England and Wales High Court (Family Division) Decisions

IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		06/07/2016

Mrs Justice Roberts :

1. This is an application for financial remedy orders. It is made by MCJ, the husband in these proceedings ('H'). The respondent is MAJ to whom I shall refer as the wife ('W'). I intend no disrespect to either in adopting this convenient form of shorthand which will protect their anonymity in what are essentially private proceedings concerning the financial consequences of their divorce.
2. W has been represented throughout this five day hearing by Mr Jonathan Cohen QC who has been instructed on a direct access basis. H has been represented by Mr Richard Sear of counsel, instructed by Payne Hicks Beach. I record at the outset my thanks to both counsel whose preparation has been meticulous and whose presentation of agreed matters and matters in issue (of which there are many) has been clear and comprehensive. We have worked throughout from a single asset schedule which sets out precisely where the parties are apart in terms of the issues which fall to be determined in the context of computation.
3. H made his application for all forms of financial relief in September 2014. In reality, he did so in order to engage the court's jurisdiction on behalf of himself and W so as to resolve all outstanding matters between them at the end of a marriage which has lasted over 17 years on W's case, or something nearer 13 years on H's case. For all practical purposes it matters not since this has been a marriage where both of the parties have made their respective contributions over a significant period of time. To seek to establish with any degree of precision exactly the point at which the marriage foundered would be a sterile exercise in circumstances where there is no element of post-separation accrual which falls to be considered. On H's case, W's financial award should not be predicated on the basis of sharing; rather, he contends that she should leave this marriage with her needs met. He advances his case from the existence of a platform of established wealth at the start of their marriage in 2000. That wealth, he contends, had been built up over a lifetime's work whilst he was married to his first wife who died in 1987 after almost 30 years of marriage, and some ten years or so before he met W. By that stage, he was in his early sixties and she was 47. By the time they married in December 2000, he was aged 68 and she nearly 51. By contrast, W's claims are advanced on the basis of a full sharing entitlement. She relies not only on the existence of clear promises which she says were made to her at the start of their relationship but also on many years of hard and substantial graft when, side by side with H, she helped him to run two care home businesses which she contends were teetering on financial insolvency when the parties met.
4. This position has been the subject of direct challenge by H and it is an aspect of the case to which I shall return in due course.

The asset base

5. The wealth available for distribution in this case is in the order of between £10.5 million and £11.6 million. Thus, I shall need to determine issues relating to computation as well as distribution. H's wealth derives from two essentially different businesses. He holds, and has historically held, a portfolio of central London investment properties. In the main, these are properties in multiple units of occupation which are let to tenants who are subsidised by receipt of housing or other government benefits. Several of these properties are subject to mortgages which are serviced from the rental income. On H's case, the overall level of borrowing secured on these properties has not reduced at all since the marriage in 2000. Whilst the value of the portfolio has increased in the period during which it has continued to be held by H and let through the corporate wrapper of an unincorporated sole trade entity called International Accommodation Services ("IAS"), this has been achieved on H's case as a result of no more than the significant increase in the central London housing market. The value of the portfolio as at April 2015 was £11.05 million, or £7.3 million net. It accounts for just under 68% of H's wealth and is the most significant asset in the case. As part of her capital settlement, W seeks the transfer of one of the commercial properties which is worth just under £4 million and produces a gross rental income of some £140,000 per annum. H resists any attempt to break up the property portfolio and contends that W's award should paid to her as a cash lump sum to supplement her existing capital position of some £500,000.
6. Throughout their married life, the parties lived at 15PC, a three bedroom flat on the Finchley Road near Swiss Cottage in north London. That property had been acquired by H at the beginning of 1993, some three years before the parties met. It had been his home and W moved in when they began to cohabit in 1997 or 1998. (They do not agree upon when their relationship became one of long term commitment.) W has remained in this property since H vacated the property in April 2015. H has been staying in a property in Ilford (the home of one of his adult daughters, T). 15PC is a second floor flat and W now has some health and mobility issues which she contends make this an inappropriate home for her in the longer term. It has been valued at £790,000 or just under £500,000 once account is taken of the interest only mortgage secured on the property. She has set her sights on another property in H's portfolio as her future home. That property, 244FR in north London, is a ground floor flat which has a small garden. It was originally purchased as a commercial investment by a corporate entity owned by H (PD Limited) in May 1998 at about the same time as (or shortly after) their relationship began. Its gross value is more or less equivalent to that of the former matrimonial home. It is not subject to a mortgage but there would be a charge to CGT in the event of a sale or transfer to W. He resists such a transfer on the basis that he wants to live there himself in future. W is highly sceptical of this position. She contends that he is settled in Ilford near his first family and adopts his current position only because he knows she wants to live there.
7. This aspect of the dispute between them is but one example of the polarised positions which each takes in advancing their respective cases. They agree on very little in terms of the factual infrastructure underpinning the forensic arguments I have heard. Whilst I make due allowance in this case for the fact that neither of these parties is in the first flush of youth and memory inevitably fades with age to one degree or another, there is remarkably little common ground here.
8. H sought to present his case as one where, at a fairly late stage of his life, he had been effectively 'duped' by W into a relationship which was born out of her desire for personal and financial security. He contends that he was not looking for marriage when they met and, from more or less day one of their cohabitation, she was pursuing her own agenda and placing him under pressure to transfer assets into their joint names. He accepts that W worked throughout more or less all of their marriage until 2012 in his second business enterprise. Through two separate corporate entities, NE Limited and HL Limited, he ran two nursing/care homes. One was in Harwich in Essex. The other was in the south, just outside Ringwood in Hampshire on the edge of the New Forest. Her contribution towards the success of those businesses is in dispute. H told me that she was little more than his employee and was paid an appropriate salary for the work which she did. W's case, on the contrary, is that they were to all intents and purposes equal partners within the nursing home businesses. She says she put her heart and soul into turning them round as commercially 'going concerns' for very little financial reward. In so doing, she told me that she relied on promises which H had made to her that their marriage was a true partnership and one which would eventually provide them with financial security for their retirement. That retirement would see them, on her case, owning homes in London and the Caribbean where they would spend the winter months indulging H's love of sailing and escaping from the cold English winter. With that goal ahead of them, W's case is that she worked very long hours, commuting between the two care homes, often in difficult conditions. She claims that she was instrumental in terms of H's business plan, liaising with the Bank which was then lending heavily to support the care homes business. When its ailing fortunes were turned around, as the evidence shows they were, she claims to have been in the vanguard of that transformation, leading from the front in terms of the various changes and strategic decisions which were implemented over the years. She claims that she was working for their common good throughout and that her expectations of a comfortable retirement should now find reflection in the award which she seeks at the conclusion of this hearing.
9. In terms of these parties' input, neither of the two care homes is now operating as an ongoing commercial concern. The business which was run in the south of England was eventually shut down following a critical report from the Care and Quality Commission (CQC). W contends that this was not a reflection of the standards which had by then been achieved within the care home. Rather, on her case, it was a reflection of the fact that they had not ensured that some nurses employed from the Philippines had been able to study for the required periods whilst they were employed at the home. Litigation followed in the Bournemouth County Court. The home was shut down in 2010. The site on which it stood is now abandoned and falling into dereliction. There is no residential planning since it lies on the boundary of the New Forest, a protected National Park designated as an area of outstanding natural beauty. Its value as it appears on the asset schedule in these proceedings is c. £1.5 million gross which is the agreed value of the site.
10. The nursing home business in Essex was sold as a going concern at the end of 2010. Prior to his marriage to W, H had held 60% of the shares with the remaining 40% held in the name of one of his adult daughters, T. (There is a dispute as to whether or not T was the beneficial owner of those shares. W contends that she was holding them as bare trustee for H.) As at the date of sale in 2010 and in terms of legal ownership, H held 35% of the shares; W 25%; and T retained 40%. The net proceeds of sale, some £3.55 million gross (£2.4 million net), were distributed amongst the three shareholders in early 2012. H received just over £855,000 net and W's share was just under £595,000. H currently holds the balance of T's share which was just under £957,000.
11. There are unresolved issues in the case as to whether T has a beneficial interest in these funds or whether, as W alleges, they are H's funds. For reasons to which I shall come, I did not hear from T and she has played no part in these proceedings as either a party or a witness. The debate extends not just to the sale proceeds from the sale of the business which owned the Harwich nursing home but to property which has since been acquired as part of an investment portfolio situated in Detroit in the United States.
12. At an earlier stage of these proceedings, W's case was being advanced on the basis that a number of assets held by T were in fact owned beneficially by H. In particular, she alleged that a residential property in Ilford, 375/377 CR ("375 CR"), was not T's property but H's. That particular property is in a residential road in which H also owns a second property at 379 CR. He claims that 375 CR was purchased in 2011 from his own resources as a home for his daughter at a time when her share of the net proceeds from the sale of HL Ltd had yet to be distributed. When those funds were released, the property was transferred into her sole name and, from 2012, he has had no further interest in the property. At about that time, he purchased a similar property in the same street, a few doors down the road, at 379 CR. That four bedroom terraced house was purchased by him on trust for his three adult grandsons, the children of his elder daughter, K, who sadly died. That position is challenged by W who queries whether the beneficial interest in this property should properly be attributed to H.
13. In February 2015, at a mention to resolve the drafting of the order made by His Honour Judge Glenn Brasse at the first appointment in January 2015, W's assertion that H was the beneficial owner of 375 CR was recorded on the face of the order. T was specifically identified as his trustee. As a result, directions were made for her intervention as a party to the financial proceedings between H and W. By the end of June, some six months later, W had abandoned her case in relation to the beneficial ownership of 375 CR. By consent, her claim for declaratory relief was dismissed by Holman J at the conclusion of an unsuccessful FDR hearing. The costs of that exercise were reserved to the conclusion of the main trial.
14. On W's behalf, Mr Cohen submits that she may have been unwise to concede that aspect of the case (he was not representing her at the time). Nevertheless, he accepts that she cannot now seek to resurrect that claim and, for all practical purposes, it is agreed that 375 CR is T's property and hers alone. Issues remain, however, in relation to its neighbour at 379 CR. No attempt has been made within these proceedings to join H's three grandsons, or one of them in a representative capacity, and it is agreed that I should proceed on the basis of the evidence which is now before me. That includes a draft Form TR1 which was prepared on H's instructions in October 2013. That document is in standard Land Registry form and is headed "Transfer of whole registered title(s)". It shows H as the transferor and his three grandsons as the individual transferees. There is no consideration for the transfer of the legal title into their names but the document records a specific declaration of trust whereby they are to hold the property on trust for themselves as tenants in common in equal shares. The transfer form has been signed by each of the four parties to it and their respective signatures have been witnessed independently, in H's case by a solicitor. It appears that the draft transfer was never formally registered at the Land Registry and the legal title remains in H's sole name.
15. Thus, as the case was opened, there were two remaining business entities which fell to be considered. NE Limited is now nothing more than a corporate shell in which H owns 97.62% of the shares with W holding the remaining 2.38%. The company owns the site of the former nursing home in Hampshire. The site is now abandoned and, although valued (net of costs) at £1.44 million, it may represent a wasting asset since the potential to exploit any development value appears to be limited. I shall return to this aspect of the computation issue in due course in the context of the comments made by the single joint expert which Mr Cohen has asked me to consider.
16. IAS is the only remaining business entity which is a viable and ongoing concern. The underlying property portfolio has been valued at just over £11 million gross. There is a sum of just under £470,000 in the company's bank accounts and various liabilities (secured and unsecured) which reduce the net value of the shares, on H's case, to £7.427 million. Included in those liabilities are sums owing to T which I shall need to consider shortly. If these sums belong beneficially to H as W contends, the shares are worth just under £7.8 million.
17. At the beginning of 2014, at a time when it is agreed that the marriage was in difficulties if not broken down altogether, H acquired a portfolio of rental properties in Detroit, USA. These are worth just under £400,000 and appear to have been bought on the basis of a deal which he struck with a gentleman called XY. H contends that XY reneged on their contract and has failed to provide the management services in respect of the properties which were part of their deal. The significance of these properties, held through offshore companies called DB 2013 (A) and (B) LLC, is that they were not disclosed in H's Form E when he made his original financial presentation in December 2014. W's suspicion is that this was a deliberate omission and that H was encouraged by T not to mention these assets in case they could be preserved "under the radar" and away from the gaze of both W and the court, a case rejected by H whose solicitors wrote on 5 January 2015 to make full disclosure of the circumstances of the purchase.
18. There is a small apartment in Spain worth some £107,000 which was purchased during the marriage in 2002. In addition, W owns a property in her sole name in Pennsylvania, US. Her ownership of that property dates back many years before the marriage. It was formerly her home and she lived there with the father of her two sons in the early 1970s. One of those sons, M, still lives there. He is now an adult but has learning difficulties which appear to prevent him from living an entirely independent existence. W visits the property periodically and has recently had to spend some of her existing capital carrying out repairs to the property which was previously the subject of a foreclosure notice issued by the local authority. She maintains that there is a longstanding arrangement with M's father (to whom she was not married) that this property would be held on trust for M's benefit. Its current value appears to be minimal (less than £30,000 on H's case). Apart from a strip of land in Grenada (worth less than £10,000) and a small pension fund in H's name of less than £30,000, these assets together represent the shape and structure of the matrimonial and non-matrimonial estate with which I am dealing.

