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Finance & Divorce Update December 2015

Edward Heaton, Principal Associate and Jane Booth, Associate, both of Mills & Reeve LLP analyse the news and case law relating to financial remedies and divorce during November 2015

Edward Heaton, Principal Associate and Jane Booth,   Associate, both of Mills & Reeve LLP 

As usual the monthly update is provided in two parts:

A.  News in brief and

B.  Case law update

A. News in brief

FLBA response to the Lord Chancellor's Consultation on the Destination of Family Appeals
The FLBA has issued a response to the consultation, which can be found here.

The consultation deals with the likes of the proposed further extension of the appeals being moved from the Court of Appeal to the High Court (with which the FLBA is in agreement, subject to the hope that the Justices of the Family Division will use their "leapfrog" powers to direct appeals in complex private law proceedings to the Court of Appeal).

Towards the end of its response, the FLBA expresses the view that the "dramatic rise" in the number of appeals to the Court of Appeal is linked to the effects of the Legal Aid Sentencing and Punishment of Offenders Act 2012 ("LASPO"), "with many litigants in person pursuing hopeless appeals due to lack of legal advice".  Concern is expressed about the "additional burden" that will be placed on High Court Judges under the proposals, who are already overburdened due to the increase in litigants in person.

The FLBA urges the Government to reinstate Legal Aid in private law cases for those who were eligible prior to the coming into effect of LASPO.

The FLBA also points to the need to replace the full-time district judges who have been lost to the Financial Remedies Unit, and to the increased burden resulting from appeals of decisions made by deputies who have been allocated cases without having "the requisite expertise and experience".

The President issues Practice Guidance on arbitration in the Family Court
The Guidance concerns the "interface between the Family Court and arbitrations conducted in accordance with the Arbitration Act 1996".  It covers:

(i) Where there are subsisting proceedings seeking the same relief as is in issue in the arbitration (including applying for an order by consent or otherwise);

(ii) Arbitration claims (as defined by the CPR), meaning claims to determine(a) whether there is a valid arbitration agreement, (b) whether an arbitration tribunal is properly constituted or (c) what matters have been submitted to arbitration under an arbitration agreement;

(iii) Arbitrations conducted when there are no subsisting proceedings seeking relevant relief (again, including applying for an order by consent or otherwise);

(iv) Enforcement;

(v) Challenging arbitral awards; and

(vi) Arbitration-specific standard court orders. 

The Guidance note can be found here.

Latest divorce statistics published
The ONS has published figures relating to 2013 which can be found here.

In short, "highlights" include the following:

(i) The number of divorces was down by 2.9% on the previous year, to 114,720;

(ii) The average age for divorce was 45 for men and 42 for women, representing a continuation of the increases seen since 1985;

(iii) The number of divorces was highest among men and women aged 44 to 44, but the divorce rates were highest, for men, in their late 30s and early 40s and, for women, in their late 20s;

(iv) The number of divorces involving those (men and women) aged 50 to 54, 55 to 59 and over 60 increased;

(v) The median duration of marriage was 11.7 years, a slight increase on 2012;

(vi) 19% of divorcees had had a previous marriage end in divorce;

(vii)  65% of divorces granted to one partner were granted to wives (54% of which were based on unreasonable behaviour, 38% being the corresponding percentage figure in relation to divorces granted to husbands);

(viii) 48% of divorcing couples had at least 1 child under the age of 16; and

(ix) For those married in 1968, 20% of marriages ended in divorce by the 15th anniversary.  For those married in 1998, that percentage had risen to 31%.

Amendments to the Family Procedure Rules 2010 coming into force
Amendments under the Family Procedure (Amendment No.3) Rules 2015, SI 2015/1868, together with two new Practice Directions will be coming into force on 7 December 2015 and 1 January 2016.

These largely relate to communications with the court and the filing of documents electronically.

