Helliwell v Entwistle: Some Troubling Aspects

I have been gratified to learn that King LJ in her judgment in Helliwell v Entwistle [2025] EWCA Civ 1055 has cited approvingly my judgment in Cummings v Fawn [2023] EWHC 830 (Fam), [2024] 1 FLR 117. I have reconsidered my reasoning in that judgment and have concluded that some of my language needs to be modified, as I will explain.

Whenever it is contended in a financial remedy case that a pre-nuptial agreement (PNA) should be set aside or disregarded on the ground of fraudulent non-disclosure the first question is, unsurprisingly, whether the alleged non-discloser has been guilty of fraud. Here the burden of proof is on the putative victim. If the answer to that question is yes, the next question is whether the non-discloser can resist the setting aside of the PNA. Here the burden of proof is on the non-discloser.

Consider the word ‘fraud’. It may be is used as a noun: ‘the wife practised a fraud on the husband’. It may be used as a verb: ‘the wife defrauded the husband’. When used as a verb it is transitive – it must have an object. It may be used as an adjective: ‘it was a fraudulent disclosure by the wife’. It may be used as an adverb: ‘the wife fraudulently under-disclosed her assets’.

Whichever way it is used there are always three essential components to its meaning. First, the conduct in question must be dishonest. Second, the perpetrator of the fraud must intend to achieve some form of gain; see Cathcart v Owens [2021] EWFC 86 at [30]. Third, someone must be prejudiced by the conduct – there must be a victim. In Welham v DPP [1961] AC 103, Lord Denning said:

‘It need not be anyone in particular. Someone in general will suffice. If anyone may be prejudiced in any way by the fraud, that is enough.’

In its report Fraud (LC 276 30 July 2002) at para 2.6 the Law Commission stated:

‘if two people agreed to make a dishonest gain without intending to inflict some form of loss, prejudice or detriment on another, it would probably not amount to a conspiracy to defraud. “Defraud” is a transitive verb. There cannot logically be a conspiracy to defraud if there is no victim, because there would be no-one who could be defrauded.’

Since Ivey v Genting [2017] UKSC 67 ‘dishonest’ means no more than that the defendant’s actual state of mind at the time of the transaction in question would be so found applying the objective standards of ordinary decent people.

Therefore, the first matter that had to be proved in Helliwell v Entwistle [2025] EWCA Civ 1055 was whether the admitted non-disclosure by Ms Helliwell (‘the wife’) was fraudulent. It would only be fraudulent if (a) her non-disclosure was dishonest, (b) she intended she would achieve some form of gain and (c) she intended Mr Entwistle would suffer some form of loss, prejudice or detriment. Here the burden of proof in the normal way was on Mr Entwistle (‘the husband’).

Although Ms Helliwell was guilty of grossly inaccurate disclosure of her fortune within the agreement it is surely debatable whether she was dishonest or that thereby she intended that the husband should suffer a detriment or that she should receive a financial gain. It is clear that the husband knew that the wife was very rich. In his judgment at [2024] EWHC 740 (Fam), Francis J said at [66], ‘It is clear from everything that I have heard that the husband knew that he was marrying into an exceedingly wealthy family’, and at [103], ‘It was obvious to the husband that the wife was extremely wealthy’. By deliberately choosing not to check the accuracy of the disclosure made to him on 18 June 2019 it is arguable that the husband was passively complicit in the falsities contained in Appendix A (which failed to disclose assets worth £48m) together with Recitals R and S of the PNA (which stated that full disclosure had been given).

In circumstances where the husband:

• knew that the wife was very rich;
• had agreed to enter into a PNA which prevented him from making a financial remedy claim in any circumstances;
• by sending the email drafted by the wife to his lawyers on 11 June 2019 had waived verification of the disclosure made by the wife; and
• suffered no detriment in consequence of the wife’s under-disclosure,

and where the wife achieved no gain by failing to give full disclosure, it is surely questionable that the wife was guilty of ‘fraudulent’ non-disclosure.