The issues for determination in this litigation

19. As I have said, the parties are apart on the computational aspects of the case by just under £1.2 million. The issues underpinning this differential flow in the main (a) from the treatment of funds currently held by H which he maintains are earmarked for T following his retention of her share of part of the sale proceeds from HL Limited; and (b) from the beneficial interest (if any) which H has in 379 CR.
20. In due course, I shall also need to consider the extent of H's pre-marital wealth and how it should be treated in terms of its reflection on the present asset schedule and exposure to a full sharing claim. H claims that the value of all the assets which currently exist within his commercial property portfolio are the result of passive growth within his pre-existing asset base. W contends that these pre-owned assets had no significant value in 1998, such equity as there then was being broadly neutralised by H's debts.
21. The significant issue of fact outside the disputed aspects of computation is the nature and extent of W's contribution to the care homes owned and operated by H at the time the parties met. It is common ground that W was employed within the business and that, during the relationship, not only was she paid a salary by one of the companies but 25% of the shares in HL Limited were transferred to her by H by way of gift. W also disputes that H is holding funds or property for T's benefit. Insofar as he has transferred assets to his daughter, she says that he has done so by way of gift rather than pursuant to any beneficial entitlement she may have had in either property or the share sale proceeds.
22. I shall also need to resolve the dispute between the parties in relation to whether or not there was any specific written or oral agreement between the parties to the effect that H would share equally all his assets with W when she agreed to move in to live with him at 15PG.
23. Finally, there appears to be an issue as to the standard of living which these parties enjoyed throughout their married life together. H describes it as "frugal" whereas W contends it was "high" and included frequent holidays abroad.

What each party seeks in terms of outcome

24. H's case is that, over and above what he describes as the 'windfall' of some £600,000 which W has already received from the sale of the shares in HL Limited which she received by way of gift, her claims should be firmly anchored to her future needs. He contends that the entirety of the assets (including the passive growth in value of those assets during their relationship) emanate from assets held by him before they met. W contends that her claims can and should be assessed by reference to the 'sharing' principle. She says that she has earned a full share of the available assets and relies not only on her contributions during the marriage but also on promises made to her at the time their relationship became one of marital commitment.
25. In terms of the specific award sought and offered, the parties' respective positions can be distilled as follows. H offers to pay to W a lump sum of £1 million on the basis that she will transfer back to him her 2.38% shareholding in NE Limited together with her interest in the Spanish property. She will retain the capital which she holds as a result of the sale of her shares in HL Limited (some £550,000 on his case, although this has now reduced to c. £500,000). This will enable her to purchase a home (which should not, on any view, exceed the value of the former matrimonial home at 15PG) and invest the balance of her award which will produce the equivalent of a Duxbury return of some £50,000 per year net for the rest of her life.
26. In contrast, W seeks the transfer of the property at 244 FR, thereby providing her with a home worth some £780,000. Since this property is currently arranged as three separate units of accommodation, she seeks a lump sum of £200,000 to convert the property back into a single home. On the basis that she keeps her existing capital and transfers her interest in the Spanish apartment to H, she seeks an outright transfer of one of the investment properties at 5QG in Bayswater, W2. That property, which has been valued at £3.9 million, is currently divided into 13 bedsit or studio apartments and produces a gross annual rental yield of £140,000. It is currently let to a single corporate tenant which, in return for the 'flat fee' referred to above, deals with the sub-lets to individual tenants. Despite the fact that she has no experience of property management, W believes that if she were to terminate the existing arrangement, she could manage the individual properties herself and produce a higher investment return. Whilst she did not ascribe any specific figures to her expectations in this respect, it follows that she puts her income needs in a much higher bracket than those predicated in H's offer on the basis of generously interpreted 'needs'. Her budget in her Form E suggests an income requirement of just under £130,000 net per annum.
27. H accepts that 5QG was purchased in 2007 during the currency of the marriage but contends that the majority of the funds used to acquire the property emanated from the sale of an investment property which he had owned as part of his commercial portfolio many years before he met W. That property, 26LS, was sold and the proceeds of sale invested in the acquisition of 5QG. In essence, therefore, he regards the property as non-matrimonial both in character and provenance.
28. The parties are therefore a significant way apart and the gap had not narrowed by the time of closing submissions after five days of evidence. Both sets of proposals are made on the basis of a clean break and I agree that there are sufficient assets in this case to make such an outcome not only achievable but desirable and in accordance with the statutory objective of financial autonomy and independence.
29. Before turning to the issues of fact which are in dispute, it may help to set the context of the case if I refer briefly to the parties' backgrounds and the lives which led each to a point of common existence.

The Background

30. H will celebrate his 84^th birthday at the end of May 2016. He was born in Grenada but came to make a life for himself in England some sixty years ago. He told me proudly that he began his working life as a young man by setting up a small business buying various commodities from Grenada and shipping them for sale at a modest profit in Trinidad. He had dreams of a better future in England and began to save for his passage to this country. He flew to Barbados and travelled by boat to Italy. From there, he travelled overland by train to London. He found a bedsit in London and secured his first job here sweeping floors at a teahouse run by J Lyons & Co. He took a second job and worked nights to supplement what little he earned in the days. As he put it in his written evidence, "I arrived in this country with little more than the clothes on my back and have, over the past 60 years, built up a property portfolio [which has included over the years] investments in hotels". Through dint of hard work and determination, he became a successful and wealthy businessman. Most of that journey was undertaken by the side of his first wife with whom he had six children. They married in 1959. Sadly, she died after a short illness in the summer of 1987 after 28 years of marriage. Of the efforts he has had to make to accumulate that wealth, he says this:

"I am proud of what I have managed to achieve, but it was at a cost. I have gone through tremendous hardship in order to generate the wealth that I have today. I worked 7 days a week from morning until night-time, took few, if any, holidays and, frankly, rarely saw my children as they grew up; nor did I have a social life."

31. The family lived modestly and H ploughed all his income and savings into building up a property portfolio. He told me that he has bought and sold over 42 properties to reach the position he is in today (including two hotels which were run as going concerns). Two years after selling the second of those hotels, he acquired the first of the nursing homes in Hampshire. It was April 1991 and, having acquired the site and the buildings on it, he set about putting in hand a substantial programme of renovation work. The Harwich nursing home was acquired some three years later in 1994.
32. Thus, by the time he and W met in 1996 or 1997, he was at a stage in his life when many people in his position might have been on the verge of retirement.
33. W was then 47 years old. She is an American citizen who was born in Mississippi. She secured a business degree and spent her working life in America as a government employee. She had been in a long-standing relationship with the father of her two sons and subsequently, in 1979, married a Ghanaian businessman at which point she moved from the US to Ghana. That marriage ended in divorce in 1985. There were no children. Their divorce was conducted in the Ghanaian courts although she and her former husband owned property in London as well as in Ghana. Her two sons from her previous relationship were educated in England from 1984 to 1995. During this period, she travelled from Ghana on regular visits to see them and developed an affection for the English way of life. At the time she met H, she was living in a London apartment in Baker Street, NW1. That had been purchased by her former husband in about 1984. Whilst the divorce proceedings were underway in Ghana, she decided to move permanently to London. It seems that she was awarded a jointly owned property in Ghana (their former matrimonial home) at the conclusion of those divorce proceedings whilst her former husband was awarded the London apartment. I did not hear any evidence about the Ghanaian property and it has not featured in the current litigation. H does not seek to ascribe to it a value and W does not disclose the existence of any Ghanaian assets in her Form E^[1].
34. When she met H, she was working for a company called GMJI Limited, a business which exported goods to Africa and arranged letters of credit for its clients. She told me that she was earning an annual net salary of c. £35,000 and received a small bonus on top if she secured a line of credit for the company's clients.
35. W claims to have been both a shareholder and a director of this company. I know little about the value of any shares which she held but there is within the bundle evidence of her directorship of this company. The form which she filled in giving details of her change of address when she moved to live with H has been the subject of some comment and cross-examination.
36. She describes her personal circumstances at the time they met in these terms:

"Sometime in 1996, I was introduced to [H] by one of my clients. We became friends. My flat [in Baker Street] was not in a re-possession list as stated by [H]. I did not have assets of note but I had a property^[2], I had an income, I had my children, I was living in a country where I wanted to live and I enjoyed my independence. I was not "looking" for a love interest."

37. The picture which H paints of her circumstances at the time is very different. He maintains that she was in the process of being evicted from the Baker Street flat because her former husband had failed to meet the mortgage payments. He had helped her as a friend to move with whatever belongings she then had to a small apartment in Victoria, London SW1 which she sub-let from a friend. He maintains that she did not pay the rent on this flat and was subsequently evicted again and needed somewhere to store her belongings since she was returning to the United States because of a family member's illness. He says he felt sorry for her and agreed to store what she left. They stayed in touch and when, in 1998, his brother died, she returned to London to provide moral support and attend the funeral. On this visit he accepts that she stayed in his home at 15PC but maintains she stayed in the guest bedroom. She went back to the United States but returned fairly soon thereafter. On H's account, she enlisted his support to find employment and accommodation. He says he offered to put her up in his apartment and "helped her out" by offering her short term employment in one of his nursing homes. He paid her a salary of c. £15,000 per annum and provided her with a flat in the care home. He accepts that shortly thereafter, in about 1998 or 1999, they began a committed sexual relationship. He flatly denies the existence of any agreement between them to share his assets.
38. W's account of this period as she explained it during her oral evidence is different. She maintains that H showed a lot of interest in her from the outset. She says that she felt flattered notwithstanding the 17 year age gap between them. In her written evidence, she had stated that his attention was "unwavering" throughout this period and their intimate relationship began in 1998 when she agreed to move into 15PC. She was later to correct this evidence during cross-examination when she said that this side of their relationship developed from a point in 1997, and not 1998. She maintains that H was, in effect, the driving force behind their decision to cohabit and that she was initially reluctant to give up her security and her home. She says that H told her that if she moved into his home, she would thereby acquire a joint interest in the property. To this end, she maintains that he drew up a written agreement which recorded the fact that 50% of 15PG was beneficially hers. This document was, on her case, signed in November 1997^[3] as she was moving in and was witnessed by his sister-in-law who has since died. Whilst that agreement was placed – on her case - in the safe at 15PG, it seems to have disappeared several years ago. W blames H for its covert removal. She states in her section 25 statement,

"We lived as man and wife from the time that I moved in in November 1997. [H] regularly asked me to marry him and I would either diffuse the situation by laughing or put him off. He would tell me that we were perfect for one another and flatter me repeatedly. In regard to financial matters he would tell me that he had assets and that we would share them equally as husband and wife and that I would be secure for the remainder of my days. This of course had an effect on me, as he designed it to have. I eventually agreed to marry [H] and we did in 2000."

