FB v PS  EWHC 2797 (Fam) was W’s application for a financial remedies order after a 16 year childless marriage where the value of the assets amounted to c. £19m yet there was virtually nothing at all in the name of the wife. The judge held the business (sold for £17.6m which was held in a trust from which only H had benefited)had been founded by H and W jointly and that the sharing principle applied to the matrimonial assets. The issue of interest is how Moor J dealt with a property which had been the family home for 15 years, was in H’s sole name, but had previously been his father’s matrimonial home and was largely funded extraneously to the marriage. Moor J noted that the matrimonial home will normally be treated as matrimonial property (Miller) but that does not automatically lead to equal sharing of that asset (S v AG): an unequal division may be justified if unequal contributions to its acquisition can be demonstrated. The transfer from H’s father (and refurbishment work) was a very significant unmatched contribution, now worth some £3.5 million gross. However, as a result of being persuaded (by the father) to remain at the property and not enter the property market W argued the parties had 'lost' £1.4m. The judge accepted this argument to the tune of £500K which he included as matrimonial property, excluding the balance of the home. This reduced the assets subject to sharing to c. £16m of which W received 50%, giving her (by cross check) some 42% of the total assets - an appropriate division of the assets to reflect the unmatched contributions made to the property by H’s father.
JS v RS  EWHC 2921 (Fam) is instructive as an example of the practical working out of commonly encountered arguments. Sir Peter Singer characterised as 'doomed' a 'clutter' of arguments by which W sought to avoid an equal division in a 6 year marriage where the assets of £6.9m (plus some £940,000 pension) had largely been accrued during the marriage but chiefly through her bonuses. The judge gave short shrift to arguments on pre-acquired ('fledged') earning capacity (impermissible, not least because of the absence of any principled approach to its evaluation), contributions('expensive, time-consuming and almost invariably arid disputes' which should be consigned and confined to the "attic" referred to by Coleridge J in G v G  2 FLR 1143), stellar contributions (very rarely made out, and here W fell “several leagues short”), while conduct (not made out) and add-backs (no wanton dissipation established) would not have made any difference to the award. 'Unilateral assets' (arising from the dual career concept introduced by Lady Hale in Miller) was a concept for which the Court of Appeal in Charman showed a patent lack of enthusiasm and an express intention to keep the application of the concept closely confined. Indeed it was difficult to think of a case in which it had been applied as opposed to being discussed. The judge concluded the sharing principle should apply to this 6 year marriage. It was consistent with current principle that the matrimonial acquest, the value of the assets and savings built up during the marriage, irrespective of the very different proportions in which the parties contributed them, should be subject to the equal sharing principle. Although W brought £1.37m into the marriage (and H virtually nothing) £1.02m was invested in the FMH and so mingled. Only £350K was therefore excluded. It proved unnecessary to consider Mostyn J’s approach to unequal contributions and thus an unequal division of the FMH (eg S v AG) because H, in the event, conceded that its value should not be included in the fund for division. The judge concluded the court could not force upon a party the greater share that would otherwise inform the award by the application of the sharing principle.
In NR v AB & Ors  EWHC 277 (Fam). Roberts J helpfully reviewed a number of authorities in addressing issues of constructive and resulting trusts (from Pettitt and Gissing to Stack v Dowden), variation of nuptial settlements (from Brooks v Brooks  2 FLR 13 to Ben Hashem v Al Shayif  1 FLR 115) and the implications of the principles in Thomas v Thomas  2 FLR 668 where both H and W came from wealthy Saudi Arabian families who, it was argued (by the opposing sides), would be expected to assist their family member. W would inherit under Sharia law from her father. H (the judge found) had only a one third interest in assets shared with his family following the death of his father. The parties had lived in properties owned by a company which H did not own or control (Prest principles applied) but under a licence held to be a nuptial settlement which could be (and was) varied to provide W (and children) with a long term home. H’s liquid assets and limited joint funds amounted to only £1.64m and his additional resources of £12.4 -15.7m were all inherited. A capitalised maintenance award was made for W (£2m to represent £175K pa over 14 years, by which time it was likely she would have received her inheritance) with further support for the children, and a modest sum for a car. Costs had exceeded £2m.
In BR v VT  EWHC 2727 (Fam) Mostyn J employed FPR 20.2(1)(c)(v) to order the interim sale of the matrimonial home in order to impose financial sanity on the family and seek to avoid insolvency where the family were in critical revenue deficit with pressing debt, albeit largely due to H’s reckless expenditure and W reneging on an agreement to sell. An interim sale could not be made unless the Court was satisfied that W’s home rights should be terminated pursuant to an order under s 33(3)(e)Family Law Act 1996 applying the evaluative factors in s 33(6). Applying those factors W’s rights of accommodation were terminated, her rights notice was vacated (para 1, Sch 4 to the Act), and she was ordered to give vacant possession on completion of the sale. H’s income would (just) cover rented accommodation for each party and the school fees.
