Prison Term For Prest For Failing To Meet Terms Of Financial Order

Royal Courts of JusticePrest sentenced to prison term for failing to meet terms of order

One of the parties in the ground-breaking case, Prest v Petrodel, has been given a suspended prison sentence as part of action to enforce the terms of an order against him.

In June 2013 a lump sum of £17.5m plus periodical payments of approximately £300,000 were ordered to be paid by Mr Michael Prest to his wife Yasmin Prest.

When the payments were not forthcoming Mrs Prest began enforcement action which ended with Mr Justice Moylan handing down a four week term of imprisonment, suspended for 3 months.

While a term of imprisonment is not unheard of for non-compliance in family cases, it is not often heard of in other types of cases. Last year the entrepreneur Scot Young actually served time in prison for non-compliance with the requirements to disclose financial information in his divorce finance case.

gateImposing a term in prison is by no means a straightforward decision for a Family Court judge as an appropriate level of punishment must be balanced with the needs of the children of the family both in terms of seeing a parent and in there being fewer resources to care for children or maintain the family home if the jailed parent cannot work.

The Supreme Court, considering the case in June 2013, decided that Mr Prest’s beneficial interest in a number of corporate assets meant they could be subject to a financial order for ancillary relief upon divorce. Mr Prest maintained that he was not entitled to the assets and therefore they should not be included in his resources for distribution under any order.

The Family Division of the High Court had previously held that Mr Prest could in practice transfer the assets so he was ‘entitled’ to them. Mr Prest’s company, Petrodel, appealed the High Court decision, with that appeal being subsequently appealed by Mrs Prest herself to the Supreme Court.

The Supreme Court unanimously overturned the Court of Appeal decision and held that the assets in question were beneficially owned by Mr Prest under a resulting trust.

If you have any questions about business assets, or assets abroad, which you think might be relevant to a divorce settlement, talk to one of our lawyers with international expertise to find out if you could benefit from the principles in Prest v Petrodel.

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