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A v B (FINANCIAL RELIEF: AGREEMENTS) [2005] EWHC 314 (Fam)

Husbands appeal against an ancillary relief order.

Neutral Citation Number: [2005] EWHC 314 (Fam)

IN THE HIGH COURT OF JUSTICE

FAMILY DIVISION

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 17th January 2005

Before:

BLACK J

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A v B (FINANCIAL RELIEF: AGREEMENTS)

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CHARLES HOWARD QC and LESLIE SAMUELS instructed by Griffiths, Smith, Conway for the petitioner

NICHOLAS FRANCIS QC and NICHOLAS ALLEN instructed by Radcliffes LeBrasseur for the respondent

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JUDGMENT

(As Approved by the Court)

BLACK J:

[1] This is the appeal of Mr A — I hope that he and Miss B will forgive me if I call them the husband and wife — against an ancillary relief order which was made by Deputy District Judge Green. The order is dated 8 April 2004. It followed a 2-day hearing which took place on 3 and 4 February 2004 and a reserved judgment which was dated 12 February 2004. The wife cross-appeals against the deputy district judge's costs order, but the argument of that issue has been deferred until I have given judgment on the substance of the husband's appeal, the outcome of which is likely to have a significant bearing on the costs issue.

[2] The parties to the appeal are both aged 58. They married in 1976 following 3 years of cohabitation. There are no children. They separated in 1996 after the husband had formed a relationship with another woman, Miss F. He went to live with her in Bristol and the wife remained in the former matrimonial home in Wimbledon. The wife is a property journalist. She worked throughout the marriage and still does. The husband describes himself as a project manager in his Form E. His skill is in the IT field. He was not working at the time of the separation and had not done so since about 1990, having left his employment in 1989 to make an abortive attempt to start his own business. It was early 1999 when he managed to secure work again, this time on a short-term but lucrative contract. His fortunes are now rather better and he is in secure employment although with a retirement age of 60.

[3] The parties did not sort out their joint finances immediately upon separation. However, in early 1999 with the spur that he needed accommodation because his relationship with Miss F was coming to an end, the husband approached the wife for a lump sum payment. He had found a bungalow near his parents' home on the south coast which he wanted to buy. He rented a property to tide him over immediately prior to that.

[4] Correspondence between the parties in March 1999 shows that the wife wished there to be a written settlement of their affairs and her letter of 23 March 1999 says that her solicitor will insist on the husband showing any document to his own solicitor before signing it. The husband was instructing Messrs Lings in relation to the purchase of the bungalow. On 7 May 1999 the wife's then solicitor, Mr Forrest, faxed a copy of a proposed agreement between the parties to Lings. The accompanying letter makes clear that the wife was to raise the funds by way of remortgage. It does not say, but it was the case, that the building society had imposed a condition in relation to the mortgage that it should be established that the husband had no further claim in relation to the former matrimonial home. The letter also says, referring to the draft agreement forwarded: 'Your client should obtain independent advice from your firm or other solicitors before signing it'.

[5] The agreement to which both parties ultimately subscribed and which is dated 13 May 1999 recites that it is made in full and final settlement of all and any claims that either party may have against the other. The main terms are:

(1) £133,000 would be paid 'in full and final settlement of all and any claims that [G] may have in the former matrimonial home'.

(2) The wife would transfer to the husband two cars: a 1962 Porsche Roadster and a 1972 Maserati Bora. (These were in addition to a Sierra Cosworth and a Renault that he already had.)

(3) On sale of the oriental rug collection the proceeds of the sale would be divided equally.

(4) A Standard Life endowment policy on the husband's life would be divided equally on maturity, the wife paying the premiums until February 2000 and the husband paying them thereafter.

[6] The district judge made findings about the extent of the advice given to the husband in connection with the agreement. The husband had asserted that he had been advised by Mr Forrest, who was then acting for the wife, that a court would not necessarily be bound by agreement and that he felt able to sign it in the light of that advice. He said that Mr Ling, his own conveyancing solicitor, did not advise him about the agreement. The district judge did not accept this part of the husband's evidence. He found that the position was the reverse of what the husband alleged, that is that he was not given advice about the agreement by Mr Forrest, and was given advice by Mr Ling, albeit that, as the district judge found, the advice given was not comprehensive and appears not to have been confirmed in writing. The husband has not sought to go behind that finding.

[7] It was the husband's case in front of the district judge that he had been blackmailed or pressured into making the agreement, not least because of his need for accommodation and the imminent purchase of the bungalow which he had chosen, in relation to which exchange of contracts and completion both took place on 13 May 1999, the date of the agreement. The district judge made a clear finding that the husband was neither blackmailed nor subjected to undue pressure. He concluded that any pressure that there was was from the husband himself because he had decided he wanted to go ahead with the purchase of that particular property. Nothing has been said on behalf of the husband on the appeal which dislodges that finding of the district judge.

