05 August 2011

Advising a client on financial remedies is often difficult. There is a category of cases where there is clearly enough capital for a fair division within an ascertainable bracket, no need for ongoing maintenance and everyone will be comfortable (although not perhaps quite as comfortable as they were before). Clever things may be done with complex assets to maximise the benefits to one or both parties, but at the end of the day, no one is genuinely going to struggle. These are a minority, but over represented in the reported cases because they are the cases where there is money to fight.

The more difficult cases are where there is not enough capital to rehouse both spouses and/or where periodical payments are an inevitable part of any package. I found periodical payments particularly difficult to advise a client about with a lot coming down to experience (inevitably based on a particular court) and a gut feeling looking at the needs and available resources that the figure "felt about right". Hardly surprising that some clients found the lack of a more scientific formula hard to swallow. The figure would usually be somewhere less than what the payee said they needed and more than the payer said they could afford. But perhaps my job was made easier by the (unofficial and anecdotal but nonetheless real) presumption that, with the exception of one or two DJs, in the Principal Registry a "classic" wife with children and a limited earning capacity would almost certainly get a joint lives maintenance order, even if it switched to a nominal order after a certain date. Outside London, that is not necessarily the case and, as Lucy Reed has noted, this may be the root of Lady Mostyn's reported concern that her case against Sir Nicholas will be heard in Taunton rather than London. But perhaps that case will not fall into the category where periodical payments are a real issue.

More difficult still I think are variation cases, including the extension of term orders (obviously those without a s28(1A) bar). What weight should the original order carry, how far do circumstances have to have changed to justify a variation, and how hard does a wife have to have worked towards financial independence? The cost benefit analysis of court proceedings is also a much finer line than on the original application.

The Court of Appeal recently considered the case of N v N [2011] FLR forthcoming. The parties were married for 5 years before they separated and had two children. Financial proceedings were compromised in 2005, seven years after separation, with periodical payments to be made to the wife of £1,000 per month for a term of 5 years (until December 2009) with no bar. It was recited that it was intended that the wife would become financially independent within that time. Before it ended, the wife applied to extend the term. The district judge in Guildford found that the wife had not made a serious effort to bring her skills up to date and was unwilling to work, but also criticised the husband's disclosure finding it had increased the costs and the wife's mistrust. The term was extended until April 2012 with a s28(1A) bar. On the wife's appeal the circuit judge increased the term to August 2015 adding a nominal joint lives order thereafter. The Court of Appeal held that the circuit judge had exceeded his appellate function in hearing fresh evidence from the wife and had failed to properly direct himself as to his limited role which had resulted in an order which was a fundamental departure from what the parties had agreed in 2005. The DJ's order was reinstated.

Thorpe LJ noted that the first instance DJ's findings might have suggested at first blush that the wife's application should have been dismissed, but the extension which was to the wife's considerable benefit was in the discretion of the judge. It seems Thorpe LJ might have been disinclined in such circumstances to have extended the term. As we know only too well, judicial discretion is by its nature not uniform and there is always a risk in invoking it.

Hayley Trim is a Family Law PSL at Jordan Publishing and was formerly a family solicitor practising in London.

She works on the Family Law online major works providing updating notes on cases and other relevant developments as they happen for The Family Court Practice, Children Law and Practice and Matrimonial Property and Finance online.

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