The High Court ordered a further €3.5 million in provision for a wife in judicial separation proceedings, including a pension contribution, staged lump sums and annual maintenance. The order followed a limited rehearing required by the Supreme Court, which had set aside parts of an earlier financial order and returned questions about extracting funds from the husband’s company and the tax effects.
The judgment, delivered by Mr Justice William M. McKechnie on 2 December 2005, concerned the parties identified as B.D. and J.D. The Supreme Court had left undisturbed the earlier findings on whether the sums could be extracted over two years and the commercial effects. It set aside the earlier lump-sum provisions and a €100,000 costs contribution, and remitted the two remaining questions to the High Court.
The judge accepted evidence that extracting money as director remuneration could produce a combined tax cost of 39.4%, rather than 47%, while noting that the company’s ability to recover tax deductions depended on its profits. He found that the lower rate was, on the evidence, highly probable. A proposed share adjustment giving the wife a stake in the business was rejected because it would require complex arrangements, lacked the husband’s cooperation and risked imposing uncertain business and legal consequences.
In determining provision afresh within the scope of the rehearing, the court ordered equal division of the family-home contents, with disputed items to be allocated on a “turn and turnabout basis”. The judgment noted that the wife had already received about €400,000 in investments and €500,000 under an earlier Supreme Court stay order.
The husband was ordered to pay a further €500,000 for the wife’s interest in the family home, which, together with 3.5 acres, would remain in his sole ownership. A further €1 million was to be paid by 28 February 2006, funded by borrowing secured on the family home. The court also ordered €500,000 to the wife’s pension fund within 14 days, and another €500,000 in four equal annual instalments beginning 30 June 2006, indexed to the consumer price index from the first payment.
Maintenance was set at €80,000 a year, taxable to the wife at 47%. The judge said the company could meet the associated cost and the other ordered payments without affecting its affairs or operations. He said the remaining assets, including the home and business, were sufficient to provide for the husband. Consequential orders remained to be addressed after counsel were heard.