“Sham” separation allegation rejected in assets claim

The genuineness of a separation and minute of agreement came under scrutiny in a commercial court action, Work Legal E-Ltd v Allen [2015] CSOH 12, seeking recovery of payments which the liquidators claimed were gratuitous alienations.

The defender still wore his wedding ring, and no divorce had been concluded. The separation and transfer of property – disponed before the date of separation and before a minute of agreement had been executed – were designed to impede an investigation, said the pursuer.

While concluding that some of the defender's explanations for pre-separation transfers were “implausible”, Lord Doherty rejected the suggestion that the separation was a sham. The separation and minute of agreement predated the liquidator's intimation of claim by several months. The defender had a new girlfriend and appeared now to reside in Dubai. Accordingly, the Scottish court did not have jurisdiction to hear the claim.

Click here to view the judgment.