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(Court of Appeal; Thorpe, Rimer and Munby LJJ; 8 February 2011)
A couple ran a hotel business together. The net value of the business was about £11 million. The wife received 47.5%, but not half because she was getting cash of £3.2 million (in two instalments) as well as the hotel.
The wife resigned from the partnership and the husband indemnified her against all liability. A young child had fallen from the window of one of the partnership properties in 2004 and a personal injury claim had been brought. The judge's final order was made in September 2009. In November 2009 the wife died suddenly of a heart attack. In December 2009 the husband learned that the insurance company had avoided the policy which the parties had understood would meet the damages claim. It also appeared that the policy was limited to £2m and the claim could be in excess of £3m. The husband, who had so far paid lump sums of £1.75m, sought to appeal the ancillary relief order.
The wife's sudden death shortly after the ancillary relief order was not a Barder event since this was not a needs based award and she had earned her share in the matrimonial assets. Realisation that the insurance cover was likely to be insufficient to meet a potential damages claim was not a vitiating event, but discovery after the order was made that the insurance cover had been avoided was a vitiating mistake and the husband was entitled to relief.
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