England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
FAMILY DIVISION
(Mr Justice Charles)

		Royal Courts of Justice Strand London, WC2
		8th December 2003

1. LORD JUSTICE THORPE: Mr Francis seeks permission to appeal two long judgments delivered by Charles J at the conclusion of ancillary relief proceedings between the parties. The second judgment is the judgment on costs. The first sets out his conclusions on the fair division of assets and income between the spouses.
2. Mr Francis rests his application on three principle points. He says that the judge was plainly wrong to order that the future use and occupation of the final matrimonial home, Watersmeet, should be for the wife and children rather than for the husband and children. He says that the consideration fixed on by the judge as decisive was one that had never been made part of the wife's case until the judge questioned her at the conclusion of her cross-examination. Mr Francis submits that it should not have weighed more heavily in the judicial balance than the very strong considerations which had been consistently advanced on his client's behalf throughout the whole preparation of the case and which were summed up by the judge in paragraph 103 of his judgment, as the use of the property for sailing and other family activities, the husband's attachment to the property and the work that the husband had done on it, and finally his proposed business uses of the property and the railway slipway.
3. There are undoubtedly difficulties in Mr Francis's path. The judge in paragraph 87 of his judgment recorded his conclusion that the wife's main reason for seeking the future use and occupation of Watersmeet was her fear that if she were excluded from the property it would have a very damaging effect, a withering effect, upon her future relationship with the children. The judge held that that fear was reasonable and he further recorded that the litigation friend appearing for the children of the family also submitted that there was a real risk of that eventuality if the husband prevailed in his fight for Watersmeet. The judge recorded that it had not been argued that the children's welfare would not suffer or that there was a similar or equivalent risk if the wife remained at Watersmeet. He went on in paragraph 90 to embark upon the necessary balancing exercise, that is to say, to set against this consideration, namely the wife's main reason, the several reasons advanced on the husband's behalf.
4. That brief review of the relevant parts of the judgment illustrates that the judge carried out a balancing exercise and arrived at a discretionary conclusion, so it seems to me that Mr Francis will have to contend that the judge was plainly wrong to prefer one consideration urged on behalf of the wife to the multiple considerations urged on behalf of the husband. That is not an easy case to pursue, given the fact that the litigation friend for the children sided with the wife on this important area of the case.
5. Mr Francis's second attack on the judgment is as to the amount of money ordered by the judge to be paid to the husband, almost by way of compensation, by which I mean money to enable him to relocate elsewhere. The judge's figure was £640,000. Mr Francis says that as a matter of principle that was simply way too low, and left the wife in life time occupation of a property worth twice the value of the property that he deemed appropriate for the husband. That ratio would never have been contemplated in a case in which the applicant for relocation had been female instead of male. This is quite unprincipled, says Mr Francis.
6. Again there are manifest difficulties in Mr Francis's path. It is plain from the judgment that the judge was asked to decide the quantum of the compensatory payment to the husband within the parameters of particulars of sale which had been produced to him by the parties. He records in paragraph 166 of his judgment that the husband had produced particulars in respect of houses that he was asserting the wife could afford. The same paragraph concluded with the sentence:

"The particulars produced by the wife were of cheaper houses and included some houses which I accept would be unsuitable as a home for the husband."

The judge went on in the following paragraph to say, without any particularity:

"In my judgment taking the particulars as a whole a very nice home that provides sufficient and appropriate accommodation for the husband and the children could be bought for about £600,000."

He went on to add another £80,000 to that to allow for costs and expenses and for kitting out the property.

