Freeths wins high court case ruling

Leading law firm Freeths has celebrated a significant victory in the High Court that allows the recovery of a multi-million-pound family gift deemed to be fraudulent. The firm represented Ed Thomas and Matthew Carter, appointed as trustees during the bankruptcy proceedings of Rai Hamilton following a dispute with his former business partner John Jones over various business-related issues. This situation resulted in considerable litigation concerning property and company holdings.

In mid-2016, the court imposed UK freezing orders aimed at preventing Mr Jones from transferring his assets. However, towards the end of 2016 and into early 2017, it emerged that Mr Jones gifted £3 million to his son, funds derived from a €100 million property deal in Luxembourg. This manoeuvre became problematic when Mr Hamilton won his case in court, as Mr Jones subsequently claimed he lacked the funds to make the required payment. In 2023, he faced imprisonment for contempt of court due to violations of the freezing orders, which notably did not cover any monetary gifts made to his son.

David Marsden, Freeths' property litigation partner, successfully led the legal team in arguing the case before the High Court. According to ICC Judge Prentis, Mr Jones was found to be attempting to evade payment to Mr Hamilton by transferring the £3 million to his son, which is now mandated to be repaid.

Reflecting on the court’s decision, David Marsden highlighted the importance of the ruling, stating, “This case is a useful reminder that to overturn transactions such as this, there doesn’t need to be any insolvency or even any fraud – it is the intention that counts. It is also a clear message to anybody hoping to avoid paying debts by gifting them away, that this carries wide-reaching consequences as - even if it looks legitimate, it can be challenged and reversed.” This landmark ruling reinforces the judiciary's stance on accountability and the complexities surrounding the transfer of significant assets, particularly in the context of creditor protection.