King LJ in para [123]–[124] found that the wife was guilty of fraudulent non-disclosure for the following reasons:

‘Where however, as here, the parties agree and record in the document the extent of and approach to be taken to disclosure, they are agreeing as to what information is to be made available to enable each of the parties to make a decision as to whether they wish to be bound by the terms contained in the proposed agreement. Wilful or fraudulent breach of that agreement such that the disclosure made bears no resemblance to the true wealth of a party is entirely different from the position in Radmacher. In my judgment, such conduct is capable of being material non-disclosure as it deprives the other party of the information that they have agreed is necessary in order for them to decide whether to agree to a pre-nuptial agreement in the terms proposed. … Since the husband in the instant case was deliberately deprived of information which it had been agreed that he should have, in my judgment, the agreement cannot stand.’

With respect, these reasons do not tell us why the wife was guilty of fraud. The deliberate withholding of information by her which may have influenced the husband’s decision-making faculties is relevant to the second stage of the exercise (see below). These reasons probably would suffice to make a finding of dishonesty but do not tell us what gain the wife would achieve by not disclosing the true figure or what detriment the husband would suffer by being kept in the dark.

I turn to Stage 2 of the exercise.

In her judgment at [98]–[101] King LJ applied the principles set out in Sharland v Sharland [2016] AC 871 at [32]–[33] and Takhar v Gracefield Developments Ltd & Ors [2019] UKSC 13; [2020] AC 450 at [63] and held that where fraudulent non-disclosure is proved in the negotiations leading to a PNA, then the PNA must be set aside unless the non-discloser can show by ‘clear and cogent evidence’ that a reasonable person in the victim’s position, and the actual victim of the deception, with full knowledge of the facts, would have reached the same agreement, or at least an agreement which was not ‘significantly different’.

Put another way, to avoid the PNA being set aside, the non-discloser must satisfy this test of no-significant-difference both subjectively and objectively.

This requirement is reminiscent of the old test for dishonesty found in the decision of R v Ghosh [1982] QB 1053 before its abolition by Ivey v Genting [2017] UKSC 67. To find ‘dishonesty’ the court had to be satisfied of two separate matters. First, the conduct complained of had to be dishonest by the objective standards of ordinary reasonable and honest people. Second, the defendant must have realised that ordinary honest people would so regard his behaviour.

In Helliwell v Entwistle at [100] King LJ relied on Lord Sumption’s dictum in the later Supreme Court decision of Takhar v Gracefield Developments Ltd & Ors [2019] UKSC 13; [2020] AC 450 at [63] where he stated:

‘the basis on which the law unmakes transactions … which have been procured by fraud is that a reasonable person is entitled to assume honesty in those with whom he deals. He is not expected to conduct himself or his affairs on the footing that other persons are dishonest unless he knows that they are. That is why it is not a defence to an action in deceit to say that the victim of the deceit was foolish or negligent to allow himself to be taken in: Central Railway Company of Venezuela v Kisch (1867) LR 2 HL 99, 120 (Lord Chelmsford); Redgrave v Hurd (1881) 20 Ch D 1, 13–17 (Jessell MR). It follows that unless on the earlier occasion the claimant deliberately decided not to investigate a suspected fraud or rely on a known one, it cannot be said that he “should” have raised it.’

In the Privy Council decision of Finzi v Jamaican Redevelopment Foundation Inc & Ors (Jamaica) [2023] UKPC 29 at [64], Lord Leggatt watered down Lord Sumption’s test where the application is to set aside a previous judgment or a consent order. In such a case he held that Lord Sumption’s dictum – which is on all fours with Sharland – should not be uncritically relied on, as it gave no weight to the strong public interest of achieving finality in litigation. That factor meant that if the applicant had evidence of fraud first time round, the set-aside application would be likely to be regarded as abusive, and summarily stopped, unless the applicant was able to show a good reason which prevented or significantly impeded the use of the evidence in the original action: see [72]. Whether that modification would be applied on an application to set aside a financial remedy judgment or consent order remains to be seen. It is not consistent with paras [32] and [33] of Sharland but does seem to be irresistibly logical.

