P v P

• Jurisdiction: Bermuda
• Court: Supreme Court (Bermuda)
• Judge: Richards, J.
• Judgment Date: 15 May 2025
• Year: 2025
• Docket Number: 2024: No. 49

P

and

P

Richards, J.

2024: No. 49

Supreme Court

Appearances:

Changez Khan & Alma Dismont of Marshall, Diel & Myers for the Applicant.

Adam Richards of Richards Ltd. for the Respondent.

Keith Robinson and Matthew Rhodes of Carey Olsen Ltd. for (REDACTED)

RULING

INTRODUCTION

Richards, J.

1 The Applicant Wife and Respondent Husband were married on 16th June 2012. A Conditional Order for Divorce was made on 30th August 2024. Although the Wife asserts in the Affidavit filed in support of this application, dated 21st April 2025, that the Divorce is yet to be made final, there is present within the Court file a Certificate doing just that, dated 1st April 2025. If the parties have not received copies of the same, they should indicate as much. Both parties have made applications for Ancillary Relief, which are yet to be determined. The Acting Registrar awarded the Applicant interim maintenance on 21st March 2025.

2 I have before me a Summons seeking the following:

• “(i) That the time for service of the Summons be abridged [which it effectively has been].

• (ii) That the Trustees, (REDACTED), be joined as necessary to these proceedings.

• (iii) That further orders be made as this honourable court deems reasonable adjust (sic) so as to prevent (REDACTED) in any way from altering, varying or restructuring the (REDACTED) Trust and disposing of, transferring, encumbering, or otherwise dealing with the assets of the (REDACTED) Trust, namely the (REDACTED) Hotel, pending the final determination of these Ancillary Relief proceedings or further order of the Court.

• (iv) The costs of this application be awarded to the Applicant on an indemnity basis.”

3 The Summons was filed on 21st April 2025, seeking an urgent hearing and listed as swiftly as the Court and Counsel's availability would allow, on 29th and 30th April 2025. I received written and oral submissions from Mr. Changez Khan on behalf of the Applicant and Mr. Adam Richards on behalf of the Respondent. Mr. Keith Robinson also made oral submissions on behalf of the (REDACTED) (“The Trust Company”). Naturally enough, the arguments before me focused on paragraphs (ii) and (iii) above. The Respondent and the Trust Company resisted them both.

4 Before turning to the relevant law, the arguments and my analysis, it is necessary to set out some relevant factual background.

FACTUAL BACKGROUND

5 On 17th October 2022, the Applicant and Respondent jointly settled a discretionary trust (“the N Trust”). The Trust Company was appointed as and remains the sole Trustee. The Respondent was appointed as and remains the sole Protector of the Trust (with the power effectively to remove the Trustee). The beneficiaries were and remain: the Applicant, the Respondent and the Trust Company in its capacity as Trustee of another trust (“the M Trust”). The M Trust was settled by Mr. H, who is also its beneficiary. He is further the Managing Director of the Trust Company, which is the Trustee of the M Trust.

6 The N Trust was created in order to acquire a business known as (REDACTED) (‘the Hotel’). The Hotel (the premises and the business) is actually owned by a company, which purchased it in December 2023 (completion did not occur until May 2024). 100% of the shares in that company are owned by the N Trust.

7 The purchase of the Hotel was financed as follows:

• (i) A loan of $1,000,000 from the M Trust (pursuant to a Promissory Note and giving the M Trust no equitable interest in the property held by the N Trust);

• (ii) A loan of $1,000,000 from the Respondent's father (which the Applicant asserts a belief was actually generated by the Respondent during the marriage and held beneficially for him by his father);

• (iii) A loan of $2,370,000 from the Bank of N.T. Butterfield & Son, secured by way of mortgage and personal guarantees.

• (iv) $500,000 from the joint personal savings of the Applicant and the Respondent.

8 It appears common ground that the Hotel will have to be sold and that, in due course, the proceeds of such a sale (once the loans or at least some of them have been repaid) will form part of the matrimonial assets that the Court will have to divide (unless agreement can be reached). What is not agreed is when and how the Hotel should be placed on the market, with a view to its sale.

9 When the Hotel was last marketed, it was at $5,000,000, and the offer accepted was $4,675,000. According to material before me, it was previously sold in 2015 for $4,500,000.

