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The Supreme Court has today unanimously allowed the appeal in Vince v Wyatt [2015] UKSC 14. It ruled that the wife's claim was not an abuse of process and should not be struck out. The Supreme Court directs that the wife’s application proceed
in the Family Division of the High Court.
The court examined the jurisdiction under Rule 4.4 of the family rules to strike out an ex-spouse’s application for a financial order. There was no equivalent power of summary judgment in the family rules as seen in the civil rules - this omission was deliberate. The wife’s application was legally recognisable and not an abuse of process and her appeal against the strike-out therefore succeeded.
Lord Wilson explained the wife’s application would face formidable difficulties although she would no doubt rely on her much greater contribution to the upbringing of the couple’s children over many years, a factor which may justify a financial order for a comparatively modest sum in comparison with the £1.9 million sought.
Speaking of the ruling, Elizabeth Hicks, a leading divorce
lawyer at Irwin Mitchell, said:
'This ruling essentially paves the way for
anyone without a completed financial order to bring a claim against their former
spouse regardless of how long ago they divorced.
The case highlights the importance
of ensuring that all financial matters are finalised at the time of divorce and
a court order is obtained. Otherwise it could lead to future claims to a share
of the wealth earned after the divorce.
It is unprecedented to hear of a
claim being made after 22 years but the court has ruled that because there was
no financial order and no time limit in family law for making a financial order,
there was nothing to prevent Ms Wyatt’s claim from being successful and the High
Court will now consider how much she should receive bearing in mind current
law.
While any good divorce lawyer
should ensure that all financial matters are finalised and immune to future
claims, it is crucial that any divorcees who don’t have financial orders in
place review their situation as they may now face claims against based on
wealth acquired after the divorce.'
Resolution chair Jo Edwards comments:
'The Supreme Court
has made it clear that the draconian power to strike out family proceedings
simply does not exist, but stress that the court will consider the merits of
such applications on a case by case basis.
If Ms Wyatt had lost
her appeal, Resolution was concerned that people without access to legal advice
as a result of the legal aid cuts would have been at risk of having their
applications struck out without proper consideration simply because of delay,
along arbitrary lines.
But it’s also
important that people who have become wealthy over time are not exposed to
potentially opportunistic claims many years after a marriage has broken down.
We want to see reform of the law around financial provision on divorce. Part of
that is a desire for greater clarity and a clearer intention to get couples to
financial independence sooner.
It will be
interesting to see how the court now approaches Ms Wyatt’s substantive claim,
with clear indications from Lord Wilson of the likely limits of her claim in
view of the facts of this case. If she had pursued her financial claims at the
time of separation, there would likely have been a capital clean break at that
point and no ability to come back and claim more now. It seems unlikely that
she will be able to sustain a needs-based claim. She is more likely to succeed
on the basis of her contributions through caring for the children after the
marriage breakdown, but her delay in bringing a claim may well dictate
otherwise.
We are rightly proud
of the broad discretion which the family courts have in England and Wales and
the ability to tailor outcomes to families. However, critics would say that we
need to inject a greater degree of certainty into outcomes in family cases, and
in doing so reduce the extent and cost of litigation associated with the broad
discretion we have.'
The below text is the official press summary of Vince v Wyatt [2015] UKSC 14:
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The appellant, Ms Wyatt, and the respondent, Mr Vince, were married on 18 December 1981 [9]. They had a son, and Mr Vince also treated Ms Wyatt’s daughter from a previous relationship as a child of the family. They separated in 1984 [10]. For around 8 years after that, Mr Vince pursued a new-age travelling lifestyle [11]. Ms Wyatt brought up the children in straitened circumstances, and Mr Vince was not in a position to make any substantial financial contribution for them [17]. The couple divorced and their decree absolute was granted on 26 October 1992. Since the court file has apparently been mislaid it is unknown what, if any, order was made at the time regarding financial provision, but the court has no reason to believe that Ms Wyatt’s claims were dismissed [14]. Ms Wyatt went on to have two more children. From the late 1990s Mr Vince’s green energy business took off [18] and he became a multi-millionaire [7]. In 2001, the couple’s son went to live with Mr Vince. Ms Wyatt’s financial circumstances continued to be, and remain, very modest [6].