[8] The district judge's order was very simple. Rejecting the husband's argument that he should be granted further provision despite the 1999 agreement, he made only those orders which would put the agreement into effect. The parties had agreed that the oriental rugs would be sold by auction and he recited their agreement that the net proceeds would be divided equally. Apart from that, the husband having already received the lump sum agreed in 1999, the district judge simply dismissed all claims by either party for ancillary relief and disentitled them from applying in future either under the Matrimonial Causes Act 1973 or the Inheritance (Provision for Family and Dependants) Act 1975. The husband was ordered to pay £14,100 towards the wife's costs.

[9] The husband now invites me to set aside the district judge's order and to exercise the ancillary relief discretion myself, granting him a lump sum of £250,000, or whatever sum I think appropriate, in addition to the other provision that is already contemplated or has already been made between the parties. The husband focuses his attack on the district judge's order on the following main points.

[10] First, he criticises the district judge's evaluation of the 1999 agreement. He says: (a) the district judge wrongly failed to treat as significant the fact that the husband did not receive full disclosure and competent matrimonial legal advice before he entered into it; and (b) contrary to the finding of the district judge, the terms of the agreement were not fair at the time when one considers the assets the parties then had and all the circumstances of the case. Whilst it is not argued that the district judge should have ignored the agreement completely, the husband argues that in these circumstances the district judge should have given it significantly less weight than he did.

[11] The second main heading raised by way of criticism for the husband is that the district judge completely failed, as he submits, to carry out the duty imposed upon him to evaluate all the s 25 factors at the time of the hearing before him and to exercise his discretion in the light of them. The husband says that the district judge treated the agreement as determinative and once he had concluded that it was fair in 1999 he went no further. Had he carried out the exercise required of him, Mr Howard QC and Mr Samuels, for the husband, submit that it would inevitably have revealed that the agreement did not provide for the husband's reasonable needs.

[12] The district judge's judgment, although reserved, is not a long document. It extends to only nine and a half pages. That in itself is not a problem. A short judgment has much to commend it provided that it includes findings on all relevant matters and shows sufficiently that the district judge has exercised his discretion appropriately. I approach this judgment with that in mind, as well as giving full weight to the reality that the workload of a district judge or a deputy district judge is not such as permits unlimited amounts of time to be spent on any individual case. Lord Hoffmann observed in Piglowska v Piglowski [1999] 1 WLR 1360, [1999] 2 FLR 763 in 1999 that:

'The reasons of a district judge should be read on the assumption that, unless he has demonstrated the contrary, the judge knew how he should perform his functions and which matters he should take into account. This is particularly true when the matters in question are so well known as those specified in s 25(2). An appellate court should resist the temptation to subvert the principle that they should not substitute their discretion for that of the judge by a narrow textual analysis which enables them to claim that he misdirected himself.'

[13] This district judge's short judgment is largely taken up with the question of the 1999 agreement which he identifies at the outset as perhaps the central issue in this case. He makes reference to the main authorities on the issue of such agreements to which he had been referred, ie Edgar v Edgar [1980] 1 WLR 1410, (1981) 2 FLR 19 in 1981, Camm v Camm (1983) 4 FLR 577 in 1983 and Smith v Smith [2000] 3 FCR 374. He does not set out in the judgment the principles derived from them at any length because they were contained in the submissions that had been placed before him. I do not intend to rehearse the principles at great length here either. The cases of Edgar and Camm have been well known for years. In Edgar, holding that any agreement should be taken into account under the heading of conduct when the court exercised its s 25 discretion, the Court of Appeal said:

'To decide what weight should be given in order to reach a just result, to a prior agreement not to claim a lump sum, regard must be had to the conduct of both parties leading up to the prior agreement and to their subsequent conduct in consequence of it. It is not necessary in this connection to think in formal legal terms such as misrepresentation or estoppel, all the circumstances as they affect each of two human beings must be considered in the complex relationship of marriage. So the circumstances surrounding the making of the agreement are relevant. Undue pressure by one side, exploitation of a dominant position to secure an unreasonable advantage, inadequate knowledge, possibly bad legal advice, an important change of circumstances, unforeseen or overlooked at the time of the making of the agreement, are all relevant to the question of justice between the parties. Important too is the general proposition that formal agreements properly and fairly arrived at with competent legal advice should not be displaced unless there are good and substantial grounds for concluding that an injustice will be done by holding the parties to the terms of their agreement. There may well be other considerations which affect the justice of this case; the above list is not intended to be an exhaustive catalogue.' (original emphasis)

[14] In Camm Sir Roger Ormrod, revisiting what he had said in Edgar, said that in referring to bad legal advice he was not thinking in terms of negligence by the solicitor but bad legal advice. He pointed out that it is not necessarily negligent advice to permit a client to take a course which a more experienced or stronger-minded adviser would have discouraged, but implied that it could fall within his category of bad legal advice, saying that the quality of the legal advice given in relation to the agreement is relevant on the issue of what is a just result on an ancillary relief claim. In Camm the wife received provision in excess of that contemplated by her agreement which was held to be unfair. The wife's circumstances are an example of the sort of pressure that Sir Roger Ormrod thought to be a relevant factor in this regard. The pressure was said to be extreme and came partly from the wife herself in that case and partly from the fact that her husband was refusing to concede anything about periodical payments.

