ON APPEAL FROM DARTFORD FAMILY COURT
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE VOS
LORD JUSTICE SIMON
|- and -
Mr Simon Johnson (instructed by Patrick Lawrence Solicitors) for the Respondent
Hearing date : 27th January 2016
Crown Copyright ©
Lord Justice McFarlane :
Deputy District Judge's order
a) The family home was to be sold with the net proceeds split so that 78% went to the wife and 22% to the husband;
b) Upon his retirement, the husband was to pay a lump sum to the wife equivalent to 50% of the payout he received from his GP practice;
c) The husband was to pay periodical payments to the wife of £1,000 per calendar month until the first of the following events occurred:
(i) Death of either party,
(ii) Wife's re-marriage, or
(iii) Further order;
d) The periodical payments were subject to an automatic upward variation in line with the retail prices index each year;
e) Upward variation of the wife's periodical payments upon the youngest child completing her secondary education (full terms set out below);
f) A pension sharing order;
g) Orders providing for a clean break (subject to the continuing periodical payments order).
Wife's periodical payments
"18. Variation of periodical payments upon the child of the family H completing her secondary education.
a) with effect from the payment due in accordance with paragraph 17 above [ordinary periodical payment order] in the month following the month in which the child of the family H completes her secondary education the periodical payments due from the respondent to the applicant shall be increased in accordance with the formula set out in sub-paragraph b) below;
b) the said periodical payments due each month shall be increased by a sum equivalent to 50% of the total private school fees and associated charges paid by the respondent in respect of the child H in the last completed school year of her secondary education, divided by 12."
"40. The decisions I have made regarding (wife's) earning capacity and the parties need for housing and the share of the proceeds of the sale of the family home, necessarily drives the figure for periodical payments."
He then rehearsed in headline terms the income and outgoings that each side had presented to the court. In his judgment the judge trimmed the wife's projected monthly outgoings of £2,979, by a reduction on clothes, holidays, presents and the current mortgage, to a figure of £2,427 from which he deducted her projected income figure based on earning potential of £1,185 per month leaving a sum of £1,242 to meet her needs.
"43. If I then allow the same projected need figure to (husband) and deduct that from the balance of £3,540 set out above, we arrive at a figure of £1,113 that would be available to pay to (wife) in respect of periodical payments. I have rounded that figure to £1,000. This should be increased each year for inflation.
44. Looking at this another way in terms of total income, the figures fall out as follows:
Total joint income:
School fees £1,750
(Child J) £ 350 _________
Balance £4,725 ÷ 2 + £2,362.50
On my calculations and awards, (husband) in fact ends up with more disposable income than (wife) (£2540 as against £2185). I keep this disparity bearing in mind (husband's) evidence regarding his anticipated fall in income from January 2015."
"45. Given that school fees form such a large sum in relation to the parties' finances and given that these fees should only be payable for another 4 years or so, it is right that upon H ceasing full-time secondary schooling there should be provision for a review upon H completing her secondary schooling so that the resulting saving on education fees be split equally between the parties by way of an increase in Periodical Payments. I have not made a similar provision in terms of the money given to J given that it is a relatively small sum and given that in all likelihood, one or both children will continue to need financial support for many years to come."
Appeal to HHJ Scarratt
a) The 78%/22% division of proceeds of sale of the former matrimonial home;
b) The absence of any final term (other than death or re-marriage) on the wife's periodical payments;
c) The automatic rise in periodical payments following H ceasing secondary education.
"40. I now turn to the periodical payments. As far as the periodical payments are concerned I have thought long and hard about the particular provision for maintenance to be fairly substantially increased to the wife when H leaves school. It is my understanding of the Order and the judgment that the learned deputy district judge took into account the fact the husband will have much more available cash once school fees do not have to be paid. The judge had in mind the disparity in earnings and I take heed of Mr Johnson's submission that this is a case where whatever the wife is going to earn she is never going to earn anywhere near the husband's earnings.
41. In my judgment whilst it is an unusual Order I ask myself, is it fair in the circumstances of the case? The learned deputy district judge had in mind all the s.25 factors. I have come to the conclusion that whilst it is unusual it is not wrong. Therefore I dismiss the ground of appeal against that head because it seems to me that there will be a substantial amount of money available to this husband when H leaves school, and that the wife should share in that in the sense that her £1,000 per month at the moment takes into account the fact (no doubt because both parties wished their daughter to have a private education) that the husband has that termly outgoing. Therefore I think it quite fair and proper that the wife receives more maintenance once H leaves school and the husband has more disposable income. The judge had all of this well in mind in his judgment and I am not going to interfere with his findings or his Order in this respect."
a) Failure by the deputy district judge to address what were going to be the wife's apparent needs once H ceased secondary education;
b) The expenditure that the husband was likely to incur on H's tertiary education;
c) In general, the future financial circumstances of both parties in and after 2018;
d) If, which is not accepted, some form of upward variation was within the court's discretion, the figure of 50% was arbitrary and unsupported by reasoning.
"Save in the exceptional kind of case exemplified by McFarlane v McFarlane  2 AC 618 a periodical payments claim (whether determined originally or on variation) should in my opinion be adjudged (or settled), generally speaking, by reference to the principle of need alone. Of course needs are elastic in concept and there is much room for the exercise of discretion in their assessment. But to allow consideration of the concept of sharing to intrude in the assessment of a periodical payments award seems to me to be based on a doubtful principle, and is replete with problems of quantification by any sure standard. The sharing principle in relation to matrimonial property is simple enough: it is usually 50/50, because in the division of the marital acquest equity (or fairness) is (usually) equality. But if the concept of sharing is going to uplift above the assessment of need a periodical payments award which will be paid from post-separation earnings how does a judge set about doing it? Is it a third? Or 40%? Or 20%? There are not even any signposts along the road to a fair award."
"15. In the skeleton argument written by counsel for the hearing of the appeal below, the function of the judge was correctly described thus :
"The court will be aware that 8.1 appeals against decisions of ancillary relief are subject to the general rules on appeal. Accordingly the general basis for allowing an appeal is that the decision of the court below was 'wrong' (CPR 1998 R52.11(3)) with respect to:
[i] the law
[ii] the facts, albeit to a restrictive degree (Piglowski v Piglowska  2 FLR 763); and,
[iii] where a decision is based on judicial discretion the discretion must be shown to be "plainly wrong" only if the decision made is so plainly wrong that he must [have] given far too much weight to a particular factor is the appellate Court entitled to interfere [ G v G  FLR 894 and V v V  2 FLR 697.]"
"21. It is very important that the limited function of the circuit judge in hearing appeals from the district judge should be recognised and honoured. This is not a process that allows any rehearing de novo. It is not a process that allows for the admission of fresh evidence unless exceptional circumstances demand that. Essentially much of the speech of the wife on that occasion was an endeavour to introduce a fresh view of the history and fresh evidence as to subsequent proceedings and prospects. That could not be admitted in any principled way and in that lies the explanation for a variation which is particularly substantial in that the election for a joint lives order is a fundamental departure from what the parties had agreed in front of HHJ Levey in 2005."
"If a court is going to exercise discretion, it has to do so on an informed basis. The only known fact here was that H's education would cease and the school fees bill would no longer need to be paid. The rest is pure speculation."
I found myself in complete agreement with that submission.
Lord Justice Vos
Lord Justice Simon