Business owners warned to take specialist advice following landmark divorce case
The Supreme Court ruling in favour of the wife of an oil tycoon against the companies owned by him has set a precedent for business owners says local family law specialist at Linder Myers.In what has been hailed as the biggest review of company law since Victorian times, the Prest v Petrodel Resources Limited case will potentially change how businesses are dealt with during divorce proceedings.
Sarah McCarthy, family law specialist at Linder Myers in Lancashir, said: “Previously in divorce matters, it was difficult to pursue a financial claim on behalf of one party against companies owned by the other when reviewing a fair financial settlement. The recent ruling has changed the ball game dramatically as Mrs Prest was successful in claiming a substantial settlement to be paid by the businesses owned by her husband - assets which would previously have been protected under company law.“This is good news for the party who may have given up a career in order to raise a family while supporting their spouse’s business endeavours, particularly in cases where assets have been deliberately hidden behind companies with the intention of avoiding paying a fair settlement upon divorce.
“Although company law still protects businesses set up in the correct way, the recent ruling sends out a strong message to those who may be using their companies with the intention of hiding assets from their spouse.” Sarah McCarthy is a collaborative law specialist and member of Resolution.