[15] I should refer also specifically to the much more recent case of Smith v Smith [2000] 3 FCR 374 which is relied upon by the husband. It would be a mistake, in my judgment, to treat the case of Smith as altering the time-honoured principles of Edgar and Camm in any material way. Thorpe LJ says expressly at 379 of the report that the relevant principles are to be taken from the judgment of Ormrod LJ and he cites the two authorities that I have just cited. In the passage of his judgment at 381, in which he sets out the correct approach, he again refers to Edgar. He says of the appeal he was determining:

'My greatest criticism of this judgment is one that is perhaps not directed against the judge himself, I believe that the omissions in the judgment are probably the product of the way in which the case was presented and argued. It seems as if it was almost presented to the judge as a preliminary issue for him to decide whether the existence of the contract in September 1996 disentitled the wife, as a matter of either law or discretion, from an investigation of her statutory claims. That was simply not the judicial function. As Ormrod LJ made clear first in the unreported case of Brockwell v Brockwell [1975] and then in Edgar, when a wife brings to the court her statutory claims for determination, the existence of an earlier contract is only one of the considerations to which the judge must give weight. In the application of the statutory criteria to the case, Ormrod LJ said that it should be brought in under the head of conduct, s 25(2)(f) of the Matrimonial Causes Act 1973.'

Later Thorpe LJ says:

'The reality is that the judge's task ... was to make a proper evaluation of the wife's claims for ancillary relief, which she was bringing to the court for the first time and which fell to be judged on the full range of s 25 criteria.'

Later again he says:

'But in the end the reason why the appeal succeeds, in my opinion, is well illustrated by something Miss Lambert said at the end of her submissions. She said the judge's task was to ask himself if the agreement was just between the parties at the date it was made. That is a fallacy. The duty of the judge was to adjudicate upon the wife's entitlement to financial provision under the statute and particularly to reach a determination that applied all the relevant s 25 criteria to the circumstances of the case. Of course, the agreement was within that range but it was no more than one ingredient within a complex equation.'

The outcome of the Smith case was that lump sum provision was made for the wife in excess of that which she had agreed to accept. This was justified by the particular circumstances of the case and does not, in my judgment, reflect a change of approach or principle making it any easier than under the principles enunciated by Ormrod LJ to depart from an earlier agreement.

Evaluation of agreement

[16] Although very critical of the district judge's conclusion that the agreement was fair at the time it was made and of the fact that, as they say, he treated it as definitive, counsel for the husband do not seek to go so far as to argue that it was inappropriate for the district judge to have looked, as part of the overall picture, at whether the agreement was fair in 1999. They argue that the district judge's finding of fairness in 1999 rested on his subsidiary finding that the total non-pension assets in about May 1999 amounted to £621,569. They complain that it is impossible to ascertain from the judgment how the district judge arrives at this figure and that it is definitely wrong. In fact, it was easy to see how it was made up with the assistance of Mr Francis QC, who appeared for the wife, both in front of the district judge and on the appeal, and by reference to the schedules that were before the district judge.

[17] The net value of the former matrimonial home at the time of the agreement was taken as £391,500. This figure reflected the subtraction of £15,000 in respect of improvements that the wife had done from inherited money after the separation which had cost her considerably more than that but which had increased the value of the house by only £15,000. It is a figure derived not from the £320,000 valuation of the house which had been obtained at the time of separation, and which was the only specific valuation available to the husband at the time of the negotiations for the 1999 agreement, but based on the actual value of the house at the time of the agreement according to a new valuation that was then in the wife's possession in the sum of £450,000. The money in the bank at the time of the agreement totalled £22,250 and there were shares and personal equity plans (PEPS) worth £50,874 and bonds worth £6,327; the joint Standard Life policy had a value of £17,788; the oriental rug collection had cost about £100,000 but was worth £23,130. There were other carpets worth £3,000. The Koi Carp had had various values attributed to them during the hearing before the district judge but he must have taken them to have a value of £10,000 which is the figure set out in the schedule that Mr Francis put in his closing submissions and which is now at p 80 in the appeal bundle.

[18] The Porsche was worth £20,000. The Maserati is included at £70,000, its cost price, although its actual value at the time was £22,000. The district judge explained the reason for taking the artificially high value. The car was purchased from inheritance moneys received by the wife whilst the husband was out of work. The district judge accepted the evidence of the wife that the purchase was made at his insistence and in circumstances which amounted to duress or undue pressure on the wife who strongly objected to the purchase but gave in. It was a bad investment as its actual value shows and the district judge took the view, which was open to him, that the wife should not be penalised for that, The Renault and the Cosworth were worth a total of £6,700.