39. In direct contradistinction to this account, H's narrative makes unhappy reading. He says this:

"I am bound to say that, on reflection, I do regret marrying [W]. It has not been a happy marriage and, more or less from the date we married, I came under persistent and increasing pressure to transfer property to her, so that everything should be in our joint names. I never agreed to this, particularly as [W]'s reasons for wanting this were transparent and it had nothing to do with love or our being in a partnership: she simply wanted my money. When [she] finally realised I would not put any properties into her name she withdrew any love or affection for me."

40. He accepts that, shortly after W began working in the care homes, he gave her 25% of his 60% shareholding in HL Limited. He described this transfer of shares in his Form E as a form of "gratuity" for W. Some five years into the marriage, matters had reached such a sorry state of affairs that H contends he consulted solicitors with a view to divorce. He says that, "unwisely", he failed to take steps at that juncture but by 2010 H and W were leading more or less separate lives. By that stage, the Harwich care home had been sold and the Hampshire care home was in the process of being closed down. On his case, she absented herself from their London apartment to spend increasing periods of time with her adult son in the United States to the point where, for at least one half of every year, they were living apart.
41. During the course of his oral evidence, H told me that, almost from the outset, they were arguing incessantly. He said that he had begun to make a written note to record the frequency of these arguments but abandoned the task when such rows became the norm of their daily existence.
42. All of this is explained by W as H's attempt to "re-write history". She exhibits to her written evidence a Christmas card which he sent to her in the very early stages of their relationship. It includes a handwritten message expressing his love for her in clear terms of endearment. She claims to have received many similar handwritten expressions of love from him over the years. She identifies the breakdown in their relationship at a time in 2008 or 2009 when H became reconciled with his adult children. It appears that there had been a distance, or "cooling", of his relationship with his children following their marriage in 2000 although W contends the distance between H and his children pre-dated the beginning of their relationship. Towards the end of that decade, he began to express regret at his estrangement from some of his children and grandchildren. He told me that he was growing older and felt the need of their love, company and support. There appears to have been an unpleasant incident between W and one of H's adult daughters in 2008 or 2009 which involved an allegation of assault against W.
43. At a time when the beneficial interest in her home at 375CR was being challenged in these proceedings, T provided a statement dated 30 March 2015. In that statement, she vigorously defended her beneficial ownership of the property and set out the circumstances in which it was acquired as a home for her family and the provenance of the funds used in connection with the purchase. As I have said, W has now abandoned any claim that H has a beneficial interest in this property: she accepts it is legally and beneficially T's asset and not susceptible to any claim arising out of her marriage to H. T's statement trespasses into territory beyond the issue of beneficial ownership and provides me with a context for the animosity which undoubtedly exists between W and H's immediate and extended family. It makes reference to a failed business investment or loan which H is said to have made to W's son in connection with a proposed property purchase in California^[4]. The sum involved was said to be in excess of £1 million. Whilst this is referred to elsewhere in the written evidence, I heard no direct evidence about it and was not invited to make any findings. I refer to it here only as an example of the family tensions which clearly existed as these divorce proceedings were launched in 2014 and which appear to continue to this day.
44. There are echoes of these tensions in W's written evidence. She reviews their relationship in these terms:

"What is true is that [H] met me, a woman 17 years younger than him, and persuaded me to share his life. I did that and then in effect spent the majority of our marriage working incredibly long and back breaking hours, whilst [H] watched on, as I single handed [sic] prevented his bankruptcy/gross financial failure, so that he finds himself in the advantageous position he finds himself in today. He consigns my efforts to history and would wish the court to believe his fantastical version of history in place."

45. Of his apparent reconciliation with his children and grandchildren towards the end of their marriage, she says this:

"Whilst I was pleased for [him], he seemed to completely ignore the fact that I was his wife and it was I, not his children, who had spent the previous decade and more putting him back into a financially secure position."

46. Having listened carefully to both parties, I have reached the conclusion that each is to an extent projecting their shared unhappiness and disappointment about the failure of their marriage onto their memories of the events which led up to its celebration. I am quite satisfied that each entered into a committed relationship in the hope and expectation that it would bring much happiness, companionship and (in W's case) future financial security. I do not criticise her for aspiring to a more financially secure future; I find that that was what H was offering her as part of their future life together. It is clear from the personal message which he wrote to her in the Christmas card which I find was sent in all probability at the end of 1999 that he had genuine feelings of deep affection for her at that time^[5]. Each of H and W has suffered lapses of memory about these early events in one respect or another. To an extent, it matters not in terms of outcome whether they started living together in 1997 or 1998. However, in terms of my finding on this issue, I prefer H's evidence since it is supported by three separate documents. The first is W's Form E sworn as long ago as December 2014. In para 4.3 of that financial presentation, she states, "We started living together in 1998". Secondly, her own statement sworn in June 2015 confirms that cohabitation at 15PC commenced in 1998. Thirdly, she was shown a document which she completed as a director of GMJI Limited and sent to Companies House to record a change of address in relation the registered office of that company and her personal correspondence address as company secretary. She accepted that she had completed that document. It records 18 August 1998 as the date when she moved from her flat in Victoria, SW1 to 15PC^[6]. Finally, in my judgment it is not without relevance that, at the First Appointment in January 2015, the judge directed H to provide a concise analysis of the parties' net assets as they stood in 1998 and now. W was represented by counsel on that occasion and, if there was argument on that occasion that such an analysis should extend back to 1997 as the effective date for the start of their cohabitation, it is not reflected in that order. W's subsequent attempt to correct the date and substitute 1997 as the date upon which they began a committed relationship may be simple lapse of memory on part. I do not believe she was being deliberately dishonest with a view to extending the length of their relationship.

H's financial position in 1998

47. In terms of H's financial position when he formed a relationship with, and subsequently married, W, I was given a separate bundle of documents which related to his pre-marital net wealth. In May 2015, his accountant prepared a statement of his assets and liabilities as they stood at the tax year ended 5 April 1998. These can be summarised as follows:-

	£
Portfolio comprising 8 commercial investment properties	4,528,105
15PC (leasehold: H's home)	202,617
Business assets (fixtures and fittings)	1,312
Personal chattels including cars	44,344
Land in Grenada (p.1971)	10,000
Director's Loan accounts	768,789
Cash savings / bank accounts	449,366
Shares in care/nursing homes	914,277
Insurance and pension policies	71,516
	6,990,326

Less:
Liabilities (personal and corporate
Including tenants' deposits)	(133,240)
Bank overdrafts	(3,209)
Longer term bank loans	(1,230,570)
	(1,367,019)
Net worth as at 5 April 1998	5,623,307

48. This schedule was challenged by Mr Cohen on behalf of W. She has had some assistance from her own accountant, Mr Roger Walton of Walton Dodge Forensic (WDF). In particular, he has been critical of the methodology employed by H's own accountant in reaching a sustainable EBITDA in respect of the value of H's shares in the two companies which owned the care homes in Harwich and Hampshire. Included in H's accountant's figures is a projected percentage saving in respect of staff and other running costs. These savings were anticipated as achievable as a result of the subsequent implementation of recommendations made by a management consultant, Mr RW. He was brought in to advise on savings and other efficiencies which could be made to improve profit in the businesses. Mr Walton points out that the assumptions fed into the 1998 share values are that hypothetical savings of some 20.63%^[7] would be made in each of the next three years. On this basis, the sustainable EBITDA has more than doubled and, says Mr Cohen, the figures in the schedule are not properly representative of H's actual net worth in 1998.
49. There is further criticism of the basis upon which H's accountant has valued the commercial property portfolio. It appears that he has used the Halifax House Prices Index in a somewhat unconventional manner. Rather than taking the relevant date and applying the appropriate indices prospectively, he has applied the figures retrospectively from the present time. Whilst no one has undertaken the calculations to determine what difference this might have made in financial terms to the bottom line figure, I accept that there may, indeed, be some scope for revisiting the global figure of £4.528 million which is attributed to the commercial property portfolio. This position is supported to some extent by solicitors' correspondence which dates back to March 1998 and which refers to an option which H was proposing to grant to a prospective purchaser of three of his commercial properties. It was pointed out to him by Mr Cohen that the option prices quoted in 1998 were lower than the values which had been attributed to those properties in his accountant's schedule. H told me that he had not proceeded with those transactions because he had reconsidered and believed the option price was too low.
50. In addition, H was cross-examined by Mr Cohen in relation to what he described as the 'flawed methodology' his accountant had used to calculate the value of what was to become the matrimonial home at 15PC. H owns another (smaller) flat in the same building (15APC). The two were purchased together in February 1993. The apportioned cost of 15PC has been assessed as at that date in the sum of £83,704. In order to ascertain market value as at April 1998, his accountants have used No 16PC as a "comparable". They have done so notwithstanding the fact that this was not a flat which H owned but on the basis of his instructions that the the two flats had an identical layout at the time of purchase in 1993. No 16PC was sold in December 2012 and the accountant has taken the actual sale price as a benchmark to which has been applied the appropriate housing index. A further adjustment has been made to reflect the fact that, since purchase, H has created an additional third bedroom out of an equivalent square footage. This results in an assumed value for 15PC as at April 1998 of £202,617.
51. Whilst these may be well-founded criticisms in terms of valuation methodology, it is clear that (i) 15PC was at the time of its purchase non-matrimonial property, and (ii) it had an appreciable equity at the time when W moved in to share the flat with H. Whilst I accept that it became a matrimonial home from 2000 (and had been a shared home for some two years before that), its fundamental character as non-matrimonial property as the relationship commenced did not change. Over time, as the authorities demonstrate, a property which becomes a matrimonial home may be considered to have acquired the character of matrimonial property but there is no dispute that 15PC was brought into the marriage as an asset which belonged to H.
52. As part of her case that she more or less rescued H from insolvency as a result of her work in the care homes, W places significant reliance on the fact that the accounts for NE Limited for the year ended 31 May 1998 show the existence of significant loans from the Bank of c. £1.627 million. For the same period, accounts for HL Limited show that company was carrying bank loans of £1.28 million. The fact that both businesses were highly geared and the somewhat artificial exercise which H's accountants have used to value EBITDA provide the forensic platform for Mr Cohen's submission that, at least in relation to the value of the care homes businesses, little reliance can be placed on the value of just over £914,000 attributed by H to their estimated value in 1998.
53. During the course of cross-examination, H was asked about the contents of some letters dating back to 1998 which suggested that he was under a great deal of financial pressure at the time. These documents were exhibited to W's statement sworn in October 2015. She accepts that they are documents which belong to H but she says they were left behind in the room he used as an office when he moved out of 15PC. One is a letter dated 1 June 1998 from a building society which had advanced money to H by way of a mortgage advance in respect of one of his commercial properties. It seems that he had a significant tax bill outstanding and was then seeking the lender's permission to apply the proceeds of sale of the mortgaged property towards its discharge. That request was refused. The letter also made reference to a substantial estimate which had been produced by surveyors in respect of urgent repairs which were required to two further properties within the portfolio. I have also seen a letter from the Inland Revenue addressed to H in June 1998 which contains a reference to a visit from a bailiff sent to levy distraint on his belongings in discharge of monies due. Thus, says W, the evidence from his accountant relating to the value of his pre-marital assets does not demonstrate that H was a man of substantial means in 1998 when their relationship began.
54. H met this challenge by telling me that, whilst there were windows of time when he experienced cash flow difficulties, he was always able to bridge any gaps by transferring funds between his businesses. The mortgage had never fallen into arrears; he had carried out all the repairs which were required to his properties; and he had discharged his tax bills even if he had on occasions paid late. He told me that he had a good line of credit with his bank and the rental income from the property portfolio was always sufficient to enable him to meet all his financial obligations. He accepts that, at a time when he was concentrating on building up the care homes business, he 'took his eye off the ball' in relation to his management of the rental properties. He claimed that the documents which W had "cherry-picked" from his files did not paint a complete picture of his financial situation at the time. He told me that, because she had removed entire files from his office, he had not had access to documents which would enable him to put into a proper context the individual documents on which she sought to rely. He accepts that there was a degree of financial movement between the two different business operations which had, from time to time, provided a subsidy for one another. Of the forty-two properties which had passed through his hands during a lifetime of building up his portfolio, he had never had a lender foreclose on any.
55. On balance, H accepts that the analysis which his accountant has carried out in relation to his pre-marital wealth was, and is, a "broad and indicative account only" and that His Honour Judge Brasse had not intended a full forensic enquiry into his wealth as it then stood. Nevertheless, he confirms in his written evidence that the figures and information included in the bundle marked "B1" are broadly accurate as a reflection of his net wealth at the time.

