England and Wales High Court (Family Division) Decisions

IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION

		Royal Courts of Justice
		5th August 2015

MR JUSTICE HOLMAN:

1. Today is listed as the hearing of an application for permission to appeal from the decision and order of Deputy District Judge Butler made on 25^th November 2014 in financial remedy proceedings arising out of the divorce between these parties. Very regrettably, the procedure prescribed for when a party requires permission to appeal to a higher court from the decision and order of a lower court does not require or contemplate that the proposed respondent will normally attend or be represented. In this particular case the appellant is the husband. I do have a very detailed and helpful document drafted by solicitors called Ewings & Co. dated 3^rd August 2015, on behalf of the proposed respondent wife. I have read that document with care and do take it into account. But in order to save costs those solicitors have not attended today and the wife personally has not attended. Accordingly, I am strictly limited in what I can do today by what was, if I can put it this way, specifically on the agenda for today; that is, whether or not to grant to the husband permission to appeal, no more and no less.
2. If the wife had been present and represented I would have had a sustained discussion with both parties and their lawyers as to the most proportionate way forward. Above all else, these parties need to resolve their differences in a time and costs proportionate way. I would have given the maximum encouragement today to going outside and spending time in seeing whether they could reach an agreed outcome once and for all. If that had not been successful, I would have given careful consideration to not merely granting permission to appeal but to actually allowing the appeal today, but remitting the underlying applications for financial remedies to a district judge for re-determination at that level. I cannot, however, do that, as the only matter formally on the agenda today is, as I have said, whether or not to grant permission to appeal. I cannot go further than that without giving to the proposed respondent wife an opportunity to be heard. The result is that these proceedings are going to become attenuated and wasteful both of court time and the parties' limited funds, and I much regret that.
3. An application for permission to appeal falls to be considered by reference to Rule 30.3(7) of the Family Procedure Rules 2010. That provides as follows:

"Permission to appeal may be given only where -

(a) the court considers that the appeal would have a real prospect of success; or

(b) there is some other compelling reason why the appeal should be heard."

There is no question in this case of there being any "other compelling reason why the appeal should be heard". The sole question is whether or not I consider "that the appeal would have a real prospect of success". A real prospect of success does not mean a 50/50 prospect of success, but something rather less than that. The prospect of success, nevertheless, must be "real" or realistic. It should be noted that, even in a case where the court does consider that the appeal would have a real prospect of success, there is still a discretion whether or not to give permission to appeal since the opening words of the rule employ the word "may". I personally, frequently refuse permission to appeal even when I consider that the appeal would have a real prospect of success in cases where on any possible view the likely costs of a proposed appeal would be disproportionate to the amount in issue on that appeal. Just to take an example far removed from this case, I have from time to time had cases where parties are contemplating spending perhaps £5,000 on an appeal where the amount in issue is only of the order of £5,000 or perhaps £10,000 or less. This, however, is not such a situation, although, as I will explain, the amount potentially still in issue between these parties is still relatively small, though significant to them, and there is a real risk here of losing sight of costs proportionality. I will return to that shortly.