[19] Much of the financial information that I have just gone through is set out in the district judge's judgment. He itemises assets worth £178,739. He does not give the exact figure for the value of the oriental rugs. He does not mention the £3,000 worth of other carpets or the Renault and the Cosworth and he does not say what figure he attributes to the Koi Carp. Those items, at the values that I have just set out, account precisely for the balance of the £621,569. That figure is, therefore, entirely tenable for the value at the time of the agreement of the non-pension assets that I have itemised.

[20] The husband's real complaint is in fact about the district judge's approach in principle to certain of the assets at that time. First, he says that the district judge wrongly omitted from his calculations the value of a flat in Jerusalem which the wife had inherited from her mother. The flat had in fact been in the wife's ownership prior to the agreement and some 3 weeks after the agreement she received £187,000, being the sale proceeds of it. Secondly, the husband says that the £15,000 discount for the improvements to the matrimonial home was wrong and amounted to giving the wife double weighting for her contributions from her inheritance by excluding this aspect of it from the joint assets and giving her a higher proportion of the assets to reflect her inheritance contribution. Thirdly, he submits, that it was inappropriate to take the Maserati at an artificially high value. Nothing that has been said constitutes a reason to go behind the district judge's finding that the purchase was made because of the husband's insistence and Mr Howard could do no other than accept that the district judge was entitled to take that fact into account. He points out, however, that the reality was that the Maserati, if sold, would not contribute £70,000 towards satisfying the husband's needs, but only £22,000, and the district judge should have taken that into account when looking at the fairness of the agreement in the light of all the s 25 criteria.

[21] Based on his figure of £621,569 for the relevant non-pension assets, the district judge calculated that the husband's receipt of £276,495, which included the figure of £70,000 for the Maserati, represented 45% of the non-pension assets. The parties' pensions were roughly equal in value, the husband's being slightly larger than the wife's. If the points raised by Mr Howard were accepted, the figure for the non-pension assets would be £621,569 minus the £48,000 illusory value of the Maserati making a figure of £573,569 to which needed to be added £15,000 for the deducted matrimonial home improvements and £187,000 for the Jerusalem flat bringing the total to £775,569. The husband's share of that would £276,495, minus £48,000, that is £228,495 which would represent just under 30% of the non-pension assets. Whatever he said about contributions and inheritances, the district judge could not, Mr Howard submits, have justified this degree of departure from the 50/50 split that he had rightly, as both sides agree, taken the view would normally apply in a long marriage such as this one.

[22] The district judge did not in fact ignore the Jerusalem flat. Why he left it out of his calculation of the assets at the time of the agreement is obvious from his rhetorical question: 'What then of the moneys received by the wife after the agreement?' and the passage that follows that question. He was plainly influenced by the fact that the wife did not have the use of the money during the cohabitation or even before the agreement and that it came to her by way of inheritance. Was this an error of approach? Section 25 of the Matrimonial Causes Act 1973 requires the court to look at all circumstances of the case. Assets that the parties have acquired after their separation or by inheritance cannot be excluded from this exercise, but equally nor is the court obliged to ignore the circumstances of the acquisition of the assets. This is recognised in relation to inherited property in what Lord Nicholls of Birkenhead says in White v White [2001] 1 AC 596, [2000] 2 FI.R 981 where he first refers to the widely held view that property owned by a spouse before the marriage and property acquired by inheritance should be on a different footing to truly matrimonial assets, then says:

'Plainly, when present this factor is one of the circumstances of the case. It represents a contribution made to the welfare of the family by one of the parties to the marriage. The judge should take it into account. He should decide how important it is in the particular case. The nature and value of the property and the time when and circumstances in which the property was acquired are among the relevant matters to be considered. However, in the ordinary course this factor can be expected to carry little weight, if any, in a case where the claimant's financial needs cannot be met without recourse to this property.'

[23] I am grateful for Bennett J's analysis of this passage in Norris v Norris [2002] EWHC 2996 (Fam), [2003] 1 FLR 1142 where he rejects the notion, as do I, that Lord Nicholls of Birkenhead was enunciating a fixed guideline that inherited property should be excluded from the ancillary relief exercise and makes clear that the impact of the fact that a party has acquired assets by inheritance will depend upon the circumstances of the particular case. I see no reason why, in an appropriate case, it would not be proper for the court to conclude that because of the circumstances of the acquisition of a particular asset, and in the light of all the other circumstances of the case, it would be appropriate for the spouse who inherited the asset to retain it or the asset that now represents it or reflects it. Although in this case the district judge expresses himself shortly on the subject of the Jerusalem flat, it seems to me that that is the view he took of it. The way in which he expresses himself suggests that he had the passage from White that I have quoted in mind as he considered it relevant that, as he had concluded, there were sufficient funds for the husband to receive a fair proportion of the assets sufficient for his needs without resorting to the inheritance.

