WALES/ENGLAND – Judge hits out at wives who demand ‘completely inappropriate’ payments as hotel boss battles £2.75m divorce case

• Lord Justice Thorpe said ‘big’ payouts should be consigned to history
• He made comments while presiding over a case involving multi-millionaire hotel boss Andrew Morris Davies

The days of wives receiving multi-million pound divorce payouts from wealthy husbands could be numbered after one of the country’s top family judges slammed such claims.

Lord Justice Thorpe said payouts in ‘big money’ divorces, where wives feel it is ‘reasonable’ to ask for millions to maintain the lifestyle they are accustomed to, should be consigned to history, adding: ‘We only talk about “needs” when there isn’t a lot to go round.’

The judge made the comments when presiding over a case in which multi-millionaire hotel boss Andrew Morris Davies, is battling to get a £2.75million divorce payout awarded to his ex-wife Debra Ann Davies cut.

   

 Debra Ann Davies (left) leaving the Appeal Court. She is involved in a bitter divorce battle with her multi-millionaire hotelier ex-husband Andrew Davies (right)

Mr Davies was ‘in love’ with his business, The Cardiff Hotel, in exclusive Norfolk Square, Bayswater, West London, and described himself as ‘a force of nature’ to Judge Martin O’Dwyer who made the award to his ex-wife.

She helped run the hotel for 13 years before the couple split, and in August last year, Judge O’Dwyer recognised her contribution to the success of the business when he awarded her a £2.2million lump sum, plus the £550,000 former matrimonial home, in Friars Way, Acton.

That payout was largely made up of a one-third share in the £6m value of the hotel building and business.

Mr Davies reacted angrily to the award, insisting that – whilst his wife was ‘the second best receptionist’ he ever had – she should not get a share of the hotel’s value because she was just a paid employee who ‘simply did her duties’.

Today he asked Lord Justice Thorpe, Lord Rimer and Lord Justice Elias sitting in London’s Appeal Court to slash her payout.

Mr Davies, 50, married his Australian wife, 39, in 2005, and they had two children, but the couple had been together- with Mrs Davies working up to 17 hours-a-day helping run the hotel business – since 1997. However they split after just four years of marriage.

The court heard the hotel had been passed to Mr Davies and his two sisters by their parents, and Mr and Mrs Davies bought out his siblings’ shares during their marriage.

Having heard that Judge O’Dwyer had assessed Mrs Davies’ claim, ‘in terms of pure need’, at £1.55million and had then upped her payout to £2.7million because of her contribution to the success of the hotel, Lord Justice Thorpe said:

‘Any mention of needs is completely inappropriate in a case of this scale. We only talk about needs when there isn’t a lot to go round.

‘In a case like this, which is loosely categorised as ‘big money’, needs should not make much of a contribution to judicial reasoning.

‘The bigger the family fortune, the less relevant needs became. In big money cases, the wife will often get twice what she needs. I don’t see what bearing needs have in this case.’

Peter Duckworth, for Mr Davies, argued that the hotel had been a ‘gift’ by Mr Davies’ parents, Morris and Gwyneth, to their children, and the judge had over-estimated the value of the ex-wife’s contribution.

‘The affairs of the Cardiff Hotel were at all times kept separate. The wife had no say in how the business was run, or any share in the profits – rather, she was paid a wage,’ the barrister said, adding that judge O’Dwyer had been wrong when he found that the business was ‘entirely valueless’ in 1997 before Mr and Mrs Davies began working there together.

Saying that, before the wife had any input, the business had produced a post tax profit of £250,000, the barrister said: ‘The judge found that the hotel was wholly valueless in 2007. In reality it was a cash generator.’

Insisting that the couple had done no more than take advantage of the valuable gift provided by Mr Davies’ parents, the barrister added: ‘They didn’t add value to the business- they just took what was there and exploited it.

‘Judge O’Dwyer accepted the wife’s evidence that she had basically turned the business around – She takes credit for the great rise in company turnover.

Mr Davies asked Lord Justice Thorpe, Lord Rimer and Lord Justice Elias sitting in London’s Appeal Court to slash his wife’s payout

‘But the value of the hotel business has varied in relation to the state of the economy, and there was nothing to suggest that the wife contributed to the value of the business,’ Mr Duckworth said.

In her evidence to Judge O’Dwyer, Mrs Davies said she and her husband had ‘worked ceaselessly’ to transform a ‘dowdy and unwelcoming’ hotel with ‘no sense of customer service’ into a successful and lucrative business.

‘We threw ourselves into it wholeheartedly,’ Mrs Davies told the court, explaining why she felt she was entitled to a share of the value of the business.

‘Mr Davies was burning to make the hotel work. He was in love with the hotel. His characterisation of his wife was as a good employee. He said she had been the second best receptionist he had.’

Judge O’Dwyer

She said she had built and designed the hotel’s first website and transformed its advertising, as well as working extremely long hours, whilst living with Mr Davies in a 9’x8′ room on the premises before they bought their home.

Jonathan Cohen QC, for Mrs Davies, said: ‘The husband in his case was seeking to diminish the wife’s contribution and in that he failed squarely.’

He added that, by virtue of her hard work at the hotel, as well as raising a family, the wife deserved every penny of her award, regardless of whether or not her ‘reasonable needs’ had been over-estimated.

‘When one comes to look at fairness, which is the touchstone of all these cases, this award is at the low end, bearing in mind that this was a lady who made a very active contribution to the business for 13 years and when the marriage broke down was left with two children,’ said Mr Cohen.

Judge O’Dwyer, in his ruling last year, had acknowledged Mr Davies’ fierce love for his business, and observed: ‘There is a third party in the relationship- the Cardiff Hotel.’

‘Mr Davies was burning to make the hotel work. He was in love with the hotel. His characterisation of his wife was as a good employee. He said she had been the second best receptionist he had.’

Although Mr Davies had at one time been ‘head over heels in love with her’, the judge said there was now ‘no real acknowledgment by him of her commitment to him both before and after the marriage.’

‘He has a great love of the hotel and a strong sense of entitlement to it.’

Dealing with Mr Davies’ view of his ex-wife’s role at the hotel, the judge said: ‘It was his case that, because she had been paid as an employee, she had simply done her duties.’

Lords Justice Thorpe, Rimer and Elias reserved their decision on Mr Davies’ appeal, to be delivered at a later date.