S v S

JurisdictionBermuda
Judgment Date28 July 2010
Date28 July 2010
Docket NumberDivorce Jurisdiction 2009 No. 88
CourtSupreme Court (Bermuda)

In The Supreme Court of Bermuda

Divorce Jurisdiction 2009 No. 88

BETWEEN:
S
Petitioner
v
S
Respondent

Mrs J MacLellan for the Petitioner

Mr J Pachai for the Respondent

The following cases were referred to in the judgment:

White v WhiteELR [2001] AC 596

Miller v Miller; McFarlane v McFarlaneELR [2006] 2 AC 618

J v J [2009] EWHC 2654

Abstract:

Ancillary relief - Lump sum payment - Clean break - 7 year marriage, 1 child - Husband is medical doctor with good earning prospects - Wife not working while child not in school but qualified as teacher - Husband Bermudian - Wife non-Bermudian - Valuation of former matrimonial home - Inherited property - Assets not acquired during marriage

JUDGMENT of WADE-MILLER, J

1. I shall refer to the parties as the husband and the wife although they are now divorced.

2. The petitioner, husband, is Bermudian and the respondent, wife, is Brazilian.

3. They were married on the 5th September 2002. The marriage was unhappy and they had counselling virtually from the commencement of the marriage. They finally separated in November 2008 when the wife left the matrimonial home. Decree Nisi was pronounced on the 24th July 2009 and made absolute on 1st October 2009.

4. There is one child of the family.

5. This hearing is in respect of an application by the wife filed on 8th July seeking the full range of ancillary relief - periodical payments, maintenance pending suit, lump sum provision, settlement or transfer of property, variation of a settlement and a property adjustment order.

6. On the first day of the hearing Counsel for the wife informed the Court that the wife abandons her claim for a transfer of property or a variation of settlement and was seeking an order for a lump sum payment.

7. The parties filed four affidavits two (2) by the wife and two (2) by the husband. Both gave oral evidence and were cross examined.

8. There is an agreed statement of facts. I have had the benefit of written and oral submissions from Mrs. MacLellan and Mr. Pachai Counsel for the husband and the wife respectively.

9. The wife is seeking a lump sum payment of two million dollars while the husband submitted that based on the circumstances of this case she is entitled to lump sum of $478,765.08.

Background

10. The husband is 44 years and the wife is 39 years old.

11. The parties were married on 5th September 2002. They separated in November 2008 the wife moved out of the former matrimonial home and moved into a two bedroom

townhouse. They were divorced by 1st October 2009; therefore the marriage lasted 7 years.

12. The only child of the marriage was born in October 2006 and is now 3 years and eight months. The parties have joint custody of the child but the issue of her care and control is the subject of opposing claims by the parties and is to be decided by the court at a later date. In the interim the parties jointly share her care and control. She attends a nursery three mornings per week from 9.00am to 2.00pm. In September 2010 she will be attending a foundation year program from 8.30am to 3.00pm daily.

13. Following a lengthy period of negotiations, the husband purchased the life interest in the property, in April 2002 and on 10th September 2003, from all the beneficiaries except one for $950,000. This interest is subject to a life interest owned by a Swiss national. There is no mortgage against the property.

14. The agreed statement of facts shows that the husband works as a general physician. He has a medical practice which operates under the umbrella of a Medical Center (MC) which was opened in December 2007. The Medical Center has a nominal value given its infancy and the debt associated with it.

15. The MC is owned by the C S Trust. MC owes the trustees of the C S Trust $135,608 and the husband $571,180.

The wife's income, expenses and earning capacity

16. The wife has no assets, property or any financial resources. Her income is minimal from her ad hoc earnings. She has been dependent financially on the husband. She receives $7,300 monthly from him. The wife has a car valued at $6,000. It continually breaks down and she expends a significant amount of funds to keep it running. The wife owes approximately $105,000 in legal fees

17. Before coming to Bermuda the wife worked full time as a pre-school teacher.

18. The wife is a qualified language teacher who speaks and writes fluent Portuguese and English. Early in the marriage she returned to Brazil where she completed her bachelors. She has a Bachelor of Arts degree in Portuguese and English. The husband defrayed the cost of this training. She has taught at a language institute and has had experience translating documents. She is licensed to teach these languages.

19. In 2009, while the husband looked after the child the wife took a computer course in order to endow herself with office skills. The husband paid for the course. The wife has a certificate effective 1st March 2010 which allows her to work in Bermuda without having to secure a work permit.

20. I am satisfied that the wife and the husband discussed and it was understood between them that once the child was in school she would return to work as a teacher starting about September 2010. I am also satisfied on the evidence that the wife can find employment as a teacher or in the first instance a teacher's aid which would give her remuneration of about $60,000 per annum. The child will be attending school from 8.30am to 3.00pm daily starting September 2010. I have had regard to the evidence I consider that by September 2011 the wife will be able to put into effect her earning competence as a teacher or teacher's aid.

The husband's income and earning capacity

21. The agreed facts show that the husband works as a general physician. He completed his training and had been established in his career before he met and married the wife in 2003. The husband inherited three properties from his grandmother prior to his marriage to the wife. He sold the properties in 2007 and put the cash proceeds of $3,140,531 of the sale in the C S Trust. The child of the marriage is the sole beneficiary of the trust. The wife is not and has never been a beneficiary of the trust. The C S Trust has investment in the amounts of $2,853,675.89 at Schroder as at 28th May 2010 and $680,003.04 as at 31st May 2010. In addition the husband has investment worth $454,911.24. I accept and find as a fact that the husband had

completed his medical training and established his medical practice long before he met the wife.

22. The husband's medical practice now operates under the umbrella of a Medical Centre (MC) which was opened in December 2007. MC is owned by the C S Trust. In order to open the medical centre the husband borrowed $500,000 from the C S Trust for 10 years with 6% interest and $767,757 from his personal savings. The Medical Practice owes the CS Trust $135,608 and the husband $571,180 as at 31st December 2009.

23. The husband works four mornings per week. He draws a salary of $13,801 per month from the business. He pays the wife $7,500 monthly - $4000 for rent and $3,500 for living expenses.

24. He has undertaken to pay all of the child's living expenses including educational cost (university as she chooses) medical and significant periodical payments to the wife for the child's maintenance.

The Assets

25. Mr. Pachai summarises the husband's asset position is as follows:

a. $2,825,675.89

The CS Trust

Schroeders

b. $ 680,003.04

The CS Trust

Barrington

c. $2,100,000.00

Former Matrimonial Home

Bethel Island

d. $ 57,000.00

Boats

e. $ 74,808.00

Pension

f. $ 38,000.00

Car

g. $ 135,608.00

Debt to CS Trust

h. $ 571,180.00

Personal loan from the Petitioner

$6,482,274.93

26. Mr. Pachai submits that the wife invites the court to require the husband to pay her a lump sum of $2 million, which is less than one-third of the husband's total assets, in full and final satisfaction of all claims.

27. Additionally the wife seeks an order for ongoing periodical payments in the sum of $6,500. This order would continue until such time as the wife secures sufficient full-time permanent employment, at which time the payment should be reduced to $4,500, depending on the level of income she receives from her employment.

28. Mr. Pachai submits that in contrast to the wife by virtue of the husband's profession, he has a significantly greater earning capacity both current and in the foreseeable future. He maintains that the husband is actively increasing his business, by recently employing an associate doctor. On the other hand the wife is only recently...

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