Guidance can be found on the documents that can be sent by email under the new Practice Direction 5B here

Sharon Minkin v Lesley Landsberg (Practising as Barnet Family Law) [2015] EWCA Civ 1152 – an insurance case with implications for family lawyers
This was a case in which the court considered the extent of a solicitor's duty to advise a client in circumstances where the parties had reach an agreement and the solicitor was being asked to put that agreement into a consent order for the court's approval.

The consent order was approved but, after the event, the claimant regretted having entered into it (alleging that the settlement was less advantageous than it might have been).  She blamed the defendant for failing to advise her more widely in relation to the terms of the settlement and brought a negligence claim against the defendant. 

A central issue in the case was the scope of the defendant's retainer.  The Judge at first instance dismissed the claimant's claim but she appealed.  The Court of Appeal dismissed the appeal and confirmed that the retainer was limited, rejecting the suggestion that additional advice nonetheless needed to be given to the claimant concerning the merits of the underlying agreement.

This case is essential reading for all family lawyers as there are risk and scoping issues when providing bespoke or "unpacked" services with the terms of the retainer letter being crucial.  The full judgment can be found here.

B. Case law update

Al & Anor v CPS [2015] EWFC B180

This was a criminal case where the judge had to decide upon the beneficial ownership of a former matrimonial home and whether he should exercise his discretionary powers under the Matrimonial Causes Act 1973 ("MCA") in relation to that home, which is the sole asset in divorce proceedings, where the husband is subject to a confiscation order and is currently serving a lengthy sentence of imprisonment for a drugs-related conspiracy.

The CPS intervened in the proceedings, contending that the husband was the sole legal and beneficial owner of the property and that the whole of the net value of the property was to be subsumed by the confiscation proceedings.  The wife wanted the house to be transferred into her sole name so that she could occupy it with the three children.

The judge held that the husband was solely entitled to the legal and beneficial interests in the former matrimonial home and that it would have been wrong for him to have exercised his discretion under the MCA to transfer to the wife any part of the beneficial entitlement or proceeds of sale of the property (save to the extent of any surplus after the confiscation).  The husband's beneficial interest in the house had been tainted by his drug-related criminality, and the wife's application under the MCA had been tainted by her own knowledge of his criminal activity.

This case has wider reaching implications for financial remedy proceedings where there has been criminal activity, as it is clear that the former matrimonial home is not necessarily going to be protected, even if there are children involved. 

MF v SF [2015] EWHC 1273 (Fam)  
This case was heard by Mr Justice Moylan, whose judgment runs to in excess of 60 pages. 

The factual background to the case was complex, and a detailed account is, out of necessity, outside the scope of this summary.  In short, however:

(i) The husband was 53 and wife 45.  They had met in the early 1990s and married in 1995 before separating in July 2012.

(ii) The husband was a chartered accountant and the wife a beauty therapist who had given up full time work when the children (14 and 17) had been born.

(iii) The husband had worked for a private family company ("TS") since 1993 before being made redundant in September 2012 and subsequently finding alternative employment.

(iv) Whilst in the employment of TS, the husband had been receiving remuneration of between £500k and £600k gross through a combination of direct salary and consultancy payments made to a company owned jointly by the parties but managed entirely by the husband ("XPS").

(v) The main issue in the case appears to have been the distrust that the wife felt towards the husband.  It was her case that there was what the Judge described as "a broad-ranging conspiracy between the Husband and TS… They are said to have conspired or colluded from about the middle of 2012 to deceive the Wife and subsequently the court as to the Husband's true financial position".  Specifically, the wife's case was that the redundancy had not been genuine, that the husband did not owe approximately £1m to TS (there were, in fact, a number of loans that the wife challenged) and that an inappropriate method of calculation was being applied to the value of the husband's shares in a company (ABC Ltd) which represented 13.14% of the issued shares (the MD of TS, "PM", holding the balance).

(vi) By the time of the hearing, the parties had incurred total legal costs of almost £1m, including costs incurred in respect of the wife's claims against the husband in relation to alleged breaches of the terms of their shareholders agreement relating to XPS.