The law in relation to an assessment of pre-marital wealth

56. Where does this evidence lead me ? Both Mr Cohen and Mr Sear agree that these 1998 figures can provide the court with no more than a snapshot of the position at that time and what is required is a broad overview of H's pre-marital wealth rather than a precise drilling down into the figures ex post facto. As both counsel accept, it is simply not possible on the basis of the evidence before me to perform the sort of forensic exercise envisaged by the Court of Appeal in Jones v Jones [2011] 1 FLR 1723 and by Mostyn J in N v F [2011] 2 FLR 533 and S v AG [2012] 1 FLR 651. In appropriate cases (which will be the vast majority), I accept and endorse the stepped and intellectually rigorous approach of (a) deciding whether the existence of pre-marital property should be reflected in outcome at all, depending upon issues of the length of the marriage and what has been referred to in previous decisions as "mingling"; (b) if so, the extent of the pre-marital property to be excluded from the sharing principle; and, finally, (c) the equal division of the remaining (marital) property subject only to the cross-check of fairness and need. This approach was analysed recently by Mostyn J with his customary clarity in JL v SL (No 2)(Appeal: Non-Matrimonial Property) [2015] EWHC 360 (Fam), [2015] 2 FLR 1202, paras 17 to 27. However, there are cases where reliable accountancy evidence is simply not available so as to make it possible for a court to establish a reliable and historical benchmark in terms of crystallised value at a particular point in time. It seems to me that this is one those cases. H's accountant has done the best he can in terms of pointing to the existence of certain premarital assets (which are not disputed). His methodology in relation to the assessment of value is in dispute in certain respects and, without having heard any oral evidence on this point from the accountants, I am not in a position to resolve the issue of quantifying precisely what the value of those assets was in 1998.
57. Moylan J was confronted with a similar situation in AR v AR [2012] 2 FLR 1. In that case, the wife was seeking a 30% share of the overall wealth and the husband was arguing for a Jones v Jones approach. Of assets in excess of £20 million, all but about £1 million had been inherited by, or gifted to, the husband. At para 81, Moylan J said this:

" … It is clear to me that the bulk of the wealth in this case is accurately described as non-matrimonial; in other words, it is not the product of the parties' endeavours during the marriage … the former matrimonial home has been lived in and the family have clearly, in part, used the invested income generated from the husband's inherited wealth. But nothing has happened to the bulk of the wealth which has changed it into matrimonial property or diminished the weight to be attached to it as a factor in this case. In my judgment, the principle which in this case best guides me in the exercise of my discretion under section 25 to the determination of a fair award is that of needs. I do not consider that the sharing principle justifies any additional or enhanced award as submitted by [counsel for the wife]…" (my emphasis)

58. It seems to me that the words which I have emphasised above apply equally to the commercial property portfolio in this case. Properties may have been acquired and/or substituted from time to time but the basic integrity of the portfolio as an asset in H's hands has not changed despite the fact that the central London property market may have introduced a significant measure of passive growth.
59. In S v AG [2012] 1 FLR 651, Mostyn J said,

"It will be a rare case where the sharing principle will lead to any distribution to the claimant of non-matrimonial property."

And later,

"… sometimes one party brings in assets which become part of the economic life of a marriage …. utilised, converted, sustained and enjoyed during the contribution period. This is the concept of mingling … [although] … even if there has been much mingling, the original non-matrimonial source of the money often demands reflection in the award.

60. As Bodey J accepted in S v S [2014] EWHC 4732 (Fam), cases in this sphere are notoriously fact-specific and are subject to the exercise of a wide judicial discretion. Where outcomes are expressed in straight percentage terms, the figure settled on by a judge will usually be influenced by a combination of (i) the ratio which the non-marital contribution of one party bears to the assets which are available for distribution at the end of a marriage, and (ii) the assessment of a claimant's needs as a fair proportion of those available assets (see para 72).
61. Most recently, Holman J has considered these alternative approaches in Robertson v Robertson [2016] EWHC 613 (Fam). Having accepted that the methodology of Wilson LJ (as he then was) in Jones v Jones (above) and the concept of "passive" and correlative "active" growth has frequently been applied and adopted in subsequent cases at first instance, his Lordship said this at para 34:

"It needs to be stressed, however, that the methodology is a tool and not a rule. The overarching duty upon the court is to exercise its statutory duty under section 25 of the Matrimonial Causes Act 1973 (as amended) and to exercise the wide discretionary powers conferred upon, and entrusted to, it by Parliament in a way which is principled and above all fair to both parties on the facts and in the circumstances of the particular case."

62. It seems to me that, whatever the financial state of the two nursing home businesses at the time these parties started to live together, there is no issue in relation to the existence and ownership of the separate commercial property portfolio. Whatever its true value at the time of their cohabitation and/or marriage, I am satisfied that H had substantial wealth tied up in his portfolio which was an asset external to this marriage. It was a portfolio which had been built up over many years during his marriage to his first wife. It was wealth to which W made no contribution, albeit that H accepts that from time to time he was obliged to use rental income generated by the commercial property portfolio and the security in the land bank to prop up the nursing homes business. Can it be said that such financial cross-fertilisation provides a foundation for an argument that H's pre-marital property had somehow become 'part of the economic life of [the] marriage … utilised, converted, sustained and enjoyed during the contribution period' ? This, it seems to me, is part of the dilemma in determining what is meant by the oft quoted process of 'mingling' non-matrimonial property with matrimonial assets. In N v F (Financial Orders: Pre-acquired Wealth), there was a specific finding that a sum of just over £2 million which the husband had brought into a 16 year marriage was well and truly 'mingled into the economic life of the partnership'. Mostyn J found that this sum of money was 'the bedrock on which [the] marriage was founded'. That is not the situation here. It seems to me that the application of income generated by a capital asset (such as a commercial property portfolio) in order to sustain - in part - the domestic economy of a marriage (or, indeed to prop up the temporarily ailing fortunes of a parallel but unrelated business venture) does not thereby change the fundamental nature of that capital asset. It was non-matrimonial from the outset. The evidence is that, when from time to time a property from the commercial portfolio was sold, the equity was ploughed into the acquisition of a substitute property. There might have been 'churn' in the underlying composition of the property portfolio but as an entity it remained wholly external to this marriage. It stands in exactly the same position as a significant sum of money inherited by a party prior to the celebration of a marriage. If those funds are invested and preserved throughout the marriage without any inroads being made into the underlying capital value, the use of interest generated in respect of those funds does not, in my judgment, impugn the fundamental nature of the inheritance as non-matrimonial property.
63. It is impossible for me now to extract with any degree of certainty or precision the extent to which, in the earlier stages of the marriage, this lateral support between the two businesses was provided, and no one has suggested that I should make specific findings in this respect. The fact that W may or may not have accompanied H on Friday evenings to the property in L Square to collect rent from the tenants does not amount to any contribution by her to this essentially non-matrimonial asset. I accept that the rental income, together with the drawings which H was subsequently able to make from the care homes business, provided the income stream which funded their day to day living expenses and informed, to a significant extent, the scale of the discretionary spending in which they were able to indulge. Nonetheless, in my judgment the outcome of this case must reflect, in part, that early unmatched contribution made by H.
64. On any view, this was a case where there was already a substantial bedrock of wealth available to H at the time this marriage was celebrated. Whether it was as great as £5.6 million as H contends, I have my doubts. But it was certainly wealth which in my judgment has to be factored into any aspect of computation in terms of the marital acquest, such as it is, which has been accumulated during the subsistence of this marriage as opposed to H's first marriage. In these circumstances, I reject W's case, as advanced in her section 25 statement, that at the time their relationship began, H was "to all intents and purposes insolvent" (see para 14(b)).

Was there a specific agreement to share equally from the outset ?

65. However, that is not an end to the debate about sharing in this case because W contends that H made to her a specific promise that, if she left her rented flat and moved in with him at 15PG, she would thereby acquire a 50% beneficial interest in the property. According to H's accountant, its value in April 1998, some 18 years ago, was just over £200,000, albeit that, for reasons I have already explained, that figure is not accepted by Mr Cohen on behalf of W.
66. In her statement dated 28 June 2015, W said this at para 5:

"We agreed that if I moved into his home, I would have a joint interest in the property. This was so I could feel secure about where I live, and it was only on the basis of this agreement that I was prepared to move in with him. In 1998, we entered into a written agreement that I would own 50% of the property … This agreement was witnessed by his sister-in-law, [OJ], who has passed away."

