Category: Divorce

“Embroiled in a bitter divorce battle” “estranged wife wins bitter £1.4m divorce battle…”

We have all read the tabloid headlines as another super-rich or celebrity marriage ends. High-profile divorce cases come with their own unique issues (scrutiny by the public and media and complex assets to start with) but they do not have to end in a bitter, drawn out, not to mention expensive, court case.

We asked Julian Hawkhead, Senior Partner, to join us on the blog to look at alternative options to help high-profile couples keep their marriage and their business out of the public domain.

This weekend I read how a certain celebrity baker and his estranged wife were destined for a courtroom showdown.

According to the article, friends of Mrs Alex Hollywood said that she was finding the whole process of divorcing her husband Paul exhausting and conflicts over money distressing. No doubt a feeling shared by both parties involved.

There are plenty of salacious rumours around the causes of the marriage breaking down, allegations of scenes in car parks and abuse being thrown around. None of this is unusual, anger is a key stage of the grieving process and to vent emotion is healthier than bottling it up. It enables you to move on with your own life. It is, of course, difficult when every incident, every alleged insult thrown is aired in the public domain.

However, what particularly caught my eye was the suggestion that mediation had failed, and the couple were destined to end up in Court. Another newspaper reported it would be an “epic court showdown”. Now I don’t tend to rely on this media source for a true account of what is happening in the world.  However, what disappointed me but did not surprise me, was that the media appeared to present the stark choices of mediation or an epic courtroom battle. Whereas this is simply not true and there are lots of different options available.

Any divorce litigation is exhausting, expensive and often acrimonious. Lawyers are trained to seek solutions but when agreements cannot be reached, the next step is to achieve your desired outcome in an arena where somebody else, most commonly a Judge, decides that outcome for you.

So, you embark on building your case, identifying issues where you can discredit the other party, sling enough mud and some of it is bound to stick and gather evidence that supports your arguments that what you are asking the Judge to decide upon is perfectly reasonable.

It can turn into a war of attrition, trench warfare where you are firing your best weapons at each other and it can sometimes get you the result you wanted. However, if you are media-worthy it will be ventilated, warts and all, in the public domain.

So, what other options exist where a negotiated settlement seems to have hit a wall?

Firstly, there are private FDRs but what is an FDR?

An FDR is a Financial Dispute Resolution hearing which divorce couples would usually come upon if they found themselves in financial court proceedings because of their divorce.

At this hearing, a Judge will:

(1) consider all proposals made by both parties, even those made on a without prejudice (or private and off the record) basis

(2) listen to any further arguments in support of each party’s proposals

(3) will encourage both parties to put their cards on the table to identify what the issues are, what is and is not agreed and consider compromise as a better course of action to facing further costs and uncertainty

(4) express a view to both parties as to what the FDR Judge considers would be the outcome if the case was to be decided at a final hearing. This view is not a binding decision, it is merely an expression of an opinion, albeit carrying the gravitas of coming from a Judge. This should help the parties entrenched firmly in the view that they must be right, reach an agreed settlement.

These FDR hearings are what can otherwise be called Early Neutral Evaluations.

Early – because the intervention is at the earliest stage in a Court process once all the facts and figures are known (and importantly before a final hearing when a Judge does make a binding decision on both parties);

Neutral because that is what any Judge is expected to be and when you have two lawyers jousting and pronouncing that they are right, fair and reasonable and the other party is wrong then you need somebody neutral to help give an independent evaluation or assessment of what is a fair outcome.

However, avid readers of all things family justice will be aware that the Court system is under pressure. There are long delays in waiting for hearings in many Courts. Sure, there are reforms on the horizon particularly with the specialist Family Court programme that is being rolled out but will this succeed on a national level or will we just see pockets of success.

There is the risk in the meantime that the Judge you come before for your FDR is not an experienced family lawyer. They may have practised in a completely different area of law when they were a solicitor or barrister before becoming a Judge so their experience and ability to give you an informed opinion may be based on limited knowledge of the relevant law.

That is the context of FDR hearings within the Court system. Private FDRs involves the same process, but you go private, you pay for an experienced lawyer, often either a retired senior Judge or a practising senior barrister or solicitor to conduct the FDR hearing for you.