The wife sought total capital resources of £3.8m plus a 50% pension share based on the husband's shares being worth £6m or, in the alternative, £1.28m plus a 50% pension share and £50k per annum (£30k for herself and £20k for the children, the former on a joint lives basis) in the event of the shares being worth £2.66m, the amount that the MD was offering to the husband for the shares.

The husband proposed a notional equal division of capital totalling £3.1m, subject to a number of adjustments in his favour, and term maintenance of £36k plus school fees.

The judge placed the capital resources at between £2.6m and £3m, excluding the ABC shares, the loans owed to TS and the sum of £137k which the wife sought to be reattributed to the husband.

The judge accepted the evidence of the PM that he was "not in any way involved in collusion (to present a false case)", describing PM as a "very decent man".  The judge also found the husband to be a "generally reliable witness". 

Despite finding the wife also to be "an honest witness", however, the judge found that she had "a deep distrust of the Husband such that she [had] been unable to bring any sensible objectivity to [the] case".

In relation to the redundancy, the judge reached what he described as a clear conclusion.  He said that the "points relied on by [the wife did] not support the conclusion that the Husband's redundancy was not genuine.  Rather, they reflect her suspicion and mistrust".  Why would TS have paid £600k to the husband if the redundancy had not been genuine?  The judge also pointed out that the husband had since found alternative employment. The judge went on to say that it was "abundantly clear that the Husband's redundancy [had been] genuine and… should always have been accepted as genuine by the Wife".

Turning to the issue of the loans, the judge found that there was no evidence put forward by the wife to support the case that TS had waived the loans made to the husband.  In relation to the management of XPS, the judge found that, whilst there may have been breaches of the shareholders' agreement, the claims made by the wife in this respect wholly ignored the fact that "the affairs of XPS had never been conducted by the parties in accordance with that agreement".  There was no evidence to suggest that the husband had managed the company improperly and other than in the financial interests of the family as a whole.

In relation to the husband's shares in ABC Ltd, the wife's case was that they were worth £6m. This was based on a shareholders' agreement and what she believed to be an undisclosed commercial agreement between the husband and PM in which PM had agreed to pay the husband an amount for the shares that had not been based on net asset values. 

The husband's case was that the shares were worth £157k, based on net asset value, and a number of pages in the judgment are devoted to an analysis of the history and, in particular, the intended and appropriate approach as to how the shares should be valued and a rectification of the shareholders agreement making it clear that net asset values should apply. 

PM made a number of offers to purchase the husband's shares during the course of the proceedings, the offer at the time of the hearing being for £2.6m (although the amount that the husband would have received would have been significantly less than this once the outstanding loans owing by the husband and XPS had been taken into account).  The judge observed the fact that PM had been prepared to offer significantly more than the shares had been worth had, perversely, encouraged the wife to pursue her case and had "fuelled the Wife's suspicions".

Following a hearing in February 2014, during which Mr Justice Holman had recorded in his order that the wife had been "running a high risk that the value of the shares and/or the amount receivable for them from PM will later be less than the sum currently on offer of £2.85m", an open offer to settle had been made by the husband based on the amount then being offered for the shares with the wife being put on notice that the husband would rely on the offer in respect of costs.

The judge found that it was "abundantly clear" that PM and the husband had intended and agreed that the husband's shares would be valued by reference to net asset values and not by reference to gross values subject to any informally agreed cap.  Accordingly, the husband's shares were worth no more than £1.7m and the offer on the table from PM needed to be accepted "expeditiously", resulting in a net value of XPS of between £1.5m and £1.9m.

Finally, turning to the wife's case that £137k should be reattributed to the husband, this was centred on monies which the husband had drawn from the directors loan account of XPS.  The judge referred to the case of Vaughan v Vaughan [2008] 1 FLR 1108 in which Lord Justice Wilson (as he then was) had made the point that a notional redistribution had to be conducted "very cautiously by reference only to clear evidence of dissipation in which there is a wanton element". 