[24] However, it is plain that he was also influenced by the timing of the acquisition of the flat in that the real benefit was only available to the wife after the parties' agreement. An asset cannot be excluded completely from consideration because it or the benefit of it is acquired after separation or even after a later agreement has been reached by the parties about their matrimonial finances but, as with inherited money, the manner and timing of the acquisition may be relevant to the distribution of assets by way of ancillary relief. In my judgment it was, therefore, within the district judge's discretion to have dealt separately as he did with the Jerusalem flat proceeds when evaluating the proportion of assets that the husband received by the 1999 agreement. It was also within his discretion, in my view, to conclude that it would not have been reasonable for the husband to have expected a share of it.

[25] Whilst I am dealing with the Jerusalem flat, I need to deal with another point raised by Mr Howard in relation to it. He argues that there was a material non-disclosure in relation to the flat in that the wife did not tell the husband at the time of the agreement that it was to be/had been sold and that she would be receiving the proceeds imminently. This is one of the factors that is relied upon as weakening the force of the 1999 agreement. It is a point that the district judge dealt with specifically. He made a finding that the husband, who he found to be an educated, articulate, intelligent man, was aware of the full extent of the wife's assets and that full and detailed disclosure would have revealed little or, nothing that he did not already know. As his illustration of this, the district judge refers to the flat and points out that it is clear from the husband's letter that he was well aware of the existence of that asset, although perhaps not of the precise amount or the 'imminence of its arrival'. Mr Howard submits that the wife's failure to say that she would very soon be receiving capital from the flat weakened the husband's position in that he would have been able, had he known that, to resist her pressure for a written agreement which was said to derive from the need to satisfy the requirements of the building society and thus obtain the mortgage that would produce the lump sum necessary to pay the husband.

[26] I am not impressed by this argument. Prominent amongst the difficulties with it, it seems to me that there is a practical flaw in that it was the husband's case that he was under time pressure because of his need to proceed to purchase the bungalow. The Jerusalem money was not immediately available. To enable the husband to proceed without any delay, the wife would, therefore, have had to borrow in any event, albeit for a short period of time. I cannot imagine that any lender would have been sanguine about making a loan, even a very short term one, for over £100,000 without security and security which would not be threatened by potential claims by the husband at a future date. Furthermore, the letter of the husband to which the district judge makes reference (which is at p 151 in the trial bundle) suggests that the husband thought the wife had already had the money from the flat, and she did not correct that impression. Her reply is at p 158. If he had been so minded, the husband could, therefore, have challenged whether she needed to mortgage the property in the light of his understanding that she had capital from the flat.

[27] Although the district judge did not spell out the reason for his acceptance of the £15,000 deduction from the value of the former matrimonial home for post-separation improvements, I do not see why he was not entitled to approach it in the same way as the Jerusalem flat. The point that is made in relation to this figure does not, in my judgment, take the husband's appeal any further.

[28] As with the flat, there is a non-disclosure point made on behalf of the husband in relation to the former matrimonial home too. He relies upon the wife's failure to tell him that she had had the house revalued and that it had increased in value to £450,000 at the time of the agreement from £320,000 at the date of the separation. Mr Francis answers this point in a number of ways. First, the husband did not need the wife to tell him about increases in the property value. He knew of the passage of time and he could have investigated or asked about the increase in the value of the property himself. Secondly, in any event it was fair for the parties to take the separation value because, pursuant to an agreement between them, the wife had been paying the husband interest on his capital since the separation. Thirdly, when the district judge actually considered the question of what proportion of the assets each party got under the agreement he took the higher value anyway. Those points do, it seems to me, nullify any argument that the husband may otherwise have had in relation to non-disclosure of the higher valuation.

[29] I turn to the argument that the district judge should have included the Maserati at its actual value when considering what proportion of the assets the husband got. He was entitled, in my view, to reach the conclusion that the circumstances of the purchase were a material factor that counted against the husband's claim. Ultimately he needed to consider whether, if he depressed the provision he made for the husband because of those circumstances, his order would still make proper provision for the husband's needs. I will come to that in a moment, but there was no reason why his evaluation should not include a consideration of the position, taking into account against the husband the significant amount of money thrown away by his insistence on a poor investment. A judge approaching an ancillary relief case rarely does so from one angle alone. The process normally involves looking at all the factors from a number of perspectives. Tentative views are arrived at in the course of this process of wide consideration which may involve a number of schedules and calculations and those tentative views are then cross-checked, notably against, of course, the yardstick of equality of division.

