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Financial Remedies Update 13 October 2011 Michael Horton

Financial Remedies Update 13 October 2011 Michael Horton. CHAMBERS. Overview. Case law last 12 months ish Family Procedure Rules. CHAMBERS. International element. News report 5 September 2011 French court orders H to pay W €10,000

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Financial Remedies Update 13 October 2011 Michael Horton

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  1. Financial Remedies Update13 October 2011Michael Horton CHAMBERS

  2. Overview • Case law last 12 months ish • Family Procedure Rules CHAMBERS

  3. International element • News report 5 September 2011 • French court orders H to pay W €10,000 • Damages for ‘not enough sex’ • Breach of Art 215 of Code Civile CHAMBERS

  4. International element • English court’s view? … CHAMBERS

  5. International element • ‘Once a week is enough’ • Mason (1980) CA CHAMBERS

  6. Radmacher • No presumptions, but • Uphold agreement unless … • … And it’s just one of the factors CHAMBERS

  7. Bankruptcy & order for sale • Standard order for sale • When do beneficial interests alter? • When order made/ decree absolute? • Completion of sale? • Warwick v Yarwood says latter CHAMBERS

  8. Bankruptcy & order for sale • So, if bankruptcy imminent or feared • Redraft order for sale (2.4) CHAMBERS

  9. Annulment of bankruptcy • Do it, if at all, early • Make provision for trustee’s expenses • Mekarska: no annulment otherwise • Should bankruptcy court adjourn if there are pending divorce proceedings? CHAMBERS

  10. Imerman • Not all doom & gloom • Documents may not be confidential • ‘Secret plan to hide assets’ • Documents clearly show, post form E, there has been non-disclosure CHAMBERS

  11. Cohabitation • Periodical payments order in force • Effect of payee’s cohabitation • Just goes to quantum • Not to be equated with re-marriage • What ought partner to contribute to reduce payee’s income needs CHAMBERS

  12. Cohabitation • K v K Coleridge J • Why not equate with re-marriage? CHAMBERS

  13. Cohabitation • This is ‘heresy’ • So says Court of Appeal in Grey CHAMBERS

  14. Cohabitation • Why is pre-marital cohabitation different? • See 4.2.3 • Outcome at 4.2.6 CHAMBERS

  15. Appeals • Kaur v Matharu (pre-FPR) • Children appeals more lenient re fresh evidence • ‘May be’ so in ancillary relief • Probably survives FPR 2010 (5.1.2) CHAMBERS

  16. Appeals • Need permission • 21 days • Consider need for updating evidence • If appeal allowed, J to exercise discretion afresh or send back down? CHAMBERS

  17. Barder appeals: Richardson • Wife’s death not a Barder event • Her award not based on needs • ‘Earned her share’ CHAMBERS

  18. Richardson • Impact of damages claim against business • Lack of full cover a mutual mistake • Entitling H to set aside? • No, it was a ‘known unknown’ (5.4.5) CHAMBERS

  19. Richardson • But insurers refusing any liability • This was ‘unknown unknown’ • H did not know they would refuse and had no way of finding out CHAMBERS

  20. Post FPR set aside • PD says must appeal • But set aside still possible • See FPR r 4.1(6) (5.5.2) CHAMBERS

  21. Joinder/ intervention • Join 3P • Mini ToLATA claim within the financial order proceedings (6.1) • Or … (6.2) CHAMBERS

  22. Joinder/ intervention • Don’t just invite 3P to intervene (6.3) • If they don’t, will be no issue estoppel CHAMBERS

  23. Joinder/ intervention • How to join? • Goldstone says there is power to join • Even though there is no specific power in the rules CHAMBERS

  24. The new inspection appointments • Order for disclosure against non-party under FPR 21.2 • Or seek permission to issue witness summons • Don’t forget Bankers Book Evidence Act CHAMBERS

  25. Non-matrimonial property • Jones approach: • Work out the current value of the pre-acquired asset • Deduct that from total assets • Divide result by two • Cross check result as % of overall CHAMBERS

