The Supreme Court has allowed an appeal by a wife against the dismissal of her application to vary one of the terms of a consent order that set out an agreed financial settlement on her divorce.

The facts of the case were as follows. Financial remedy proceedings were concluded by a consent order in July 2010, which noted the husband’s agreement that he had no interest in the former matrimonial home. The wife gave an undertaking to secure the release of the husband from the mortgage on the property by the 30th of September 2012, failing which it was to be to be sold.

In November 2011 the wife applied to vary the undertaking so that the husband would be released from the mortgage or the property sold in default when their youngest child attained the age of 18 (in 2019), or when either of their two children completed full time education. She applied under section 31 of the Matrimonial Causes Act 1973, which would require the court to take into account the children’s best interests.

The District Judge held that the court did not have jurisdiction to hear such an application, essentially as it related to a property adjustment order (for an explanation of what a property adjustment order is, see here) which cannot be varied, because such orders are intended to be final. He therefore dismissed the application, and the wife’s appeal was also dismissed. The Court of Appeal dismissed the wife’s further appeal, holding that the jurisdiction to vary the order was derived from the inherent jurisdiction of the court, rather than section 31 of the Act, and that it was not appropriate to exercise it in this case. The wife appealed to the Supreme Court.

The Supreme Court held that there was jurisdiction to hear the wife’s application, and therefore allowed her appeal. Handing down the leading judgment Lord Wilson said that describing the wife’s application as being to vary her undertaking was confused. The court could not vary an undertaking, but it could grant or refuse an application for release from an undertaking, and it could accept a further, different, undertaking. Accordingly, the court had jurisdiction to hear the wife’s application. In any event, the undertaking related to an order for sale of the property, rather than to a property adjustment order, and an order for sale can be varied under section 31.

The Supreme Court remitted the wife’s application to His Honour Judge Waller to decide, although Lord Wilson made clear that it was by no means certain that the application would be successful.

Family Law Cafe says: It will be interesting to hear the outcome of the application, but Lord Wilson is quite correct that it is unsatisfactory that it has taken so long for the case to reach this stage. Family Law Cafe’s mission is to see an end to these long delays and convoluted processes, by ensuring there is a strategy from the beginning and by mentoring, checking and expediting the process.

The full report of the case can be read here.

Image: Supreme Court of the United Kingdom, by FuFu Wolf, licensed under CC BY 2.0.

The Ministry of Justice has launched a consultation on proposed amendments to the rules governing financial remedy claims arising from divorce or dissolution of civil partnerships.

There are essentially two proposed amendments. The first relates to the ‘de-linking’ of divorce/dissolution proceedings and financial remedy applications, and the second is the introduction of a “fast-track” procedure for certain types of financial claims.

As to de-linking, the main proposal is to remove the possibility of making a financial remedies application within the divorce petition/application for civil partnership dissolution. Until now, for example, it has been possible for someone issuing divorce proceedings to include such an application within their divorce petition, even if they do not intend to proceed with the application at that time. This can act as a ‘protection’ so that they can proceed with the application at a later date, even if they have remarried (a person who has remarried cannot make a financial remedies application in relation to an earlier marriage). The idea behind de-linking is to make the divorce application and financial remedies applications entirely separate, now that they are dealt with separately (the divorce in one of the eleven regional divorce centres and the financial remedies application in the parties’ local family court).

As to the fast-track procedure, this is actually the re-naming of an existing procedure used for less complex family financial claims not related to divorce/dissolution proceedings, such as applications for financial provision for children under Schedule 1 of the Children Act 1989. However, it is also proposed that certain claims made in relation to divorce/dissolution proceedings that are likely to be less complex should also use the fast track procedure, such as maintenance claims and lump sum claims not exceeding £25,000.

Family Law Cafe is generally in favour of the de-linking proposal, so long as those involved in divorce/dissolution proceedings are made fully aware of the need to protect themselves where necessary by making an application. As to the fast-track proposal, Family Law Cafe is also in favour, although with some reservations about making matters more complicated by having two separate procedures, and also about having a lump sum limit, when parties will often not be able to quantify lump sum claims until after proceedings have been instituted.

