The value of a family business or business interest is treated as an asset and therefore part of the matrimonial pot to be distributed when it comes to negotiating a financial settlement on divorce or...
When meeting with clients to discuss their succession planning, many cannot recall whether their property is held jointly as joint tenants or jointly as tenants in common. The distinction is that with...
BANKRUPTCY: Williams v Bateman  EWHC 1760 (Ch)
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Aug 4, 2009, 06:06 AM
Article ID :85895
(Chancery Division; David Richards J; 22 July 2009)
The husband and the wife held the matrimonial home as joint tenants. When the parties were divorced the joint tenancy was severed by notice. In the same year a bankruptcy order was made against the husband. About 15 years later, following a rise in the value of the matrimonial home, the trustee in bankruptcy applied for a declaration in respect of the interests in the property, and for an order for sale. The judge made a declaration that the trustee had a 50% beneficial interest, with an order for sale. The judge made certain deductions in the wife's favour, including £37,245.50 by way of equity of exoneration and £11,250 representing the value of improvement works to the property. The wife appealed, arguing that the equity of exoneration figure should have been treated as a set-off against the trustee's interest in property, under Insolvency Act 1986, s 323(1).
The appeal was dismissed. It was fundamental to the operation of set-off under s 323 of the 1986 Act that there be liabilities each way between the bankrupt and the other person as at the date of bankruptcy. While there had been a contingent liability of the bankrupt husband to the wife as at the date of bankruptcy, there had been no liability due from her to the bankrupt husband. Therefore, applying s 323, the notion of setting-off the contingent liability to her against the husband's beneficial interest in the property had no place.