Category: Divorce

I noted a press release this afternoon, released by the Minister of Justice, that promised the “biggest shake-up of divorce laws in 50 years aimed at reducing conflict and supporting children and families.”

And I, for one, agree. The Divorce, Dissolution and Separation Bill will revolutionise the way in which divorcing couples will end their marriage.

No longer will they need to lay blame either through allegations of bad behaviour or adultery and instead this will be replaced with a simple statement of irretrievable breakdown.

The truly original feature is that couples may opt to make a joint statement of irretrievable breakdown if they choose. Reflecting the fact that when many marriages end, both parties have reached the same conclusion.

It will also take away the prospects of unsightly defended divorce cases where parties are subjected to airing the intimate aspects of their marriage in the Court.

It is to be hoped that starting the divorce process on a less contentious footing will help the parties to resolve other issues that may arise whether they relate to future arrangements for their children or sorting out financial settlements.

I think that the end of the blame game in divorce is definitely one step closer.

Julian Hawkhead, Senior Partner at Stowe Family Law

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I have written here previously (for example here) that financial remedy orders are intended to be final, and that therefore a party is not usually entitled to have a ‘second bite of the cherry’. Once a claim against property has been determined, no further claim can be made against that property. In the recent case Chaudhri (Shafi) v Shafi & Another, however, the situation was slightly different: here, the wife had declined to take that first bite. She did not actually pursue a first claim against the property. However, as we shall see, the end result was still the same.

The case, heard by Mr Justice Mostyn in the High Court in April, concerned the wife’s application for a freezing injunction against a property in London (the injunction had been made earlier by Mr Justice Cobb, and Mr Justice Mostyn was reconsidering it). The injunction was sought in relation to the enforcement of a lump sum order requiring the husband to pay to the wife £686,000. The husband had failed to comply with the order, and the wife sought the freezing injunction to prevent the property being sold or mortgaged, thereby protecting the wife’s claim against the property, which she no doubt hoped would be sold, so that she could recover all or part of the lump sum.

The complication was that the property was held in the name of a third party. The wife claimed, however, that she and the husband had funded its purchase, and were the true (’beneficial’) owners. The wife had made a claim against the property within the financial remedy proceedings. However, she stated that she “did not pursue it due to stress and ill-health.”

Whilst it was true that the wife had suffered stress and ill-health around the time of the final financial remedies hearing, Mr Justice Mostyn found that she was not incapacitated, and was in a position to give instructions to her solicitor. A lawyer for the third party had written to her solicitor stating that her claim against the property had no substance, and asking whether the wife would oppose an application by the third party to have the claim struck out. The wife’s solicitor replied, confirming that she would not resist the strike-out application.

In addition to this, when the matter later went before the court the judge specifically recorded that the wife did not pursue a claim against the property.

Turning to the wife’s freezing injunction application, it was suggested by counsel for the third party that it would be an abuse for the wife now to be allowed to pursue a claim in relation to the property. Mr Justice Mostyn agreed, citing the following words of Lord Bingham in a 2002 House of Lords case:

“The underlying public interest is … that there should be finality in litigation and that a party should not be twice vexed in the same matter … The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all.”

Mr Justice Mostyn said that not once, but twice, had the wife failed to pursue her claim in relation to the property. In his judgment, it would be a manifest abuse were a claim now to be allowed to be mounted and protected by a freezing injunction. Accordingly, the injunction was discharged.

(It should be noted that the wife also had the protection of an earlier worldwide freezing order, presumably freezing any property held by the husband, anywhere in the world. Sadly, it can be very difficult to enforce against assets held abroad, which was no doubt why the wife was eager to enforce against an asset in this country.)

You can read the full judgment here.

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Can I stay in our family home if we split up?

This is such a common question that our lawyers are asked and quite rightly so. The family home is a special place and, in many cases, is the main family asset so it is little wonder that when a family breaks down, the property will be central to the divorce.

So we decided to revisit a blog from 2018 by Sarah Barr- Young, Managing Partner of Stowe Family Law in Ilkley which does a great job of explaining what options are available for separating couples and the family home.

“What are the options for the family home in a divorce settlement?

In a divorce, all assets held jointly and in sole names need to be identified and their values agreed in order for the negotiations to commence to bring the parties financial relationship to an end.  During this process, a value for the family home will be agreed for negotiation purposes.

There are several options for the home. For instance: one spouse buys the other one out and keeps the house, the house is sold and the proceeds divided, or one parent remains in the property and the other party may defer receiving the balance for their share. This can be until the property is sold or transferred to another party upon a specific future event, such as once the children move out or the partner remarries.

It is usually clear early on whether one party can afford to retain the family home post-divorce or if it needs to be sold. Retaining the family home is important when children are involved to give them stability as they adjust to the new dynamic, but this is not always financially possible.

What if I cannot afford to run the family home by myself?

If you are unable to meet all the outgoings on your income, you could seek assistance from your spouse as an interim measure if they have the money available to help and your own outgoings are reasonable. You will need to check that your income includes everything that you are entitled to e.g. child maintenance/tax credits etc. If your spouse is unwilling to agree, it is worth contacting the mortgage provider to see if they can offer any assistance by way of a mortgage holiday as a short-term solution.

