2001/235A
ROYAL COURT
(Family Division)
28th November, 2001
Before: |
M.C. St. J. Birt, Deputy Bailiff, