Daughter of dead millionaire banker, 37, launches fierce legal battle against his lover

The daughter of a dead millionaire banker is fighting his former model lover who walked away with half of his £4.4m estate including cash from the sale of his Belgravia mansion

Rainer Kahrmann died suddenly in 2014, having fathered four children by two women, his Swiss socialite wife Christiane De Muller, and his girlfriend in later years, former model Hilary Harrison-Morgan.

Mr Kahrmann was a highly successful banker, art collector and clock expert, who enjoyed a luxury lifestyle with his partners, living in some of London’s most exclusive neighbourhoods.

At the time of his death, he had been set to net £4.4m from deals including the sale of the Belgravia home he once shared with Mrs Harrison-Morgan.

When the deals went through, £2.2m of the money went to her.

Hilary Harrison-Morgan outside the Court of Appeal

Alice Kahrmann – daughter of Rainer Kahrmann – outside High Court last year (left) and Hilary Harrison-Morgan outside the Court of Appeal (right)

But in a bitter Court of Appeal battle which has already seen over £1m run up in lawyers’ bills, Mr Kahrmann’s daughter, Alice, is fighting to make her father’s former partner give it back.

Miss Kahrmann, 37, a writer, claims Mrs Harrison-Morgan is not due a penny from the windfall, which should instead go into his estate to be split between the four children, all of whom live in London.

Her lawyers claim 60-year-old Mrs Harrison-Morgan has been ‘unduly enriched’ by the payment, ‘walking away with a vast sum of money at the expense’ of his heirs.

However, Mrs Harrison-Morgan insists the money is hers, because it was a payment she received to leave her former home of more than 20 years to allow it to be sold.

‘I would never have left that house or signed anything without expecting to be paid,’ she said in evidence.

‘I was paid to get out, it was really simple.’

The centre of the dispute involves a property in Wilton Crescent, Belgravia (pictured)

The centre of the dispute involves a property in Wilton Crescent, Belgravia (pictured)

Mr Kahrmann was already separated from his first wife Mme De Muller – with whom he had daughters Alice and Louise, 40, – when he met Mrs Harrison-Morgan in London in 1991.

They started a relationship and moved in together in a maisonette in Wilton Crescent, one of the capital’s most expensive streets, having twin sons Max and Fred, both now 18.

The couple enjoyed a luxury lifestyle, with dates at exclusive Knightsbridge dining club Mossiman’s, while Mr Kahrmann even gave her a Cartier ring within two weeks of their first meeting.

But facing financial pressures, Mr Kahrmann relocated to Germany in 2005, although he continued to maintain Mrs Harrison-Morgan and the boys, who visited him regularly.

However, he never moved back and finally died suddenly from a blood clot, aged 71, in July 2014.

At the time, the astute businessman was in the middle of a series of property deals – totalling over £16m – with a partner, including the sale of his former home and an adjoining property in Belgrave Mews.

However, the deals did not go through until after his death, whereupon his £4.4m share of the profit was split between Mrs Harrison-Morgan and his daughters.

Christiane De Muller with her financier husband, Rainer Kahrmann, in 1982. Mr Kahrmann died from a blood clot in July 2014

Christiane De Muller with her financier husband, Rainer Kahrmann, in 1982. Mr Kahrmann died from a blood clot in July 2014

Unhappy with the way the transaction had taken place, the sisters handed their £1.1m shares of the money back to his estate to be divided between his beneficiaries.

But Mrs Harrison-Morgan refused to give back the money, sparking a long and expensive court battle.

In a trial last year, Alice Kahrmann and her mother, Mme De Muller, challenged Mrs Harrison-Morgan’s refusal to return the money, but saw their case dismissed by Judge Richard Hacon.

Mme De Muller has since died, aged 70 in January, but her daughter is fighting on alone, hauling her father’s ex to the Court of Appeal in an attempt to get the £2.2m back.

Representing Alice, who is personal representative of her late father’s estate, Penelope Reed QC argued that the profits of the property deals are rightly part of Mr Kahrmann’s estate.

He died intestate, meaning his money would be divided between his children, Mme De Muller – who he was long separated from but still married to – having died.

Mrs Harrison-Morgan was not married to Mr Kahrmann or named in a valid will and so is entitled to nothing from his estate.

‘In this case, there was no lawful basis for Mrs Harrison-Morgan to receive the money which should have gone to the estate,’ Mrs Reed told three senior judges.

‘She should never have received the money and must now return the benefit of it to the estate by way of money had and received.’

She argued that Judge Hacon was wrong last year in saying the estate’s claim to the £2.2m had ‘no foundation’.

‘On any view, the deceased’s share of the profits should have gone to the estate,’ she told the judges.

‘He was plainly entitled to this money had he been alive, and that entitlement passed to the estate.’

The judge had allowed Mrs Harrison-Morgan to ‘walk away with a vast sum of money at the expense of the deceased’s beneficiaries,’ she added.

But in her evidence last year, Mrs Harrison-Morgan insisted she had a ‘loving relationship’ with Mr Kahrmann and he intended she would get cash from the sale.

‘Rainer fully intended to make sure that myself and the boys were looked after from the proceeds of sale,’ she insisted.

‘There’s absolutely no doubt in my mind that that is what he intended.’

She said part of the property deal involved her own home of 23 years and it would not have gone through without her agreeing to leave.

In the Court of Appeal, her barrister, Clifford Darton QC, said the £2.2m was her payment for agreeing to get out of the maisonette.

‘Mr Kahrmann’s entitlement to 50% of the profit from the sale had always been predicated on the basis that he would deliver vacant possession,’ he said.

‘After 3 July 2014, such possession could only be achieved with the consent of Mrs Harrison-Morgan or as a result of a successful claim against her.

‘The payment was made…under a contract under seal and in consideration for Mrs Harrison-Morgan’s vacation of the property and any claims over it.’

However, Mrs Reed, for Alice, insisted that Judge Hacon was wrong and the money should be paid back to the estate.

‘She effectively intercepted a legal benefit which the estate was entitled to receive…and which, but for her intervention, would have gone to the estate either directly or indirectly,’ she said.

‘The enrichment was unjust in the sense that it was made without any lawful basis whatsoever and they were made without the lawful authority of the personal representatives of the estate.

‘It is therefore submitted that the personal representatives of the estate were entitled to recover the benefit of this payment from Ms Harrison-Morgan.’

The judges – Lord Justice Floyd, Lady Justice King and Lord Justice Henderson – reserved their decision in the case until a later date.

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