10 Within her application for Ancillary Relief (dated 28th November 2024), the Applicant sought a business valuation in relation to the Hotel. The Application for Ancillary Relief was, in due course, supplied to the Trust Company. On 4th March 2025, Mr. H responded in the following terms:

“Please be advised that we are agreeable to a valuation being undertaken on [the Hotel] and have no plans to sell this trust asset until matters are agreed between [the Respondent] and [the Applicant].”

11 Directions were given and there was to be a hearing in that regard on 25th March 2025_ The day prior, the Respondent's Counsel wrote to the Court seeking the delisting of that hearing, stating that: “The parties have made significant progress in agreeing the way forward on these issues.” Ultimately, however, the parties were not able to come to an agreement on the terms of the instruction of an expert to value the business, although a suitable expert was identified.

12 By letter dated 21st April 2025, Mr. H wrote to the Applicant's Counsel:

“Given the poor financial performance of [the Hotel], we think it advisable to put [the Hotel] back on the market at $5,000,000 and see what offers we receive. Given that we paid $4,675,000 for the Hotel, we consider this a reasonable starting point. Of course, we would circulate all offers received to all beneficiaries of the trust for comment before any offer is accepted.”

13 The present application has been filed in response to that change of position by the Trust Company (which the Respondent supports).

THE LAW

14 Mr. Khan has sought to persuade me to intervene to prevent the Hotel from being marketed and sold; something he says I can do either in the exercise of the specific statutory jurisdiction conferred by section 41 of the Matrimonial Causes Act, 1974 (“MCA”) or under section 19(c) of the Supreme Court Act, 1905 (“SCA”) or (if it be distinct from the latter) by reason of this Court's inherent jurisdiction. Although Mr. Richards and Mr. Robinson seemed a little reluctant to concede as much, I do not doubt that, one way or another, the Court has the power to grant relief that would achieve what the Applicant seeks. To my mind, the question is really whether it is appropriate to do so in these circumstances; whether the applicable legislative and/or common law conditions are satisfied.

15 Section 41 of the MCA provides as follows:

41 Avoidance of transactions intended to prevent or reduce financial relief

• (1) For the purposes of this section “financial relief” means relief under any of the provisions of sections 26, 27, 28, 31, 35 (except subsection (6)) and 39, and any reference in this section to defeating a person's claim for financial relief is a reference to preventing financial relief from being granted to that person, or to that person for the benefit of a child of the family, or reducing the amount of any financial relief which might be so granted, or frustrating or impeding the enforcement of any order which might be or has been made at his instance under any of those provisions.

• (2) Where proceedings for financial relief are brought by one person against another, the court may, on the application of the first-mentioned person—

  • (a) if it is satisfied that the other party to the proceedings is, with the intention of defeating the claim for financial relief, about to make any disposition or to transfer out of the jurisdiction or otherwise deal with any property, make such order as it thinks fit for restraining the other party from so doing or otherwise for protecting the claim;

  • (b) if it is satisfied that the other party has, with that intention, made a reviewable disposition and that if the disposition were set aside financial relief or different financial relief would be granted to the applicant, make an order setting aside the disposition;

  • (c) if it is satisfied, in a case where an order has been obtained under any of the provisions mentioned in subsection (1) by the applicant against the other party, that the other party has, with that intention, made a reviewable disposition, make an order setting aside the disposition;

  and an application for the purposes of paragraph (b) shall be made in the proceedings for the financial relief in question.

• (3) Where the court makes an order under subsection (2)(b) or (c) setting aside a disposition it shall give such consequential directions as it thinks fit for giving effect to the order (including directions requiring the making of any payments or the disposal of any property).

• (4) Any disposition made by the other party to the proceedings for financial relief in question (whether before or after the commencement of those proceedings) is a reviewable disposition for the purposes of subsection (2)(b) and (c) unless it was made for valuable consideration (other than marriage) to a person who, at the time of the disposition, acted in relation to it in good faith and without notice of any intention on the part of the other party to defeat the applicant's claim for financial relief.

• (5) Where an application is made under this section with respect to a disposition which took place less than three years before the date of the application or with respect to a disposition or other dealing with property which is about to take place, and the court is satisfied—

  • (a) in a case falling within subsection (2)(a) or (b), that the disposition or other dealing...