[30] A key passage in the district judge's evaluation of the ancillary relief claim is at p 5 in his judgment where he turns to the s 25 criteria and explains that whilst the starting point for this marriage would be a 50/50 division he considers there are factors justifying an increase in the wife's share. These factors are her greater contribution through her earnings in the last 6 years of cohabitation when the husband was not working and the substantial amount she inherited from her mother and father. Although it is not set out specifically in the judgment, I am told that up to the time of the agreement, excluding, therefore, the Jerusalem flat and sums of money that the wife acquired later on by way of gift and so on, she had brought £250,000 to the marriage from inheritance whereas the husband had brought a legacy from his uncle of somewhere around £60,000. This £60,000 had been given to the wife by deed of arrangement because of the husband's worries about his financial security at the time but she took no point on that. What was relevant was that she held the money at the time of the agreement and that the lump sum the husband received at that time included repayment of it to him as well as money in relation to his share of the former matrimonial home. Mr Howard submitted that this made the 1999 deal particularly unfair to the husband because it reduced the sum he was in fact getting for the house and submitted that the district judge did not take this into account. The district judge's judgment shows that he was fully aware of the legacy from the husband's uncle which he deals with specifically at p 6. His approach to evaluating the fairness of the agreement side-steps any problem that may have been created by the legacy by concentrating on the schedules of assets (which included that legacy). That was, it seems to me, a sensible and proper approach. Only in that way was he able to look at fairness overall, taking into account not only what was agreed in relation to the matrimonial home but also in relation to the other assets. It was this overview that led him to reach the conclusion that there had been a 45/55 split of the non-pension assets under the agreement. As for his discretionary conclusion that this inequality was justified by the history of the marriage, that was, in my judgment, within the band of conclusions to which he could properly come. The husband had argued that the parties had contributed equally and that it should not be found that the wife had made a greater contribution than he had by virtue of his unemployment during the last six years of the marriage. His case was that that unemployment was a misfortune that he was unable to do anything about despite his efforts and that it was, in any event, mitigated by the special efforts that he had made in improving and maintaining the property (as the wife accepted that he did although she said that she helped too) thereby adding to its value. The district judge plainly rejected that as his reference to the wife's greater contribution during the last 6 years of cohabitation shows, and nothing that was said on the husband's behalf established that that was an inappropriate conclusion on all the evidence before the district judge.

[31] It is a pity that, having reached a provisional conclusion that the agreement was fair in proportion terms in 1999, the district judge did not then articulate his reasons for concluding that it was fair in the light of the totality of the s 25 factors and in particular that it met the husband's needs.

[32] It is common ground that he correctly sets out the approach that should be taken where the circumstances of the case include an agreement on financial matters when he says:

'It is quite clear that I must approach the case by applying all the s 25 criteria in the usual way and taking the agreement into consideration as one of the circumstances or as "one ingredient within a complex equation" as it was put in Smith v Smith at 382.

It is quite clear from the authorities that I do not look at the agreement as a preliminary matter but that I look at all the s 25 criteria factoring in the agreement where relevant and taking particular notice of the arguments raised by each side based upon the guidance contained in Edgar v Edgar and Camm v Camm in particular. Section 25 requires me to have regard to all the circumstances of the case and of course the agreement is relevant as a circumstance.'

Furthermore, I do not think any real exception can be taken when the district judge goes on to say: 'It was also argued that I should take it into account as conduct. I think it matters little what heading I consider it under as long as I do consider it'.

[33] What he failed to do was to spell out sufficiently his conclusions in relation to certain of the named factors set out in s 25 and to show why it was that he concluded that the agreement met the husband's needs. That he knew it was necessary to look at this issue and reached the conclusion that proper provision had been made for the husband's needs by the agreement is, however, implicit in the following passages of his judgment. At p 5 he says:

'The position seems to me to be that inherited moneys stand to be taken into account to increase one party's share where there are sufficient funds to allow the other party to be properly provided for without recourse to the inheritance moneys.'

And, similarly, in relation this time to the Jerusalem flat at p 9:

'My conclusion is that having taken into account the full history of contribution of this marriage and the fact that there was (sic) sufficient funds for the husband to receive a fair proportion of the assets sufficient for his needs without resorting to her inheritance, leads me to the conclusion [sic] that it would not be reasonable for the husband to have expected a share of it.' (my emphasis)

[34] Was the district judge right in concluding that the husband's needs were satisfied by the agreement giving him 45% of the pre-agreement assets? In my view that was a conclusion he was fully entitled to reach. The agreement left the husband in a position to purchase the bungalow that he wished to purchase. He had found work again after a long spell of unemployment, albeit on a short-term (but lucrative) contract which had just ended at the time of the agreement, and although there then followed another spell without work, he was able to obtain employment again and expects to remain employed until he retires at 60. He retained his pension provision which slightly exceeded the wife's in value. Complaint is made that the assets that he received included a significant amount of the duff in the form of the chattels rather than the plum and that in this respect he did less well than the wife. I do not consider that argument to be well founded. There is a disagreement about who had the better items from the matrimonial home, but, in any event, the 'chattels' that were itemised were for the most part cars and Koi Carp. If the Maserati is taken for this purpose at its real value (as must inevitably be the case if a proper examination is to be carried out of whether a proposed order meets the husband's needs) the value of the cars total £48,700. That could have been realised if the transfer of the vehicles to the husband had occurred, rather than at least one of the vehicles being left in the wife's garage.