My name is not on the property deeds – do I still have any rights?

If the property is the family home then the court views it as a joint asset. However, if the family home is in the sole name of your spouse you must act quickly and enter a Notice of Home Rights against the property with the Land Registry. This should help prevent your spouse from trying to sell the property without your knowledge or consent.

Are my rights affected if I move out before the house is sold?

No. If the atmosphere at home has become unbearable and you need to move out it will not affect your entitlement to a claim on the property. It is advisable to collect all your personal belongings, including paperwork, before you go in order to prevent any issues in recovering them at a later date.

Do you need divorce advice?

There are many myths surrounding divorce and what happens to the assets of a marriage so I always recommend obtaining legal advice from a solicitor so that you can get advice tailored to your own situation. This will enable you to make informed decisions about you and your family’s future.”

If you would like advice on divorce and who keep the house, you can make an enquiry here or call our Client Care Team at the number below.

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As a family lawyer who spent most of his time dealing with cases involving clients of ‘ordinary’ means, it is nice occasionally to come across the report of a financial remedies case in which the parties do not belong to the ‘mega rich’ class (of course reported cases are more likely to involve the mega rich, as they can better afford the cost of taking their cases to the higher courts, where the judgment is more likely to be reported). The Court of Appeal decision in Crowther v Crowther, which was handed down in February 2017 but has only recently been reported on the Bailii website, was such a case.

The case concerned an appeal by the husband against an order that the wife retain the former matrimonial home, the only capital asset of the marriage, which had been purchased entirely from an inheritance that the wife had received from the estate(s) of her late parents. The case is not just of interest for what was decided, it also acts as a further demonstration of the difficulties that can arise as a result of legal aid not usually being available in financial remedies cases.

I don’t need to spend much time setting out the facts of the case. The parties were married for about ten years, before they separated. The property was purchased about half way through that period. At the time of the final financial remedies hearing it was valued at about £200,000, and was mortgage free.

After the separation the wife continued to live in the property, which has four bedrooms, along with her adult daughter from a previous relationship, and that daughter’s partner. The husband was living in his parent’s home.

A complicating factor was that both the husband and the wife were found to be vulnerable, in terms of their psychological and mental health. In fact, the wife’s mental condition led to concerns as to whether she had capacity to conduct the litigation. The husband, meanwhile, appeared to be physically disabled, although medical experts found very little physical explanation for his apparent disability, and that there was a very significant element of ‘functional overlay’.

The husband was fully represented at the hearing, and the wife was a litigant in person. The husband argued that the matrimonial home be sold, that the net proceeds be divided equally, and that that would provide each party with sufficient to rehouse themselves. The wife argued that the husband was not entitled to any claim on the house because it represented her inheritance from her parents, and that if he wanted to live independently, the husband could easily fund it by either obtaining council accommodation, or through housing benefit. He did not therefore need any capital from the house.

The hearing was conducted by His Honour Judge Tolson QC. He of course was put in the difficult position of trying to ensure fairness between one party who was represented, and one party who was not. To achieve this he undertook questioning of the husband, effectively on behalf of the wife. The questioning was extensive, and as a result of it Judge Tolson formed the opinion that the husband was unlikely to be able to live independently. This had not been part of the wife’s case. Nevertheless, it was a primary reason for him concluding that receiving a half share of the property would not actually meet the husband’s needs. Accordingly, he ordered that the wife should have the property.

The husband appealed, to the Court of Appeal. Giving the leading judgment Lord Justice McFarlane found that the process adopted by Judge Tolson had been unfair to the husband. The husband should have been given advance warning that the issue of whether he was able to live independently would be raised, so that he could take steps to present his case in order to meet it. He had been given no such warning, and that determined the appeal, irrespective of any issue of whether Judge Tolson had wrongly put the issue of contribution (i.e. the wife funding the property out of her inheritance) above the issue of the parties’ needs.

Accordingly, the husband’s appeal was allowed, and the case was sent back to the family court to be heard again. Lord Justice McFarlane expressed the wish that the wife should be represented, the case in his view being sufficiently complex to justify exceptional legal aid funding.

As I said earlier, the case is a demonstration of the difficulties that can arise as a result of legal aid not usually being available in financial remedies cases. It also shows that that can lead to unfairness not just to the party who is unable to obtain legal representation, but also to the other party.

The full judgment can be read here.

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In the second instalment of “A public and bitter divorce battle, there is another way” by Senior Partner, Julian Hawkhead he looks at how arbitration is another useful tool to resolving financial issues in divorce away from the public eye.

Another route to resolving financial issues is arbitration. Arbitration, in short, is a privately funded process where your nominated independent arbitrator decides the outcome of your case by making a binding award which through the rules of arbitration is turned into a Court order.

Like private FDRs, you can choose your arbitrator or if you cannot agree who it should be, an independent body can select the arbitrator for you. The hearing will be conducted away from the Court in private offices. It is entirely confidential, and you are not constrained by the delays of the Court system or the constraints of time. It is, however, a voluntary process. Both parties must agree to enter it.