The judge found that a schedule produced by the wife had failed to demonstrate any dissipation of resources by the husband, his expenditure not having been excessive.

The judge ascribed a £5k per annum earning capacity to the wife which, with credits, increased her income to £13k.  The wife placed her needs at £68k. 
The husband placed his at £94k with school fees on top of £20k.  The total income available was £160k.

Based on total assets of just over £3m (with a £1.9m value attributed to XPS), the judge found that the starting point would be an equal division of the assets.  He then turned to the adjustments to this sought by the husband.

The judge was satisfied that the wife's refusal to accept the early offer of PM on the basis that she did not trust the husband had resulted in a loss to the family of £350k, and that this had amounted to conduct that it would be inequitable to disregard, and an adjustment should accordingly be made.

The judge was similarly satisfied that there was a disproportionate disparity in the level of the parties' costs in the sum of £168k and that this warranted an adjustment.

Then, turning to the issue of costs, the judge referred to Rule 28.3 of the Family Procedure Rules 2010 and to the listed factors to consider.

The husband sought an adjustment of £400k and, applying this to the asset base of £2.2m, the judge felt that this would be too much.  "Standing back", the judge found that a fair division would be £900k : £1.3m in the husband's favour, with an equal division of the pensions on top.  In terms of maintenance, this was to be of a global sum of £50k, the £30k for the wife reducing by £5k after 6 months, the amount being further reduced by 50p for every £1 earned between £5k and £15k and on a £1 for £1 basis over that.  The wife would also receive 25% of any bonus received by the husband of over £15k up to a maximum of £50k.  The spousal maintenance would be payable for a non-extendable term until 2024.

AA v BB [2015] EWCA Civ 1138  
This case revolved around the extent to which the EU Maintenance Regulation (Regulation 4/2009) prevented the wife from pursuing, successfully, an application for spousal maintenance. 

The relevant parts of the Maintenance Regulation included the following:

"Article 2:  Definitions
1.   For the purposes of this Regulation:

1.  the term "decision" shall mean a decision in matters relating to maintenance obligations given by a court of a Member State, whatever that decision may be called, including a decree, order, judgment, or in writ of execution, as well as a decision by an office of the court determining the costs or expenses…;

2.  the term "court settlement" shall mean a settlement in matters relating to maintenance obligations which has been approved by a court or concluded before a court in the course of proceedings;"

"Article 42:  No review as to substance
Under no circumstances may a decision given in a Member State be reviewed as to its substance in the Member State in which recognition, enforceability or enforcement is sought."

"Article 48:  Application of this Regulation to court settlement and authentic instruments
1. Court settlements and authentic instruments which are enforceable in the Member State of origin shall be recognised in another Member State and be enforceable there in the same way as decisions…"

By way of background, the husband and the wife had both been born in Kosovo and had lived for much of their married life in Slovenia.  They had married in 1981 and had had 4 children, all of whom were, by the time of the hearing, over the age of 20. 

In May 2008, the wife had moved, with the 4 children, to England and, a month later, she had commenced divorce proceedings against the husband in Slovenia, the Slovenian court subsequently dissolving the marriage in 2011.

In October 2013, the wife had been given leave to apply for financial remedy orders under Part III of the Matrimonial and Family Proceedings Act 1984, and an application by the husband to set aside / strike out the leave to apply had been heard by Mr Justice Moylan in November 2014.  In what the Court of Appeal subsequently described as "an immaculately crafted and fully reasoned judgment", Mr Justice Moylan had refused the husband's various applications in their entirety.

Before the Court of Appeal, the husband sought to challenge Mr Justice Moylan's decision to the limited extent that it applied to spousal maintenance.  In short, the husband argued that the wife's claims in respect of spousal maintenance had been determined in Slovenia and that its determination was entitled to recognition under the Maintenance Regulation.