Family Law Cafe will monitor the outcome to this consultation and will keep you up to date with changes. We provide strategy and mentoring advice to make sure you get the best outcome in your family matter. You can call us on 020 3904 0506 or email us at info@flc.chcdigital.com.

If you are interested, you can see the consultation paper here, and the proposed rule changes here.

Image: Financial Key, by GotCredit, licensed under CC BY 2.0.

How do courts treat inheritances on divorce? Does an inheritance belong to the party who received it, or does it go into the ‘pot’ for division between both parties?

The answer to this common question is, as so often, “it depends”.

The primary thing that it depends upon is whether there are sufficient other assets to meet the needs of the parties. As explained in this post, the financial needs of the parties is one of factors to which the court must have regard when deciding what financial orders to make on divorce. In many cases needs can be the most important factor, especially when there are limited funds to go around.

In cases where the other assets are not sufficient to meet the needs of both parties, the court may consider the needs of the parties to be more important than the wishes of the person who left the inheritance, and the inheritance will be used to meet those needs.

On the other hand if the other assets are sufficient to meet the needs of both parties, the court may leave the inheritance out of account so that, for example, the other assets may be divided equally, with the inheritance remaining with the party who received it.

When the inheritance is received may also be relevant. For example, an inheritance that was received long before the divorce may have become ‘mixed’ with other property/money, so that it is simply impossible to distinguish it from ‘matrimonial’ property. If, however, the inheritance is received close to the divorce or after the parties separate, it may be more likely that the court will leave it out of account. Note, however, that the court can, in certain circumstances, take into account inheritances that have not yet even been received.

If you would like further advice as to how an inheritance might be treated in your case, Family Law Café can help you find it. To contact us click the Contact link above and fill in the form, or call us on 020 3904 0506.

Image: inheritance, by Lauren C, licensed under CC BY 2.0.

It’s a common scenario: the marriage (or civil partnership) has broken down, and the matrimonial home is owned solely by one party. How does the other party stop the owning spouse from selling or mortgaging the property?

If there are divorce proceedings then ultimately the court will decide what is to happen to the (former) matrimonial home, if the parties can’t agree this between themselves. However, what can the non-owning spouse do to protect their interest in the home before the court sorts things out?

One answer is that the non-owning spouse can register their ‘home rights’ (i.e. their right to occupy the home) against the title to the property at the Land Registry (the title to most properties these days is registered at the Land Registry, but there is a similar procedure available for unregistered properties). Registering home rights means that the non-owning spouse will be notified if the owning spouse tries to sell or mortgage the property (if you receive such notification you should take urgent legal advice – see below).

Home rights can only be registered against one property, and therefore the home rights procedure is not available in respect of other properties owned by the other spouse. It is also not normally available where the owning spouse owns the property with someone else. In these cases the non-owning spouse may have to take other action to protect their interest in the property.

It should be noted that the home rights are brought to an end when the divorce is finalised, unless the court has previously made an order extending the rights beyond the termination of the marriage. It is therefore important to ensure that what is to happen to the house is sorted out before the divorce is finalised.

It should also be noted that the registration of home rights is not an absolute protection against the house being sold or mortgaged. To obtain full protection, you will have to take further steps, and you should do so urgently if you believe your spouse is intending to sell or mortgage the property. A specialist family lawyer can advise you about this. Family Law Café can help you find a specialist – to contact us click the Contact link above and fill in the form, or call us on 020 3904 0506.

Image: home sweet home, by essie, licensed under CC BY 2.0.

Torstein Hagen, the founder and Chairman of Viking Cruises, and his estranged wife Ellen-Karine are embroiled in a bitter and expensive divorce battle in the High Court in London.

The couple, who are both in their 70s, have reportedly spent around £10 million in legal fees, and Mrs Justice Roberts, who is hearing the case, has been told that the court hearing, which is expected to last three weeks, is costing around another £100,000 a day.