67. In the same statement, she says at para 8:

"After our marriage in 2000, [H] reconfirmed in a discussion with me that our marriage is a partnership and that it would entail our matrimonial home being a joint asset of ours as well as his other assets." (my emphasis)

68. In her section 25 statement dated 20 October 2015, some four months later, she claims that H drew up a written agreement to this effect in order to encourage her to move in. She states that this agreement was signed in November 1997 at the point when she physically moved in to 15PG. (As I have said earlier in my judgment, I do not accept this date as representing the start of cohabitation for the reasons I have given.) The agreement was placed in the safe. Having moved in, she claims that she received regular proposals of marriage and assurances that she would share equally in all the assets H owned. She does not at that point in time recall (or record) any specific discussions about what assets he then held or their value but refers simply to his promise that she would be financially secure for the rest of her life.
69. It is true that, as she goes on to develop her case in relation to contributions to the nursing homes business at a later stage in that statement, W does make reference to six separate properties (including 15PC) which H owned when they started to cohabit. I suspect that her knowledge of the specific detail of his financial position is based in no small part on the financial disclosure and his accountant's presentation of his 1998 net wealth as it has emerged during the course of this litigation. There is certainly no suggestion on her part that at the time of the alleged agreement to share everything on a 50:50 basis, H provided her with a detailed breakdown, or indeed any breakdown, of his assets and liabilities as they then stood. He himself told me during the course of his oral evidence that she was unaware of all the properties he owned for some time into their marriage.
70. He also told me that, whilst he accepted that marriage was, and is, a partnership, he had never made any representations to W that, from the outset, he was prepared to share what he had with her. He accepted that, as a couple, they would enjoy what his wealth brought them but he denied there was ever an intention to divide that wealth on an equal – or any other – basis. He told me that, contrary to W's assertions, the proposal of marriage had come from W to him. She had asked only two things of him in terms of their future life together. First, she wanted a nice home and, secondly, she wanted to enjoy married life without interference from his children. It was H's evidence that, from "day one" she had started to ask him to effect formal transfers of the properties he owned into their joint names. He remembers those requests as a specific source of tension within the marriage and describes it as a topic which was frequently the trigger for the rows which began to characterise their relationship.
71. In terms of my findings in relation to this aspect of the case and the existence or otherwise of the agreement relied on by W, I have reached the conclusion that H's evidence is more likely to be true. I do not believe that he was in any sense "duped" into marriage. On the contrary, I suspect that there is an element of truth in the suggestion put to him by Mr Cohen that he had reached a stage of life where he was quite lonely and socially isolated. I am satisfied that he had genuine feelings of deep affection for W and that he was, indeed, anxious for her to move in to 15PC. He had been on his own for some nine years when W came into his life and, whilst this may not have been a coup de foudre for either of them, I am sure he was an enthusiastic suitor, as W describes him.
72. I suspect that W did have some feelings of financial insecurity at that time. She had recently been divorced from her former husband who appears to have been a man of some financial substance. There is no evidence that he was kindly disposed towards her as a former spouse: indeed, the evidence is to the contrary. The financial settlement which she had been awarded in the overseas divorce never materialised for one reason or another. She had at least one child who was at least partially financially dependant upon her. Whilst she had a job, she was then approaching her fifties and had no pension provision for her future. The property which she owned in the United States had minimal value. Some sixteen years later, she was to attribute to it in her Form E a value of no more than US$40,000.
73. To the extent that H was keen to progress their relationship, I suspect that she was in a position to seek certain assurances from him in relation to her future financial security. The fact that she asked him on several occasions following their cohabitation and marriage to transfer assets into their joint names (as I find she did) suggests that financial security was likely to have influenced her decision to commit to a shared future with H. She more or less admits as much in her written evidence. In my judgment, it is a slightly unattractive aspect of her case that she now seeks to rely on the existence of a written agreement which promised her a 50% share of 15PC in return for her agreement to cohabit. At that point in time she was living in a rented flat. She says that she had a good job and denies that she was in arrears with her rent or at risk of eviction. I am puzzled as to why, in those circumstances, she should have sought a half share in H's property as a pre-condition to moving in with him. On any view, their relationship was in its very early stages. They might have discovered that they were entirely incompatible. The relationship might just as easily have proved to be short-lived. The rented apartment in which W was living did not appear to have held any particular attachment for her. Had the relationship broken down, she could just as easily have rented another property.
74. I have no evidence to help me determine this aspect of the factual dispute save for the evidence of the parties themselves. If there was a written agreement, it is not before the court. W herself accepted in her oral evidence that she had not seen the document for years. The only third party who is said to have witnessed these events is no longer alive. W was adamant in her oral evidence that H was very well aware that he had signed such an agreement, although he denies having done so. Having considered matters carefully and having listened to both parties, I am unable to find that H specifically agreed that, as a condition of cohabitation, he would transfer to W a 50% interest in 15PC. I find it is even more unlikely that he would have agreed to part with 50% of his entire wealth. On balance, I accept his evidence that, whilst he was willing to share with W the benefits which flowed from his wealth as a consequence of marriage, there was never – on his part at least – an expectation, far less a legal commitment or agreement, to endow her independently with a 50% share of that wealth.
75. I am prepared to accept that his failure to do so was the source of future tension between them and I suspect that it was this in no small measure which led to a growing alienation between W and H's adult children. I accept that, despite earlier difficulties, H has now repaired his relationship with his family. He has been generous to his children in the past and plainly feels himself to be under a moral, if not legal, obligation to provide appropriately for them in future. However, he appears to be a man who has reservations about those he believes to be motivated by money. At one point, W referred to his dislike of some of his children's partners, describing them as "meter-breakers". That soubriquet had the ring of truth as an expression which H might well have used. I suspect that, having accumulated wealth after a lifetime's hard graft and effort, he is a man who has little respect for those who seek an easier path to financial security. With this failed marriage behind him, that was certainly the tenor of much of his evidence about W's current claims for a full share of what he now owns. This found reflection to a large extent in the way in which he sought to denigrate her contributions in respect of the work she did in the care homes.

W's contribution to the nursing/care homes business

76. Throughout the course of this marriage, and during her cohabitation with H, W has worked in the care homes business (and by this I am referring to the fact that she regularly commuted between the two homes albeit that she was only a minority shareholder in one of the two companies which owned the properties). H had acquired the Hampshire care home in April 1991, some five or six years before he met W. The Harwich home was purchased in 1994. In her Form E, W contended that it was agreed between them that she would be given a 25% stake in each home if she agreed to work in the homes in order to assist H to turn around their financial fortunes. She describes them as "shell nursing homes … in a financially bankrupt state" at that point in time. Without providing any further detail at that stage, she states, "We subsequently agreed that if we married we would be 50/50 owners".
77. It is common ground that, prior to W's involvement, Mr MG had been employed by H as his general manager for the two nursing/care home businesses. Equally, it is common ground that at this point in time H was supporting the losses in the care homes by injecting funds which were transferred from the bank accounts maintained by IAS. W has produced a number of documents (belonging to H) which support the parlous financial state of the business in 1995 and 1997. These refer to its negative cashflow position and the excessive overdraft which had been built up. The business accounts for the 1997/1998 financial year confirm the level of indebtedness both to the bank and to various creditors. There was a falling out with Mr MG who resigned his position as general manager. At around that point in time, at H's request, W accompanied H to a meeting with the Bank which was threatening to withdraw its support from the care homes business unless the financial situation improved.
78. W was aware that Mr RW had been commissioned on a consultancy basis to prepare a report in relation to management practices at the homes and to identify the means by which the business could be returned to profitability. She told me that she had never seen that report but she acknowledged its existence. One of the principal concerns at that time was the level of over-staffing in the homes. The cost of employing staff absorbed in excess of 50% of the income which the business generated and there was a consensus that this cost must be reduced.
79. Within the material in the bundles is a statement from Mr RW. I had ruled as a preliminary point that only parts of that statement could be relied upon by H as evidence in these proceedings. RW confirms that reports were produced in relation to both care homes after a number of meetings with the home managers. Those reports itemised RW's findings in relation to the analysis which was undertaken of work methods, staffing levels and recruitment. They contained conclusions and recommendations as to the actions which were required. Whilst I have not seen the report (copies are no longer available), it appears that this was a detailed and comprehensive piece of work which contained a significant number of recommendations in relation to future action.
80. On H's behalf it is said that when W commenced her work in the care homes business, she already had the blueprint for what needed to be done.
81. When H gave his oral evidence, he told me that when MG left the care homes business, he asked W to help him implement the recommendations in RW's report. She was certainly working for the business more or less from the outset and was almost immediately made a director of HL Limited^[8]. It is H's case that he was anxious to involve some of his adult children in the business but maintains that W was unwilling to work with them because she had an unhappy experience of trying to involve her own children in a business enterprise in Ghana some years before. Prior to setting up the care homes business, H had been involved in running two hotels. His son, S, was a business partner in that venture and was marginally involved at one stage in NE Limited as both director and shareholder.
82. When he made his initial financial presentation in his Form E, H said this of W's contribution to the care homes businesses:-

"During the marriage, [W] worked at the care home run by [NE Limited] and occasionally helped out at [HL Limited]. However, she made no material contribution to either that went beyond the fact that she was a well-remunerated employee with responsibility to some degree for the day-today running of the care homes (in particular, [NE Limited]). I suspect that [W] will say differently, however the fact of the matter is that she had no strategic responsibility (or anything akin to that) that made any positive difference to either the overall profitability of the companies or the sale price achieved for [HL Limited]. In fact, her contribution was, if anything, to the detriment of both companies.

… In any event, notwithstanding the fact that I consider that [W] made little relevant financial contribution to the (from a financial perspective) [sic] she received a financial windfall in the sense that, early on in our relationship and perhaps ill-advisedly, I gave her a sizeable shareholding (25%) in [HL Limited] which netted her approximately £600,000-700,000 on its sale. For the record and avoidance of doubt, this was not a reflection of her contributions to the company and can best be regarded as a gratuity."