The wife had commenced divorce proceedings in June 2008 and had, in October of the same year, applied for spousal maintenance.  At a hearing in September 2010, however, the wife had revoked her claim and the husband had agreed to her doing so. 

At a subsequent hearing, in November 2011, an order had been made with the following wording beneath the heading "Decided":  "I. Due to the partial withdrawal of the complaint, the proceeding regarding the... claim for maintenance has been stopped".

The issue for the Court of Appeal to determine was, therefore, the extent to which the revocation of her claim by the wife and the subsequent stopping of the claim by the court had been sufficient to be entitled to recognition under the Maintenance Regulation.  Mr Justice Moylan had been satisfied that there had been no "decision", within the meaning of the Maintenance Regulation – the claim had merely been "withdrawn or discontinued".

The husband's case before the Court of Appeal can be summarised as follows:

(i) There had been a "decision" or, in the alternative, there had been a "court settlement";

(ii) A decision in a Member State bound by the 2007 Hague Protocol had to be recognised without question;

(iii) The Slovenian order amounted to a "final determination" of the wife's maintenance claims; and

(iv) Once a party's maintenance claims had been determined and terminated, it was not open to that party to claim maintenance in another Member State.

In short, the Court of Appeal held that the husband's case fell at the first hurdle in that the facts of the case "fell a long way short of establishing that the Slovenian court made a 'decision' or that there was a 'court settlement' with respect to spousal maintenance".  Whilst there had been a decision, it had been one of the wife and not of the court – to withdraw her claim.  The wording in the order, whilst under the heading "Decision" had been a recital rather than a decision of the court, contrasting very clearly with the other six clauses in the document which had been in the form of mandatory statements as to the outcome of the proceedings.

As far as a "court settlement" was concerned, the husband had not asserted that the withdrawal by the wife of her claim had formed part of an agreement prior to the September 2010 hearing and it had not been a settlement "in the sense of a pre-agreed compromise of claims".  Rather, "the record suggests that the withdrawal was probably a unilateral statement of [the wife's] position… as part of the process of narrowing contested issues".  The husband had not been able to establish that the wife's actions had been part of a settlement.

JR v Secretary of State for Work and Pensions & Anor (CSM) (Child support: variation/departure directions: lifestyle inconsistent) [2015] UKUT 582 (AAC)
This case deals with inconsistent lifestyle and the extent to which there should be a departure from a child support calculation.  This was an appeal to the Upper Tribunal on behalf of the mother (who was the parent with care) and there were three "qualifying children".

The judge noted that "the relationship between the court and Tribunal proceedings is potentially complex. In broad terms the county court is concerned with capital adjustments and provision as between the divorcing parents while the Tribunal is focussed on income maintenance for children. One of the complications of the inter-relationship between the two systems is that in certain circumstances a non-resident's capital assets can be used on a variation to adjust the amount of child support maintenance that would otherwise be payable".

The father was liable, under the assessment, to pay £38 per week in child support, but the mother argued that he should be paying more.  The judge referred to the test for granting permission to appeal as being whether there was "a realistic prospect of the appeal succeeding".  Having reviewed the submissions, the judge indicated that variation based on inconsistent lifestyle was the mother's best point.  However, he noted that the fact that it was arguable did not necessarily mean that it was determinative.

The judge explained that "the starting point is that a tribunal does not have to make specific findings of fact and give reasons for all the matters in dispute between the parties.  What the Tribunal must do is make sufficient findings of fact and give adequate reasons for its decision as a whole, explaining why it is that one party won and the other party lost.  The test for reasons is context-specific and is one of adequacy, not optimality – the fact that another tribunal might have gone into more detail is neither here nor there, providing the fact-finding and explanation of reasons is adequate."

The judge agreed with the assessment that there was "little evidence that the father, at the relevant date, had a lifestyle which was clearly inconsistent with his declared income".  The judge therefore concluded that the First-tier Tribunal had not erred in law in reaching its decision and so the mother's appeal to the Upper Tribunal was dismissed.