7. The paragraphs to which I have referred demonstrate that the judge was exercising a broad discretion within the context of a batch of particulars that the parties had produced. Mr Francis says that, apart from the point of principle, as a matter of practicalities the figure on which the judge settled condemned the husband to a property without water access and a property without business user. Perhaps the riposte to that would be that to some extent there is an interrelationship between the capital award and the income award, for the judge went on to consider what should be the order for periodical payments within the bracket of £36,000 a year offered by the wife and the £48,000 a year sought by the husband. The judge accepted the husband's figure and set that as the continuing rate of periodical payments, with an automatic RPI uplift. In accepting the husband's figure as against the wife's, the judge referred to the need to enable the husband to meet the extra costs that would arise from a move of his business.
8. Finally, Mr Francis attacks the judge's determination that there should be no order for costs in the case. Mr Francis says that the judge was effectively unprincipled in that conclusion, given the fact that the Calderbank correspondence revealed that the wife had never at any stage made an offer that approached the judge's ultimate award.
9. Again, there are difficulties in Mr Francis's path. Obviously the major issue in the case had been the retention of Watersmeet, and on that the husband had lost. Furthermore, there were obviously substantial costs incurred between 13th January and the beginning of April 2003 in an investigation and discovery process, which had been made necessary or at any rate relevant by the husband making a substantial shift in his financial arrangements between the close of evidence and the handing down of judgment.
10. I have in each instance pointed out the difficulties that lie in Mr Francis's path, because it seems to me important that the most careful consideration should be given on both sides to the costs consequences of coming into this court for another expensive round of litigation. That said, the test that Mr Francis has to meet is only one of demonstrating that on at least one of these principal contentions he has a reasonable prospect of success. We have reached the conclusion that it would not be possible to dismiss this application out of hand. Albeit there are considerable difficulties, they are not such as to justify the conclusion that there are simply no realistic prospects of success. Before there be any further listing in this court, I would make a direction that this is a case which should be compromised. If compromise has escaped these parties through negotiation, then it is a case in which they should import an experienced and qualified mediator. So that is the disposal I would propose this afternoon, namely that we grant permission but with due warning of the risks of failure and with equal emphasis on the costs consequences of proceeding down the appellate path.
11. LORD JUSTICE MANCE: I agree with all that my Lord has said, particularly with regard to the risks on costs and the desirability that both sides should make a serious attempt to resolve this matter by mediation.
12. With regard to what the judge concluded was the wife's real reason for not wishing to move from Watersmeet, (see paragraphs 86 to 87 of the judgment), before deciding that was the wife's main reason, (it having only been mentioned, we were told, towards the end of cross-examination), it might be thought that the judge should have considered in his judgment why that reason had not been previously articulated, what motive she could have for not revealing it, if indeed it was the main reason.
13. As to paragraph 88, the judge says that:

"Correctly it was not argued that if this risk materialised the children's welfare would not suffer or that there was a similar or equivalent risk if the wife remained at Watersmeet."

It seems clear that, once the point arose, the husband was arguing that there was no basis for the wife to have any fear of a real risk to her relationship with the children if she had to leave Watersmeet. If the husband was wrong about that, then it is difficult to see why there was no equivalent risk if the husband had to leave Watersmeet. It may be suggested that psychological reasons distinguish the two situations, but these were not addressed in the judgment. It seems possible that the point was determined by forensic considerations, in other words the husband's challenge to the wife's case, rather than the underlying reality.

14. The second area on which I address brief comments relates to the slipway, which I understand from the submissions was proposed to be used or would be proposed to be used if available, possibly in a limited way for the husband's own business but primarily for a family business run by his brother. That is addressed in paragraphs 105 to 107. It seems to me, on the face of it, that it might be said in relation to those paragraphs that it would be better and cheaper to sort out any permission, including the terms of any relevant licence, in the judgment rather than to seek to encourage a future agreement. The prospect of any voluntary licences being granted in the future would seem, in the light of the parties' deteriorating relationship, always to have been very remote, and the judgment confirms that no agreement has been reached. The need for further requests would be more likely to exacerbate relations than to lead to any agreement. For that reason it seems to me that paragraphs 105 to 107 might be thought to represent a questionable way of dealing with future use of the slipway.
15. MR. JUSTICE EVANS-LOMBE: I agree with both my Lords.

ORDER: Application for permission to appeal allowed.