83. Given the evidence which I heard and read, and in the light of my findings as set out below, I regard this description of W's efforts over the years as both inaccurate and patronising.
84. The accounts for the two businesses show that W was a director of NE Limited with H and S, his elder son, by the company's year end in May 1998. Over the course of the following year, S transferred his 2.38% shareholding in the company to her. In May 1999, H transferred 25% of his 60% shareholding in HL Limited to W. H accepted in his oral evidence that he did this in order to provide her with some assurance and to make her feel comfortable about her personal stake in the business. She was paid a salary through NE Limited.
85. From W's own evidence in her statements and from the witness box, I accept that over the course of the next few years she was working extremely hard for both businesses. She was fully occupied throughout the week in one or other of the nursing homes. She commuted regularly by train and by coach between London and Harwich and London and Hampshire. Whilst I accept that H, too, was involved in the business, I had the impression from his evidence that it was much less of a "hands on" role than that undertaken by W. He told me that he handled the environmental health aspects of the business and did not spend so much of the working week away from London. W was able to give me a very graphic description of the routine of her regular commuting existence. She divided her time between the two care homes but was predominantly based at the home near Ringwood in Hampshire. She would leave early on a Monday morning and travel by coach from Victoria. Returning on Friday evenings, H would generally meet her at the coach station and they would eat out because there was invariably no time for food shopping during the week. On Saturday mornings she attended a course at a local college. She stated that she was often asked to assist H in a secretarial capacity, typing his letters and helping him with the books.
86. W told me that she was not simply involved in the day to day running of the business but also took charge of some of the strategic aspects of the changes which were required. She recognised at an early stage that one of the main reasons for the heavy losses was the fact that there was no effective control by the accounts department over cash flow. She introduced tighter monitoring systems and, over the course of time, as the various changes were implemented, the business turned the corner and became profitable. That much I can see from the helpful distillation of the accounts which W has exhibited to her section 25 statement. This document was prepared by the book-keeper who worked in the Harwich care home. Over two separate pages it charts the financial information extracted from the company accounts of each business. It is accepted by H as an accurate reflection of the accounts and thus the performance of HL Limited between 1998 and its sale in 2010. Over that period a loss of £128,270 was converted into a profit which peaked in 2005 at just under £560,000. Whilst profit in the year prior to the sale of the business had reduced to £127,609, that is counterbalanced by the increasing level of profits retained within the business. At the point of sale in 2010, there was in excess of £1,227,700 within the business reflecting its attraction as a going concern for the corporate purchaser which acquired the shares on sale. In four years from 2000 to 2003, a total of £180,000 was withdrawn from the business in the form of dividends but otherwise profits were ploughed back into the business with the result that, by 2003, the entire bank loan had been repaid. That loan stood at just less than £1.5 million when W started working in the business.
87. The results were no less impressive for the Hampshire nursing home business, NE Limited. In 1998, the profits were less than £200,000. By 2010 that figure had risen to £2.22 million.
88. At one stage of her evidence, it appeared to be part of W's case that H had failed to account for the profits retained in the business when HL Limited was sold at the end of 2010. She appeared to believe that she was entitled to a share of this sum. I am satisfied that this was not the case and that, as Mr Cohen accepted on her behalf, it was her failure properly to understand the accounts and their presentation rather than any non-disclosure by H. It is accepted that the consideration which was paid for the acquisition of the Harwich care home business (some £3.55 million gross / £2.684 million net) reflected its commercial viability as a going concern.
89. One of the particular criticisms made by W of H is that, whilst she received a salary from NE Limited, she received nothing by way of remuneration from HL Limited throughout the twelve years during which she worked as the managing director of the business. She says that this saved him approximately £60,000 per annum, the equivalent of the salary which he had been paying to MG prior to his resignation in 1998. Whilst that may be true as a matter of fact, it seems to me that it ignores the fact that H was throughout maintaining W from the income he drew from his commercial property portfolio as well as from the dividends he was subsequently able to take from the care homes business. According to W, this income enabled them as a couple to live a very good life with frequent holidays, cruises and the like. Whilst she was perfectly entitled to seek the financial autonomy of being paid a going rate for the job she was doing, it would be wrong to ignore the underlying financial support which he was providing throughout the period of their married life.
90. Where criticism can be levelled at H, in my judgment, is his failure properly to acknowledge the very significant contribution which I find W undoubtedly made towards the transformation of the care homes businesses. I accept that he, too, worked hard to turn their fortunes around but I find that her role and input were substantial elements of the success which was achieved in staunching the haemorrhage of losses which had occurred before she became involved. She has set out in her section 25 statement much narrative detail about the work she undertook and she has included in the exhibits which accompany that statement various documents which support her account of the different management functions she discharged. I have seen a letter which was sent to the Bank by the parties' accountant which refers to W having 'embarked on a major cost cutting exercise in relation to overheads, begun a strict regime of budgetary control, managed to employ several new members of staff and taken in several new residents'. H maintains that much of the 'spadework' in terms of strategic planning had been put in place before her involvement, largely as a result of RW's input. He told me that it takes time to trade out of initial start-up losses and consigns W's contribution to the ranks of that which would have been made by any employee. In my judgment, that is not a fair description of her role and he has not sufficiently recognised or appreciated the time and effort which she applied over the years to the running and operation of both care homes.
91. It is not necessary for me at this juncture to say any more about the circumstances in which the UK Border Agency became involved in the closure of the Hampshire care home nor the litigation which followed. It is clear from several letters which W has exhibited to her statement that the families of the care home residents had no complaints about the care which was being provided for their relatives. That said, I have seen a copy of a letter dated 17 September 2010 from the Care Quality Commission to NE Limited giving notice of the cancellation of the company's registration as an approved provider of care. The letter refers to 'a long history of non-compliance with respect to … service [users] and a lack of ability to sustain quality care provision'. It seems that, as of June 2009, the service which was being provided was deemed to be good but by the time of a subsequent inspection in February 2010, the rating was reduced to merely 'adequate'. The letter refers to 'serious concerns about the recruitment of staff' as expressed by the UK Border Agency which culminated in July 2010 in the arrest and detention of 13 people at the care home. This resulted in the intervention of the local social services department which decided to remove the residents to alternative placements. That action appears to have marked the effective demise of the business carried on by NE Limited. The care home remained unoccupied; the business was closed and the empty site now continues to deteriorate as I have explained earlier in my judgment.
92. W told me that senior counsel had advised that their prospects of challenging the closure and the de-registration were good. Be that as it may, it seems to me that is now history since it is accepted that the value of the shares in NE Limited is now restricted to whatever can be achieved in future on a sale of the site on which the care home stood. However, the fact that the business failed in this way does not, in my judgment, detract from the contribution which W made (with H) in returning the business to a position of profit and repaying a corporate debt of some £6.6 million by 2006.

The computation issue: T's interest in assets currently held by H

93. In relation to the structure of equity participation in the two companies, W accepts that H made her aware of the fact that the shares in HL Limited (which owned the care home in Harwich) were owned as to 60% by him and 40% by his daughter, T. However, W's case is that H told her that T was merely his nominee in relation to the HL Limited shares. She became confused when she was asked whether this information was imparted to her before or after she had started working in the homes. This issue lies at the heart of the dispute in relation to the computation of the asset base since W seeks, in effect, to add to H's share of the sale proceeds not only those funds which he claims to be holding for T but also to trace through T's 'notional' share of the retained share sale proceeds into the assets currently held by a US company called M E Limited. Those assets comprise an investment property worth US$300,000 and a bank account holding approximately US$40,400.
94. The completion statements in respect of the sale of HL Limited show the holders of the issued share capital as at the date of sale as being H (35%), W (25%) and T (40%). Whilst T was then (2010) the major shareholder, this position only came about as a result of H's dilution of his shareholding through his gift of 25% of his shares to W. The distribution of the proceeds of sale was held back for some two years for accounting reasons which are in in dispute. When monies were paid out as between the three shareholders, each was entitled to receive the following:-

[A/D:44] Gross Net

H £ 939,680 £ 855,153

W £ 671,200 £ 594,450

T £1,073,920 £ 956,997

100% net proceeds £2,684,800 £2,406,600

95. H's written evidence records the pressure which he claims W exerted on him over the years to remove T's 40% shareholding. That evidence finds some reflection in W's evident annoyance at what she perceives to be a wholly unfair attempt to deny her a share of the fruits of her endeavours. Although she does not accept that T ever had a beneficial interest in the shares but was merely H's nominee, she was, and is, clearly resentful of the fact that T "never set foot in the nursing home" whilst retaining such a significant shareholding to the detriment of the hard work which W herself was undertaking. In his section 25 statement H provides very little explanation as to the circumstances in which T came to hold her 40% interest in HL Limited. It is accepted that H was for all practical purposes the sole owner of NE Limited when the care home in Hampshire was acquired in 1991 following the death of his first wife^[9]. The acquisition of HL Limited some three years later gave his daughter an immediate interest in 40% of the shares. He explains his retention of her share of the sale proceeds in 2012 on the basis of his paternal supervision over how she might apply those funds. He says that she has always had difficulties managing her own money and she was willing to leave her funds in his hands but on the basis that he was merely looking after her money for her and making investments on her behalf. He refers to the fact that W had always resented the arrangement bitterly, just as she had resented the fact that T held 40% of the shares in the first place.
96. There is no issue as between H and W that, at the point of sale, T legally held 40% of the shares in HL Limited. There was no challenge by W at the time to the apportionment of the sale proceeds as recorded on the completion statement and no subsequent challenge by her when the sale proceeds were distributed some two years later. In a statement made by W in June 2015 (a week before the FDR hearing), W says that she had been told by H that T was holding 40% of the shares in trust (presumably, for him). She goes on to state that H had deceived her in his representations that she, W, should have a 50% share in the business. It was on this specific basis that she formally withdrew her claim to trace through into his beneficial ownership of T's family home at 375CR. She went on to say this:

"If I had known that [T] was going to be entitled to 40% of the shareholding, I would have taken a salary for the hard work I did in turning the company around and making it profitable."

97. The evidence from T herself (dated 30 March 2015) confirms both her legal and beneficial ownership of 40% of the shares in HL Limited.
98. In terms of establishing the true beneficial ownership of this 40% stake in the business, the evidential burden lies on W. It is she who asserts a divergence between the legal and beneficial title to this tranche of shares and it is she who must prove her case on the balance of probabilities. In my judgment, and taking the evidence as a whole, she has failed to make out her case in relation to this issue. First, there is a presumption that beneficial ownership follows the legal title to these shares unless there is evidence proving the contrary to be true. Here, it seems to me that W's own evidence as set out in the June 2015 statement to which I have just referred is accepting of what she regards as a "deception" on H's part (his willingness to endow her with a 50% interest in the business) and an acceptance of T's "entitlement" to her 40% of the net proceeds of sale through her 40% shareholding in HL Limited. No challenge was made to the distribution out on that basis. Secondly, I have direct evidence from both H and T that she held her shares as legal and beneficial owner. W has formally abandoned her case in terms of any potential entitlement to trace those cash proceeds into the property at 375CR. T was not required to attend this hearing in order that she could be cross-examined on this issue and her written statement has been neither tested nor impugned. H maintains that her 40% shareholding was T's, and hers alone. He has some "track record" in terms of family ownership of shares in the various businesses he has run. His first wife was a substantial shareholder in NE Limited; his son, S, was heavily involved in running one of the two hotel businesses in Blackpool and also held shares in NE Limited. In addition, H has shown at least a commitment to ensuring that the children from his first marriage (and their children, to a limited extent) are provided for financially. Other than to point to recollections of unspecific discussions with H that everything which H had by then accumulated over a lifetime's work would be shared on a 50:50 basis, W has been unable to point to any direct or specific evidence of a clear agreement between them to this effect. On the contrary, it was H's refusal to endow her with the half share she sought which led, as I find, to many of the arguments between them over the years of this marriage. I have already rejected W's case in relation to a specific agreement to share in 15PC as a pre-condition to her moving in. I regret that I cannot place any greater confidence in her evidence about a specific agreement to share across the board in the totality of H's assets. I accept that H may have said on more than one occasion that they were working hard in the care homes business because "after the cross comes the crown", but that, in my judgment, does not provide any evidential foundation for a specific agreement to share other than in the limited terms he has acknowledged.
99. On this basis I find that T held her shares in HL Limited both legally and beneficially.
100. Part of T's share was used to purchase her home at 375CR in Ilford at a cost of £352,522. A further part of her share (£193,590) was used to purchase one of the investment properties in Detroit (owned legally by M E Limited). Mr Cohen sought to highlight various inconsistencies in H's evidence in relation to this property. However, given the fact that T has plainly entrusted her father to manage her money and investments, I do not place any great weight on the fact that H is currently paying the tax due on the rental income generated by the US property held in T's name whereas she manages the rental of another investment property held in her name in this jurisdiction. Father and daughter plainly have a fairly fluid arrangement based on mutual trust and, notwithstanding these inconsistencies, they do not in my judgment displace the body of evidence in this case which points to T's legal and beneficial ownership of both the shares and the assets which have been purchased with her tranche of the sale proceeds. By the time he came to sign his section 25 statement, H had calculated that, of the sum of £956,997 which was due to T on the liquidation of HL Limited, about £480,000 remained due and owing to her. These were the funds held within IAS Limited (£367,806) and one of the bank accounts with AIB (£114,860). In addition, a property in the IAS portfolio (137WC) is said to belong to T. H manages the property for her under the corporate umbrella of IAS and accounts to her for the rental income of which there is an accumulation of some £62,056.
101. W has formally abandoned her claim in relation to H's interest in T's property at 375CR. Given that the provenance of her ownership of that property is exactly the same as her ownership of the assets to which I have referred in the preceding paragraph (i.e. the cash from the sale of her shares in HL Limited), I can see no basis upon which W can make out her case that H is the beneficial owner of those assets. All that she can point to is his alleged "stewardship" of those assets and the basis of his management of these assets on her behalf. However, the evidence I do have from T suggests that she relies upon her father for advice and guidance in relation to financial matters. Their financial affairs have been entwined in the past to an extent in that he has plainly had authority to operate and manage accounts in respect of which she has had an interest. T herself has confirmed that H has in the past acted as her agent in respect of the purchase of 375CR. I have some independent third party evidence in relation to H and T having acted independently as business partners in 2009, long before the institution of these divorce proceedings. With replies to a schedule of deficiencies advanced by W and dated 25 June 2015, H has produced copies of letters and email correspondence written in August and October 2009 from H's bank manager at Barclays Bank to H's accountant and to H and T directly. These refer to a joint business account which they operated and in respect of which she was acknowledged as one of the account holders.