[35] Having reached the tenable conclusion that the agreement was not, in fact, unfair to the husband in 1999 therefore, what weight should the district judge have given to the circumstances in which it was arrived at? I have dealt with the issues of alleged non-disclosure already. As I have said, the district judge found that any pressure that there was came from the husband himself. Self-generated pressure can be relevant to the weight given to an agreement as the authorities show. However, the picture that emerges from the district judge's judgment, as well as from the correspondence that I have seen, is of an intelligent and capable man who had demonstrably prevailed against his wife already in the purchase of the Maserati for £70,000 and who was the one generating the pressure in 1999. I do not think that the district judge can be criticised for concluding that this was not the sort of situation contemplated in the leading authorities by way of relevant influence and pressure. The advice the husband received was undoubtedly less than would have been desirable but the district judge recognised that, finding that it was not comprehensive and not confirmed in writing. He could have gone further and recited that it was not from a matrimonial solicitor and that it probably did not follow a full review by Mr Ling of all the parties' assets, the history of the marriage and the s 25 factors. However, bearing in mind that the substance of the agreement was actually fair at the time, I do not consider that complaint can be made about the weight the district judge gave to it in the light of the deficit in the advice.

[36] The obvious gap in the district judge's judgment, as Mr Francis concedes, is in relation to the situation in 2004 to which I now turn. It is this that enables Mr Howard to launch his most powerful attack on the district judge's order, arguing that contrary to his own direction to himself, the district judge failed to carry out his duty under s 25 and wrongly treated the agreement as the sole issue in the case.

[37] Mr Howard reinforces his argument by reference to passages in the district judge's judgment. In particular, at p 9, having recited that his role is to evaluate the husband's claim at the time of the hearing and identified from the schedules that the changes in value of the properties and investments since 1999 have worked in the wife's favour and to the husband's disadvantage, the district judge says:

'Does that mean that I should award provision for the husband now when I have already reached the conclusion that had the application come before the court shortly after the agreement I would not have done so? It was argued strongly on behalf of the wife that I should in this regard have in mind the further dicta in Edgar v Edgar as follows: "important too is the general proposition that formal agreements properly and fairly arrived at with competent legal advice should not be displaced unless there are good and substantial grounds for concluding that an injustice will be done by holding the parties to the terms of their agreement". It is also argued strongly on behalf of the husband that the key words in that sentence are "competent legal advice". I have already given my reasons for concluding that the husband should not be able to resile from his agreement on that ground. The agreement was entered into some four years ago and the wife has acted and arranged her affairs in reliance upon it. The particular circumstances of this case lead me to the conclusion that it would be unfair to the wife to allow the husband to succeed by adopting the argument that he knew perfectly well what the agreement said and what the agreement meant but that he had his fingers crossed at the time he was signing it. This was an agreement which in my view was properly and fairly arrived at and was fair at the time that it was entered into. I do not consider that an injustice would be done by holding the parties to the terms of the agreement. I consider, on the contrary, that an injustice will be done to the wife in this case by not upholding the terms of the agreement and I therefore dismiss the husband's application.'

[38] From this passage it is clear that the district judge continued to have in mind throughout the judgment the need to consider whether in 2004 ancillary relief should be granted. It is also clear that he had made reference to the up-to-date schedules and was fully aware that the passage of time had left the husband worse off than the wife. In my view he should at this point in his judgment have summarised their respective positions preparatory to going on to consider the issue of needs and resources and whether an order should be made to enable these to be met.

[39] The up-to-date schedule presented to the district judge by the wife showed assets worth in total, including pension assets (still roughly equally split between the parties) of £351,480, just under £1.6m, of which the wife had 75% and the husband 25%.

