Category: Articles

Elderly people and those who are vulnerable are sadly prime targets for rogue traders, but the law is not powerless when it comes to helping those affected. The successful prosecution of a rogue builder promises more than £200,000 in compensation for his victims.

The builder’s modus operandi was to con householders, mostly pensioners who lived on their own, into paying extortionate sums for unnecessary work that was shoddily carried out. One victim paid more than £300,000 for work which was assessed as being worth only £1,500.

The builder was ultimately jailed for five years and four months after pleading guilty to three counts of fraud and one of theft. Proceedings followed under the Proceeds of Crime Act 2002 and he received a confiscation order requiring him to pay £217,214. That sum represents the entirety of his available assets and the authorities intend to use it to compensate his victims for their losses, at least in part.

The facts of the case emerged as he challenged the order before the Court of Appeal. He argued that his matrimonial home and a bank account containing about £100,000 were his wife’s alone, although both were held in joint names. The Court rejected his appeal as entirely lacking in merit.

Some couples have second thoughts in the midst of divorce proceedings and get back together. However, in a unique decision, the High Court has ruled that the resumption of a toxic relationship does not amount to marital reconciliation.

The case concerned a wealthy couple who had been married for about two years when the wife petitioned for divorce. In doing so, she asserted that the husband’s behaviour was such that she could not reasonably be expected to continue living with him and the marriage had thus irretrievably broken down.

She obtained a decree nisi and, following financial relief proceedings, orders were made in accordance with the terms of a pre-nuptial agreement that both she and the husband had signed after taking legal advice. Provision was made for her housing, maintenance and other needs. However, she thereafter took no steps to finally terminate the marriage by obtaining a decree absolute.

Some years after the decree nisi was granted, the wife applied to rescind it. She did so on the basis that she and the husband had reconciled soon after it was issued and their marriage had thus continued. She asserted that her original divorce petition should be dismissed and the financial orders set aside. She acknowledged that the marriage had now finally broken down and, if her applications were granted, she intended to lodge a fresh divorce petition.

Ruling on the matter, the Court noted that it had not previously encountered a case in which a spouse sought to impeach an earlier decree nisi made in his or her favour. The wife’s applications were superficially curious and the facts of the case were very unlikely to be repeated in the future.

The Court observed that the wife’s motive in making the applications was purely financial in that the pre-nuptial agreement provided for her to receive increasing levels of financial provision depending on the length of the marriage. If the marriage had lasted for eight years, as she contended, as opposed to two, the level of her provision would therefore be substantially increased.

In dismissing the applications, the Court acknowledged that a relationship of sorts had resumed after the grant of the decree nisi. It was, however, as unhealthy and toxic as it had been since the early days of the marriage. Whilst they may have still referred to themselves as husband and wife, there was no mutual comfort or assistance and they obtained no enjoyment from each other’s society.

The Court found that it would be an abuse of language to describe the resumption of such a dismal relationship as a marital reconciliation. The original decree nisi was not granted in error in that there had indeed been an irretrievable breakdown of the marriage. The husband was granted a decree absolute, with the result that the financial orders would now, at last, take full effect.

HM Revenue and Customs (HMRC) may appear a very big battalion indeed but, with the right legal advice, individuals can succeed in overturning their decisions. Exactly that happened in a case concerning a couple who lost over £6 million in a disastrous attempt to buy a luxury holiday home overseas.

The couple entered into a contract to purchase off plan, for $25.9 million, two neighbouring villas on the island of Barbados as a holiday home for their family. They paid a deposit of over $5 million, and stage payments as construction targets were met brought their overall outlay to almost $11.3 million.

However, after the developer experienced cashflow difficulties arising from the 2008 financial crisis, building works were first delayed and then suspended. Although the couple retained rights to the villas, they were of negligible value in that the works were unlikely ever to recommence. The partially built villas stood derelict and the couple had yet to recover any of their money.

The couple, who calculated their joint losses at almost £6.25 million, sought to set that sum off against Capital Gains Tax (CGT) liabilities arising in subsequent tax years. After HMRC refused to allow them to do so, the couple lodged an appeal to the First-tier Tribunal (FTT).