In JS v RS  EWHC 2921 (Fam) Sir Peter Singer considered the merits of off-setting.A pensions expert had been asked to calculate the PSO necessary to provide an equal income outcome from the growth of each party’s pension during the marriage. She concluded there should be a 23.8% PSO from W to H. W would lose more pension income than H would gain (£5,300 pa), and any benefit to H depended on him surviving the 20 years until he would take the pension. Off setting would, by contrast,provide H with immediate capital and give W greater security. The expert calculated the appropriate capital sum, even discounted, as £210,856 which the judge could not accept as the value of £5,300 pa in 20 years time and he assessed the off-setting sum(apparently arbitrarily) at £60,000.
In WS v WS  EWHC 3941 (Fam) the issue arose again. The judge noted JS v RS and recent commentary in Family Law which demonstrated the absence of any reliably consistent expert evidence as to methodology or outcome for calculating the appropriate figure for off-setting and concluded there was 'no obviously right figure or correct calculation' for offsetting but adopted W’s approach of assessing a conventional Duxbury valuation of the shortfall in H’s pension income which was certainly preferable to an annuity based calculation.
Cases with a foreign element
Estrada v Walid Bin Ahmed Abdallah Al-Juffali  EWHC 213 (Fam): Hayden J had to decide whether H had diplomatic immunity from suit (under Art 39(1) Vienna Convention on Diplomatic Relations (1961) in respect of his appointment as Permanent Representative of St Lucia to the International Maritime Organisation) in relation to an application for financial relief under Part III of the Matrimonial and the Family Proceedings Act 1984. He concluded that the appointment was spurious and that, as W argued, H had secured the post to avoid her claims. Article 39 must be interpreted in light of W's Art 6 ECHR right to a fair trial, and therefore, balancing the need to protect the functionality or effectiveness of a mission on the one hand and minimising abuse of diplomatic immunity on the other, Art 39(1) required not only that a person had been appointed to a diplomatic post but that he had, in reality, taken it up. He had not. In any event the immunity would not apply if H was permanently resident and a factor in deciding this was whether he would be in the UK but for the requirements of the sending state. On all the evidence he was permanently resident. Hayden J finally,and although it was no longer relevant, considered whether W's claims fell within the'real action' exemption (Art 31 of the Convention) to diplomatic immunity and concluded they did not.
Another Part III case
Ramadani v Ramadani  EWCA Civ 1138 was an appeal concerning the jurisdiction of a court in England and Wales to hear a spousal maintenance application in the context of Council Regulation (EC) 4/2009 ('The Maintenance Regulation') following previous proceedings in another EU member state.Held: no ‘decision’ by the Slovenian court, when W withdrew her application there.
In MS v PS  EWHC 88 (Fam) W, a German living in Germany, applied to the Family Court in Lincoln to enforce a German maintenance order for two children against the H living in England. The matter was referred to the High Court on the issue of whether an application for enforcement of such a maintenance order can be issued directly in the Family Court or whether, in all cases, the application must first be lodged with the Lord Chancellor for onward transmission to the Family Court through the Reciprocal Enforcement of Maintenance Orders Unit ('REMO'). There was a conflict of judicial opinion in the case law, and an apparent inconsistency between Council Regulation (EC) Maintenance Regulation 4/2009 and domestic legislation (the Civil Jurisdictions and Judgments (Maintenance) Regulations (2011)). Roberts J concluded that the matter required an expedited reference to the ECJ (in summary): whether a maintenance creditor wishing to enforce in one member state an order obtained in another has a right under the Maintenance Regulation to make an application for enforcement directly to the competent authority of the requested state? If so must each member state provide a mechanism to recognise that right?The answer will be awaited with interest.
In Maughan v Wilmot  EWHC 29 (Fam) H challenged a 2013 order authorising service on him by e-mail on the basis that there is no power to serve a person out of the jurisdiction by email where he is in Turkey, a party to the Hague Convention of 1965 on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters. While dismissing the challenge for delay, acquiescence and/or voluntary acceptance of delivery (Art 5 of the Convention), Mostyn J also addressed the merits.The objective of the Convention was 'to create appropriate means to ensure that judicial and extrajudicial documents to be served abroad shall be brought to the notice of the addressee in sufficient time'. It requires service through the authority designated under the Convention in respect of the foreign country. At the time technology did not exist to effect service other than physically. Things have moved on. Service in another jurisdiction used to be regarded as an interference with the sovereignty of the other country. Abela and Others v Baadarani  UKSC 4 decided that the purpose of service is simply to inform the defendant of the contents of the claim form and the nature of the claimant's case. Previous jurisprudence is now redundant. FPR 6.1(b) permits the court to dis-apply the terms of Chapter III of Part 6 and to authorise email service on a party out of the jurisdiction, if there is good reason to do so. H had not shown there was no such reason.