In 2011 Ms Wyatt made an application in the divorce proceedings for financial provision in the form of a lump sum. She also applied for interim payments to fund her legal costs [2]. Mr Vince crossapplied for Ms Wyatt’s substantive application to be struck out pursuant to Rule 4.4 of the Family Procedure Rules 2010 (“the family rules”), which provides:
'(1) … the court may strike out a statement of case if it appears to the court –
a) that the statement of case discloses no reasonable grounds for bringing or defending the application;
b) that the statement of case is an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings …'
On 14 December 2012 a deputy High Court judge dismissed Mr Vince’s strike-out application and ordered him to make interim periodical payments in respect of legal costs directly to Ms Wyatt’s solicitors (“the costs allowance order”). Mr Vince appealed, successfully, to the Court of Appeal to have the deputy judge’s orders set aside. The Court of Appeal struck out Ms Wyatt’s application for financial provision and ordered her to repay part of the money received under the costs allowance order [2]. She appealed to the Supreme Court.
Judgment
The Supreme Court unanimously allows the appeal [29] and directs that the wife’s application proceed in the Family Division of the High Court [36]. The deputy judge’s costs allowance order is restored and the Court of Appeal’s repayment order set aside [41]. Lord Wilson (with whom Lady Hale, Lord Clarke, Lord Hughes and Lord Hodge agree) gives the judgment.
Reasons for the judgment
The court examines the jurisdiction under Rule 4.4 of the family rules to strike out an ex-spouse’s application for a financial order [3]. It can be inferred that the references to “no reasonable grounds” and “abuse of the court’s process” in Rule 4.4 are intended to bear the same meaning as the equivalently worded strike-out provisions in the Civil Procedure Rules (“the civil rules”) [23]. The civil rules also confer upon the court a further power to give summary judgment on the basis that the claimant or defendant has no real prospect of success and there is no other compelling reason why the case should be disposed of at a trial [24]. However, there is no equivalent power of summary judgment in the family rules [25]. This omission is deliberate. When an ex-spouse applies for a financial order, the court has a duty under section 25(1) of the Matrimonial Causes Act 1973 (“the 1973 Act”) to determine that application having regard to all the circumstances, including the eight matters set out in subsection (2); this assessment is not apt for summary determination. The Court of Appeal was therefore wrong to insinuate a test analogous to summary judgment into the family rules. Both limbs of Rule 4.4 should be construed without reference to real prospects of success. An application has “no reasonable grounds” for the purposes of Rule 4.4(1)(a) only if it is not legally recognisable, e.g. because there has already been a final determination of the proceedings or because the applicant has remarried. Neither should an application be viewed as an “abuse of process” falling within Rule 4.4(1)(b) solely on the basis that it has no real prospect of success [27]. Ms Wyatt’s application is legally recognisable and is not an abuse of process [28] and her appeal against the strike-out therefore succeeds [29].
Lord Wilson identifies the issues in the application for the purpose of efficient future case management [29]. Ms Wyatt faces formidable difficulties in seeking to establish that a financial order should be made in her favour, including the short duration of the marriage and the long delay since then [30-31]. It is not clear whether she will be able to sustain her claim on the basis of need generated by her relationship with Mr Vince [33]. However, section 25(2)(f) of the 1973 Act obliges the court to have regard to “the contributions which each of the parties has made … to the welfare of the family, including any contribution by looking after the home or caring for the family”. Ms Wyatt will no doubt rely on her much greater contribution to the upbringing of the couple’s children over many years [34], a factor which may justify a financial order for a comparatively modest sum [36].
The court also considers the costs allowance order [3]. Mr Vince argued that even if Ms Wyatt’s application were not to be struck out, the deputy judge had been wrong to make the costs allowance order [37]. The threshold test for making such an order was whether Ms Wyatt could reasonably secure legal services by any other means [39]. Given that it would be unreasonable to expect her solicitors to continue to act without payment until the determination of her substantive application (as contended by Mr Vince), this test was satisfied [40].
