in court this week and are due to be concluded next week, will be determined by the judge before the jurisdictional issue which Mr Pointer's client has raised can be determined in this court. That is clearly unfortunate; but it is not something which, in the circumstances, I am able to do anything about.

[6] However, it does, I think, put into a slightly different focus the question of how the position should be held pending the determination in this court of the husband's application for permission to appeal. One consequence of the delay, but in any event something which I had no reason to know about or suppose at the time (and I want to make it clear that I do not criticise anybody for that), is that the car is now of interest to other parties. In the first place, it has been charged or pledged to the husband's solicitors to secure his liability to them for the cost of the proceedings. That charge is challenged in the ancillary relief proceedings before the judge under s 37 of the Matrimonial Causes Act. One of the issues which Sir Peter Singer is currently seised of and will determine, as I understand it, in his judgment, will be whether or not the charge should be set aside under those avoidance provisions.

[7] That is one obstacle which the wife faces in relation to being able to lay claim to the car or its proceeds of sale to satisfy her own liability for costs. But that is something within the jurisdiction of the English court and something on which the judge, subject to any appeal, will rule in due course. Mr Pointer QC says that the charge, although governed by English law, was taken when the car was physically situated in France, and that there are, or may be, complications if the car is shipped to England in terms of the enforceability of the security. What, I think, he is contemplating is the possibility that there may be French formal requirements - such as (although I know not the detail) perhaps registration - which need to be completed in France in order to make the charge enforceable according to the law of the place where it was taken, even though the charge itself is governed by English law. If that is a problem then it seems to me that it can be resolved by the solicitors taking any steps on advice which they need to in relation to the charge. Those steps must be governed by, I assume, the legal position when the charge was taken. I am not at the moment satisfied that the fact that the car is no longer physically in France will make any difference.

[8] But a more complicated issue is the intervention into the timetable of a claim by the New Huerto Trust (which I will refer to for convenience simply as ‘the Trust'), which took place on 19 March, after I had granted the stay, by the initiation of proceedings in the court in Aix‑en‑Provence as part of an attempt by the trustees to recover a debt from the husband of some €5 million. The origin of this claim, as I understand it, goes back a number of years to a time when the husband was still a beneficiary under the Trust, which is a discretionary trust set up in 2002 into which, on the evidence, a significant portion of his personal wealth and assets were placed. This is a BVI discretionary trust on the face of it for the husband and his children.

[9] As I understand it, the husband, and possibly the children, were removed as beneficiaries at some stage in the early 2000s. Mr Pointer QC tells me that the husband has now been permanently removed, although that of itself seems to be a matter of dispute in the sense that there was a hearing in the BVI before Bannister J in November 2013, where the judge declined to sanction the removal. I know very little about that, and it is not, I think, necessary for me even to attempt to express any view about it for the purposes of today.

[10] What is important as part of the background (and I think this is not in dispute) is that the husband funded the purchase of a number of significant assets, including the Bentley car, with the benefit of a bank loan. The Trust provided security for that loan either in the form of a charge over the Trust assets or simply in the form of a guarantee. Following the commencement of the ancillary relief proceedings, including an application by the wife for a freezing order, the bank reviewed the loan and withdrew the loan and sought repayment. The consequence has been that the debt due to the bank has been discharged out of the Trust assets, either under the guarantee or the charge that I have referred to, with the consequence that the Trust has a claim against the husband, it says either on the basis of an express indemnity or it may be simply on the basis of the Trust being subrogated to the rights of the bank against the husband.

[11] In any event, for the purposes of today, I have to proceed on the basis that there is no significant dispute that the Trust does have a claim against the husband for the €5 million.

[12] The judge in Aix on 20 March put in place a saisie conservatoire (which, so far as I can judge from the translation of the order, seems to be something either in the nature of an injunction or some form of attachment) over the car, which, according to the terms of the order, requires the vehicle to be seised within three months of the making of the order. Mr Pointer QC has told me this morning that there has been some form of walk‑in possession, but that the car physically remains at the husband's house in Provence.

[13] That order creates a complication in the sense that, before the order of Sir Peter Singer for delivery up can be complied with, even if the stay is lifted either today or following the substantive appeal hearing, the French order has also to be lifted. As far as that is concerned, there is likely, on the basis that the wife seeks the removal of that order, to be a need to argue in France jurisdictional questions, including the question of whether the Trust's claim to the car and the wife's claim in the English matrimonial proceedings are related, and secondly, if they were related, which was the court first seised?

[14] Again, it is not possible for me in the context of this application to form any view whatsoever, nor indeed necessary for me to form any view, as to what the likely outcome of that argument will be. What it seems to me is important and necessary for me to decide this morning is whether, in these rather different and unforeseen circumstances, it is right that I should continue the stay that I imposed or I should remove the stay so that at least the wife can, if able, clear the way to Sir Peter Singer's order being complied with, and, more important, any further orders for the sale of the car and the use of the proceeds to be complied with in due course, assuming that the jurisdictional challenge in the Court of Appeal fails.

[15] That, therefore, is essentially a question of where the balance of convenience and risk lies. For the wife, it is said that there are really two important questions to consider. One is that if the English stay remains in place it will be much more difficult for her to argue successfully in France that the French stay should be lifted for the simple reason that the English court is not, as things stand, requiring the immediate removal of the car to England. Secondly, she says that there is on the evidence a history by the husband of non‑compliance with orders of the court, and that if the car is allowed to remain, even assuming it can be freed from the French order at the husband's home in France, there is, to put it mildly, a significant risk that the husband will physically remove the car to some other inconvenient jurisdiction where it will be difficult, if not impossible, for the English court's order to be enforced.

[16] Mr Pointer QC says that there is no substance in the second of those grounds of objection and queries whether there is any substance in the first. As far as the second point is concerned, he says that the car will not be at risk, that it can remain very conveniently at the house in France without causing prejudice to anybody, and that what I should therefore do is to leave this stay in place pending the appeal.

[17] It seems to me that I should be guided by what steps will best enable Sir Peter Singer's order to be given effect to, assuming that the appeal before this court does not succeed. I am not in any position to form a view, and I do not do so, as to whether or not the French saisie conservatoire was justified or whether, on jurisdictional grounds, it should be set aside. Those are matters in the first place for the French court. But I think I am entitled to take the view, and indeed should take the view, that this court should not make an order which makes it more difficult and perhaps impossible for the car to be freed from the unexpected order of the French court that has occurred in the interim period. For that reason alone, and having regard to the fact that, in my view, no serious prejudice will be caused to the husband or any other interested parties if the stay is lifted and the car is removed to England under the control of the court, I propose to lift the stay and to give effect to the judge's order, subject, of course, to the removal if a French court considers it appropriate of its own order, the saisie conservatoire, in relation to the car.

[18] For those reasons, the stay will be lifted.

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