IN CONFIDENCE
Neutral Citation Number: [2025] EWFC 144 (B)
Case No: 1662-0279-7639-9790
IN THE FAMILY COURT AT TRURO
Courts of Justice
Edward St
Truro
Date: 17 February 2025
Before :
District Judge Stone
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Between :
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X |
Applicant |
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- and –
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Y |
Respondents |
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Rupert Chapman (instructed by Stephens Scown) for the Applicant
Christan Gape (instructed by Vingoe Family Law) for the Respondent
Hearing date: 12 February 2025
Handed down 15 May 2025
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JUDGMENT
District Judge Stone:
a. The application brought by the respondent husband Mr X ("Mr X") to appeal out of time the final order I made in this matter on 1 December 2023 ("the order"). By order of HHJ Mitchell dated 3 January 2025 that application is to be treated as an Application to set aside and/or vary the capital provision contained in the order
b. The application brought by the applicant wife Mrs Y ("Mrs Y") to strike out Mr X's application
a. Mrs Y's offer dated 24 November 2023 was that the proceeds of sale at a price up to £850,000 should be divided so that she received £475,000 and Mr X the balance; and that any proceeds in excess of £850,000 should be shared equally.
b. Mr X's offer dated 10 November 2023 (set out in his Section 25 statement) was that the proceeds of sale at a price up to £800,000 should be divided so that Mrs Y received £350,000 and he received the balance; and that any proceeds in excess of £800,000 should be paid to him. In short, she would get £350,000 and he would get the balance.
"17. The family home shall be sold forthwith on the open market for sale and the following conditions will apply:
a. the property shall be placed on the open market for sale immediately by the parties for such price as may be agreed between the parties or in default of agreement determined by the court;
b. the property shall be sold for the best price reasonably attainable in excess of £800,000, such price to be agreed by the respondent alone or in default of agreement determined by the court;
c. both parties shall have conduct of the sale;
d. such solicitors as may be agreed between the parties or in default of agreement determined by the court shall have the conduct of the conveyancing work relating to the sale;
e. The nominated Estate Agents shall offer the property for sale; and
f. the proceeds of sale shall be applied as follows:
i) to discharge the mortgage;
ii) in payment of the solicitors' conveyancing costs and disbursements
iii) in connection with the sale;
iv) in payment of the estate agents' charges;
v) in payment to the applicant of the lump sum of £410,000 and in payment of the balance to the respondent less the liability owed to the applicant under the costs orders made by Deputy District Judge Deacon on 12 July 2023 (£3,659.50 plus VAT)."
"Given the recent trend of the market (which is slow) in this sector it would be worth considering a further reduction and we could see the value continue to drop in the coming year. A figure of £750,000 would logically be the next marketing price point to try.
...
It is worth noting that we have an offer for the property from Mrs Z however she does need to sell a property in order to purchase. I have spoken to her this week and although she has had a little more interest in her property recently, does not yet have a buyer. She did say that since offering, more property has come to the market and there are some others that also interest her now."
"The grounds on which a financial remedy order may be set aside are and will remain a matter for decisions by judges."
"I am seeking permission to appeal out of time against the lump sum order. The position with the sale and fall in the property market is a new event which has occurred since the making of the order on 1st December 2023, and which invalidates the basis on which the order was made."
"In this case the order remains executory as the order for sale is yet to be implemented - and in reality will remain so because the requirement to sell for more than £800,000 cannot seemingly be achieved.
As held in Kicinski v Pardi [2022] 1 FLR 474 the Thwaite jurisdiction provides that the Court may set aside one of its orders if
i) it remains executory,
ii) there has been a material change of circumstances, and
iii) it would be inequitable not to vary the order
It is noted that unlike set aside based on Barder events etc the change in circumstances does not need to be 'wholly unforeseen'."
a. The order is executory because the house has not been sold
b. The reduction in value of the house represents a significant change. The Thwaite jurisdiction does not require the change to be unforeseeable.
c. The court set a minimum sale price and determined the division of capital on that basis. In light of the significant change it would be inequitable not to vary the order and the impact on Mrs Y would be minimal.
a. He questions whether the Thwaite jurisdiction still exists. He referred me to the case of BT v CU [5] in which Mostyn J questions whether that jurisdiction has survived Barder. He says that the House of Lords in Barder was referred to Thwaite. It chose not follow it but to impose a higher test.
