Keeping property within company structures fails to protect husband from divorced wife’s claims

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You may not kiss the bride: lifting the corporate veil - .PDF file.

In Prest v Petrodel Resources Ltd and Others [2013] UKSC 34, The sums at stake were significant, as his wealth was assessed to be roughly £37.5m.

It is an extremely well-established principle that a company has its own legal identity that is separate to, and independent of, its owners. However, in this case, the husband had failed on numerous occasions to give full and frank disclosure regarding the relevant companies. The court found that there was implicit evidence that the properties were effectively held on a resulting trust for his own benefit.

Since the husband was therefore entitled to the properties in his personal capacity, the court was then able to ‘pierce the corporate veil’ to ensure that the wife was not deprived of assets to which she would otherwise have been entitled, but for them being held in the name of the companies…

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