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Moutreuil v Andreewitch & Anor [2020] EWHC 252 (Fam)
27th February 2021
The case concerned a committal application made against a litigant in person for non-compliance with a freezing order.
Ms Moutreuil, the claimant (“C”), and Mr Andreewitch, the defendant (“D”), cohabited for 20 years, they had five children but never married. On the breakdown of the relationship, C issued three parallel sets of proceedings in order to determine her beneficial ownership of shares in “the company” (the company also owned the former family home): Children Act proceedings; Schedule 1 proceedings; and proceedings under Part 7 of the Civil Procedure Rules.
C’s substantive case was that she owned shares in the company. As such, a freezing order was made against D on 22nd March 2019 preventing him from disposing of: the former family home; shares in the company; or any assets of the company (“the freezing order”).
Despite this order, H transferred significant funds out of the company bank account. C issued an application for D’s committal under Part 37 of Family Procedure Rules (“FPR”). The question of D’s breach turned on the construction of the freezing order.
Mrs Justice Lieven set out that a breach of an order does not require a wilful breach [18] (Pan Petroleum AJE Limited v Yinka Folawiyo Petroleum CO Ltd [2017] EWCA Civ 1525).
However, Lieven J did stress the relevance of the “contemnor’s state of mind” to the court’s decision of whether or not to commit a party – as opposed to merely investigating further and making an order for costs [19].
It was C’s case that D, in breaching the freezing order, treated the company’s bank account as his “personal piggy bank”; this included food shopping and a transfer of £20,800 for legal fees [11].
D accepted that he: a) understood the terms of the freezing order; and b) that he made the payments. However, D maintained that the payments were not in breach of the order. D claimed the transfers were necessary to meet company liabilities – including legal fees. D also justified the personal spending stating he was entitled to a ‘salary’ as director. Finally, D argued that he needed money to live [22] – [30].
Lieven J found both that C’s application had complied with all of the necessary rules under Part 37 FPR and that, applying the criminal standard of proof, D had breached the freezing order.
First, there was no documentary evidence supporting D’s case: no evidence of salary; no evidence of liability; and evidence that H had other fund available to meet his living expenses. Second, when assessing D’s credibility, Lieven J found D to be dishonest and “making matters up as he went along” [32].