Lord Leggatt accepted however that Lord Sumption’s dictum was ‘an orthodox statement of the test for rescission of a contract for misrepresentation’: see [64].

If a PNA is to be regarded as analogous to a contract, then King LJ was correct to apply Lord Sumption’s test (which, I repeat, is on all fours with Sharland). Fraudulent non-disclosure by the wife having been proved, King LJ held at [101] that a ‘strong’ evidential presumption or burden was imposed on the wife to adduce ‘clear and cogent’ evidence that the non-disclosure did not play a material part in the decision made by the husband to enter into the agreement.

Although a PNA is designed to prevent possible future litigation between the spouses in the event of divorce, I do not think that it can be regarded as analogous to a consent order thereby bringing into play Lord Leggatt’s reasoning in Finzi. That reasoning depends on there having been a previous action in which the applicant did not, for whatever reason, deploy the evidence of fraud now relied on. In a PNA case there will have been, ex hypothesi, no previous court case. Moreover, it would be a bold step by a first instance judge hearing a financial remedy claim not to follow Sharland in favour of Finzi.

It is important to understand exactly what King LJ’s formulation of what the wife had to prove amounted to.

To avoid the PNA being set aside Ms Helliwell had to adduce ‘clear and cogent evidence’ that rebutted a ‘strong evidential presumption’ that by under-disclosing her assets (a) she was intending to cause the husband to enter into the agreement, (b) the under-disclosure duly played a material part in the decision of the husband to enter into the agreement and (c) a reasonable person in the position of the husband, if they had full knowledge of the facts, including the scale of the undisclosed assets, would have nonetheless made the same agreement.

If the non-discloser is to succeed in keeping the PNA alive, the evidence adduced by the wife must therefore show that the husband himself was indifferent to the extent of the wife’s fortune (a concrete fact); and that a reasonable person in his position would have been equally indifferent (an abstract evaluation).

It must be borne in mind that the burden of proof, or an evidential presumption, even a ‘strong’ one (whatever that means) only determines where the evidential analysis starts, not where it ends. See Cathcart v Owens [2021] EWFC 86 at [43] where I ventured:

‘Where the burden lies … may not make much difference at the end of the day. A burden of proof operates in the same way as a presumption. Where evidence is lacking, an applicable burden of proof will not be discharged and there will arise a predetermined legal consequence namely that the proposition in question will be answered negatively. Equivalently, where evidence is lacking an applicable presumption will not be overreached and there will arise a predetermined legal consequence namely that the proposition in question will be answered positively.’

Then there is the requirement of ‘clear and cogent evidence’. This phrase crops up repeatedly in varying factual circumstances. The earliest example I can find is Cunynghame & Ors v Higgins & Ors [1802] UKHL 4, Paton 401 where Lord Eldon LC formulated the following test to make a trustee personally liable:

‘it must require, as I apprehend, the individual concurrence of the individual acting as an individual, made out by very clear and cogent evidence, in order to bind him, or make him liable personally.’

Bailii lists an astonishing total of 288 cases in England and Wales where the phase is used. It is a lazy judicial trope which cannot alter either the burden or standard of proof in civil cases. That standard is ‘more likely than not’, no more, no less.

In ‘Black marbles, blue buses and yellow submarines: an essay on the civil standard and burden of proof’ LQR 2024, 140(Oct), 570–594, Lord Leggatt explains how in Re H (Minors) (Sexual Abuse: Standard of Proof) [1996] AC 563 Lord Nicholls set a hare running when he said:

‘The more serious the allegation the more cogent is the evidence required to overcome the unlikelihood of what is alleged and thus to prove it.’

This solecism, which subtly and covertly raised the standard of proof, has required two further Supreme Court decisions – namely Re B (Children) (Care Proceedings: Standard of Proof) (CAFCASS intervening) [2008] UKHL 35; [2009] 1 AC 11 and Re S-B (Children) (Care Proceedings: Standard of Proof) [2009] UKSC 17; [2010] 1 AC 678 – to eradicate it.

