Rorke’s Drift in the Family Division: A Tale of two judgments

Prest (Appellant) v. Petrodel Resources Ltd and Others (Respondent) 2013 UKSC 34 

DR v GR & others (Financial Remedy: Variation of Overseas Trust) 2013 1996 (Fam)

The preservation of the corporate veil, or the ability to achieve fairness for the economically weaker party in a divorce. For years the Family Division has had no doubt which was the more important. The concepts came head to head in two cases earlier this year. It does not seem likely that we have arrived at a final position, but it is instructive to see where things lie at this stage.

To explain the position, Henry Hood first reviews Prest v Petrodel Resources Ltd and particularly the speech of Lord Sumption who sets out the relevant facts and some of the history of the Family Divisions approach to issues concerning the corporate veil. It is no secret that he, as the majority in the Court of Appeal had before him, did not agree with that approach and he arrived at a statement of principle which Lord Justice Thorpe (the dissenter in the Court of Appeal) described as giving to a husband who wished to avoid his obligations “a fast car and an open road” Was the game up?

Those who thought so reckoned without Mostyn J who in DR v GR might have found a way round the difficulty which all of us in operating in the Family Division think we face. However, whether these efforts will survive the attentions of the Higher Courts must be doubtful.

Read the full article, in UKSC via a PDF, here.