Top 5 family law cases of 2007

21 DEC 2007

As 2007 draws to a close, Newswatch looks back at the five most significant family law cases over the last year. It has been an eventful year for family law practitioners with a major reform of legal aid by the Legal Services Commission, increased uncertainty about ancillary relief laws, the introduction of the Forced Marriage Act 2007, the further implementation of Domestic Violence, Crime and Victims Act 2004 and, several landmark judgments. Below are what we consider to be the most important five cases of 2007.

1.Charman v Charman [2007] EWCA Civ 503

(Court of Appeal; Sir Mark Potter P, Thorpe and Wilson LJJ; 24 May 2007) The parties had been married for 28 years and had two children, now adult. The judge found that the parties' assets amounted to 131 million, including 68 million in an off-shore discretionary trust created by the husband upon an expression of wish that during his lifetime he should be its primary beneficiary. A trust set up for the children, containing assets of at least 30 million, was not treated as part of the assets to be divided. The judge awarded the wife 48 million, 36.5% of the assets; this was believed to be the highest ever award on determination of a contested application for ancillary relief in divorce proceedings. The wife had conceded a special contribution by the husband in the generation of the fortune, and the judge based his departure from equality on both the husband's special contribution, and the greater risks inherent in the assets remaining with the husband. Under a further order, if the husband was required to make specified tax payments (estimated by the husband at 11 million) the wife should contribute 36% of such payments (up to 3.5 million). The husband argued that the wife's award should have been no higher than 28 million, and that the money in the trust should not have been treated as assets of the parties, because the trust was a dynastic trust intended for the benefit of future generations.

2.Stack v Dowden [2007] UKHL 17

(House of Lords; Lord Hoffmann, Lord Hope of Craighead, Lord Walker of Gestingthorpe, Baroness Hale of Richmond, Lord Neuberger of Abbotsbury; 25 April 2007) [2007] The Times April 26. The starting point in a case of joint legal ownership was joint beneficial ownership. A conveyance of a domestic property into joint names indicated both legal and beneficial joint tenancy, unless and until the contrary was proved. The burden would be upon the person seeking to show that the parties did intend their beneficial interests to be different from their legal interests. Many factors other than financial contribution were likely to be relevant, eg advice or discussions at the time of the transfer, reasons for acquisition in joint names, purpose of the home, financing of the purchase, and financing of the household. Cases in which joint legal owners would be taken to have intended that their beneficial interests should be different from their legal interests would be very unusual. Curiously in the context of homes conveyed into joint names, but without an express declaration of trust, the courts had sometimes reverted to the strict application of the principle of the resulting trust. The approach to quantification in cases in which the home was conveyed into joint names should certainly be no stricter than the approach to quantification in cases in which it had been conveyed into the name of one only, and to the extent that Walker v Hall [1984] FLR 126, Springette v Defoe [1992] 2 FLR 388 and Huntingford v Hobbs [1993] 1 FLR 736 held otherwise, they should not be followed. However, this case was a very unusual one, in that although the couple had cohabited for a long time and had four children together, they had kept their financial affairs rigidly separate. This was strongly indicative that they did not intend their share, even in the property in joint names, to be held equally. The woman had made good her claim for 65% of the property, having contributed far more to the acquisition of the house than had the man.

3.Hill v Haines [2007] EWCA Civ 1284

(Court of Appeal; Sir Andrew Morritt C, Thorpe and Rix LJJ; 5 December 2007) A property adjustment order made in ancillary relief proceedings, whether following a contested hearing or by consent, was made for consideration in money or moneys worth and could not therefore be set aside as a transaction at an undervalue. The order quantified the value of the applicant spouses statutory right to apply for financial provision by reference to the value of the money or property to be paid or transferred by the respondent spouse to the applicant spouse. Parliament could not have intended that a court order of this type be capable of automatic nullification on the suit of a bankrupt spouses trustee in bankruptcy.

4.North v North [2007] EWCA Civ 760

(Court of Appeal; Thorpe and May LJJ, Bennett J; 25 July 2007) The husband and wife divorced in 1978 after the wife had an affair. A financial order was made in 1981, settling (although not expressly dismissing) the wife's claims to capital by the husband's provision of a house for her and by his transferring ground rents to her to provide her with an annual income. The order also contained a provision for nominal periodic payments of five pence per annum until the wife remarried or until a further order was made.

In the following years the husband transferred further ground rents and investments to the wife, all together worth upwards of 30,000. He also carried out works to the wife's mother's property without charge and paid half of the wife's legal fees in connection with an application for a residence order in respect of a grandchild. Between 1978 and the present the wife chose not to work, and in 2000 moved to Australia, investing all her money there and living in a rented apartment in Sydney. The investments turned out to be unwise and the net result was that her assets and income dwindled drastically. The wife applied for a variation of the periodical payments order. The district judge ordered that the husband pay the wife a lump sum of 202,000 for the capitalisation and dismissal of the wife's periodical payments claim. The husband appealed.

The appeal would be allowed. In his judgment the district judge had absolved the husband of responsibility so that the order he then made amounted to a contradiction. It could not be said however that the wife's application for variation of the periodical payments order must be dismissed as a matter of principle: the factors upon which she relied were not excluded as a matter of statute or authority. The wife's failure to utilise her earning potential, her subsequent abandonment of the secure financial future provided for her by the husband and her lifestyle choices in Australia were matters which the husband could not be held responsible for in law. The investment losses fell into a different category and were more the outcome of hazard and came down to misfortune rather than mismanagement. In a second judgment handed down on 31 July the Court of Appeal awarded the wife 3000 a year in periodical payments, anticipating that the parties would agree a conventional capitalisation which would result in the dismissal of the wife's outstanding claims.

5.Ella v Ella [2007] EWCA Civ 99

(Court of Appeal; Thorpe and Maurice Kay LJJ and Charles J; 17 January 2007) The husband and wife both had dual British and Israeli nationality, but had been largely resident in England during the marriage. The husband had brought proceedings against the wife in Israel; the wife had brought proceedings against the husband in England. A pre-nuptial agreement between the parties provided that the law of Israel should apply. In the Israeli jurisdiction the wife had committed herself to a consent order concerning a postponement. The English judge agreed to stay the English proceedings, noting that the family's relationship with Israel was a profound one and identifying the pre-nuptial agreement as a major factor.

Whatever the relevance of the pre-nuptial agreement might be in England, it was undoubtedly a contract of considerable effect in the Israeli forum, of juridical advantage to the husband. An alternative basis for the judge's conclusion could be found in the history of the concurrent proceedings in Israel. If the husband obtained enforcement of the terms of the pre-nuptial agreement in Israel, the wife's prospects of getting permission to make a claim under Part III of the Matrimonial and Family Proceedings Act 1984 were good, given the connections of the family with England.

We hope you have a good holiday and look forward to bringing you more family law updates in the New Year. If you have any feedback about the Newswatch website please do not hesitate to email the editor: hugh_logue@jordanpublishing.co.uk.

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