How to deal with divorcing clients

Andrew Haines, law consultant at Andrew Jackson, discusses the dos and don’ts for clients whose marriages have broken down

A recent series of high profile cases highlights an increasing number of celebrity spouses, who allege the other has hidden assets, and who take documents and computer information to court to back up their arguments. The resulting hearings have proved acrimonious and expensive.

With a growing number of clients turning to their trusted professional advisers upon divorce, it is useful to look at recent cases and ask what we can learn from the outcomes.

Before looking at some dos and don’ts for divorcing clients, I will first summarise some ongoing cases which have made the headlines recently, and which will no doubt impact upon future divorce outcomes.

In a highly publicised case, celebrity chef Marco Pierre White has obtained permission to claim damages against his wife, Mati White, and Withers, her solicitor, after she removed 42 documents including a letter from Letty, his daughter from a previous marriage, asking to see more of him.

White had not seen these until they were produced in Court. Lord Justice Ward described the letter as, “Touching… heartbreaking, which desperately called for a speedy reply.”

White alleges his wife told him the lawyers had advised her to intercept his mail and take the documents. The Court of Appeal held the lawyers had “at least a case to answer”.

White’s action is expected to be heard in the autumn. Family lawyers are concerned that if White is successful this may result in a spate of similar claims. Despite permitting White to pursue his civil case for damages, the Court has permitted Mrs White to use the evidence she improperly obtained in the divorce case where she is alleging he threatened to leave the country, that he would “pull the plug” and had sold everything for £1 and owned nothing. White denies the allegations.

A rather different twist arises in the recent case of Scot Young, who gave a computer to his daughters to use for exams. Wife Michelle, who is arguing over his alleged £400m fortune, used experts to retrieve his encrypted financial information from the hard drive and is sending this to the Inland Revenue so it can unlock the fortune that he claims no longer exists.

Mr Young told the High Court he was bankrupt and has failed to pay a £27,500 per month maintenance order. He also has a suspended six-month prison sentence for contempt of court in failing to properly disclose his assets.

When Vivian Imerman (former owner of Del Monte foods and Whyte & McKay whisky) sent his chauffeur to remove the bullet-proof Rolls Royce used by his estranged wife Lisa Tchenguiz from the garage where it was being serviced, her brothers removed an estimated 2.5 million pages of documents from a computer in the office they shared.

The password protected information was loaded onto two memory sticks and included documents setting out his personal finances and family trusts. The brothers argued Mr Imerman, whose wealth was estimated at £500m, claimed he had no money and his wife would get nothing in the divorce.

In civil proceedings against the brothers, orders were made to return the documents and preventing disclosure of their contents. The brothers were also ordered to pay costs. The Family Courts were left to decide which – if any – of the documents could be used by Lisa in her divorce. The brothers recently appealed to the Court of Appeal whose decision has been reserved.

In the divorce, Mr Justice Moylan described the brothers’ actions “as being at the extreme end of the range of behaviour I have seen during the course of the past 30 years”.

He ordered Lisa to pay costs estimated at £1m-plus and that after removing privileged documents the files should be returned to Lisa’s lawyers, arguing she had now seen the material and it was too late to stop her using the impact on clients files.

So what impact might these cases have upon your clients whose marriages have broken down? These and other recent cases appear to amend the ‘Hildebrand’ rules, which provided guidance on the rights and wrongs of ‘self help’.

Lawyers and clients are now placed in a difficult position of gauging whether or not evidence obtained by self help can be used and also whether they may be liable for costs and/or damages. The outcome of the White and Tchenguiz cases should provide some clarity for both lawyers and clients. In the meantime, it is worth looking at the main principles considered by the courts:

• The rights of the parties to respect for their private lives, correspondence and for these not to be unfairly invaded through self help;
• that in litigation the truth should be revealed;
• and that the court should not encourage parties to use unlawful means to obtain information.

What you can do in a divorce

• Copy any documents freely available unless legally privileged;
• Copy any electronic information not security protected; and
• Lawyers must disclose to the other party all such information received.

What you can’t do in a divorce

• Break in or cause any damage to obtain information including computers (this may change with the result of the Tchenguiz appeal);
• keep originals;
• use privileged information;
• disclose information to third parties except the court and professional advisers; and
• IFAs must not assist or encourage clients to use improper means and can be liable in damages if they do. There is also a possibility of disciplinary sanctions from their professional body.

At the least it is clear parties breaking the rules will be ordered to pay costs. Remember, criminal penalties can also arise for theft, interference with post, damage to property, misuse of computers and phones or by encouraging such activities.

The Court must conduct a balancing exercise and weigh the need for truth and disclosure against the methods used to obtain it. The more extreme the irregularity of the behaviour the greater the need will be to justify this. The answer may well lie, as suggested by Mr Justice Sedley in the White case, that in cases of conflict between establishing the truth by seizure of documents and a claim for damages he believed the Court’s approach would be “to choose doing justice between spouses”.

Until the Courts provide greater clarity, IFAs must exercise great care in advising clients in cases of self help and should always seek guidance from their lawyers.

Professional Adviser, www.ifaonline.co.uk [2010-06-10]