Dover (US), Dec 8:A Delaware judge has refused to appoint a receiver to manage and oversee the sale of a multimillion-dollar mansion in Beverly Hills, California, that is at the heart of a bitter divorce feud between a Saudi prince and his ex-wife.
The judge ruled on Monday that the request for a receiver was improper because it was not authorised by a manager of the Delaware limited liability company set up to buy the property in 2011.
The motion was filed by a lawyer for Princess Fahdah Husain Abdulrahman Al-Athel on behalf of New Generation Ideas LLC, but Vice Chancellor Paul Fioravanti noted that the princess has denied that she is a manager of that entity.
The judge also noted that her former husband, Prince Faisal Bin Abdullah Bin Abdulaziz Al Saud, did not authorize the request for receivership as a manager of the LLC.
The couple married in 2001. Their divorce was finalized in Saudi Arabia in 2016.
The princess asked for a receiver after a ruling by a judge in the Cayman Islands, where she has filed a petition to dissolve a corporation that is controlled by her and her ex-husband and is the sole member of the Delaware LLC.
The Cayman Islands judge told the warring ex-spouses earlier this year that the Delaware court needs to rule first on the prince’s claim that he is owed about USD 42 million from the LLC for loans he provided to buy and renovate the property. The Cayman Islands judge has set the value of the property within the range of USD 31 million to USD 40.5 million, according to court records.
Jason Jowers, an attorney for the prince, noted that if the liabilities of the LLC, including the purported loans from the prince, exceed the value of the California property, the Cayman Islands court has no authority to act.
“If the plaintiff really is owed 40-plus million dollars on the liability issue, then Ms Al-Athel will most likely be out of money, and if she is out of the money, she has no right to seek liquidation under Cayman law,” Jowers said.
After the princess filed the Cayman Islands petition in 2017, the prince responded with a Delaware lawsuit seeking to prevent his ex-wife from selling the property without his consent. He also claims she has mismanaged the estate and failed to pay employees, resulting in several lawsuits.
“This has been a very nasty separation and divorce,” Steven Caponi, an attorney for the princess, told Fioravanti.
Caponi argued that the prince, whom he described as one of the wealthiest men in the world, has allowed the Beverly Hills property to fall into disrepair, resulting in utility shutoffs along with fines, and the threat of foreclosure, by a homeowners association.
The homeowners association represents the “creme de la creme of American corporate society,” and its clients are “particularly unhappy” with the Saudi royals for buying “a plaything” in their neighborhood and letting it go to “hell in a hand basket,” he added.
According to court records, the estate was purchased for about USD 17 million and includes about 48,000 square feet of gross building area, with at least 19 bedrooms and 21 bathrooms.
Caponi noted that the homeowners insurance on the property has lapsed, and that the parched landscaping presents a fire hazard that threatens both adjoining compounds and human life and led to fines by the local fire marshal before water service was restored.
“The property has been held by the prince as a weapon, so to speak, against my client,” he added. ”…. He will neither agree to sell it, nor fund it, nor use it, nor buy it.” But Fioravanti said the request for a receiver was beyond the scope of the order by the Cayman Islands judge asking the Delaware court to resolve the liabilities issue. He directed attorneys to confer on a schedule for him to decide that issue in the first half of next year. (AGENCIES)
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