b. In any event, if the Thwaite jurisdiction exists then the conditions to exercise that jurisdiction are not met because
i) The change is not significant: it is a minor variation in valuation because if the property sells for less than £800,000 then any reduction in the sum received by Mr X is mitigated by the fact that the mortgage Early Redemption Penalties are now through passage of time no longer payable: on the original figure of a sale at £800,000 Mr X would receive £104,187; now on a sale of £795,000 he would receive £134,961 (ie an increase); on a sale at £750,000 he would receive £91,311.60 - a reduction of around only £13,000
ii) It would not be inequitable to retain the existing order: many of the cases concerning Thwaite jurisdiction consider whether the one party has caused the significant change by acting inequitably; but there is no suggestion that Mrs Y has done anything of such a nature and so the court should be very cautious about exercising its discretion here.
a. What are the conditions that must be fulfilled to rely upon the Thwaite jurisdiction?
b. What does it enable the court to do?
c. Does the jurisdiction even exist - ie has it survived Barder?
"The judge might have left the matter there because under the consent order of April 30, 1979, the dismissal of the wife's application for ancillary relief took effect only from the date of the conveyance. It was open to her to restore her application immediately or later. But he, not unreasonably, thought that this state of affairs was unsatisfactory, particularly because he concluded that the die was cast, and that the children's future now lay in Australia and that the circumstances under which the order had been made had wholly changed.
A curious situation then arose. The judge proposed to make a new order in favour of the wife. The husband consented but the wife refused to agree to his doing so. Notwithstanding the wife's refusal, he decided to proceed..."
"Where the order is still executory, as in the present case, and one of the parties applies to the court to enforce the order, the court may refuse if, in the circumstances prevailing at the time of the application, it would be inequitable to do so: Mullins v Howell (1879) 11 Ch D 763 and Purcell v F C Trigell Ltd [1971] 1 QB 358, 366, 367. Where the consent order derives its legal effect from the contract, this is equivalent to refusing a decree of specific performance; where the legal effect derives from the order itself the court has jurisdiction over its own orders: per Sir George Jessel MR in Mullins v Howell (1879) 11 ChD 763, 766. We do not think that the references to "fraud or mistake" in Lord Diplock's judgment in de Lasala v de Lasala [1980] AC 546 were intended to confine the powers of the court in these respects, in regard to orders based on consent, within narrower limits than those which apply to non-consensual orders."
a. The order is executory (ie has not yet been implemented)
b. It would be inequitable to enforce it
c. It does not matter whether it is an order made by consent or otherwise
"The judge was entitled, in his discretion, to make a new order for ancillary relief in favour of the wife, notwithstanding the refusal of the wife to consent to his doing so. His jurisdiction arose, not from the liberty to apply as he held, but from the fact that the wife's original application for ancillary relief was still before the court and awaiting adjudication. It had not been dismissed since the conveyance had never been executed, so that that part of the order of April 30, 1979, by which her application was dismissed, had never come into effect. We think that the judge correctly exercised his discretion in this respect.'"
"I am quite satisfied that I have that jurisdiction. It is right, in fact, to note that the clean break only takes place once there has been compliance with all of the orders that were made by Holman J, so in one sense there is still jurisdiction in any event to make an order under s 24(a) for a sale of the French property. But, I am equally satisfied that pursuant to Thwaite v Thwaite [1982] Fam 1, a decision of the Court of Appeal, an executory order can be varied in the way that Mr. Chamberlayne invites me to do."
"31. ...the husband submits that Moor J was wrong in his interpretation of the case of Thwaite v Thwaite (1981) 2 FLR 280. It is submitted that that authority dealt solely with the court's jurisdiction to opt to refuse to enforce a consent order and that it is not authority in relation to there being any jurisdiction to set the original order aside.
...
34. For some reason the appellant's skeleton argument does not, however, reproduce paragraph 3 of the head note recording what the Court of Appeal "held" in Thwaite, which reads as follows:
"that, although the judge was in error in considering that he had jurisdiction to vary the consent order under the liberty to apply, he had jurisdiction to hear the husband's appeal against the consent order and set it aside on the basis of the fresh evidence that the wife had no intention to make a home for herself and the children in this country; that the judge also had jurisdiction to make the orders for ancillary relief, despite the wife's refusal to consent to such a course, because her original application for ancillary relief was still before the court and awaiting adjudication."
"37. It is plain to me that Moor J was entirely correct in holding that the authority of Thwaite v Thwaite to the effect that "an executory order can be varied in the way that Mr Chamberlayne invites me to do" was entirely sound and the appellant's submission that the judge was wrong in his interpretation of this authority is completely unsustainable."