The venue is not a courtroom but a place of your choosing, it might be the barrister’s chambers or the lawyer’s offices or a completely neutral venue such as a dedicated meeting room or a hotel. Whatever the option, it is infinitely more comfortable than being in a Court building surrounded by other litigants.

You also get as much time as you want. Your Private FDR Judge will dedicate their entire day to your case, giving you as much time to negotiate as you want or as much time in the hearing as you need.  In the Court system, you are constrained by opening and closing times and by the fact that the Judge has a full list of other cases to get through leaving your time restricted.

In some courts, one often finds several FDR hearings listed at the same time in the hope that some will settle easily. This leaves the Judge to juggle a number of cases, all with different facts and figures where their ability to give the matter full attention is then naturally impaired.

Most importantly the private FDR is private, it is away from the public gaze. One often finds the media wandering around the Central Family Court in London looking for a story or you run the risk of other litigants in Court seeing you. A Private FDR gives you a truly confidential and safe place to sort out your issues with the other party. You are paying for it but with that, you get a better-quality experience, and this must increase the prospects of you reaching a financial agreement.

In the next instalment, Julian will look at arbitration, another route to resolving divorce financial issues in private.

The post A public and bitter divorce battle, there is another way appeared first on Stowe Family Law.

As a Jewish businessman criticises the Family Court for putting him in a catch-22 situation that allegedly traps him between family law and religious law, Julian Hawkhead, Senior Partner joins us on the blog to look at the case in more detail.

“A recent article in the press told of a Jewish “property millionaire” husband Mr Alan Moher who was denied a clean break by the Court. This left him required to pay his wife, Mrs Caroline Moher, ongoing maintenance despite her being awarded £1.6m until he granted his wife a Get (Jewish religious divorce). He protested to the Court of Appeal that he was being discriminated by being denied the clean break because he had religious faith-based objections to granting his wife the Get.

The decision of the Court of Appeal is awaited but the article throws up some interesting questions. Why should the Court make a clean break award conditional upon the husband granting his wife the religious divorce she seeks? Why should money and the full legal and religious termination of the marriage go hand in hand?

A Get is a Jewish certificate of divorce granted by the husband to his wife which will permit her to remarry in a Jewish religious ceremony and returns her rights to her that a husband holds on marriage. It is essential to a woman who holds Orthodox Jewish beliefs. A Get must be given of the husband’s free will.

In this case, the husband has argued that the conditional discharge of a maintenance order upon him granting his wife a Get means that he is not acting of his own free will. As a result, he does not consider the Jewish religious authorities would accept the Get he presented as valid in any event.

According to the article, the husband’s counsel Brent Molyneux QC was quoted as saying that the Get “is something which has to be given freely, after financial ties between the parties have come to an end” and “ The husband is thus left in a position where, due to the element of compulsion placed on him by the order of the court, he is unable to grant a valid Get.” By way of a summary of the husband’s case he said: “It is wrong for the wife to receive a financial benefit and the husband a financial penalty by virtue of their religious beliefs.”

However, was this just clever wordplay? Religious divorces are not rare. The pronouncement of a Decree Absolute is the certificate of the Courts of England and Wales that the marriage has been legally dissolved. However, in certain faiths and indeed in some countries, a legal certificate of divorce is not enough to fully dissolve all marital links between husband and wife. The Get is one such example.

Why then is a religious divorce withheld in this way? It can be for several different reasons. In some instances, the party who withholds the issuing of the religious divorce has such fundamental beliefs based on their religion that they feel a marriage cannot be ended. So, whilst they can do nothing ultimately to stop the legal divorce, if the ability to grant the religious divorce remains within their power then they will hold onto it. This will prevent their spouse from being able to remarry within the same faith in the future.

Sometimes withholding has financial motives:  that the spouse who could grant it uses their ability to do so, to try to secure a better financial settlement knowing that their spouse is so desperate for the religious divorce that they would make financial sacrifices to obtain it. Others are just being obstructive, knowing it will cause their spouse the most amount of upset.