In DB v DLJ  EWHC 324 (Fam) Mostyn J upheld an arbitral award on H’s application for W to show cause why it should not be made an order of the court (pursuant to the procedure set out by the President in S v S (Arbitral Award: Approval) (Practice Note)  1 FLR 1257, and the Practice Guidance: Arbitration in the Family Court). W resisted the application on the basis that the award was vitiated by a mistake about the true value of a property in Portugal allocated to her. Alternatively, she said that events had occurred since the award which invalidated the finding made by the arbitrator as to the value of that property. The judge, while commending the arbitration route to resolving such disputes underlined and described the very limited basis upon which such an award may be challenged(while identifying the slightly broader grounds open to parties in family proceedings because of the need to secure an order of the court, for instance to obtain a clean break or a pension sharing order). Mistakes in the presentation of evidence, and supervening events would not enable a party to avoid the award. Mostyn J also set ou procedural steps which will be necessary to implement such awards.
In Minkin v Landsberg  EWCA Civ 1152, after being advised by T solicitors against a proposed settlement the claimant W, an experienced accountant, decided to proceed with it anyway and she and H submitted a draft order to the court which was rejected (twice). She instructed D solicitors to redraft the order which was then accepted by the judge. Subsequently she unsuccessfully sued D for failing to advise her against the settlement. W’s appeal failed. On the judge's findings of fact, the defendant was working under a limited retainer to redraft the financial remedies consent order and had no duty of care to advise on the merits of the underlying agreement or to give the broader advice or warnings for which W now contended. Also, on the basis of the evidence at trial, W could not succeed on causation. Jackson LJ summarised the duty of a solicitor as follows (para 38):
i) A solicitor's contractual duty is to carry out the tasks which the client has instructed and the solicitor has agreed to undertake.
ii) It is implicit in the solicitor's retainer that he/she will proffer advice which is reasonably incidental to the work that he/she is carrying out.
iii) In determining what advice is reasonably incidental, it is necessary to have regard to all the circumstances of the case, including the character and experience of the client.
iv) In relation to (iii), it is not possible to give definitive guidance, but one can give fairly bland illustrations. An experienced businessman will not wish to pay for being told that which he/she already knows. An impoverished client will not wish to pay for advice which he/she cannot afford. An inexperienced client will expect to be warned of risks which are (or should be) apparent to the solicitor but not to the client.
v) The solicitor and client may, by agreement, limit the duties which would otherwise form part of the solicitor's retainer. As a matter of good practice the solicitor should confirm such agreement in writing. If the solicitor does not do so, the court may not accept that any such restriction was agreed.
King LJ made the further point that with the loss of legal aid in financial remedy cases the courts were overwhelmed as a consequence of the increase in court time taken by each case where the parties appear as litigants in person. It is not the function of district judges to draft or redraft consent orders. As a consequence solicitors are offering a bespoke but limited service to both draft Forms E and consent orders. This service is invaluable to both courts and litigants alike, saving as it does court time but also stemming the increasing number of applications to the courts in relation to the working out of orders which do not accurately reflect the true intentions of one or other of the parties. It is essential that solicitors are able to offer such a service within the confines of their retainer without an obligation to offer wider advice, but it is also important that the restrictions on the retainer are recorded in writing.
In Mackay v Mackay  EWHC 2860, Holman J recused himself where, although there was no express application for him to do so, he felt there were “'solid reasons' why he might feel personally embarrassed where he might have to make a judgment about the integrity or probity, and possibly the very honesty, of the husband who was a friend of a sailing friend of the judge. The case was a ‘set aside’ case which, in any event Holman J held, could not be heard before Sharland and Gohil had been decided.
In Mann v Mann  EWHC 314 (Fam) Roberts J had to calculate outstanding arrears due to W after 17 years of litigation and examined the applicability of s 24 Limitation Act 1980 to claims for interest on unpaid financial orders in light of Lowsley and Another v Forbes (t/a L E Design Services)  1 AC 329. In addition, she addressed recent developments concerning the burden of proof for committal under s 5, Debtors Act 1869 (Mostyn J in Bhura v Bhura  EWHC 3633 (Fam) and of McFarlane LJ in Prest v Prest  EWCA Civ 714).
This article is due to be published in the FLBA's Family Affairs and appears on the St John's Chambers website. It has been reproduced here with kind permission.
Family Affairs is the FLBA’s tri-annual magazine which aims to keep members up to date with events around the country and important developments in family law and procedure. Family Affairs is edited by John Wilson QC.