"With respect to cases where there is an undertaking or an order that is still executory the approach to determining whether or not to set aside or vary the order is, as the appellant submits, based upon it being inequitable to hold to the terms of the original order in the light of a significant change of circumstances. Given that this is a case about an executory order, it is not necessary to engage any further with the Appellant's wider submission regarding the test where the jurisdiction may arise in other circumstances. In any event I agree with Mr Chamberlayne that the circumstances justifying intervention are likely to be met where an order remains executory as a result of one party frustrating its implementation."
"66. In Benson v Benson (deceased) [1996] 1 FLR 692 at page 696 Bracewell J described the principle as being that:
"the judge has an inherent jurisdiction to make a fresh order for ancillary relief where the original order remains executory if the basis upon which it was made has fundamentally altered."
I respectfully agree."
"94. I can start by clearing the ground. There is not — there cannot be — any suggestion that circumstances have changed in any material respect since the consent order was made..... This is not the case of an unexpected supervening event. It is, if it is anything, a case where, as the husband would have it, there was a flaw in the trial process. It follows, therefore, and for reasons which I have already explained, that the husband cannot rely upon either Barder v Caluori [1988] AC 20 or Thwaite v Thwaite [1982] Fam 1"
"9. However, it is an iron rule that aside from a lump sum payable by instalments, and aside from a set aside on traditional grounds as discussed below, a capital award cannot be varied, or, a fortiori, discharged, by a court of first instance. That an order has, in the usual way, a "liberty to apply" clause certainly does not entitle a court to rewrite non-variable capital awards and to make different ones. Equally, the fact that a dismissal clause does not take effect until there has been full compliance with certain transfers and payments plainly does not entitle a court to replace an executory order with a new one. The judge referred to the decision of Thwaite v Thwaite [1982] Fam 1. In a recital to an order made on 13 July 2016 he stated:
"In accordance with the authority of Thwaite v Thwaite the court may consider the order and refuse to enforce the order if it is inequitable to do so. Where such an outcome is determined it is open to the court to determine the matter afresh"
10. I have to say that I do not agree with this."
"12. ...this gives no support to the notion that if the court, exercising its equitable jurisdiction, refuses to enforce an order it gains the power to make a completely new one....
13. ... Therefore, I think that any application under the principle in Thwaite should be approached extremely cautiously and conservatively."
"the fact that a dismissal clause does not take effect until there has been full compliance with certain transfers and payments plainly does not entitle a court to replace an executory order with a new one"
"It is essential in this case that steps are now taken to resolve the current impasse. For the reasons explained above, I have reached the clear conclusion that I have jurisdiction in this case to revisit the terms of the mainframe order which I made in 2015. I accept, following SR v HR, that any such revision must be contained and, so far as possible, should reflect the underlying intention of the original extraction route embodied in the 2015 mainframe order. That is a jurisdiction which I am exercising with the consent of both parties although I do not need such consent in order to exercise it. It is a jurisdiction which flows both from the Thwaite principle (contained, as explained above) and from the jurisdiction conferred on the court pursuant to the FPR 2010."
"In Thwaite v Thwaite [1982] Fam 1, Ormrod LJ identified two routes to extinguish the lump sum order made in that case. First, in a harbinger of the later case of Barder [1988] AC 20, the lump sum order could be set aside on an appeal out of time in reliance on fresh evidence which destroyed the basis of that order. Second, the court could refuse to enforce the unpaid lump sum order, as it was executory.
44 Thwaite was cited to the Judicial Committee of the House of Lords in Barder and is referred to in Lord Brandon's speech (at p 40) on a different point namely as an authority for the proposition that the legal effect of a consent order derives from the order itself and not the underlying agreement.
45 The first route must now be seen as being superseded by the decision in Barder, which propounded a much stricter test for the grant of leave to appeal out of time. The first route in Thwaite did not incorporate the requirement of unforeseeability; nor did it have the one-year limitation period.
46 As for the second route, it must be strongly emphasised that in Barder itself, Lord Brandon observed at p 29 that the order under appeal was executory. Yet, fully aware of the decision in Thwaite, the Committee did not decide the case by reference to that doctrine. I agree with Ms Kisser that the Committee must be taken as having impliedly rejected this route as a legitimate source of relief."