Arbitration, at times, does arouse suspicion of bias particularly concerning the politics and tactical thought processes of the relationship between the lawyer and the arbitrator chosen. This is less of a feature of private FDRs, where the views are in any event, not binding. However, as an arbitration award is a final binding decision, the fear of bias can loom larger.

The attraction for some litigants is that the “lottery of litigation” creates a level playing field and you both share in the good or bad experiences. It does, however, reflect a naive attitude towards the private FDR and arbitration processes and shows little faith in the professionalism of highly experienced lawyers. An arbitrator who showed bias would soon lose any credibility. Judges are just as capable of misunderstanding issues, having natural human biases for different circumstances or types of behaviour.

Of course, private FDR hearings and arbitration both attract additional fees. However, if you trade that cost against the saving of time (which inevitably leads to more costs), the quality of experience and decision making, then surely it is a price worth paying?

We are dedicated to finding solutions for our clients and advise on all the options available to our clients to resolve their issues in the quickest, most cost-effective and least acrimonious way.  Read our section on out-of-court settlement options here.

With over 50 members of Resolution in our team and a high number of specialist accredited lawyers, we can help you find the best way to achieve your goals.

For advice on arbitration and other out of court settlements you can contact me here or our Client Care Team below.

You can read part one of this article here. 

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All family lawyers will be familiar with the phenomenon of the client who has a strong sense of what they are ‘due’ or entitled to when it comes to financial remedies on divorce. Now, there is nothing intrinsically wrong about believing you are entitled to something, whether it be money or property, but a really strong sense of entitlement can sometimes cloud the judgment. Sometimes, for example, that party can be rather too eager to recover what they believe they are due, and end up incurring costs in a forlorn pursuit of their ‘entitlement’.

I’m not saying that the applicants in the two quite different recent cases to which I am about to refer suffered from this phenomenon, but certainly the cases act as a useful reminder of the perils of being too eager to recover what you believe you are due.

Both cases are recent judgments of Mr Justice Mostyn.

The first case is Purvis v Purvis, which concerned a rather unusual application by the husband. He was apparently convinced that the wife may have been hiding assets in the USA, which obviously should have been taken into account in any divorce settlement.

The facts of the case given in the judgment are rather ‘bare bones’, as the judgment did not require full details. Essentially, the parties began a relationship in this country in 1992, in 2001 they purchased a property in Florida, and they were married in January 2004. In July 2004 they acquired a cafeteria business also, I assume, in Florida, to which they moved at some point in that year. In December 2005 the marriage broke down and the husband returned to this country. Divorce proceedings were eventually commenced in this country in 2009, although they have yet to be finalised.

The husband made a financial remedies claim within the divorce proceedings. Obviously, both parties were required to make full disclosure of their means. However, the husband was not satisfied that the wife had provided sufficient explanation as to what had happened to the property and business in Florida. He claimed that the house is worth $250,000 and the business was profitable, with a turnover of $750,000. The wife was in sole control of both. However, the house was foreclosed in November 2008 and the company ceased to be registered in 2013.

The husband therefore applied for an order that a letter of request be issued to the authorities of the United States of America for the wife to be examined in Florida and to produce documentation to disclose the true nature of her financial resources. Mr Justice Mostyn refused the application, which he considered to be nothing more than a “fishing expedition”. The husband had no evidence as to the existence of any of the residue of the assets, he was merely “fishing” for that evidence.

The second case is Gladwell v Gladwell. This concerned an application by a husband to set aside a writ of control issued by the wife to recover a debt that was not yet due (a writ of control authorises a court enforcement officer to seize goods of a debtor in order to recover the debt).

The relevant facts of the case were that the court had made a consent order, setting out the financial settlement agreed by the parties. A term of the order was that the husband should pay to the wife the sum of £5,889 in lieu of her claims against his pension, from his share of the proceeds of sale of the parties’ timeshares in Malta.

Clearly, the payment was not due until the timeshares were sold. However, despite this, the wife issued the writ to recover the payment before the sale took place. On the 28^th of March 2019 enforcement officers attended at the home of the husband. The enforcement officers’ costs had increased the debt to £8,304.72. That sum was paid by the husband on his credit cards.

The husband then applied to have the writ set aside. Without going into detail, Mr Justice Mostyn found that the writ was unlawful, and that the monies had been wrongly taken from the husband. He therefore set aside the writ and ordered that the monies be returned to the husband.

In both of these cases the applications had been misguided, quite possibly because of the applicants being too eager to recover what they believed they were entitled to. The result, however, was that the applicants had failed, and could well have incurred considerable costs for their efforts. The moral is: think hard (and preferably take the best available advice) before you act!

You can read the full report of Purvis v Purvis here, and of Gladwell v Gladwell here. As far as the latter is concerned, a word of warning: in family cases the party who was originally described as the ‘applicant’ can subsequently become the ‘respondent’, and vice versa, if the original respondent later makes an application of their own. Unsurprisingly, this can sometimes lead to a little confusion, so please bear it in mind if you read the Gladwell judgment.

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