In other situations, when it is the husband who wants the legal divorce, but the wife is concerned that he will not grant the Get or another religious divorce, it is possible for the Court to make an order holding up the pronouncement of Decree Absolute until that religious divorce has been granted.

Charlotte Newman, Solicitor from the Stowe Family Law office in Leeds office comments

“It is true to say that the Orthodox Jewish divorce law, rests power with the man. However, the Beth Din have, and continue to work with many women being denied a Get and unable to move on with their lives.

These women have often been termed ‘Agunot,’ which translates to chained women. The effects of being in this situation can be more far-reaching than being unable to remarry within the faith; the children of the new marriage may also find themselves in difficulty marrying in an Orthodox Synagogue.

As such, the Beth Din has seen the refusal of a husband to provide a Get a form of abuse and caseworkers work with wives to ‘unchain’ them, allowing them to live freely. I personally second this view and (reluctantly) agree that a financial consequence may be the only way to ensure that the husband, in this case, stops using religion to justify his behaviour and perhaps as a wider issue, distract the court from his other behaviour within the proceedings”.

There will be different opinions on the husband’s motives, the wife’s counsel Sally Harrison QC indicated that the option to link the termination of the husband’s maintenance obligations with the granting of a Get was the option of last resort. He had been asked to simply promise to the Court that he would do so, and he had apparently refused. This would suggest that the husband’s account of his reasons for not granting the Get are disingenuous however the Court of Appeal is yet to make its own determination.

What we do see here though is that the Court will do what it can to support the vulnerable party, accepting creative ways to protect them or ensure that they get what they need to secure an autonomous future for themselves.

The issue over the Get is part of a wider appeal made by the husband against the financial award made in favour of his wife. Indeed, the quantum of the maintenance order of £1,850 is small amount when compared to the costs the parties will have incurred in proceeding to the Court of Appeal (probably running into the hundreds of thousands of pounds) in which case why is this issue even being pursued.

Looking at the wider commentary on the case it would seem the husband had failed to provide financial disclosure or to co-operate with the Court process. As a result, it was not possible to get a full picture of his financial resources. Nevertheless, the husband claims that the award of £1.6m represents 85% of the overall wealth.

But is this true? The husband’s conduct was described as “appalling and contemptuous”. Such dishonest behaviour never finds favour with the Court and I cannot count the number of people who have thought they could mislead the Court by hiding or transferring assets and failing. Dishonesty is probably the worst trait to take into Court with you as it tarnishes everything you try to persuade the Court about. I suspect that this is another litigant who has tried and failed.

We have a team of expert lawyers who specialise in untangling complex financial situations and dealing with difficult divorce scenarios. If any of the issues I have commented on in this article affect you, whether it is a dishonest spouse, or you are stuck in a marriage and do not know what your options are to get out of it, do get in touch with me to discuss your situation.”

The post A clean break conditional on a Jewish religious divorce – right or wrong? appeared first on Stowe Family Law.

Sir James Munby’s judgment in Baron & Others (4 Defective Divorces) hit the headlines recently, but not actually because of the subject-matter of the case (the headlines, as I mentioned here, were to do with Sir James’s comments regarding the inefficiency of some Regional Divorce Units).

What the former President of the Family Division was actually considering in the case was applications by the Queen’s Proctor for the setting aside of divorce decrees in four different cases, on the ground that the petitions had been presented before the expiration of the period of one year from the date of the marriage. As I explained here recently, the Queen’s Proctor is an officer of the judiciary, who may intervene in divorce proceedings “to argue before the court any question in relation to the matter which the court considers it necessary or expedient to have fully argued”. (The case referred to in that post was one of five, the other four being considered in the Baron case).

To explain for those who are not aware, the present law forbids the filing of a divorce petition before the expiration of the period of one year from the date of the marriage. Accordingly, any petition filed before then is null and void. And this, it seems, will not change when (and if) the proposed no-fault divorce is introduced, as the government intends to retain this ‘one-year bar’, which it believes “serves a useful purpose to underline the importance of commitments made at the time of marriage”. Accordingly, if the government gets its way this case will still be relevant when the law on divorce changes.