WD v HD [2015] EWHC 1547 (Fam) 
This was a variation application which went to the Court of Appeal.  The hearing took place before Mr Justice Moor J, who was asked to consider whether Calderbank offers were admissible on the question of costs.  Moor J considered the Family Procedure Rules 2.3 and 28.3(4) and whether appeals fell within the definition of financial remedy proceedings (where the no order for costs presumption applies).

Moor J considered the case of Judge v Judge [2008] EWCA Civ 1458, in which the Court of Appeal determined that an application to set aside a consent order was not an application for a financial remedy – it was a different type of application.

Moor J observed that, by permitting Calderbank offers, there was "the added advantage that litigants [were] able to protect themselves in appeals where the costs of the appeal [could] be totally disproportionate to the amount at stake".  Moor J was, therefore, prepared to admit any Calderbank offer.  He concluded that the rule that offers that are not made on an open basis are inadmissible at any stage in the proceedings (FPR 28.3) applied only to the initial proceedings leading to the first instance decision and not to appeals.

Moor J also concluded that he was entitled to allow part of the appeal whilst leaving other aspects of the lower court's decision intact.  Moor J noted that FPR 30.11 provided an appeal court with the power to set aside or vary a lower court's order and it followed, therefore, that it must be possible to allow part of an appeal.

Moor J then considered the Calderbank offers made and, whilst no offer "bit", he nevertheless made a costs order in favour of the wife in respect of 75% of her costs, assessed at £7,500, inclusive of VAT.

Galea v Rafoni [2015] EWHC 3097 (Fam)
This case concerned a French maintenance order which the mother argued was in arrears and the father argued he was unable to pay because of a considerable drop in his income. 

The issue was whether a maintenance order made in another Member State could be varied in England & Wales where the mother had already sought the assistance of the English court to enforce the order.  Holman J explained that these arguments were not susceptible to resolution in the 30 minute hearing that had been listed that day, and he listed the matter for a final hearing.

Negotiations that had taken place meant that the amount in dispute was £4,000 per annum.  The underlying maintenance order was for approximately £10,000 per annum and the father had offered to pay £6,000 per annum.

There was a dispute as to whether there were arrears but, if there were, they were in the order of £3,000 to £4,000.

Since the commencement of enforcement proceedings the wife, had incurred costs of around £30,000, inclusive of VAT.  The father was already in breach of an order made by Sir Paul Coleridge in the enforcement proceedings to pay costs of £12,000.  Instead, he had made an offer to pay £5,000 in settlement of the outstanding costs debt.

Holman J explained that "there [was] a total loss of costs proportionality in this case; and the idea of this mother coming over from Paris, as she [had] today and will have to again, and being locked in litigation with this father about these objectively small sums, is almost mind-boggling."

Holman J said that the "case cries out for settlement". However, it was impossible for him to adjudicate upon whether or not the father should have to pay all or part of the costs of the mother of and incidental to these proceedings without establishing who was right and who was wrong as to whether or not the court had jurisdiction.

Although the matter was listed for a final hearing and directions given, Holman J urged the parties to resolve their differences by negotiation and agreement and stressed the need for their child "to be provided for in a way that is fair and just to both parties, but also meets or contributes to his needs".

Al-Baker v Al-Baker [2015] EWHC 3229 (Fam)
This was an application, heard by Mr Justice Mostyn, by the wife for the committal to prison of her husband for breach of two disclosure orders made respectively by Mrs Justice Roberts on 19 August 2015 and, in identical terms, by District Judge Aitken on 2 September 2015.

There was a complex factual background about whether the parties were in fact still married and the extent to which matters should proceed under English divorce proceedings or English Part 3 proceedings will, no doubt, be determined as the case progresses.  However, Mostyn J observed that the claim for financial remedy would proceed in England and it was in that context that disclosure orders had been attached to freezing orders.