My conclusions in relation to overall computation of the asset base

102. Before turning to the quantification of W's claims, I propose to set out my conclusions in relation to the assets which are available for division in this case. Where there is no dispute as to the assets, I propose to include them, without further comment, in the table which appears below.

(i) The former matrimonial home at 15PC

By the conclusion of the case, there was no dispute between the parties: Mr Cohen accepts that the figure produced by the single joint valuer should be used. Thus, I am proceeding on the basis of a gross value of £790,000 and a net value of £493,250.

(ii) 375 CR, Ilford (T's family home)

For reasons I have explained, H has no interest in this property.

(iii) 379 CR, Ilford

The sum in dispute here is £499,550. This is the property in respect of which H has signed a form of transfer recording his intentions that the property should belong to the three sons of his deceased daughter, K. Because I take the view that the outcome of this this case will be determined essentially by reference to W's needs given the existence of pre-marital property, I have decided to exclude this sum as an asset belonging to H. The transfer form was signed by all four parties and witnessed by H's solicitor long before these divorce proceedings and I take the view that H's motives in seeking to effect the transfer of the legal, as well as the beneficial, interest in the property were influenced by a desire to provide for his grandsons rather than any ulterior purpose of defeating W's claims in these financial proceedings. I accept that none of his grandsons has ever lived in the property, nor has rent been diverted to their personal bank accounts. Nonetheless, I accept H's evidence that he regards this property as belonging beneficially to them as a form of accelerated inheritance.

(iv) W's property in Pennsylvania

I do not propose to include a value for this property. I accept that such minimal equity as there may be is unlikely to be available to W given her ongoing responsibility to provide a home for her son, M.

(v) Allied Irish account no: 92-606

H contends that a sum of £114,906 is held by him for T and represents accrued rent on her property at WC. I accept both her ownership of this property and her entitlement to the rent. I have therefore excluded this sum from H's funds.

(vi) W's Region Bank bond

W maintains that a bond worth £3,281 is held on trust for her children. Because she, too, continues to bear a degree of financial responsibility for her adult children, I propose to ignore this sum.

(vii) Sums due to T from sale of shares in HL Limited

For reasons given earlier in my judgment, I am ignoring the sum of £6,313 which is the balance of funds owed to T from her share of the HL Limited share sale once allowance has been made for the purchase of her interest in the properties in Detroit and at 375CR. H told me in cross-examination that he had spent money in terms of various renovation work which was carried out to 375CR. I accept that his accounting can properly be said to be fairly "loose" in terms of the absence of a separate account but the absence of any detailed reliable evidence will not allow me to define with any precision the extent of any reduction in the debt which he owes her. Since I am not undertaking the computation exercise with a view to a meticulous 50:50 division, I regard this approach as entirely proportionate in the circumstances of this case.

(viii) AIB current #92523

A sum of £367,086 will be ignored in the final computation of the assets since I have accepted that these are funds held within IAS for T's benefit.

103. Thus, the asset base in this case is reflected in the following table.

	£
FMH (15PC)	493,250
Land in Grenada	9,700
Property in Malaga	107,250
Joint funds (AIB)	226
H's funds	392,054
Cajamar deposit a/c #0883 55 (omitted – asset schedule)	20,212 [B/C:349]
W's funds	500,009
Balance HL Ltd sale proceeds	6,313
Less (i) H's (est'd) tax liability	(70,000)
(ii) H's unpaid costs	(87,700)
Less W's liabilities (inc unpaid costs)	( 5,680)
Total non-business assets	1,365,634
Business assets
NE Limited (H- 97.62%; W – 2.38%)	1,052,481
Cash deposits	62,042
IAS (H's sole trader vehicle)	7,427,000
Detroit portfolios	392,961
H's pension	47,800
TOTAL (inc business assets and pension)	10,347,918

Discussion

104. It is clear that H has looked after his adult children and made financial dispositions in the past for their benefit^[10]. Given the wealth available to him, no criticism can be levelled at him for such paternal generosity. Whether treated as gifts or sensible advance tax planning (given his age), he is entitled to distribute his assets as he sees fit provided that such steps have not been undertaken with a view to defeating or reducing W's claims in this litigation. Because she seeks an outcome based on 'sharing', W has pursued a computation of the global resources available and a determination of the line to be drawn between the matrimonial and non-matrimonial assets insofar as that exercise can be performed at this stage. For reasons I have already explained earlier in this judgment, I regard the commercial property portfolio which H owned long before he met W to be non-matrimonial property. By the same token, it might be said that, save for the shares in HL Limited which W owned in her sole name (gifted to her by H) and those which she still holds in NE Limited, H's shares in both companies are essentially non-matrimonial in character given that they predate both cohabitation and marriage. Herein lies the difficulty in seeking to draw any bright lines between matrimonial and non-matrimonial property in terms of the shares in the care homes business, as opposed to the commercial property portfolio.
105. It follows from my findings in relation to W's contributions to the care homes business that value was injected into the shares in HL Limited prior to its sale as a result of her unstintingly hard work during the marriage. The fact that H was also working hard does not in my judgment detract from the very real contribution which W made in her capacity as the nominal managing director of the homes. He rather disparagingly refers to the gift to W of her shares in HL Limited as a "gratuity". He contends that she has received full value for those shares in that she now has over £500,000 in cash and other investments as a result of the sale of the Harwich care home business. To an extent, that is true. (She accepts that she came into the marriage with virtually no assets, save for the minimal equity in her US property which, on her case which I accept, is held in trust for her son.) The same cannot be said in relation to the current value of the shares in NE Limited because any uplift in the value of those shares has been lost with the closure of the care home as an ongoing concern. No one suggests that the business can be resurrected and value in the shares now lies only in whatever price can be achieved on the disposal of the site. The photographs included in the valuation report prepared by the single joint expert show only too clearly the current state of dilapidation into which the buildings have fallen. That expert considered that the site as it stands is unviable and the better option would be an application for planning consent for, say, six houses. There is no evidence as to whether such consent would be forthcoming although it appears that the principle of finding a new use for the land has been accepted. Whilst I am aware of one offer from a national developer in the summer of 2014 in the sum of £2 million, this was conditional on securing a change of use in relation to the property. Since this was not forthcoming, the offer did not proceed.
106. W was anxious to stress during the course of her cross-examination that her complaint was that the Hampshire care home business could have been saved. At the time when the local authority removed the funding for the thirty-five or so residents living at the home, the business was making a profit. However, she conceded, as she was bound to, that it was now too late to save the business. She accepted that the only value left was whatever could be achieved in terms of the sale price for the site.
107. Put another way, if there was any marital acquest generated over the course of this marriage, it is now represented by the sale proceeds of the shares in HL Limited (or the assets which have been acquired through use of those proceeds) and the value which has yet to be determined by a sale of the Hampshire site, with or without planning permission. This must represent the highpoint of W's case in relation to "mingling". It is impossible to define with any precision the value, notional or otherwise, of the care home shares in 1998. I say "notional" because, whilst the two companies were clearly pre-marital assets, it may well be that the loss-making nature of the enterprises at that stage lends considerable weight to Mr Cohen's submission that there was little realisable value in either company at the time. In relation to HL Limited, it is H's case that W has received her share already; in the case of NE Limited, he says in terms that his current offer of £1 million in cash on the basis of her future needs subsumes any further sharing entitlement.
108. It seems to me that it is at this point that a distinction has to be drawn between W's strict entitlement to her fixed or legal "share" of the company sale proceeds (25%) and her claim to a 50% share of the value of the marital acquest. I have already rejected her case in relation to a specific agreement to share all the assets on a 50:50 basis. That disposes of any argument based upon constructive trust principles involving concepts of promise, reliance, and detriment. It also disposes of any argument based upon H's conduct, although I have my reservations as to whether or not, even if representations of this nature had been made, they might amount to conduct which it would be inequitable to disregard for the purposes of section 25(2)(g) of the Matrimonial Causes Act 1973.
109. Together, the net value of the two care homes businesses was/is £2,564,126 [i.e. £1,114,523^[11] (NL Limited) + £1,449,603 (combined value of net sums paid to H and W for their respective 35%/25% shares in HL Limited^[12])]. A 50% share in those enterprises (impressed with a full marital contribution from each) would have given W an interest of £1,282,063. That, in my judgment, is the maximum value of any sharing claim which she may be entitled to advance in relation to the marital acquest in this case.

What are W's needs and how should these be reflected in outcome ?