I’m not going to go into the legal niceties of whether failure to comply with the one year rule is a matter that can be corrected by the court, or whether it means that the petition is a nullity (you can find the details in paragraphs 4 to 9 of the judgment). Suffice to say that Sir James found in favour of the latter.

So to the four cases.

In the first case the parties were married on the 23^rd of August 2012. The wife issued her divorce petition on the 28^th of May 2013. No one spotted the error and the divorce eventually went through (i.e. to decree absolute) in August 2018. As Sir James said, “the case admits of no possible argument”. Accordingly, he declared the divorce void.

In the second case the parties were married on the 28^th of May 2015. The wife issued her divorce petition on the 20th of May 2016. No one spotted the error and the divorce went through in January 2017. Again, said Sir James, the case admitted of no possible argument. Accordingly, he also declared this divorce void.

In the third case the parties were married on the 26^th of July 2014. The husband post-dated his petition 27^th of July 2015, but sent it to the court on the 17^th of June 2015, and the court issued it on the 22^nd of June. Without going into the details, the divorce was made absolute on the 11^th of October 2016. Once again, Sir James found that the case admitted of no possible argument, and declared the divorce void.

The fourth case was slightly different. The parties were married on the 16^th of January 2015. The wife issued her divorce petition on the 13^th of January 2016. The divorce went through in September 2016, but the problem was then identified, and the court set aside the decrees. A fresh petition was issued, and fresh divorce decrees made. Unfortunately, there was an administrative error by the court in that it failed to properly process the fresh petition. However, Sir James held that this did not nullify the ‘new’ divorce, which remained valid.

In all of the cases the parties had issued new petitions for divorce, in order to preserve their positions. In each of the first three cases Sir James went on to grant a decree nisi, and to abridge the time for the decree absolute, from six weeks to four days in the first two cases, and to three weeks in the third case. The new petition in the fourth case was struck out.

The moral from all of this, of course, is to make sure that you comply with the one year rule. It’s an easy trap to fall into, but one that can have serious and expensive consequences, not least the possibility of bigamy if a party remarries when they were not actually divorced.

You can read Sir James’s full judgment here.

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Pensions are often of great significance in divorces, more so than many divorcing couples realise. Even in cases involving quite modest assets, pensions can be one of the most valuable of those assets, usually only exceeded in value by the matrimonial home. However, pensions can be even more significant in high net worth divorce cases, as recent research has shown.

The research was carried out by the wealth planning company Succession Wealth. They analysed the Office for National Statistics’ Wealth and Assets Survey data and the number of divorces in England and Wales, to estimate the makeup of the assets of divorcing couples whose net financial wealth is £1 million or more.

They found that that 550 couples with net financial wealth of one million pounds or more each will divorce this year, and estimate that collectively these individuals have around £1.91 billion of net wealth, equating to an average of about £3.48 million per couple.

And so to the breakdown of that wealth. This was divided into four categories: financial wealth, property wealth, physical wealth and private pension wealth. I haven’t seen an explanation of the first three, but I assume ‘financial wealth’ means cash and savings-type assets, such as bonds, shares and so on, ‘property wealth’ means real property (i.e. land and buildings) and ‘physical wealth’ means other valuable physical assets, such as cars, jewellery and paintings.

The breakdown was as follows: financial wealth represented 20% of the assets, worth on average about £712,000, property wealth represented 31% of the assets, worth on average about £1,075,000, physical wealth represented 5% of the assets, worth on average about £186,000, and private pension wealth represented a whopping 43% of the assets, worth on average about one and a half million pounds. In other words, private pension wealth is by some margin the most significant asset of many couples whose net financial wealth is £1 million or more.

These figures may not come as a surprise to an experienced family lawyer used to dealing with high net worth cases, but I’m sure they would raise a few eyebrows elsewhere. How many ‘non pension owning’ spouses in high net worth cases will be aware of this? I suspect not many. That is why it is essential that they obtain full disclosure of the other spouse’s wealth. And that does not just mean accepting what the other spouse discloses. All too often a spouse with substantial financial assets will be less than forthcoming in disclosing them. That is when it may be necessary to employ the services of a forensic accountant (see below), who can help to uncover those assets.