The financial remedy claim is made in the context of "immense wealth and an exceptionally high standard of living".  The disclosures made by the husband thus far had been partial and had been demonstrated by the wife to be, in all likelihood, dishonest. Notwithstanding the evidence of enormous wealth, the husband had disclosed virtually nothing and the wife had been able to demonstrate that his assertion in relation to non-ownership of property in Dubai had been untrue.

The specific disclosure order related to all of the husband's worldwide assets exceeding £15,000 in value, whether or not in the husband's name and whether solely or jointly owned. The court had directed that the service of the order could be effected by email. Mostyn J had to determine whether the application had been validly served and all the rules had been complied with, and Mostyn J also considered the extent to which the court should dispense with service in circumstances where it is clear that the respondent has in reality been served with the application.

Mostyn J explained that the application notice had been sent to the husband's gmail address, as provided for in the order, and to his lawyers in Lisbon who had been communicating with the court in relation to the freezing orders and who had been communicating with the wife's solicitors.

Mostyn J explained that "the point of the service rules are to ensure that the respondent to any application knows what is happening and has a reasonable opportunity to present his case".  Mostyn J was satisfied that the husband had had such a reasonable opportunity and, therefore, dispensed with the need for personal service of the committal application, pursuant to Rule 37.10(5)(a), and he abridged the period in Practice Direction 37A, para 12.2 by one day to 13 days.

Mostyn J addressed the substance of the application by saying that the husband had "not only refused to comply, but he [had] been defiant in his refusal to do so", and Mostyn J regarded this "as an exceptionally serious case of refusal to comply with the court's lawful directions".  Mostyn J observed that this case was worse than the case of Young v Young [2013] EWHC 34 (Fam) because it had been shown that the disclosure that the husband had provided thus far had been untrue.

Mostyn J was satisfied that this was a case where the husband should be imprisoned forthwith for his default, and the husband's sentence was 9 months.  Mostyn J ordered that the respondent had the right to apply to him to purge his contempt.

Mostyn J also considered the rules surrounding a European arrest warrant and was satisfied that the sentence that he had determined was to be properly backed by a request for such a warrant.

JS v RS [2015] EWHC 2921 (Fam)
This case was heard by Sir Peter Singer.  The parties' relationship had lasted six years, and there were no children.  The parties' respective basic salaries had not been very different early on but, during the central years of their relationship, the wife had received bonuses totalling £10.5million. The husband's bonuses, in contrast, had been comparatively trivial.

The parties had assets of £6.9million, including two properties (one of which was valued at significantly less than the amount for which it had been purchased, despite the fact that a significant amount of money had been spent on it).

Singer J observed that each party's present and future earning capacities carried risk and uncertainty.  However, he assumed that they would each be able to provide for their own income needs, albeit perhaps less lavishly than had been possible during their relationship.

Singer J stated that, if a party puts forward a coherent case for an outcome that is less than a court regards as their entitlement upon principled application of the relevant provisions and considerations, the court is not obliged to make a higher order.  Singer J explained that the "concept of individual autonomy must encompass not only the right of an adult party to settle for less than a court would award him or her, but also the right to invite the court to resolve a dispute by ordering less than it otherwise might".  Singer J said that a party may often have his or her own notion of what the fair outcome may be based on or influenced by factors unknown to the judge.

Singer J considered at length the wife's arguments about pre-acquired earning capacity, contributions, conduct, add-back and unilateral assets.  He found that the arguments failed, as there had not been any separation of finances.  The parties' incomes had been pooled and both parties had clearly contributed to household and other expenditure. Singer J stated that there should be equal sharing of the assets built up during the marriage, irrespective of contributions, even though it had been a short marriage. 

Although £1.37million represented the wife's pre-acquired assets, £1.02million of it had been used to buy the parties' first home and had, therefore, become matrimonial property.

Having considered all of the factors outlined above, Singer J awarded £2.725million to the husband (which included one of the properties).

Singer J rejected the husband's application for a pension sharing order, instead giving the husband an additional £60,000 to offset the disparity in pensions whilst the wife's pension remained intact.

5 December 2015