Superyacht case demonstrates problems enforcing orders

Superyacht case demonstrates problems enforcing orders

Lauren Preedy - Senior Associate Solicitor - Head of Divorce and Relationships Team

Lauren Preedy – Senior Associate Solicitor – Head of Divorce and Relationships Team

Obtaining a financial remedy order should signal the end of divorce proceedings. The terms of the order simply need to be implemented, and matters will then be concluded.

Unfortunately, it is not always so simple. Obtaining the order may just be the start of the problems, as a case that is back in the news all too clearly demonstrates.

The case concerns the divorce of Russian oligarch Farkhad Akhmedov, which was in the news just last month when Mr Akhmedovc’s son Temur was ordered by the High Court in London to pay some £75 million to his mother, Tatiana Akhmedova.

To recap, in 2016 the High Court ordered Mr Akhmedov to pay to Ms Akhmedova the sum of £453 million, and since then Ms Akhmedova has been endeavouring to enforce payment of the award.

As part of those endeavours Ms Akhmedova has been attempting to seize a superyacht belonging to Mr Akhmedov, said to be worth some £350 million. The yacht, called Luna, is presently docked in Dubai. Ms Akhmedova applied to a court in the Marshall Islands, where it is registered, to take over ownership of Luna, as part of the divorce settlement.

However, the court has said that it has no power to enforce a change of ownership, and that only a court in Dubai can do that.

To date, Ms Akhmedova has reportedly only recovered about £45 million of her settlement.

The case may involve huge wealth, but it is a reminder of the problems that anyone can face in enforcing a financial remedies order. Indeed, potential issues with enforcement should be considered even before proceedings begin, as an order that cannot be enforced is obviously not worth the paper it’s written on.

Meeting about enforcing orders

Methods of enforcing orders

So what methods are available to enforce a financial order?

The answer largely depends upon what type of order has been made.

If it is simply an order that the other party pay a lump sum of money then there are a number of options. For example, requesting the court bailiff to seize goods belonging to the other party, so that the goods can be sold and the proceeds used to pay the lump sum.

Another possibility is obtaining a ‘third party debt order’, directing a third party who owes money to the other party, for example their bank, to pay the lump sum.

And a third possibility is obtaining a charge on the other party’s property, so that the lump sum can subsequently be recovered by seeking an order that the property be sold.

A fourth possibility, although quite rarely used, is the ‘judgment summons’. This requires the other party to attend court to explain why they should not be committed to prison for failure to comply with the order. Most committal orders are suspended on condition that the party pay the amount due by a certain date, or by specified instalments.divorce and enforcing orders

Moving on, many financial remedy orders made on divorce include orders relating to property, in particular the former matrimonial home. The orders may require that the property be sold and the proceeds divided, or that one party transfer their interest in it to the other.

If such orders are not complied with then it may be necessary to ask the court to enforce them. For example, if a party living in the property is not cooperating with an order for sale, the court can order them to deliver up possession of the property, to enable the sale to proceed. And if one party refuses to sign over the property to the other then the judge can be requested to sign it over on their behalf.

Lastly, if the order requires one party to pay maintenance to the other then an attachment of earnings order may be appropriate, if the paying party is employed. The order requires their employer to deduct the maintenance from the party’s salary, and pay it to the court.

As the Akhmedov case shows, enforcement of financial orders can be difficult, complicated, and time-consuming. Anyone seeking to enforce an order should therefore seek the advice of an expert family lawyer.

Ian Walker team

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