Of course uncovering the true value of pension (and other) assets is only half of the story. The other half is working out how those assets should be divided between the parties.

Thus the question is: if you are the ‘non pension owning’ spouse, how do you receive your fair share of pension assets? Well, there are essentially three ways: offsetting against other assets, pension sharing orders and pension attachment orders. Offsetting, at its simplest, involves the spouse with the pension keeping it, but the other spouse being compensated by receiving a greater share of other assets. Pension sharing means transferring the pension ‘pot’, or part of it, from one spouse’s pension to a pension in the name of the other spouse. Pension attachment orders redirect all or part of the pension benefits to the other spouse, when the pension comes into payment. Which of these options is right for you can be a complex question. (For further information regarding pensions, see here.)

The moral of all of this, of course, is to get the best possible advice when you divorce, especially if the assets of the marriage are significant. And that does not just mean legal advice. It is also necessary to have the best financial advice. That is why Stowe Family Law have their own specialist in-house team of forensic accountants, which is one of the reasons why they are experts in high net worth divorce cases.

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As I have said many times, both here and to my own clients when I was practising, getting a final order is often only half of the battle when it comes to sorting out financial arrangements following divorce. The other half comes in actually enforcing that order.

Despite the importance of enforcement, we don’t see an awful lot of cases about it reported. However, we did get at least a glimpse of it in the case ET v ST, which was decided by Mr Justice Mostyn in April last year, but which only recently appeared on the Bailii website. The case is also of interest because of the wife’s attempts to thwart the enforcement action.

The case revolved around the husband’s attempts to recover a painting by the artist Caziel. The painting was amongst the contents of a property that it had been agreed should be retained by the husband. That agreement was incorporated into a consent order in July 2011.

For the benefit of those, including myself, who are not art experts Caziel was, according to Wikipedia, “a Polish artist who lived and worked in Paris during the inter-war period and who worked alongside a number of important figures of the School of Paris, including Pablo Picasso”. Despite that illustrious connection, I don’t think his paintings are especially valuable – a quick internet search reveals them being sold for anything between a few hundred pounds and five thousand pounds. We are not told how much the painting in this case is worth, although obviously it could also have had sentimental value to the husband.

By October 2017 the painting had not been delivered up to the husband by the wife, and the husband therefore commenced enforcement proceedings.

On three occasions the wife had told the court that she had not seen the painting for some years, and implied that the husband had taken it. Two of those statements were made under oath from the witness box, and one in a written witness statement endorsed with a statement of truth. However, in another witness statement in January 2018 the wife admitted that her earlier statements had been untrue – she did know the whereabouts of the painting.

Following this, the painting was recovered by the husband, although not before the husband had issued an application for the wife to be committed to prison for breach of the order.

There still, however, remained the issue of the husband’s costs, both of the enforcement action and of the committal proceedings. In addition to this, the husband sought permission from the court to proceed with committal proceedings against the wife in respect of both her false witness statement and her lies under oath. These issues fell to Mr Justice Mostyn to determine.

Dealing with the committal application first, Mr Justice Mostyn refused permission for the husband to proceed. The reason for this is that he considered that the husband had a better avenue available to him: criminal proceedings against the wife for perjury, which carry with them a maximum prison sentence of seven years. We are not told whether or not the husband chose to take this course.

As to the issue of costs, Mr Justice Mostyn felt it unarguable that the husband should recover his costs relating to the enforcement action. As to the committal application, Mr Justice Mostyn felt that the husband had pursued this “in a very single-minded way”, despite the fact that he had achieved his primary aim, which was to recover the painting. Accordingly, Mr Justice Mostyn only ordered the wife to pay 50% of the husband’s costs in relation to the committal application.

An interesting little case, illustrating quite typical enforcement issues: one party having to go back to the court to recover an asset that should have been delivered to them, and the other party lying to the court in an attempt to thwart them. The case is also perhaps an illustration of the perils of being over-zealous when it comes to enforcement: one can fully understand the husband’s annoyance at the wife’s lies, and his determination that she should not ‘get away’ with them, but in the end his actions cost him money that he was not able to recover.

You can read the full judgment here.

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