(Court of Appeal; Sir Mark Potter P, Wilson and Rimer LJJ; 2 December 2009)
After a 4-year relationship the husband issued a divorce petition, which the wife defended. Five months after the petition was filed, the husband issued an application under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA), seeking an order for the immediate sale of the jointly owned matrimonial home, worth £12 million but with a mortgage of £7 million, in which the wife was still living; it was costing over £200,000 per year to maintain the property. Although the husband's usual net income was about £350,000, a large one-off commission recently received meant that it was not impossible for him to continue with the payments on the property, but he argued that it was unreasonable to expect him to do so. More than a year after the filing of the divorce petition, a court ordered the sale of the property. Two months later the divorce decree was finally granted. The wife appealed on the basis that the order for sale had been premature, and ought not to have been made under TOLATA before the divorce.
A court confronted with an application under Trusts of Land and Appointment of Trustees Act 1996 should embark upon the discretionary exercise by asking itself whether the issue raised by the application could reasonably be left to be resolved within an application for ancillary relief following divorce. Because it was in principle much more desirable that an issue about the sale of the matrimonial home should be resolved within an application for ancillary relief, at the threshold stage, the court would, in particular, have regard to the question whether, within a time frame tolerable in all the circumstances, the parties would become able to apply for ancillary relief. Furthermore, if, at first sight, there appeared to the court to be any measurable chance that, on an application for ancillary relief made within that time frame, the respondent would be able to preserve his or her occupation of the home by securing an outright transfer of ownership, or a variation of the trust for sale, it was hard to conceive that an order for sale would reflect a proper exercise of the discretion. In this case, in which the wife had obstructed the grant of decree nisi for more than 6 months, further delay had not been tolerable and there had been no measurable chance that the wife would secure transfer of the property into her sole name. The court could order vacant possession for the purpose of ordering a sale of the property without finding that an occupation order should be made against the wife. There was an issue concerning whether the wife's housing needs had been sufficiently considered by the court, but on the basis that the husband accepted that she was entitled to use half the net proceeds of the sale to house herself, this did not need to be further investigated.