110. In terms of her future housing needs, W has described 244FR as her "dream" once the work of converting it back into a single residential unit has been completed. With a current value of £780,000 and an agreed budget of £200,000 for the conversion works, this takes W to a global housing budget of just under £1 million. That figure coincides with the conclusion to which she told me that her property search in the area had led her: she did not believe she could acquire suitable accommodation which meets her needs for a ground floor flat with small garden in the area for much less than about £1 million to £1.1 million. The estate agents' particulars she has produced range from £1.25 million to £1.425 million. H, in turn, has produced examples of flats very similar to the former matrimonial home costing between £750,000 and £1.25 million. A transfer of 244FR to W will cost H an additional £158,120 in capital gains tax and thus the true cost to him of providing W with the property on which she has set her heart is slightly in excess of £1.1 million.
111. Of course, H's case, quite late in the day, is that he also wishes to live in 244FR. He has said nothing in his evidence about his plans for the property but I assume that he will also wish to spend money on converting the property into a single unit. This property was acquired as an investment a matter of weeks before the start of the parties' relationship. The purchase was completed in May 1998 and H's evidence (which I have by and large accepted) is that their relationship commenced in June 1998 or shortly thereafter. Thus, whilst it was in strict terms a pre-marital asset, it has been owned more or less throughout the duration of the parties' marriage and the period of cohabitation which preceded it.
112. In my judgment, W is being realistic in setting her sights on 244FR (fully converted) in terms of her future housing needs. I do not regard the total cost of delivering the property to her as being unreasonable in terms of an appropriate housing budget. It is where she wants to be and it is a home she will be happy to call her own as she approaches full retirement. In terms of the competing aspirations of both parties to live in this property, I have reached the clear conclusion that W is probably right when she says that, in reality, H is likely to wish to remain in Ilford or, at least, closer to where his children now live. Even if I am wrong about that, my global award to W will leave him in an eminently stronger financial position and with that position comes a greater freedom of choice in respect of his own housing options. It will be a matter for him as to how he rearranges his financial affairs in future but I am entirely satisfied that he has the potential liquidity and the flexibility to accommodate W's wish to live in 244FR. Accordingly, I shall order the transfer of that property into her sole name together with a lump sum of £200,000 as a conversion fund. Precisely how she applies that sum in terms of the work to be carried out will be a matter for her but that sum will represent the limit on H's obligation to contribute towards the cost of those works.
113. It will be a matter for him whether he retains 15PC or whether it is sold as part of an overall restructuring of his finances. However, there needs to be a moratorium in respect of W leaving that property since I am persuaded that at least some of the building work will need to have been completed prior to her move to 244FR. Mr Cohen has suggested that she may need to remain at 15PC for between 6 months and a full year. I do not think she will need this amount of time provided that the builders she instructs to carry out the work appreciate that they must operate within strict time constraints. She will need vacant possession to 244 FR before the builders can begin the conversion work. I am told that the property is currently tenanted. I shall leave the parties to work out the detail of implementing this aspect of my order, however, in my judgment and subject only to whatever notice needs to be given to the tenant, she should be allowed to remain in the former matrimonial home for a maximum of 6 months. During this period, H will be responsible for maintaining the financial status quo ante. However, if he chooses to sell 15PC, W's occupation should not preclude an orderly marketing of the property and she must co-operate with any viewings and the like provided that the estate agents who are instructed in any sale understand that vacant possession will not be given before the beginning of 2017. If W is able to move before then, I expect her to use her best endeavours to do so.
114. What then of her future income needs ?
115. As I have already said, the standard of living which these parties enjoyed during their marriage is one of the issues in this case. It is relevant because it is one of the factors which I have to consider as influencing, if not determining, an aspect of W's future needs. She told me during the course of cross-examination, and I accept, that H had little time for pension investments. He regarded the property portfolio as the source of their retirement income, had the marriage not foundered as it did. W's target in terms of her future income provision is the transfer to her of one of the prime commercial investment properties in IAS. The transfer to her of that property will provide an income stream of at least £140,000 per annum and more if she is able to renegotiate the letting arrangements. H opposes the transfer of that property not least because it provides him with a significant element of the income which he requires to discharge the mortgages on some of the properties in the commercial portfolio. Furthermore, he contends, through Mr Sear, that it would be wrong in principle to transfer non-matrimonial property to W when a cash lump sum would provide her with an appropriate Duxbury fund.
116. 5QG is undoubtedly non-matrimonial property. It was acquired in 2007 in substitution for another commercial property (29LS) which had been in H's ownership through IAS since 1983, many years prior to the celebration of this marriage. Although there was a shortfall which was required in order to complete the purchase, it is accepted that W made no contribution towards the purchase price and has had no meaningful involvement with the management or operation of IAS since its inception. For this reason alone, I do not regard the transfer of the property to be appropriate in circumstances where H accepts that he is in a position to raise a capital lump sum to meet W's future income needs. Furthermore, it is a trite proposition that a Duxbury fund is intended to provide the recipient with an amortised income-producing fund of capital. In seeking a transfer of 5QG W is looking not only to income generation but to capital appreciation, the antithesis of amortisation. Had this property been part of the marital acquest and thus fallen into a legitimate claim for sharing, I might have taken a different view. Duxbury is, after all, a tool and not a rule. However, in the particular circumstances of this case, I do not regard it as a fair outcome to H to extract this property from the commercial portfolio in order to meet W's claims in respect of future income generation.
117. In terms of the calculation of an appropriate Duxbury fund, I have looked carefully at W's budget. She accepted during the course of her oral evidence that her annual expenditure needs, put at just under £130,000 per annum, were capable of being trimmed in respect of certain categories of expenditure. For example, the figure she included in respect of the premiums on her private health insurance was some £1,500 per annum too high. She has claimed a little over £1,000 per month in terms of car expenses in circumstances where she does not drive. Sensibly, in my view, Mr Sear has accepted that this sum is not unreasonable especially if the cost of taxis is substituted for some elements of her travel budget.
118. Within her budget is provision for just under £20,000 per annum for holidays and weekend breaks. She was able to provide a detailed account of the extent to which she and H had travelled during their marriage. Since the closure of the nursing home in 2010, she has not taken any holidays but I am satisfied that regular holidays and cruises abroad were a feature of married life which both enjoyed. I am also satisfied that, for so long as her health enables her to do so, she will wish to fly to the United States at least once a year to visit her family.
119. That said, I accept that, with the closure of the care homes business, that source of income is no longer available as a potential resource to either H or W. Each must look to the existing capital resources to fund their respective retirements. Inevitably, economies will have to be made. H's future budget for himself is less than £70,000 per annum and a figure at this end of the spectrum is probably more of a realistic figure going forward for each rather than a figure in excess of £100,000 per annum.
120. Mr Cohen described H's budget as "hair shirt" in its sparseness. As originally formulated, it was closer to £90,000 per annum when an extra allowance of some £10,000 per annum was included for the cost of the additional domestic assistance he is likely to require as he becomes older.
121. There is sufficient money in this case to give each of these parties a decent, if not luxurious, standard of living for the rest of their days. Each is entitled to expect that and W has certainly earned it. In my judgment, an annual net income of £90,000 per annum will provide sufficiently generous pension provision to enable W to live comfortably. To produce this level of income, she will require a Duxbury fund of about £1.289 million.
122. On this basis, she would receive a housing fund of approximately £1 million (net of the cost of transfer) and £1.289 million for her income needs. This would provide her with a global award of £2.289 million, or £2.3 million in rounded figures. She already has just over £500,000 from the sale of her shares in HL Limited which, my judgment, must be taken into account because of the provenance of those funds. Thus, on a needs basis, she would require a sum of £1,020,000^[13] from H together with the transfer of 244FR.
123. That figure exceeds by a significant margin a 50% share of the notional marital acquest (see paragraph 109) but I am satisfied that W's needs cannot properly be met for less. I bear in mind that the balance will have to be paid from non-marital assets. Mr Sear reminds me that in cases where non-matrimonial property must be invaded to meet needs, the courts have been inclined to adopt a more restricted approach to the assessment of needs: see, for example, Baron J in NA v MA [2006] EWHC 2900 (Fam), [2007] 1 FLR 1760. In my judgment, W's contributions in this case have to be weighed in the overall balance of fairness and I am not persuaded that it would be fair in all the circumstances to reduce her overall needs below the figures set out above.
124. I have an obligation to consider all the factors set out in section 25 of the Matrimonial Causes Act 1973 in my overall approach to this case and I must reach a decision which is fair to both parties. Whilst I do not propose to rehearse in serial detail each and every one of those factors, I have borne them all carefully in mind. I have already said much about needs and resources in the course of my judgment. I have considered the ages of the parties and the contributions which each has made to this relationship and marriage which lasted, in total, for some seventeen years. It was not a short marriage by any means, however H seeks to characterise it, and I am satisfied that each of these parties in their own way made a full contribution.
125. Is the award to which I have referred above fair to H ?
126. A global award which leaves in W's hands assets of £2.3 million will leave H with over 75% of the wealth in this case. I am satisfied that such an award meets her needs. The fact that she is now in her sixties and therefore requires a smaller income-producing fund (often referred to as "the Duxbury paradox") cannot, in my view, be relied on as a good reason for increasing her share of the assets in a case based upon needs where there is a significant element of non-matrimonial property. Despite the fact that such an award is in excess of what H was prepared to offer on an open basis, having stood back to review all of these factors, I am satisfied that it is entirely fair to both parties. It gives proper weight to the origin of the assets as well as to the contributions made by W.
127. Accordingly, the order which I propose to make is as follows.

(i) H will transfer to W the property at 244FR on the basis that he will bear responsibility for any costs associated with such transfer.

(ii) W will be entitled to remain in occupation of 15PC for a further 6 months on the basis that, until she vacates the property, the current financial status quo will remain in place.

(iii) H will pay to W a lump sum of £1,020,000. As to the timing of this payment, I accept that he will need some time to restructure his finances. W has a significant amount of cash in the bank and she can use part of those liquid resources to fund at least the first stages of the conversion work to 244FR. I am content to leave the parties, with their legal advisers, to try to agree the detail of the order in this respect but will hear further submissions on the structure of the order if necessary.

(iv) W will transfer to H (i) her remaining shares in NE Limited; and (ii) her interest in the Malaga apartment.

(v) I hope and expect that there will be agreement as to the appropriate division of the matrimonial chattels.

(vi) Once W has received in full the lump sum from H and the appropriate property and share transfers have been made, there will be a clean break on usual terms.

128. In relation to costs^[14], I say only this at this stage. This is a needs case. I have factored both parties outstanding costs into the calculation of the net asset base. I hope there will be agreement that the appropriate order in this case is that there should be no order as to costs. If this cannot be agreed, I shall deal with any application either on the basis of a further short hearing or on paper.
129. All that remains at the end of a hard fought and difficult case for each of these parties is for me to wish them both well for whatever lies ahead. I hope that they will now be able to put the unhappiness and stress of these proceedings behind them and enjoy in comfort the retirement which each richly deserves.

Order accordingly

Note 1   In his section 25 statement (para 28), H states that she was awarded property with a value of between £1 million and £2 million at the conclusion of the Ghanaian divorce proceedings although she has never received any part of that award, the property having been put beyond her reach by her former husband (who has since died).     [Back]

Note 2   The house in Pennsylvania    [Back]

Note 3   And not 1998 as she said in her first statement    [Back]

Note 4   In his own evidence, H contends that he loaned W’s son a sum of £1.6 million which was intended to fund investments in some rented properties and a coal mine. That sum was apparently lost, on H’s case, when W’s son lost the money trading in foreign currency [B/C:30].    [Back]

Note 5   H’s evidence was that this card was written at a later point in time, probably 2002. If this was the case, it suggests that his affections for her subsisted for much longer than he now seeks to suggest.    [Back]

Note 6   I do not regard 18 August 1998 as necessarily being the actual date when W moved in to 15PC. Rather, I suspect that is the date on which she completed the form for submission to Companies House. I say that because I am aware that she had become a director and company secretary of NE Limited by 31 May 1998, although at that point in time she did not own any shares in the company. Both parties agree that she started to work in the care homes business within weeks of cohabitation commencing.    [Back]

Note 7   [B1/C:437]    [Back]

Note 8   Although W was never formally appointed as Managing Director, it is common ground that she was regularly held out as such to employees.    [Back]

Note 9   It appears from the draft tax report prepared by the SJE [A/E:96] that NE Limited was a corporate vehicle acquired by H some 46 years ago in 1970. He paid £12,000 for the shares in the company. It was used as a vehicle to acquire various properties over the years, including one of the hotels which he owned during his marriage to his first wife who held a significant quantity of shares in her own name. After her death, the majority of those shares passed to H with a minority interest (c. 2.3%) being held by their son, S. The hotel was sold by the company in 1989 and in or about 1991 NE Limited was used as the vehicle through which the care home in Ringwood was acquired.     [Back]

Note 10   In addition to the home he has purchased for T and the informal trust arrangement which has been put in place in respect of 379CR for the three children of his deceased daughter, K, H has also bought a property for his younger daughter which was purchased in the name of a bespoke corporate vehicle, SC Limited.    [Back]

Note 11   i.e. £1,052,481 plus £62,042 (DLA)    [Back]

Note 12   See paragraph 94: [A/D:44] .    [Back]

Note 13   [244FR (£780k) + £1.02m + £500k (HL Ltd proceeds)] = £2.3m    [Back]

Note 14   Including the costs reserved by Holman J in June 2015     [Back]