"47. ...the first question in deciding whether to exercise the Thwaite jurisdiction is whether there has been a significant (and necessarily relevant) change of circumstances since the order was entered into; and the second question is whether, if there has been such a change, it would be inequitable not to vary the order. For myself, I do not find the words 'cautious' and 'careful' particularly helpful. There are two requirements to the use of the jurisdiction and their application will ensure that the Thwaite jurisdiction is used with care. There is no additional test or hurdle set out by the Court of Appeal in Bezeliansky which is the case that binds me.
...
56. The next issue, under Thwaite is whether it is inequitable to vary the order in the way sought."
a. What are the conditions that must be fulfilled to rely upon the Thwaite jurisdiction?
There must have been a change of circumstances that would render it inequitable to hold one party to the financial provision order that has not yet been implemented (ie is executory). By definition a minor change in circumstances would not be sufficient to render it inequitable to hold a party to it, so it is inherent that the change of circumstances must be significant. Where the change of circumstances has been brought about by the other party's inappropriate conduct, that also may point towards inequitability.
It is not necessary for the change to be unforeseeable. Indeed, in some cases where a party has conducted themselves badly throughout the process, an attempt to frustrate the implementation of an order may be as foreseeable as it is inequitable.
b. What does it enable the court to do?
It enables a court to refuse to enforce the relevant provision of the order if to do so would be inequitable.
Whilst some of the High Court decisions appear to conflate the issues of refusal to enforce with an ability to alter the order, the basis for asserting that the court has a general jurisdiction to alter the order is unclear. It appears to arise from the fact that in Thwaite the court did vary the order, but it did so only because the parties' claims remained live before the court and had not been dismissed.
c. Does the jurisdiction exist - ie has it survived Barder?
Despite the best efforts of Mostyn J to interpret the House of Lords' silence regarding Thwaite in the subsequent Barder judgment, there is no doubt that the jurisdiction continues to exist. If it had not survived the Court of Appeal would not have referred to it in the Bezeliansky permission to appeal decision.
a. First, whilst I acknowledge that my order provides Mrs Y with a fixed sum as opposed to a percentage share that would be self-varying, that is the model of order that both parties sought at final hearing. Mr X's position was that he was content for Mrs Y to receive a fixed lump sum, and he would take the risk (or reap the benefit) if the house sold for less (or more). Further, his own open position was that the proceeds of sale at a price up to £800,000 should be divided so that Mrs Y received £375,000 and he received the balance; and that any proceeds in excess of £800,000 should be paid to him. The formulation of his own offer would have meant that he stood to lose if the property sold for less exactly as he does now; yet now he says that such an outcome is inequitable.
b. Second (and in a similar vein), whilst Mr X may consider it unfair that if the property price drops he receives less and Mrs Y does not, that must be put into context: if the property had sold for £875,000 (or even more than that) then he would have benefitted entirely from the sum above £800,000. He took both potential risk and potential benefit.
c. Third, there is no evidence before the court that the house will sell for only £750,000. There is a letter from estate agents, but no updated expert evidence. The information for the court to conclude that the property is worth significantly less than £800,000 is simply not before the court. Whilst Mr X states that there was a fall in the property market shortly after the final hearing, there is no evidence of that before the court and the news might come as something of a surprise to those in Cornwall who keep an eye on property prices or who look at the Land Registry House Price index for Cornwall.
d. Fourth, the letter from the estate agent confirms that the property is under offer from a buyer at £795,000, just £5,000 below the valuation used at final hearing. It may be that the particular buyer cannot currently proceed, but if the best evidence of property values is what someone is willing to pay then the evidence Mr X has put before the court is that it is worth £795,000. That cannot be a significant change that would render it unfair to hold him to the order.
e. Fifth, the result of the delay in a sale completing is that the Early Redemption Penalty period has elapsed. On a sale at £795,000 Mr X would now receive more than the figures upon which the judgment was based. As Mrs Y's counsel points out, were the property to sell for only £750,000 then Mr X would only receive £13,000 less than had been foreseen. Again, such a reduction is not so significant as to render it inequitable to hold Mr X to the order.
f. Sixth, this is not a case where Mrs Y is alleged to have conducted herself in a way that has led to an inequitable situation arising.
g. Seventh, in the absence of any evidence that house prices have reduced sharply, it would be no more inequitable to Mr X to hold him to the order than it would be to Mrs Y to give her less than the court concluded she needed in order to rehouse herself and the children.
"the property shall be sold for the best price reasonably attainable in excess of £800,000, such price to be agreed by the respondent alone or in default of agreement determined by the court;"
District Judge Stone
17.2.2025