Marilyn Stowe Blog

Lykiardopulo v Lykiardopulo: when “different considerations” apply

Does it sometimes seem as if the very richest people think that wealth buys them immunity to say, do and act exactly as they please?

The New York billionaire Leona Helmsley was nicknamed “The Queen of Mean” and once said, famously, that “only the little people pay taxes”. Those words came back to haunt her. She discovered that in the eyes of a US court, she was a “little person” too – even though her husband owned the Empire State Building. Mrs Helmsley ended up serving a jail sentence for tax fraud. I was working on another case with her New York-based lawyers during this period. I remember being told that the army of lawyers working on the Helmsley case all slept in the office, not getting home for several weeks at a time. Even so, their efforts could not save their client. When a court gets mad, it gets mad.

I was reminded of Leona Helmsley’s attitude and undoing when looking over the recent case of Lykiardopulo v Lykiardopulo [2010] EWCA Civ 1315.

The Lykiardopulos are one of the oldest and most prestigious of Greek shipping families. When Panaghis Lykiardopulo and his wife Sally divorced, however, the Greek husband and two family members presented a case of breathtaking perjury to the court.

Their perjury was exposed and the wife was awarded a £20 million settlement. The original judge, Mrs Justice Baron, in her judgement found that “the husband, his brother and another influential family member had conspired to manufacture, for the purposes of the trial, documents which, on their face, were written in 2005 in order to terminate the husband’s involvement with the family business and to divest himself of his interest therein”. The conspiracy within the family was to present “forged and back-dated documents” to the court.

As practising family lawyers, we all have cases like this at one time or another; perhaps not at that “super rich” level, but perjury still happens. Some people are so desperate and determined to ensure that their spouse gets as little money as possible, they are prepared to take a risk and lie about it. Sometimes, however, those lies can be breathtaking in their size and arrogance, and the Lykiardopulo case is one of those. As the Court of Appeal pointed out, this was an act not of omission, but commission. Such breaches are serious.

The Lykiardopulo case was heard by the Court of Appeal because the wife sought to have the judgement published with the parties’ names released to the public. She claimed to have pursued the course of action for “public policy reasons”. As her lawyer, barrister Tim Bishop, put it: “this is the worst case of non-disclosure ever before the English courts”.

Could it be that the wife feared she would have major problems getting paid the money found due to her – and thought that this would be a weapon she could hang over the husband’s head?

When the wife’s lawyer made his point about non-disclosure, the judge said, “I doubt it”.

Undaunted, the lawyer continued. “It unquestionably is My Lady. It is a fraud involving £46.5 million to £100 million, it is an unrepentant fraud”.

To that, Mrs Justice Baron then replied: “It is nothing like the case that I dealt with a year ago that has been published on an anonymised basis. That was far worse than this…”

Yes, clearly there are those who take risks that the “little people” dare not. In the interests of overall justice, the Court of Appeal is there to weigh in on the side of right, regardless of the standing or status of those who appear before them.

As it happens, there were indeed problems with payment in the Lykiardopulo case. When the case came back before Mrs Justice Baron a few months later, she said: “I have made an order…I expect that order to be obeyed….If I do not feel the family are co-operating with the enforcement of this order..I might find of my own motion that it was part of my duty that the public should know how this family have operated. I do not want to do that because I do not want to ruin their business….I want my order obeyed”.

Stern stuff. But what happened? Several months later, the payment had still not been made. A hearing about the publication of the judgement took place in December. At that point Mr Lykiardopulo was claiming a “health condition”, arguing that exposure of his affairs in the media would exacerbate it. The wife, who had been put through years of miserable litigation, argued that her husband’s litigation misconduct should be fully exposed.

The judge decided on a halfway house: ordering reporting of the judgement but keeping the parties anonymised. The wife appealed and, as can be seen, her appeal was allowed.

The Court of Appeal comprises a fearsome bunch of judges. They have previously ordered the release to the public of details of a case involving the King of Saudi Arabia, when a lower court ordered it to be kept out of the public domain.

When the case of Lykiardopulo v Lykiardopulo came before the Court of Appeal, it was heard by three judges: Lord Justice Thorpe, Lord Justice Stanley Burnton and Lord Justice Tomlinson.

In his judgement, Lord Justice Thorpe concluded that the decision about publication was about striking a fair balance. He considered the arguments presented to him by the husband against publication, and dismissed them all. He did not accept that the family business would be adversely affected, that the health of the husband would be adversely affected, nor that there would be an adverse impact on the children. Lord Justice Thorpe thus ordered the judgement to be published, subject to redaction of sensitive commercial information. He also deplored the use of publicity as a tool for enforcement.

Lord Justice Stanley Burnton gave a much more robust judgement, which I liked. It was blunt and succinct.

He said: “Different considerations apply where the information and documents provided by a litigant are false. That litigant has no entitlement to confidentiality in respect of that information or those documents. They do not evidence his private life. In general there is no good reason why his conduct should not be made public”.

Lord Justice Tomlinson agreed with both judgements.

However much the court criticised the “name and shame” approach in theory, that is exactly what it did and it was right to do so.

I am not a fan of publishing judgements about couples who get divorced in this country. I believe that their private lives should remain private. I am sure that a lot of people read these judgements not just to digest the law (informative as this is) but also to gain fascinating insights into the finances and activities of some of the most glamorous and powerful people in the world. However if you choose to play games with the court, you should be prepared to suffer the consequences including, for those scions of ancient lineage, the worst of all: dragging your family name through the mud.

Twenty million pounds is a dizzying amount of money – but a relative drop in the ocean to the Lykiardopulo family. I can also only wonder if, had the truth been the told, the sum awarded would have been less. We cannot know, but I do know for sure that if a judge has to exercise discretion in a case, no-one can expect mercy if found to have committed perjury.

As for the family members who forged documents: their actions seem so pointless. If we are, all of us, only guardians of our wealth for the short time we are on earth, couldn’t that wealth be used more wisely by those who truly are as “rich as Croesus”? As Croesus (above) discovered for himself, wealth cannot always protect you against unpleasant degradation in real life.