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Home > Judgments > 2005 archive

Owens v Owens [2005] EWCA Civ 1275

Husband's application to appeal against ancillary relief order, arguing that non-disclosure by the wife may have adversely affected his share of the matrimonial home. Application refused on the basis that, although non-disclosure was proved, it was immaterial to the order.

B4/2005/1729

Neutral Citation Number: [2005] EWCA Civ 1275

IN THE SUPREME COURT OF JUDICATURE

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM BROMLEY COUNTY COURT

(HHJ HALLON)

Royal Courts of Justice

Strand

London, WC2

Monday, 10 October 2005

B E F O R E:

LORD JUSTICE WALL

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ERNEST FRANCIS OWENS

Applicant

-v-

YVETTE OWENS

Respondent

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(Computer-Aided Transcript of the Stenograph Notes of

Smith Bernal Wordwave Limited

190 Fleet Street, London EC4A 2AG

Tel No: 020 7404 1400 Fax No: 020 7831 8838

(Official Shorthand Writers to the Court)

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MR FRITZ KODAGODA (instructed by Austin & Jed Solicitors) appeared on behalf of the Applicant

THE RESPONDENT DID NOT APPEAR AND WAS NOT REPRESENTED

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J U D G M E N T

(As Approved by the Court)

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Crown copyright©

1. LORD JUSTICE WALL: This is an application by Mr Ernest Francis Owens for permission to appeal against an order made by HHJ Hallon, sitting in the Bromley County Court on 26 July 2005. The order made by the judge was to dismiss two appeals by Mr Owens from orders of the district judge made respectively on 21 January and 13 May. Both before the district judge and before Judge Hallon, Mr Owens appeared in person. However, today he has had the advantage of representation by Mr Fritz Kodagoda of counsel, and I am extremely grateful to Mr Kodagoda for the skeleton argument which he has produced at short notice, and for his concise and helpful submissions.

2. The point is a short one, but nonetheless, from Mr Owens' point of view, an important one. In order to explain it, I have to go back some time in history. I go back to 17 December 2004, when I heard and refused an application by Mr Owens for permission to appeal, as now, against a decision of Judge Hallon, sitting in the same court on 20 August 2004. On that occasion, Judge Hallon had dismissed Mr Owens' appeal against an order for ancillary relief made by District Judge Thomas on 24 February 2004 in the divorce proceedings between Mr Owens and his former wife.

3. The essence of the order made by the district judge on 24 February 2004 was that the parties' former matrimonial home should be sold and the proceeds divided equally between the them. This was on the basis that there would be a clean break, and all other claims for financial provision, pension sharing and property adjustment orders on both sides would be dismissed. Neither party, moreover, would be entitled to make a claim under the Inheritance Act or any further provision of the Matrimonial Causes Act 1973.

4. The marriage had been of some length and, in the view of the district judge and Judge Hallon, the equal division of what was the only available asset was, on the face of the facts, unexceptional, and indeed following White v White, where equality is the yardstick, the only real order in all probability that the district judge could have made. In any event, that is what the district judge thought and so did Judge Hallon because she dismissed Mr Owens' appeal.

5. When the matter came to this court, I also took the view that the order made by the district judge was one eminently within his discretion. Moreover, I pointed out to Mr Owens that section 55(1) of the Access to Justice Act 1999 applied to his application for permission to appeal. It seemed to me there was no point of principle involved and no other substantial reason why the court should entertain the application, and accordingly I refused permission to appeal.

6. That was on 17 December. On that day, Mr Owens advanced to me an argument that the district judge's order of 24 February 2004 had been obtained by fraud or dishonesty on his former wife's part. I told him that if he wished to attack the order on that basis, that it was obtained by fraud or non-disclosure, his proper remedy was to go back to the district judge and apply to have the order set aside on the basis of non-disclosure or fraud. I recall -- and indeed, having checked the judgment, I see -- that I discouraged Mr Owens from taking that course because, if he took it and if he was unsuccessful, he would be likely to have to pay the costs of the other side.

7. However, Mr Owens did take that course and, it has to be said, on the face of the documentation there is some justification for it, because the district judge found, and was plainly right to find, that Mrs Owens had not been full, frank and clear in the disclosure which she had given to the court. What she had concealed from the district judge was that she had purchased alternative accommodation, contracts for which had been exchanged on 11 March 2004 and completion had taken place on 26 March 2004. The offer for the mortgage which she had had to raise had been made on 12 February 2004, and so these matters were plainly in her contemplation and in the process of being implemented at the time she appeared in front of the district judge, something which she did not disclose to him.

8. Apart from the £166,000, which was the sum she had borrowed, she had also increased another liability she had to the bank, but the district judge took the view that that was relatively minor in comparison with the mortgage loan. So the property she had contracted to buy, 85 Firhill Road, Catford, cost £185,000, with a mortgage of £166,000 and none of that had been disclosed to the district judge.

9. Mrs Owens' explanation for her failure to disclose was what she described as the continuing acrimony in relation to the property, and her belief that if she had made the disclosure, her former husband would have been even more unco-operative than she believed him already to be. Mr Owens also takes the point that Mrs Owens gave her counsel dishonest instructions, because counsel told the judge last year when the matter was on appeal before District Judge Hallon that she was staying with a friend. That was plainly untrue, and although the judge exonerated counsel, who was simply obeying instructions, it was clear that the court had been given false information. Of course, the duty to give disclosure does not end with the hearing before the district judge. The duty continued in relation to the appeal in front of Judge Hallon. So there has been, on any view, a very substantial degree of non-disclosure by Mrs Owens, and the district judge so found.

