The article continues Christopher Sharp QC’s regular reviews of the more important recent financial remedy cases, this one covering the period from February 2016 to mid-June 2016.We are cursed with excessive reporting of cases, many of which are mere examples of established principles. An example is
Besharova v Berezovsky [2016] EWCA Civ 161 which was an appeal from a decision interpreting the wording of a consent order in which it was common ground that the principles applicable to the construction of a consent order are the same as those applying to a commercial contract. This author can see in it no new principle, merely a reminder that consent orders must be carefully drafted. There are also cases which hit the headlines but which merit no legal reporting, and
Hart v Hart [2016] EWCA Civ 497 (where H sought to challenge the judge’s refusal to adjust his assessment of W’s needs by reference to her cohabitation with another man) was one which was merely a refusal of leave to appeal decided on its own facts. Munby P rejected the contention that Mostyn J’s judgment in
AB v CB [2014] EWHC 2998 (Fam) lays down any principle of law.
In these circumstances the subjective selection of cases which follows does not purport to be comprehensive.
A case with media profile was the negotiated settlement in
Vince v Wyatt, which gave
rise to a judgment on disclosure in addition to approving the order [2016] EWHC 1368
(Fam). W retained £325,000 previously paid to her in respect of costs and secured a
lump sum of £300,000, but Cobb J declined to allow disclosure of her (unfinalised)
outstanding costs (which would show her net result) despite H’s wish to publish this, although he had originally argued there should be no publication of any details of the
case at all. Giving leave to publish the award Cobb J reviewed the conflicting issues
under arts 6, 8 and 10 and the case law in reaching his conclusion that the starting
point of privacy was 'readily displaced' here where 'the lives and financial circumstances of the parties ha[d] already been trailed extensively in the public domain' and no commercially sensitive information had been disclosed but declined to opine on whether the Judicial Proceedings (Regulation of Reports) Act 1926 applies to financial remedy cases.
The CA took a purposive approach to procedure in
Mutch v Mutch [2016] EWCA Civ 370 where W, prior to its expiry, sought an extension of a periodical payments order byway of 'further directions' under a liberty to apply provision and in an accompanying witness statement her application was framed as an “invitation” to the court not to terminate the order. H contended no proper application had been made in time. The CA held the intention was clear and the failure to comply strictly with the procedural requirements was not fatal.
Where a financial provision order contained an automatic increase in periodical payments in 4 years’ time on the younger child leaving private secondary school, equal to one half of the fees, the CA found this to be an error of law. Periodical payments were to be based on need and it would be speculation to predict all the parties’ future circumstances and assume no change. The release of the burden of the fees would be but one factor. The correct approach was for an application to be made to vary at the time:
A v A [2016] EWCA Civ 72.
In
TM v AH [2016] EWHC 572 (Fam), Moor J disagreed with Mostyn J in
DR v GR [2013] that, once trustees have been served, there is no need to join them. Moor J's experience was to the contrary, namely that the trustees are joined when there is an application to vary the trusts of which they are the trustees; that this was necessary for orders to be binding upon them (
A v A and St George's Trustees [2007]); and that Art 6 requires it.
On H's application to show cause (pursuant to
S v S (Arbitral Award: Approval) (Practice Note) [2014] 1 WLR 2299), Mostyn J ruled in
DB v DLJ [2016] EWHC 324 (Fam) that courts can interfere with awards made under the arbitration procedure for family financial dispute resolution run by the IFLA in cases of fraud, mistake or supervening event, the ARB1 agreement providing that the award having to be embodied in an order of the court, its finality would be subject to (inter alia) any changes which the court making the order may require and the parties recognising the court's discretion in making the order. Mostyn J usefully views the law relating to mistake and
Barder events, and finds that he should not interfere in this instance. He opines that
Barder applications can be made to the original court.
In
Randall v Randall [2016] EWCA Civ 494, H successfully appealed against a decision of a Deputy Master that he (as a creditor of a beneficiary, W) did not have an 'interest' (within the meaning of r 57.7, CPR 1998) sufficient to enable him to bring a probate claim challenging the validity of W's mother's will.
In
Robert (Trustee in Bankruptcy of Jonathan Elichaoff, Dec'd) v Woodall [2016] EWHC 538 (Ch), the trustee's attempt to pursue the deceased's bankrupt's claims under ss 23 and 24 of the MCA 1973 as a cause of action vesting in the estate was rejected. The claims for financial provision were personal to the parties and did not extend beyond their joint lives. In
Sands v Tarlochan Singh [2016] EWHC 636 (Ch), the trustee in bankruptcy failed to set aside a trust deed and a consent order (as a transaction at an undervalue) under which the bankrupt agreed that W would hold the FHM on trust for their two children. Giving up a claim under the MCA 1973 whether the order was by consent or after a contested hearing, absent vitiating factors such as collusion between spouses, amounted to consideration under the Insolvency Act 1986, s 339 (which would usually be assessed as equivalent to the value of the money or property transferred under the order).
