We wrote here in January about a case in which the husband was seeking rent from the wife in relation to her occupation of the former matrimonial home.
As we explained then the husband was appealing to the Court of Appeal against a ruling that the wife was not liable to pay rent of £5,000 per week (a total of £600,000) to the husband in relation to the period that she occupied the property before it was sold.
The Court of Appeal has now handed down its judgment. It found in favour of the wife, and therefore dismissed the husband’s appeal.
The appeal revolved around the interpretation of a consent court order that was drawn up in 2016, setting out the terms of an agreed financial settlement between the husband and the wife.
The order provided that the wife was to receive a lump sum settlement of £11.5 million, £6.5 million straight away, with the balance due when the house was sold. However, the sale was delayed, and did not take place until 2019.
The order did not specifically state that the wife should pay rent to the husband, but the husband argued that it would be ‘absurd’ not to imply a term into the agreement requiring the wife to pay rent – the parties would surely have agreed this had they known that the sale would take so long.
The Court of Appeal disagreed. The matter turned solely upon what the consent order said. As it did not say that the wife should pay rent, she was not obliged to do so.
The case demonstrates the need to be specific when drafting court orders. Care should be given to take into account all reasonable possibilities, and to provide for them accordingly, either by agreeing the matter with the other party, or by requesting the court to include a suitable provision in any order.
It may now be that a rental clause will be sought in any similar agreement, as a matter of course.
But that obviously means that this would have to be taken into account when negotiating the amount that the occupying spouse should receive from the settlement. As Lady Justice King, giving the leading judgment of the Court of Appeal, pointed out, the only way that the wife could pay £600,000 would be from her lump sum, thereby reducing the lump sum by a “very significant sum”.
Clearly, whichever side you may be on, you will need to obtain the best possible legal advice. We can provide the advice you need, by finding you an expert that works with you on our digital platform. For more information, call us on 020 3904 0506, or click here, and fill in the form.
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