The challenge was based on the presumption that David fraudulently disposed of assets in order to defeat his creditors. Although this was likely not the case, the Appeals court ordered Wendy to turn over half of the funds from the sale of the house, which was sold to pay for the current litigation.

The trial court, in awarding Wendy the house, noted that the Haines family had an extravagant life style in buying the home, farm, horses, cars and living beyond their means. Wendy has appealed to the High Court of Appeals.

If this decision is allowed to stand, bankruptcy trustees will have a field day overturning final divorce decisions in which the debtor's property has been transferred to the former spouse within a potential timeframe of up to five years.

This common law is also followed in the US. Trustees can set aside property settlement orders of divorce courts where a spouse has incurred substantial debt. Often, disgruntled exes will go off on spending sprees to deliberately defeat the division of matrimonial property. In the US, property transfers made within one year of the bankruptcy filing can be recovered by trustees. Any property transferred for less than assumed fair value may be challenged for up to six years.

If the UK High Court does not reverse this decision, many divorce decree property settlement agreements are in jeopardy. While this case may relate to "big spenders," the precedent will impact average families as well. It places women and children in jeopardy when divorced fathers file for bankruptcy. The law seems to favor the creditors over the family. We hope Wendy will be successful in her appeal.