The total wealth that they are arguing over has not been disclosed, but Mrs Justice Roberts has said that a “very substantial” sum of money is at stake. Mrs Hagen is said to be seeking a half share.

Making matters worse, the couple’s adult daughter and son are also involved in the litigation. Lewis Marks QC, who is representing Mr Hagen, said that they had been “dragged” into a dispute about their prospective inheritance, and that as a result the family was in “a vortex of conflict”. A total of twelve barristers are said to be involved in the case, which is taking place in one of the largest court rooms in the Royal Courts of Justice.

Mrs Justice Roberts has urged the couple to negotiate, in an attempt to reach an agreed settlement. This is not the first time recently that a judge has tried to persuade a couple arguing over finances to settle the case, rather than run up huge legal costs in a contested court hearing (and nor is it likely to be the last). In May Mr Justice Holman criticised a couple for spending a “crazy” sum on their divorce case, and urged them to negotiate.

If you are involved in divorce proceedings then you should make every effort to settle the matter by agreement. Family Law Café can help you find a lawyer who can advise and negotiate for you. To contact us click the Contact link above and fill in the form, or call us on 0208 768 2278.

Image: Viking Star docked in Istanbul, by JD Lasica, licensed under CC BY 2.0.

UPDATE: Family Law Cafe is pleased to report that Mr and Mrs Hagen have apparently reached a settlement. Details of the the settlement, which was agreed six days into the three week trial, will not be revealed.

As explained in this post, it is possible for a respondent to a divorce based upon five years’ separation to ask the court to dismiss the divorce, on the ground that the dissolution of the marriage will result in grave financial or other hardship to them, and that it would in all the circumstances be wrong to dissolve the marriage.

There is another option available to respondents to a divorce based upon either two years’ separation and consent or five years’ separation: they may ask the court to delay the finalisation of the divorce until it has considered their financial position as it will be after the divorce.

Upon hearing such an application the court must consider all of the circumstances of the case and will not make the decree absolute, finalising the divorce, unless it is satisfied that the petitioner should not be required to make any financial provision for the respondent, or that the financial provision made by the petitioner for the respondent is reasonable and fair, or the best that can be made in the circumstances.

Note that the court may if it thinks fit makes the decree absolute notwithstanding the above, if it appears that there are circumstances making it desirable that the decree should be made absolute without delay, and the court has obtained a satisfactory undertaking from the petitioner that they will make such financial provision for the respondent as the court may approve.

For more information about the ground for divorce, see this post.

If you would like advice as to how the above may apply to your case, Family Law Café can help you find this. To contact us click the Contact link above and fill in the form, or call us on 020 3904 0506.

Image: Delayed, by Jordlet, licensed under CC BY 2.0.

A wife who complained that an equal division of the matrimonial assets was not fair to her because of the short duration of the marriage and her greater contribution towards those assets has won her appeal against the decision.

Julie and Robin Sharp lived together for six years from 2007, and were married for the last four of those years. There were no children of the marriage. For most of their time together they both worked and earned similar salaries, but Mrs Sharp received bonuses totalling £10.5 million, whereas Mr Sharp’s bonuses were ‘comparatively trivial’.

After the marriage broke down divorce proceedings were commenced and Mrs Sharp made a financial remedies application. The application was heard by Sir Peter Singer in the High Court. At that time the total assets held by either party amounted to £6.9 million, although Mr Sharp accepted that a property acquired by Mrs Sharp before the marriage should be left out of the pot of “matrimonial assets” that should be divided between the parties. The total value of the matrimonial assets was £5.45 million. Sir Peter Singer decided that that sum should be divided equally, and therefore awarded Mr Sharp £2.725 million.

