By Beatrice Carro, Paralegal
A wife’s application for maintenance pending suit, within financial proceedings considering whether to uphold a prenuptial agreement made in New York, results in the judge awarding interim maintenance to the wife of £GBP71,300 per month pending the final resolution of the case.
Mr Michael Fuchs (“husband”) is 62 and holds German and US citizenship. Mrs Alvina Collardeau-Fuchs (“wife”) is 46 and holds French Citizenship.
When the parties met in New York, the husband was a successful property developer, and the wife was a journalist. The parties began cohabiting in 2008 and were married in 2012.
Prior to their marriage, the parties entered into a pre-nuptial agreement. Both parties received advice from distinguished New York lawyers, and each disclosed their financial circumstances to the other. At the time of the prenuptial agreement the husband’s net worth was said to be US$1.064 billion and the wife’s US$4.471 million.
The parties executed a modification agreement (“agreement”) in 2014 which increased the financial provision to the wife. No suggestion has been made to date that the process leading to the agreement was deficient or that there was any pressure on the wife to enter into it. The effect of the agreement, if implemented, provided the wife with net capital of £23.5 million and 18 years of rent-free accommodation in their home.
The parties enjoyed an extremely high standard of living during the marriage. They lived in a £30.2m home in London with their two children (aged 6 and 3) and employed an array of staff. The parties owned another real property in London, a villa in the south of France, and a penthouse in Miami. They enjoyed regular holidays, including in their homes overseas.
The parties separated in March 2020 and the wife issued her divorce petition in London on 22 December 2020.
The husband sought to hold the wife to the terms of the agreement and issued an application to the court to this effect on 30 March 2021. Procedural hearings and a negotiation hearing were scheduled ahead of a three-day final hearing listed for 10 October 2022.
In the meantime, on 13 September 2021, the wife made an application for maintenance pending suit (an application for interim financial provision) asserting that since separation the husband had reduced the financial provision he had supplied to her during the marriage. The wife contended that the husband no longer transferred monthly sums to her, had decreased her expenditure on his credit card, and failed to meet the outgoings on the family home on time (including the payment of staff salaries). The wife also sought payment of her legal fees which the husband had initially agreed to meet but had stopped doing so.
By the time this application came before Mr Justice Mostyn on 21 February 2021, the parties had spent a combined sum of £917,982 on legal fees.
At the hearing Mr Justice Mostyn ordered that the husband pay the wife £71,300 a month until the husband’s financial applications are determined and that he pay the wife’s outstanding legal fees immediately.
His Honour determined that the amount of interim maintenance he had ordered met the wife’s reasonable needs when considering the parties’ standard of living during their marriage, considering their expenditure since 2019. The husband also agreed to continue to meet the outgoings in relation to the family home and provided an undertaking (a promise to the court) that he would do so on time.
Whilst prenuptial agreements (known in Australia as Financial Agreements) are legally binding in Australia, if they comply with strict legal requirements outlined in the Australian Family Law Act (1975), this is not echoed in the UK and the latter does not automatically uphold these agreements if its jurisdiction is seized for divorce proceedings.
In this case, the husband was forced to make an application in the UK courts to have the parties’ prenuptial agreement made in New York upheld at a cost of nearly £1million in legal fees to him to date and these fees will continue to increase exponentially with the two further hearings listed.
Further, whilst proceedings are ongoing to determine whether to uphold the agreement, the husband was ordered to pay substantial monthly interim maintenance to the wife, meet all the outgoings in relation to the family home, and the wife’s legal fees.
This case provides a word of caution to those who hold Australian financial agreements and live in the UK or where jurisdiction can be seized for divorce in the UK by other means.