In upholding the appeal, the FTT noted that it was accepted that they had acquired an asset when they contracted to purchase the villas and that they had suffered a commercial loss in that the villas were unlikely ever to be completed. They had paid the relevant sums to acquire, or enhance, their contractual rights and Section 38 of the Taxation of Chargeable Gains Act 1992 thus entitled them to deduct their losses from future CGT liabilities.

The law that allows someone who was dependent on a deceased person during their lifetime to make a claim against their estate if there is no, or inadequate, provision for them in the will is one of long standing (the Inheritance (Provision for Family and Dependants) Act 1975). However, many people think it applies only to blood relatives.

That this assumption is incorrect was emphatically confirmed in a recent case in which a 70-year-old woman was awarded £325,000 from the estate of a man with whom she had had a relationship lasting more than 20 years, the last seven of which they had spent together in the man’s home, which was the principal asset of the estate.

His will left his £1 million estate entirely to his two daughters, both of whom are comfortably off. When his former partner made a claim under the Act, they opposed it, contending that the relationship was not one of permanence and substance.

The judge concluded that the man had clearly had a responsibility to his partner and made the award.

In order to make a valid will, you need to know your own mind – and it helps to have a solicitor on hand to advise you. That was certainly so in a case in which a businessman left the lion’s share of his £1 million fortune to a friend and colleague a few weeks before he died from alcoholism.

Against medical advice, the man had discharged himself from hospital ten days before he signed his last will. He left his shareholding in his company – by far his largest asset – to a friend who had worked with him for over 20 years. The friend was also bequeathed 75 per cent of the residue of his estate.

The man’s widow and three sons, who received 25 per cent of the residue, challenged the validity of the will on the basis that the friend had brought undue influence to bear upon him at a time when he was extremely sick and vulnerable.

The High Court acknowledged that the friend, who had made all the arrangements for execution of the will, was in a position to exert influence. In upholding the will, however, it found that he had not overstepped the mark. The man had wished the company that bore his name to carry on after his death and had viewed his friend as presenting the best prospect of achieving that objective.

The friend may have encouraged or even persuaded him to sign the will, but the Court was satisfied that he had done so of his own volition and had not been overpowered. The evidence of the solicitor who had drafted the will – who was convinced that the businessman was of sound mind, although obviously unwell – was also a crucial factor in the case.

Adopting children from abroad can complete families and be of great benefit to all concerned. However, as a High Court case showed, it is fraught with legal pitfalls and should not be attempted without first taking specialist legal advice.

The case concerned a British citizen who adopted a child in Iran under Iranian law. The child had thrived in the adoptive placement. The parent launched proceedings in London, seeking recognition of the adoption in this country. The Home Office opposed the application on the basis that the criteria for recognition specified in the Adoption and Children Act 2002 had not been met.

Ruling on the matter, the Court noted that Iran has not ratified the Hague Convention on Protection of Children and Cooperation in Respect of Intercountry Adoptions. It is also not one of the countries where adoption is recognised by operation of the Adoption (Recognition of Overseas Adoptions) Order 2013.

The parent was domiciled in Iran at the time of the adoption and it was not disputed that the child had been legally adopted in accordance with the requirements of Iranian law. However, the Home Office argued that adoption in Iran does not have the same essential characteristics as adoption in England and that recognition should, for that reason alone, be refused.

The effect of an English adoption is to sever the legal relationship between the child and his or her biological parents. Section 67 of the Act provides that, if an adoption order is made, the child will be treated as if born to the adopter(s). Adoption orders made in this country can only be revoked in highly exceptional and very particular circumstances and such revocations are extremely rare.

The Court noted that those principles differ starkly from the position under Iranian law, where an adoption order does not extinguish the legal relationship between a child and his or her biological father. The threshold for revocation of Iranian adoption orders is also set at a much less demanding level.

The Iranian adoption had provided the child with much-needed security and stability. However, in refusing to grant recognition, the Court observed that the case turned not on the child’s welfare but on the interpretation of the legal principles through which English law recognises foreign adoptions.

The Court observed that an application for an English adoption order in respect of the child could be made under Section 49(3) of the Act if it could be shown that the child had been habitually resident in this country for 12 months. Any interference with the human rights of the child and the parent arising from the refusal to recognise the Iranian adoption was, in the circumstances, justified.