Mrs Sharp appealed, claiming that an equal division of the matrimonial assets was not appropriate, in the light of the short duration of the marriage and the fact that the parties had largely kept their finances separate. Giving the leading judgment of the Court of Appeal Lord Justice McFarlane said that these factors, together with the fact that it was a childless marriage and both parties had their own income, justified a departure from the principle that matrimonial assets should normally be shared between the parties equally. Accordingly, the appeal was allowed and the award to Mr Sharp was reduced to £2 million.

You can read the full judgment of the Court of Appeal here.

Image: The Royal Courts of Justice, by Francisco Rojas, licensed under CC BY 2.0.

A man who believes that he has been unfairly treated by being ordered to pay maintenance to his ex-wife for life (unless she should remarry) is raising money via crowdfunding so that he can take his case to the Supreme Court, and change the law.

Graham Mills and his wife wife Heather were divorced in 2002. At that time he agreed to pay her a lump sum of £230,000 to enable her to purchase a house for her and their young son, as well as pay her maintenance of £1,100 per month. In 2014, having remarried and had another child, he applied to the court for the maintenance payments to stop. However, the court refused to stop the maintenance. Mr Mills appealed to the Court of Appeal and in February this year the Court of Appeal not only dismissed the appeal, but increased the maintenance payments to £1441 per month.

Mr Mills claims that his ex-wife is perfectly capable of supporting herself. He believes that the law should be changed, as it treats men as “cash machines for life”, and also encourages women to be “dependent upon men”.

He is not alone in this view. Not only have many members of the public indicated their support for it, former chair of the Bar Standards Board Baroness Deech has said of the case: “If there is one thing that stops women getting back on their feet and being treated seriously and equally at work, it is the assumption throughout the legal system that once she is married, she is somehow disabled and incapable of ever managing on her own. It is a very serious impediment to equality. This case shows how unethical, unpopular and out-of-date the law is.”

Last year the Baroness introduced a private member’s bill that would limit the duration of spousal maintenance orders to a maximum of five years, unless the court is satisfied that there is no other means of making provision for that spouse, and that that spouse would otherwise be likely to suffer serious financial hardship as a result.

So, should the ‘meal ticket for life’, as life-long spousal maintenance orders have been called, be ended? We will have to wait and see whether Mr Mills gets his case to the Supreme Court and, if so, what the Supreme Court Justices have to say. Otherwise, it does appear that the time may have come for the matter to be given proper consideration.

Image by Alex Liivet, licensed under CC BY 2.0.

We’ve seen here previously what kind of financial orders the court can make upon divorce, but what if the other party does not comply with the order? What can be done to force them to comply?

There are various methods of enforcement available, depending upon the type of order to be enforced. Some methods are specific to certain types of orders. For example, the court can require a maintenance order to be paid through the court, and if it is not paid then the party to whom the maintenance should be paid can ask the court to take enforcement action on their behalf.

Another example of an order-specific type of enforcement is where the court has ordered that a property, such as the former matrimonial home, should be sold or transferred, and the other party refuses to sign the necessary paperwork. In such cases a judge can be requested to sign the paperwork on their behalf.

The other most common methods of enforcement of family financial orders are:

Attachment of earnings orders – Requiring the debtor’s employer to make periodical deductions from the debtor’s earnings. Most commonly used to enforce maintenance orders, but obviously only available if the debtor is employed.

Judgment summons – Requesting the debtor to be committed to prison for failure to comply with the order. In practice, any committal order is likely to be suspended on condition that the debtor pay the amount due by a specified date, or by specified instalments.

Charging order – An order placing a charge on the debtor’s property, to the value of the debt. The debt is therefore secured, and can subsequently be recovered by seeking an order for the sale of the property.

Third party debt order – An order directing a third party who owes money to the debtor (e.g. the debtor’s bank) to pay the debt directly to the creditor.

Enforcement of financial orders can be a difficult and complex subject. If you would like any further advice about it, Family Law Café can help. To contact us click the Contact link above and fill in the form, or call us on 0208 768 2278.

Image: Barclays Bank, Ossett, by Tim Green, licensed under CC BY 2.0.

A recent case has highlighted the duty that the parties to family proceedings owe to the court.