  26. Non-matrimonial property: Jones • Keep needs and sharing separate • Compare results (7.1.2) CHAMBERS

  27. Non-matrimonial property • H’s co worth £2m at time of marriage • CA say this now worth £9m • So matrimonial property is £25m less £9m • W gets 50% of £16m, ie £8m CHAMBERS

  28. Non-matrimonial property • How did H’s £2m co in 1996 … • … become £9m in 2006? • Springboard • Plus passive economic growth • NB cross-check on % of overall CHAMBERS

  29. Building blocks? • Pleadings? • Issues • Findings • Evidence CHAMBERS

  30. Pre-acquired assets: N v F • Same approach • But needs left W with 44% of overall • NB ‘add backs’ at 7.2.2 • Evidence of earning capacity (7.2.3) CHAMBERS

  31. Pre-acquired assets: Robson • Assets all pre-acquired inheritance • Needs based claim • W aware living on mismanaged inheritance • Could not base future income needs on excessive marital standard of living CHAMBERS

  32. Pre-acquired assets: Robson • NB no interest can run pre-dA (7.3.5) • Timing of payment of lump sum • Where coming from proceeds of sale • Guidance at 7.3.7 • Art not science! CHAMBERS

  33. Pre-acquired assets: K v L • W shares worth £680k on marriage • Now, pre-tax £58m • Family lived off (not all of) dividends • W offered £5m • Bodey J ordered just that CHAMBERS

  34. Pre-acquired assets: K v L • No sharing • Just needs, generously interpreted • H’s appeal to CA dismissed (7.4.4) CHAMBERS

  35. Pre-acquired assets: Whaley • No classification into ‘dynastic’ • & ‘settlor-beneficiary’ trusts • Test still whether trustees likely to advance capital • W not confined to needs but small ‘sharing’ element on top CHAMBERS

  36. Pre-acquired assets: Mansfield • Personal injury damages not immune from financial orders • But court has to reflect reason why they were awarded in first place • Mesher here once children grown up and H’s needs would increase CHAMBERS

  37. Post-separation assets • SK v WL: no need for clear boundary between matrimonial/ non-matrimonial property • W got 40% overall • Big increase in assets over 3y separation CHAMBERS

  38. Schedule 1 lump sums • Just for capital needs? • Could not be used to obtain capitalised child maintenance (ie in advance) • Or to clear income-related debts (ie in arrears) • Until … CHAMBERS

  39. Schedule 1 lump sums • DE v AB Baron J • M sought housing fund • Plus lump sum partly to clear debts • DJ found CSA assessed F’s income too low CHAMBERS

  40. Schedule 1 lump sums • On F’s appeal • Lump sum broad brush • Lump sum could cover debts incurred for eg mortgage payments as for ‘benefit of child’ • Revenue costs could go into lump sum as CSA in error CHAMBERS

  41. Schedule 1 lump sums • CSA appeal? • CSA variation? CHAMBERS

  42. Schedule 1 settlements • Enforcement difficulties • Transfer and charge back ok CHAMBERS

  43. Schedule 1 lump sumsfor legal fees • CF v KM says yes to interim lump sum under Schedule 1 • Even if no power to order pp’s • R v F Bodey J – just for s 8 proceedings • NB cl 45 LASPO (8.6.2-3) CHAMBERS

  44. Future income disparity • Acknowledged clean break case • One party has better income • Adjust capital to reflect income differential? • Murphy says yes CHAMBERS

  45. Future income disparity: Murphy • See 9.1.2 • 8 year childless marriage • £3m to go wrong • All hallmarks of clean break & equality CHAMBERS

  46. Future income disparity: Murphy • No 65:35 split • Price of a clean break • H v high earning capacity • Unused for c 4 years before trial • ? And illiquid assets too? CHAMBERS

  47. Variation of lump sum orders • Is order at 10.1 an order for lump sums? • Or a single lump sum payable by instalments • If latter, court can vary it under s 31 (10.3.1) • H v H says it is latter no matter how drafted (10.3.3) CHAMBERS

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