[40] The value of the former matrimonial home had gone up to £1m (£881,596 net) and this represented the most significant feature in the increase in the total, benefiting the wife rather than the husband. The husband had not remained in the bungalow that he had purchased from the proceeds of the agreement. He had moved into a property called the Georgian House, still on the south coast, with a new partner. This is a considerably larger property than the bungalow. I have seen the particulars. It has four bedrooms, a good-sized garden and an outdoor swimming pool. Both the husband and his partner put capital into the purchase which was completed in November 2001 in joint names. The purchase price was £340,000 including fixtures and fittings. There is a mortgage in joint names of around £74,000 which is being repaid over 10 years. At the time of the purchase both the husband and his partner were selling their individual properties. Miss M's property sold first and she invested £70,000 in the Georgian House. At that time, I am told that it is estimated that Mr A's bungalow was worth about £140,000. There was not a great deal of detailed argument about the net value of it at that time, but I was nonetheless left with the impression that it was greater than the net value of Miss M's property and that had they both been able to invest in the Georgian House at the same time. His investment of actual capital would have exceeded hers, although their liability on the mortgage would have been equal. I am told that the property market went up disproportionately in the next 7 months before the bungalow was sold, and that the fact that it raised £212,000 and that from the net proceeds of that Ms A was paid off in the sum of £154,000 (representing Mr A's contribution to the Georgian House) must be seen in that context. When Mr Howard complained that the schedule of current assets put before the district judge did not include a £38,000 gift that the wife had made to her niece from her inherited money, I did nevertheless incline to the view that as well as being something which had all taken place well after the parties' separation and agreement, this was also probably counterbalanced to an extent by the fact that the Georgian House had been put into joint names with equal shares to the husband and his partner.

[41] Mr Howard's schedule of current assets includes, in addition to the £38,000 I have just mentioned, moneys in a Euro bond worth £82,000 and a further sum representing moneys withdrawn from the bond of £14,000. That Euro bond I understand to represent the present incarnation of the Jerusalem flat money or what remains of it. Mr Howard's total is, therefore, £1,823,932 with Mr Francis' corrections to Mr Howard's maths incorporated. Mr Howard calculates that the husband, therefore, now has 22.6% of the assets which he points out is including chattels, whereas most of the wife's chattels he would say are omitted.

[42] Relevant in any evaluation of the current situation is, of course, a consideration of why the parties' assets are now worth what they are and divided in the proportions that they are. The major factor in this case is that the wife had, as a result of an agreement which the district judge found to be fair at the time it was made, a larger proportion of the assets plus money subsequently coming by way of inheritance and has had the benefit of the London property market rises. The husband had a lesser sum of money which would inevitably appreciate to a lesser extent unless he was very lucky, and he chose to live outside London where property rises may — although there is no evidence about this and I am conscious that I was told about a particular rise in the value of the bungalow just before it was sold — have been less dramatic. Any claim for further provision by the husband now must be seen with this all very much in mind, and it is not inappropriate, in my judgment, that it would lead to a reluctance on the part of the district judge to interfere, simply on the basis of rises in property values, with the 1999 agreement, particularly where, as here, the husband's ancillary relief application did not come for some significant time after the agreement and where, as the district judge found, the wife had ordered her affairs on the basis of the agreement.

[43] Did an overall view of the s 25 factors dictate a lump sum payment to the husband, however, particularly in terms of his need? Detailed analysis of this aspect of his case has been late in coming. The general principle that needs and resources were relevant was plainly part of this case at trial, but I do not get a sense that the district judge was taken through a practical examination of how the husband was managing under the current arrangements as compared with the wife, nor was this part of the presentation originally in Mr Howard and Mr Samuel's skeleton argument before me which asks for 'an order for financial provision for the husband which enables him to discharge his mortgage indebtedness and to live decently after his retirement'. Mr Francis produced a needs analysis based on the income and outgoings for each party set out in their Form E. This showed that each party had a shortfall between their income (including in the husband's case his partner's income also which is based on what she said in evidence to the district judge and which, it has to be said, is probably overstated as it is assumed she will work full time at her temporary job throughout the entire year) and their outgoings. The shortfall will get worse in each spouse's case when they cease to work and turn to their pension. In the husband's case this will be at 60 in his present employment and there is no information as to whether he would get another job. His case was run on the basis that he would not. In the wife's case there is no finite period fixed for her work but neither of course would she be able to go on working forever either. Commutation of part of that pension would enable each spouse to draw a lump sum which would go some way, for the husband, to paying his mortgage off but would, of course, also reduce his income. He will alternatively be able to utilise (subject to issues of costs) what he raises from the sale of the cars and what is made by the oriental rugs for this purpose. There is also the option for him to trade down in his property.

[44] Having looked at the current position, or at least the position on the 2004 figures, which is the only way to take a uniform set of values at roughly the present time, I have concluded that the husband will be able to meet his own needs from his own resources, albeit that some adjustments in his living arrangements may be necessary. I have also concluded that, although he failed to spell out all the s 25 factors (and particularly to do so in the 2004 context), the district judge's conclusion that the appropriate ancillary relief order was for no further payment to be made to the husband in addition to that provided for in the 1999 agreement was one to which he was entitled to come and which was proper in the light of all circumstances of the case, not just the existence of the agreement. I would, therefore, dismiss the husband's appeal against the district judge's order.

[45] That, I think, concludes the substance of the appeal and leaves the issues of the cross-appeal on costs and the costs of the appeal so I will adjourn at this point.