Family proceedings are governed by the Family Procedure Rules 2010. The rules have the ‘overriding objective’ of enabling the court to deal with cases justly, having regard to any child welfare issues involved. Dealing with a case justly includes, so far as is practicable –

(a) ensuring that it is dealt with expeditiously and fairly;

(b) dealing with the case in ways which are proportionate to the nature, importance and complexity of the issues;

(c) ensuring that the parties are on an equal footing;

(d) saving expense; and

(e) allotting to it an appropriate share of the court’s resources, while taking into account the need to allot resources to other cases.

The court must seek to give effect to the overriding objective when it exercises any power given to it by the rules, or interprets any rule. However, what is not well known by many parties involved in family proceedings is that they are required to help the court to further the overriding objective.

An example of this not happening occurred in the recent case Christoforou v Christoforou. The case concerned a wife’s financial remedy application, where the resources were in the region of £50 to £55 million. The application was heard by Mr Justice Moylan in the High Court. He found that the husband, in particular, had conducted the case in a manner which was contrary to the duty placed on parties to help the court to further the overriding objective. He said:

“This failure can be demonstrated by the husband’s contention that he should be awarded the additional sum of €17,622 to compensate him for the wife’s unequal division of the balance in an account. I appreciate that a number of small sums can add up to a significant amount. I also recognise that, if the court too readily ignores what might be tactical accretion or expenditure of small amounts, parties might be encouraged to engage in such behaviour. However, to descend to this level in this case having regard to the available resources is, frankly, absurdly disproportionate.”

The case has not yet been finalised, but it may well be that the husband will be penalised on costs for his failure to help the court to further the overriding objective.

You can read the full report of the case here.

Image: Royal Court of Justice, by Santi Villamarín, licensed under CC BY 2.0.

In his 17th and latest ‘View from the President’s Chambers’, his periodic update on the process of reform of the family justice system, the President of the Family Division has called for the issues of divorce and ‘money’ to be ‘de-linked’, so that they are started and pursued by completely separate processes (albeit that the timeline for financial remedies is determined by the progress of the divorce). At present financial claims are made within, or ancillary to, the divorce proceedings.

The President says that: “The need for continuing reform is clear, not least to create systems and procedures that can be easily navigated by the litigants in person who increasingly dominate the worlds of both divorce and money.” He proposes that specialist ‘Financial Remedies Courts’ be set up to deal with financial remedy claims, and that the first pilot court be rolled out as soon as sensibly possible in late 2017, or very early 2018.

Divorce is, of course, now dealt with in eleven regional divorce centres, while financial claims are still being dealt with by local courts. This means that when a financial remedies claim is made the divorce proceedings are transferred to the local court. It does therefore seem to make sense for financial claims to be dealt with separately. However, financial orders cannot usually be made until the decree nisi has been pronounced, and do not usually take effect until the divorce is finalised, and so, as the President pointed out, the local court will need to know what stage the divorce has reached.

You can read the 17th View from the President’s Chambers: Divorce and money – where are we and where are we going? here.

Image: £’s, by Petras Gagilas, licensed under CC BY 2.0.

The wife of a former London oil and gas trader has been awarded the sum of £453 million in a divorce case in the High Court. The award could be the biggest ever made by a court in this country.

The husband built up a fortune in the Russian energy business, and sold shares in a Russian company for £1 billion, nearly five years ago. The sum awarded to the wife amounts to 41.5% of the total marital assets.

It seems that the husband had intended to argue that he had made a “special contribution” towards the family wealth. However, for reasons that are unclear, two weeks before the hearing he decided not to contest the proceedings, and he did not attend the final hearing, which took place in November and December last year.

It is thought that the award, which was made by Mr Justice Haddon-Cave, could be the largest ever made by a court in England and Wales. However, details of many awards are not published, so it is impossible to say for certain whether this is the case.

The full judgment in the case can be read here.

Image: London Stock Exchange, by James Hume, licensed under CC BY 2.0.