10. The question, therefore, is what are the consequences of that non-disclosure? Mr Owens, through counsel, argues that the matter has to be looked at again by the district judge, and the question of the distribution of the proceeds of sale of the former matrimonial home has to be reconsidered. Accordingly, the district judge was wrong to dismiss Mr Owens' application, and Judge Hallon had been wrong to dismiss the appeal.

11. It is of course the case, as is argued on behalf of Mr Owens this afternoon, that there is an ongoing duty for full, frank and clear disclosure and much authority for the proposition that the court simply cannot properly exercise its discretion under section 25 of the Matrimonial Causes Act 1973 if it is not given full, frank and clear disclosure. There are many cases in the books in which applications to set aside an order made by a district judge have been successful because of non-disclosure or because of a radical change of events. The leading case undoubtedly is the decision of the House of Lords in Livesey (formerly Jenkins) v Jenkins [1985] FLR 813. For present purposes, that decision is relevant, very largely because of the final paragraph of the speech of Lord Brandon, in which Lord Brandon made clear that it was not every application to set aside on the grounds of non-disclosure which would succeed. Lord Brandon said:

"I would end with an emphatic word of warning. It is not every failure of frank and full disclosure which would justify a court in setting aside an order of the kind concerned in this appeal. On the contrary, it will only be in cases when the absence of full and frank disclosure has led to the court making, either in contested proceedings or by consent, an order which is substantially different from the order which it would have made if such disclosure had taken place that a case for setting aside can possibly be made good. Parties who apply to set aside orders on the ground of failure to disclose some relatively minor matter or matters, the disclosure of which would not have made any substantial difference to the order which the court would have made or approved, are likely to find their applications being summarily dismissed, with costs against them, or, if they are legally aided, against the legal aid fund."

12. During the course of his helpful submissions this afternoon, Mr Kodagoda argued that both the judge and the district judge had been wrong in determining that the non-disclosure which I have described was relatively minor, and would not have altered the discretion as to the distribution of the proceeds of sale of the house. He pointed out, correctly, that it was wrong in principle to conceal information which was meant to influence the discretion of the court, and it was relevant to the exercise of discretion on the part of the decision-maker. If the district judge had been appraised of that non-disclosure at the time of making the original order, not with hindsight, it would have made a difference to the outcome. Mr Kodagoda submits it would have made such a difference, and it ought to be taken into account in granting a different percentage in relation to the proceeds of sale of the property. Moreover, it showed that Mrs Owens did have a property, whilst the husband had only the matrimonial home. She was employed; he was not. The proper balancing exercise which should have been undertaken by the district judge had been fettered by concealment of material matters, and in those circumstances, in view of the seriousness of the non-disclosure and its effect on the outcome, a fair distribution of the proceeds of sale had not been achieved. Permission to appeal therefore should be given.

13. That, if I may say so, is an elegant argument and very well put. But I have to test it against the essential facts of this case. In this case there is only one matrimonial asset, if I can use that particular phrase. That was the former matrimonial home. There was no question here, as I understand it, of orders for periodical payments either way. The only question was what should happen to the former matrimonial home.

14. In my judgment, the only answer to that question, as the law currently stands, would be a sale and equal division of the net proceeds of sale. If the non-disclosure had demonstrated that Mrs Owens had substantial free cash assets, then it seems to me the matter would be quite different. But what she in fact should have disclosed was that she had a further massive liability: a mortgage liability of some £185,000, the only solution to which, and the only way that could be re-paid, was by the receipt of her half share of the net proceeds of sale, which would by no means eliminate, but would reduce, the liability, it would be hoped, to manageable proportions. So if I ask myself the question: if she had disclosed, would the order have been any different? In my judgment, the answer simply has to be no. What Mrs Owens was going to do with her half share of the property was to use it to purchase alternative accommodation, as one imagines Mr Owens will do when the property is sold. She had simply, in my view, jumped the gun and she should have told the district judge what she had done. But, in my view, if the district judge had known the facts in February 2004 which he knew when the matter came back to him in 2005, he would not have made any different order. Indeed, I think he would have made exactly the same order. That was certainly the view of the district judge in what is a long and careful judgment. He says that whilst of course Mrs Owens should not have given false information, and it was wrong that she did so, he understood the reasons for her wanting to conceal her address, but that did not mean that the court should have had these matters concealed from it. I agree with him. But he went on to say that that does not, in his view, alter the decision that would have been made. Once again, I agree with him.

15. The matter went to Judge Hallon and she took the same view. I only have a note of her judgment, but her reasoning is, I think, reasonably clear, and she supported the decision of the district judge, taking the view that the only permissible outcome was an equal division of the net proceeds of sale, and that therefore the non-disclosure was immaterial.

16. It therefore seems to me that, if one looks at the test put forward by Lord Brandon, and if one looks at the later authority which is in my papers: T v T (Consent Order: Procedure to Set Aside), it is clear that there has been in this case non-disclosure, but that the non-disclosure would not have made any difference and was not so grave and so serious as to justify a re-opening of the proceedings, which would itself cost a great deal of money and which would, in my view, result in precisely the same conclusion.

17. So, in my judgment, Mr Owens' application for permission to appeal cannot succeed. The appeal would have no prospect of success in this court, even though it overcomes the section 55(1) hurdle. For all those reasons, despite the helpful and skilful argument of Mr Kodagoda, the application must be refused.

Order: application refused