The former wife of the multimillionaire Tory grandee Sir Paul Judge is seeking to reopen the couple’s divorce settlement, claiming that he kept £14 million back to reimburse a charity but never paid it.

Anne-Marie Judge, 61, says that she is entitled to a £5.6 million share of that £14 million – which would in effect double her divorce settlement, reached in 2001.

James Turner, QC, her counsel, told the Court of Appeal in London that the original distribution of wealth from the marriage at a hearing before Mr Justice Coleridge was based on a mistake.

Sir Paul, a leading businessman who was formerly chairman of Premier Brands, a director-general of Conservative Central Office and a Cabinet adviser, had in effect misrepresented the true state of affairs to the judge deciding the settlement.

Mr Turner told the appeal judges that he did not assert any “bad faith” or deliberate misrepresentation. However, he said that the blame for nondisclosure of the true situation and misrepresentation “cannot be laid at the door of my client”.

Sir Paul, 59, is also an alderman and Freeman of the City of London. He and his present wife, the second Lady Judge, formerly Barbara Thomas, are a powerful couple who move in the upper echelons of politics and business.

Lady (Anne-Marie) Judge, who along with Sir Paul was in court yesterday – though sitting far apart – received a settlement of about £5 million based on the couple’s total assets valued at nearly £30 million. She also received a flat in Pimlico, said to have “spectacular” views of London, and the couple’s farmhouse in Droitwich, Worcestershire.

Of the £30 million, £14 million was discounted because Sir Paul said he was liable and also had a “moral obligation” to reimburse a charity of which the former couple were trustees, the court heard.

This charity had lost money, said Mr Turner, as a result of investing and “propping up” a company run by Sir Paul that had failed.

On their divorce Lady Judge had received 38 per cent and Sir Paul 62 per cent. But, the QC argued, Sir Paul went on to persuade the Charity Commissioners that he did not need to reimburse the charitable trust.

That meant Sir Paul ended up with about £10 million plus the £14 million, which eventually went to one of his companies, after he paid £589,648 in tax to the Inland Revenue.

In the divorce settlement, the sum allotted to Sir Paul amounted to nearly half of the entire assets of the parties. If the £14 million was included, it meant he ended up with 81 per cent of the total, Mr Turner said.

“Sir Paul and his advisers subsequently persuaded the Charity Commissioners that no liability to reimburse the relevant charity actually existed and Sir Paul did not do what he had previously told the court,” he added.

Lady (Anne-Marie) Judge had applied to set aside the original order once she discovered what had happened, Mr Turner said. “In the circumstances the outcome was not fair or just,” he added.

Mr Justice Coleridge, the judge who made the original divorce order, heard her application last November but refused it. Lady Judge is appealing against that decision.

Lady (Anne-Marie) Judge was born in the US and met Sir Paul in 1973 at the University of Pennsylvania. They married in 1983 and have two sons. Mr Turner said in his grounds of appeal that the original order for division of the assets of the marriage was made on the basis that there was a liability, both in law and in honour, to pay at least £6.8 million to the charity, the Judge Charitable Foundation.

To enable Sir Paul to do this, Mr Justice Coleridge allocated £14 million from the assets before ruling on the division of the remainder.

Robert Seabrook, QC, for Sir Paul, will argue that courts should be slow to set aside a divorce settlement because otherwise there is no finality to litigation. The judge had made no error in law. No allegation of nondisclosure or misrepresentation had originally been made at the hearing in November and it is “disturbing”, he argues, that this is alleged now.

The hearing continues.

Judge v Judge

— Sir Paul Judge made his millions in marketing and turned a £90,000 investment in Premier Brands into £45 million in three years

— He worked for Cadbury Schweppes for 13 years before leading the buyout of their food companies to form Premier Brands

— In 1989 he sold the company to become chairman of Food from Britain, promoting the food and drink industry overseas

— He is chairman of the Royal Society of Arts, President of the UK Chartered Management Institute and an independent director of South Africa’s Standard Bank Group

— Lady (Anne-Marie) Judge is American by birth but in 1996 she renounced her American citizenship and became a British citizen. The couple married in June 1983

— She was a trustee with her husband of the Judge Charitable Foundation set up in 1992. They were divorced in 2001

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