I am embarrassed to admit that in Bhura v Bhura (No 2) [2015] 1 FLR 153 at [9(vii)] I too was guilty of lazy use of this trope and have had to be recently corrected by Moylan LJ in Awolowo v Awolowo & Anor [2025] EWCA Civ 641 at [65]. Likewise in Cummings v Fawn at [75] I said:

‘the consent order, and the underlying agreement, must be set aside unless the non-discloser can show by clear and cogent evidence that a reasonable person in the position of the victim of the deception would, if she had full knowledge of the facts, have reached the same agreement.’

‘Clear and cogent evidence’ cannot mean anything more than that sufficient evidence is adduced which proves that it is more likely than not that the disputed fact happened.

Therefore, stripping out rhetorical judicial glosses, the wife had to prove by sufficient evidence (a) that it was more likely than not that her non-disclosure did not play a material part in the decision made by the husband to enter into the agreement and (b) a reasonable person in the same position of the husband would have reached the same decision.

I agree with King LJ’s para [120]:

‘In the end, of course, the husband had the worst of both worlds: no legal advice once disclosure was made and no honest disclosure to inform his decision making. There was, moreover, no clear evidence that, having accepted Option 2, the husband thereafter placed no reliance on the contents of Appendix A and Recitals (R) and (S). Further, because (as I have indicated above) the judge’s analysis of disclosure was incomplete and based upon the mischaracterisation of the wife’s deceit as simply being “a lower number than the truth or than it should have been”, he made no findings which could properly support a conclusion that the contents of Appendix A played no part in the husband’s decision to enter into the agreement.’

Option 2 was for the incorrect Appendix A to be appended to the agreement and for the husband to waive further legal advice. The husband adopted Option 2 and thereby, as previously discussed, was passively complicit in recitals R and S and Appendix A all containing falsities.

I agree that Francis J did not analyse the evidence in such a way that permitted a valid conclusion to be reached on whether the omitted material did or did not play a material part in the decision made by the husband to enter into the agreement or whether his hypothetical reasonable counterpart would have done so.

What is hard to understand is why the Court of Appeal, on remitting the case to be reheard by a High Court judge, has withheld that forensic issue from the retrial court. It is as if the Court of Appeal has made the factual decision that the evidence, including any further evidence that the wife might seek to adduce, could never be sufficient to permit a valid finding to be made that the omitted material did not play a material part, both subjectively and objectively, in the decision made by the husband to enter into the agreement.

That strikes me as odd for two reasons. First, it is unusual (to put it mildly) for the Court of Appeal to remove from a first instance retrial court a key factual issue, proof of which by sufficient evidence could have a decisive influence on outcome. Second, the actual evidence in the case looks to me to suggest pretty strongly that the husband, like Mr Granatino, knew that the wife was extremely rich but was indifferent as to the details. It also looks distinctly arguable that a reasonable person in the position of the husband who had made the decision in principle to enter into a drop-hands prenuptial agreement, and who knew that Appendix A was likely to be wrong (and thereby rendering Recitals R and S also to be wrong), would have been indifferent to the scale of wrongness of Appendix A.

It seems to me therefore that there are good grounds for the wife to seek permission to appeal to the Supreme Court, namely:

1. Was King LJ right to find that the wife’s non-disclosure in this case was fraudulent having regard (a) to the passive complicity of the husband in the falsity of Appendix A (and thereby also of Recitals R and S), and (b) the absence of any gain thereby achieved by the wife or any detriment thereby suffered by the husband?
2. If the disclosure was fraudulent should the law require anything more than a subjective analysis of the actual impact on the husband? Why is there also an objective component?
3. Was King LJ correct to find that the wife had not adduced sufficient evidence to prove that the omitted material did not play a material part, subjectively or objectively, in the decision made by the husband to enter into the agreement?
4. Was King LJ correct, having ordered a retrial, to have removed that question from the retrial court?
5. Was King LJ correct not to consider Finzi at all? Should the decision in Sharland be modified for financial remedy cases to align it with Finzi?
6. Who bears the burden of proof on the separate stages of a set aside application on the ground of fraud?