Hill v Haines [2008] Ch 412 applied.
Bataillon and Anor v Shone and Anor [2016] EWHC 1174 (QB) went the other way, with the creditors succeeding under s 423 of the 1986 Act in setting aside an 'informal separation agreement' between H and W which they contended had transferred assets to W at an undervalue (no consideration).
W (Appellant) v H (Respondent) and Secretary of State for Foreign and Commonwealth Affairs (Intervening) [2016] EWCA Civ 176 concerned the Saudi H's claim to diplomatic immunity from W's claim under Part III of the 1984 Act on the basis of an appointment as Permanent Representative of St Lucia to the International Maritime Organisation. Hayden J rejected this claim in principle (finding H had not effectively taken up his post), and on the basis that he was permanently resident in the UK in any event. His first ground was not upheld as immunity derives from the time of appointment and does not allow a 'functional review', but if, as Hayden J was entitled to find, he was permanently resident in the UK, immunity extended only to official acts (to which W's claim did not relate).
Z v Z, Codan Trust Co Ltd, Kopt Development Ltd [2016] EWHC 911 (Fam) was another Part III case in which Roberts J carefully analysed the s 16(2) factors in permitting W to make a claim after a Russian court made a consent order in 2009 US$10m) which, although it purported to provide W with just over half the joint assets in full and final settlement, did not expressly provide for W's housing and no specific inquiry was made into the sufficiency of the award to meet her future needs, nor were there the English obligations of full disclosure of assets. W's case was that the Russian order was intended to deal with Russian property only, and had not dealt with spousal or child maintenance. H now declared assets of £40m and W £4.7m. W and the children had loosening connections with Russia, a strong connection with England, and lived in a London house acquired by H's father's trust. The court had regard to the financial benefit W received from the Russian court, but even if the terms of the agreement were fair in the light of the
then prevailing circumstances, that fact, of itself, was not necessarily a bar to an effective Part III claim provided that the English court considered it 'appropriate' in all the circumstances to make an order. Section 16(2) does not, in terms, require the court to consider whether the foreign order had foreclosed any claim in England under the terms of the agreement. W's delay was mitigated by several factors including her health and seeking advice during the period. W was presumed to have relied on H's assurances that she could, during the children's minority, remain at the Kensington house upon which he paid rent to the trust. No separate provision was made for W's housing thereafter. It was concealed by H that the arrangements in respect of the house might constitute a nuptial settlement (
cf NR v AB, below). Her claim would be decided at a further hearing, but the judge warned that her aspirations were 'wildly ambitious' and the delay would be a factor under s 18.
NR v AB [2016] EWHC 277 (Fam) involved inherited wealth, and was agreed to be a needs case. W would, under Saudi law, inherit wealth on the eventual death of her father. H's father had already died but he, his mother and his sister had followed his father's testamentary intentions by arranging the family affairs on the basis of joint or collective ownership of various properties (through a company, BCO) and assets of which he therefore held only a one-third beneficial interest, which the judge concluded he could not access at will as his sister was unwilling to allow the release of cash. He could not access his mother and sister's shares. W's case on the basis of
Thomas v Thomas did not avail her beyond H's offer, which was a capitalised maintenance award, and that her housing needs should be met by a licence to remain in the matrimonial home but without ownership. H's family would thereby by tying up capital assets to meet W's needs. Having reviewed the law in relation to resulting and constructive trusts, Roberts J held the matrimonial home to be owned by BCO, but concluded that the terms upon which it was occupied amounted to a nuptial settlement capable of variation under s 24(1)(c) of the Matrimonial Causes Act 1973. W's needs were met substantially by H's offer of a lump sum of £2m for income, some capital for immediate needs, financial support for the children and a right to remain in the properties rent-free until her re-marriage or her father's death. She did not get the capital interest she sought in the properties, but no order could be made against BCO and she had a guaranteed share in her father's estate in due course.
Re V [2016] EWHC 668 (Fam) concerned a conflict of jurisdiction between England and Scotland where W issued an application under s 27, MCA 1973, H having issued divorce proceedings in Scotland but not making any financial claims in the writ of divorce. There was no reason why the divorce and the financial claims might not proceed in different jurisdictions, England and Scotland being treated as different member states under Sch 6 to the Civil Jurisdiction and Judgments Maintenance Regulations 2011. The English court might not entertain an application under s 27 unless it had jurisdiction to do so by virtue of the Maintenance Regulation (Council Regulation (EC) No 4/2009) and Sch 6 to the 2011 Regulations. W satisfied the habitual residence condition, but there remained the issue of whether the Scottish court was seized of the financial issue. Parker J held that the absence of any formal financial claim in the Scottish proceedings (which must be brought before the grant of a divorce, the opportunity to make such a claim being lost upon divorce being granted) was fatal to H's case to secure a stay of the English proceedings, which in the circumstances as to jurisdiction the court had no discretion to grant in any event. Interim maintenance and legal services orders were made.