4. For the purposes of an application for permission to appeal I can give the essential factual background very shortly. I take these facts and dates from the written judgment of the deputy district judge, which itself is dated 29^th October 2014, although his order only fructified on and dates from 25^th November 2014. At that time the wife was aged forty-one and the husband forty-three. They may now each be a year older. They had married in September 1998. They have two children. At that time the elder was aged thirteen and the younger aged ten, although they may also each now be one year older. At some point, sadly, the marriage between the parties became unhappy and there were proceedings for divorce in 2013. However, they continued both to occupy their home, together with their children. Early in 2014 they agreed that there would be what they called "shared residence" of their two children. They contemplated that there would, ultimately, be actual separation between the parents and so the children would spend part of their time in the home of one parent and part in the home of the other parent. There was a dispute before the deputy district judge as to whether or not the current house should actually be sold, but he came to a clear conclusion (for reasons which he gave) that sale was inescapable. He made an order that the house "shall be sold forthwith" and various consequential directions as to sale. He then provided how the net proceeds were to be apportioned between the parties. There is a slightly complicated formula within the order dated 25^th November 2014 depending on the actual sale price achieved and the actual net proceeds of sale, after discharging the mortgage and the usual costs of sale. The gist of it was that the net proceeds of sale were to be divided roughly 70% to the wife and 30% to the husband.
5. It is crystal clear from the judgment of the deputy district judge that the reasons for that unequal division of the net proceeds of sale were essentially two-fold. One reason, and at any rate part of the background, is that, although both parties work in good secure employment, the income of the husband and therefore his mortgage borrowing capacity is higher than that of the wife. But the other, and to my mind clearly dominating reason, was that it was contemplated between the parties that the actual division of the children's time between the two parents would be about 70% staying or living with their mother and 30% staying or living with their father. It was clearly recognised that both parents needed a suitable home in which to live and accommodate their children, but it is also clear that the deputy district judge felt that the wife had the greater need since the children were going to spend significantly more time with her than with the husband.
6. The actual figures in the judgment of the deputy district judge were based on an agreed value for the home of £290,000. On the basis of that figure and taking account the existing mortgage and costs of sale, the judgment and order of the deputy district judge would have produced about £140,000 for the wife and £50,000 for the husband. A sale was in fact subsequently negotiated (but it has been aborted for the reasons I will shortly explain) at a gross figure of £346,000. That would have yielded an equity of about £225,500. The skeleton argument on behalf of the husband calculates at paragraph 4 that, applying the formula in the order of the deputy district judge made on 25^th November 2014, that equity would be divided as to about £157,800 to the wife and £67,800 to the husband. On those figures, if the net proceeds were divided equally, the parties would receive about £112,500 each. I cannot conceive that, on the facts and in the circumstances of this case, the wife is likely to receive less, nor the husband more, than a half share of the equity. At the moment the wife is due to receive a greater share on application of a needs based approach. But if, for the reasons I will describe, it is no longer appropriate that she should receive more than half on a needs based basis, then it does not currently seem to me that this case could be resolved other than on the sharing basis. This is the matrimonial home that was acquired and funded during the course of their marriage. Absent some overriding needs based reason, the normal approach would be that it should be shared evenly. Although, as I will explain, it is now the husband and not the wife with whom the children are living, I doubt whether he could establish a needs based claim to more than half in view of his own secure income and mortgage capacity.
7. I wish to make crystal clear that on the facts and in the circumstances as they were when he prepared his judgment in October 2014 and made his order on 25^th November 2014, the approach of the deputy district judge was both painstaking and impeccable. It simply cannot be faulted. It is right to say that, so far as I am aware, the husband accepted the outcome at that time and there was no suggestion of any attempt to appeal.
8. What then happened is deeply regrettable, but is as follows. On 5^th January 2015, only about six weeks after that decision and judgment, there was what I will call "an incident" between the wife and their then thirteen year old daughter. It is said by the wife's solicitors in the document dated 3^rd August 2015, to which I have referred, that it involved no more than waving a wooden spoon at the child with no physical contact on the child. Frankly, I have no detailed information about that incident for the purposes of today, but the relevant point is that it did result in the wife being prosecuted for a criminal offence. The magistrates imposed a conditional discharge, which does of course imply and require that they were satisfied that a criminal offence had been committed, however minor, by the wife upon the daughter. Rather more significant is the fact that the criminal proceedings involved both children actually giving evidence by video link in the magistrates' court against their mother and being questioned by what would normally be called "cross examination". The upshot of all of that is that, very tragically indeed, both children have reacted against their mother. It thus came about that, within a matter of only weeks of the decision and order of the deputy district judge, which was predicated on the assumption that the children would spend about 70% of their time with their mother and 30% of their time with their father, they in fact began to live 100% of their time with their father. For a period after the incident on 5^th January 2015, the wife was in fact required as a condition of bail to leave the home until the trial which took place on 27^th May 2015. As I understand it, she has not subsequently returned to live at the home and indeed currently the children do not see, because they are unwilling to see, a great deal of their mother.
9. I mention that another factual development since the decision and order of the deputy district judge is that the wife has apparently undergone an Islamic ceremony of marriage with a man, and is apparently now about to go through an English civil marriage with yet another man. If the wife does indeed lawfully marry under English law some other man, then of course any question of any future liability by this husband to maintain her comes to a complete end. But I wish to stress very clearly indeed that the fact of this subsequent marriage, or even those marriages to two different men, does not, in my view, amount to what is called a "Barder" event, and does not of itself afford the slightest ground for any reconsideration of the decision and order of the deputy district judge. It not infrequently happens that parties form new relationships or re-marry relatively soon after proceedings for a financial remedy order, and that can never justify a subsequent appeal out of time and a re-opening of the order. The only exception may be if, at the time of the making of the order itself, a settled intention to re-marry is fraudulently concealed from the other party and the court. That said, since I propose to grant permission to appeal, the appeal will have to take account of the facts as they now are and those facts may apparently include the fact that the wife by then will have re-married.
10. The very well-known authority of Barder v. Barder (Caluori intervening) clearly established that in certain very limited circumstances an order as to financial provision or remedies may be re-opened relatively shortly after it was made, even if it was correctly made at the time, if certain conditions are satisfied. Those conditions are, in summary, that:

(1) The new event falsifies the assumptions on which the original order was made so that an appeal would almost certainly succeed;

(2) it happened soon after the original order;

(3) the proposed appellant acts quickly; and

(4) innocent third parties are not prejudiced.

