Financial order still stands despite property being worth less than expected

What is to happen to the former matrimonial home is, of course, a primary issue in most financial remedy cases on divorce. And in order to make a decision the court will require a valuation of the property.

But what if the valuation later proves to be incorrect? Should the decision of the court still stand?

That was the question apparently facing the court in a case that took place recently in the Family Court in Truro.

The case concerned a wife’s financial remedies application, which was heard in November 2023.

At that hearing the court was provided with an expert valuation of the former matrimonial home, which valued the property at £800,000. The valuation had been obtained jointly by the husband and wife, and neither of them suggested at the time that it was unreliable.

In fact, at that time the property was on the market for £895,000, and both parties appeared confident of achieving more than £800,000. However, when making its decision the court used the value of £800,000, in accordance with the expert valuation.

The court ordered that the property should be sold for the best price reasonably attainable in excess of £800,000, that the wife should receive the sum of £410,000 from the net proceeds, and that the husband should receive the balance.

In the event the property has not been sold. The asking price was reduced to £800,000 in July 2024. The estate agents now suggest reducing the asking price to £750,000, although an offer was received for £795,000, dependent upon the purchaser selling her property.

In view of these developments the husband, concerned that he would now receive less than anticipated, went back to the court to request that the order be set aside, or varied.

The court found that at the hearing of the wife’s application the husband had been content for an order whereby the wife received a fixed sum from the net proceeds of sale. This, of course, meant that he would receive less if the property sold for less than anticipated. However, it also meant that he would benefit from any increase in the value of the property.

Further to this, the offer made for the property suggested that it was actually worth close to the £800,000 figure used by the court. (If it was actually worth significantly less then perhaps the outcome may have been different.)

And further to that, the delay in selling the property meant that an early mortgage redemption penalty would no longer have to be paid, meaning that the husband would get more.

In the light of these factors the court dismissed the husband’s application.

You can read the full report of the case here.

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