Judge warns Sir Frederick Barclay ‘the debt will not go away’

Sir Frederick Barclay was today warned ‘the debt will not go away’ by a High Court judge who said the businessman should be ‘ashamed’ for leaving his ex-wife penniless as their legal battle following a £100m divorce settlement continued. 

The Daily Telegraph tycoon, 87, was facing sentencing for contempt of court over failure to pay nearly £250,000 in legal bills and maintenance to Lady Hiroko Barclay, 79, following the breakdown of their 34-year marriage. 

Lady Barclay had previously asked for Sir Frederick to be sent to prison after claiming he had breached court orders to pay her more than £100m – saying he had failed to pay two lump sums of £50m. 

But Sir Frederick was let off the hook last month when Sir Jonathan Cohen ruled he was not in contempt for failing to cough up the huge sums, as Lady Barclay had not proved he had the means to pay it.

The judge did rule, however, that he was in contempt for not paying the £245,000 he owed for legal fees and maintenance, as he had the means to pay those debts.

Sir Frederick Barclay was today warned ‘the debt will not go away’ by a High Court judge who said the businessman should be ‘ashamed’ for leaving his ex-wife penniless as their legal battle over a £100m divorce settlement continued

At a hearing on Thursday, Stewart Leech QC, for Lady Barclay, said that while the £245,000 debt had now been paid, ‘Sir Frederick remains massively in default, there is still no plan for payment of the £100m’.

Sir Jonathan said he would adjourn his decision on whether to impose a penalty against Sir Frederick – which could include jail time – for three months.

The Barclay brothers – identical twins – were among the UK’s most high-profile businessmen. Their business interests included Telegraph Media Group and The Ritz hotel in London. Sir David died in January last year, aged 86. 

The judge said today: ‘It should be a matter of shame for Sir Frederick and his nephews that Lady Barclay is left with next to nothing in financial resources for the future.

‘Does Sir Frederick, and do the nephews, really expect and wish to see her without a penny of her award satisfied?

‘It seems to me an extraordinary point that every member of the family is prepared to put their hands into their pockets to help Sir Frederick to avoid prison but will do nothing to assist the greatest victim in this, Lady Barclay, particularly when I have found she is entitled, and I stress the word entitled, to the award that I made which is to be paid out of Sir Frederick’s share of the fortune that he and his brother amassed.

‘The debt will not go away and I expect Sir Frederick to engage personally with his nephews to find a way through this.’

Sir Jonathan said that he would ‘not be impressed’ if the issue was left to lawyers, adding: ‘There needs to be meetings and sustained serious efforts to be made to find a route through this.’

During the short hearing at the High Court in London, Mr Leech asked for Sir Frederick to be given a suspended prison sentence of five weeks.

‘The pattern is that Sir Frederick simply ignores these orders until his feet are put to the fire,’ he told the court.

But Charles Howard QC, for Sir Frederick, said no order needed to be made after the businessman ‘purged his contempt’ with a loan from his and Lady Barclay’s daughter Amanda.

Lady Hiroko Barclay (right at a previous hearing) insists Sir Frederick Barclay (pictured left) has breached that order and accused him of being in contempt of court and asked the judge to consider a custodial sentence 

The court also heard that there were also further legal costs and up to six months’ worth of maintenance payments in dispute.

‘My client has no money and Amanda has made it clear that she is not going to provide any more,’ Mr Howard said.

It came after Lady Hiroko claimed her former husband had a punch-up at sea with his twin brother Sir David in a battle for control of their businesses. She alleged in her evidence in their London divorce battle at the end of July that Sir Frederick had a fight with his identical sibling on board a yacht.

The Barclay brothers were among the UK’s most high-profile businessmen. Their business interests included Telegraph Media Group and The Ritz hotel in London. Sir David died in January last year, aged 86.  

Lady Hiroko said Sir Frederick, and his brother David, had acquired the freehold of Brecqhou – one of the Channel Islands – in 1993 and paid £2.3 million.

And she said her ex-husband and his brother had once had a brawl while abroad in a row over the running of their businesses. ‘There was a fight on a boat on the holiday,’ she told the judge, ‘They were punching each other’.

The brothers were reported to have bought the Leander G superyacht in around 2016, although it is not known if the alleged fight was on board.

She also told Sir Jonathan Cohen, who began overseeing a hearing in the Family Division of the High Court in London on Monday, that Sir Frederick had the means to pay but was aiming to ‘string things out’ until ‘one or other of us dies’.

Sir Frederick disputes her claims.

Lady Hiroko Barclay alleged that Sir Frederick (left) had a fight with his brother Sir David (right), in her evidence in their divorce battle

Around five years ago the Barclay brothers were reported to have bought the Leander G, a 75-metre yacht. It is not known if this is the yacht they had a fight on

Lady Barclay said Sir Frederick had ‘the means to pay’, adding: ‘For him to pretend otherwise is false.’

She told Sir Jonathan, in a written witness statement: ‘He has no respect for me or for the court. His aim is simply to string things out, hiding behind a web of complex structures (the initial purpose behind which was the avoidance of tax), allowing our daughter Amanda to fund all his financial needs, until one or other of us dies.’

The family also has links to the Channel Islands and Monaco.

Sir Jonathan had ruled that Sir Frederick should pay Lady Barclay sums totalling £100 million after overseeing their fight over money.

The judge criticised Sir Frederick, saying he had behaved in a ‘reprehensible’ fashion.

He said the businessman had sold a luxury yacht and ‘applied the equity for his own use’, in breach of orders.

The judge said Lady Barclay had wanted £120 million and Sir Frederick had made an offer which might have led her to getting nothing.  

In her witness statement, Lady Barclay said that while Sir Frederick claimed to have been evicted from a ‘palatial’ central London residence due to failing to keep up the mortgage, he had carried on staying there for some months, ‘seemingly undisturbed, with access to his ballroom and purpose-built oxygen chamber and attended by his housekeeper, security guard and driver’.

Sir Frederick’s lawyers insist he has been evicted.

On his failure to hand over the divorce settlement cash, Lady Barclay said: ‘Frederick says he cannot pay. He says he has no money. I do not believe him. It is not that he cannot pay, but that he will not pay. He has never had any intention of doing so.’

She added: ‘He has no respect for me or for the Court. His aim is simply to string things out, hiding behind a web of complex structures (the initial purpose behind which was the avoidance of tax), allowing our daughter, Amanda, to fund all his financial needs, until one or other of us dies.’

She went on to say: ‘If Frederick dies before I get my first lump sum, my monthly maintenance will stop. I will be left virtually penniless and almost certainly homeless after a relationship/marriage of close to half a century, where our standard of living was beyond extravagant.’

Lady Barclay also alleges that their daughter Amanda has become Sir Frederick’s ‘de facto banker’ and is ‘in charge of all financial and business matters about which he claims to know nothing’.