In the present case, it seems to me eminently arguable that this new event which happened in early January 2015, only about six weeks after the underlying order, was one that did indeed happen very soon after the making of the order. In the present case, the husband made his first attempt to challenge the order during March 2015, which, in my view, shows sufficient promptitude. He should not be prejudiced or penalised by some short delay when one pauses to consider the turmoil in which he must have been living at that time, when the wife had suddenly been excluded from the home by the bail conditions and he was having to take on full responsibility for the children as well as cope with the impact upon the family of the events I have mentioned. In the present case, so far as I am aware, there are no third parties who would be prejudiced. It is correct that a buyer was found for the house, but contracts were not exchanged and there is therefore no legal prejudice to that buyer. It seems to me eminently arguable with a real prospect of success, which is all I have had to decide today, that the events to which I have referred falsify the assumptions on which the original order was made so that the proposed appeal would almost certainly succeed.

11. In my view, therefore, the test in rule 30.3(7) for the grant of permission to appeal in this case is indeed satisfied in that the proposed appeal would have a real prospect of success. The amount prospectively in issue on the proposed appeal may be of the order of £44,000 as I have described. In absolute terms that may not be a large amount of money, and there are serious issues as to costs proportionality even in this case. I am told that, although from time to time he has represented himself, the husband has nevertheless already incurred costs of between £12,000 and £14,000. The wife has been legally represented throughout. I have no material as to what her costs have been, but I assume that they can hardly have been less than the husband has incurred since she has been represented throughout. That tends to suggest, therefore, that these parties may already have incurred somewhere of the order of £30,000 or possibly more on this protracted litigation between them. The costs of a proposed appeal, if both parties are represented, could hardly be less than another £10,000, and so one sees that there is a terrible scenario here of these two parties continuing to throw money at this litigation and losing sight of what is in issue between them.
12. For the reasons I have given I must, as I do, grant to the husband permission to appeal from the decision and order of Deputy District Judge Butler of 25^th November 2014 on the ground that a Barder event may subsequently have occurred and the conditions in the case of Barder are or may be satisfied. As I have already said, if the wife were present and represented today, I would have given very serious consideration to allowing the appeal today and setting aside the material parts of the order of Deputy District Judge Butler and remitting this whole matter for redetermination by a district judge. For the reasons I have given, I cannot do that. Therefore I have no alternative, although I deeply regret it, but to contemplate that there is in fact a substantive appeal at the level of a High Court Judge of the Family Division. In order to get the wife and her lawyers to court and enable the court to engage with them, I will list this case for directions only before a judge of the Family Division on Friday 16^th October 2015 with time allowed of two and a half hours. I shall direct that both parties must attend, together with any lawyers whom they may instruct. I anticipate that, on that occasion, the judge dealing with this matter will want to discuss with the parties the possibility of settlement and give the maximum encouragement to resolve this case once and for all then, if not before. But I intend to add a provision to my own order made today as follows:

"The court today urges and encourages both parties to negotiate and resolve their differences by agreement. The amount realistically in issue between them [viz at most about £45,000] renders the further delay, costs and stress of a contested appeal hearing disproportionate."

I cannot emphasise those words strongly enough and loudly enough both to the husband, who is present today, but also through this judgment and the order to the wife and her lawyers. Finally, I shall direct that a transcript of the judgment given today must be made urgently at the initial expense of the husband, who must order that transcript today. The costs disbursed by the husband in obtaining the transcript shall be part of his costs of an incidental to the appeal, recoverable, if so ordered, against the wife. The purpose of requiring a transcript is so that it can be supplied to the wife and her lawyers, who are not present today, and so that the court subsequently dealing with this matter can clearly see the reasons why I have granted permission to appeal and what I, at any rate, conceive to be the issues in this case. I wish to stress, again and finally, that nothing whatsoever in my decision and judgment today reflects in the least upon the decision and judgment of the deputy district judge which was, in the circumstances prevailing at the time, impeccable.