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When a divorcing couple can’t reach a financial settlement themselves they must instead rely on the family courts to make a final decision on the division of assets. As with any court proceedings there’s a strict timetable. In a financial relief hearing it’s crucial to assemble evidence of your needs and present your arguments at the appropriate time. If you are seeking to purchase a new home following the divorce for example, it’s common to provide the court with details of the price and location of several suitable properties. In the recent case of AR v ML the wife failed to produce any examples of suitable property during the course of proceedings. In a rather unusual step her lawyers tried to do so after the judge had made a decision. We discuss what happened below.

 

Changing A Financial Order

As we have pointed out before, family judges focus on reaching financial orders that are final so that the estranged couple and their children can have the highest degree of certainty around money matters post divorce. There are however limited grounds to set aside a financial order. These are when one side can establish that there has been:

  • Fraud
  • Material non-disclosure
  • A mistake
  • A subsequent, unforseeable event which invalidates the original order

If someone does want to set aside a financial order they should seek to do so without delay as it’s not something that is normally encouraged.

 

The Case Of Ar v Ml

During the hearing in the case of AR v ML the judge had been critical of the wife’s evidence about her housing needs. Although she stated that she could find an appropriate property in her local area for £525,000 she did not produce any evidence to back this up. The husband argued that £400,000 was sufficient to meet her housing needs. In making the financial order the judge awarded the wife received 49% of the total marital assets (amounting to just 412,000 after payment of debts – less than what she claimed she needed to buy a house). These figures were based partly on the fact that, even if the wife were awarded the larger amount she sought, there was no evidence that she would be able to use the money to buy the kind of property she wanted.

It may seem a slightly technical legal point but while the judge had delivered the financial judgment along the lines described above, the formal court order reflecting the decision had not been ‘perfected’ or drawn up and approved. And it was immediately after the judgment was delivered in court but before the order was drawn up and sealed that the wife’s barrister sought to introduce fresh evidence to justify her claim for a larger share of the marital assets that would enable her to buy a suitable property.

After listening to detailed argument the judge agreed to the wife’s request to be able to present this new information. Instead of being asked to finalise the order for the court’s approval the parties were given further directions – the wife to file a statement about her housing needs and the husband to file a statement in response. Perhaps unsurprisingly the husband appealed this ruling.

 

The Husband’s Appeal

The High Court judge who heard the appeal, Mr. Justice Mostyn was unequivocal in his support for the husband’s position. In what amounted to a strongly worded criticism of the trial judge Mostyn said that the decision was not based on any proper legal principle. If it had been reached in the exercise of permitted judicial discretion it was, in Mostyn’s opinion ‘plainly wrong’. He continued,

It was merely another example of counsel on behalf of a disappointed litigant seeking spuriously to try to get the judge to change her mind immediately after judgment has been delivered, to which the judge should not have succumbed.

The full judgment makes clear that a wish to adhere to the principle of finality in financial remedy applications weighed heavily on the mind of Mr. Justice Mostyn when arriving at his decision.

 

Comment

This case provides a warning to anyone preparing for a financial remedy case. Although the appeal decision was disappointing for the wife it does greatly strengthen the idea that – more than many other types of case cases – financial decisions made by the courts in divorce actions should be as clear and final as possible. Introducing evidence late on in the proceedings, when arguments have been made and appropriate conclusions drawn will only ever be permitted in exceptional circumstances. In his judgment Mostyn J. quoted an earlier commercial law case where the judge remarked that:

“The trial is not a dress rehearsal. It is the first and last night of the show.”

Mostyn J. believed this was a maxim that should apply strongly in all financial remedy cases. After all, financial hearings mean the parties incur enormous expense and experience high levels of stress. It’s clear that, if the wife in AR v ML – or her lawyers – had prepared with due diligence they could, without difficulty, have supplied the necessary details of housing needs at the first hearing.

Contact Us

If you are affected by any of the issues we have raised please call us for further advice on 44 (0) 20 7430 8470 or contact us here.

 

 

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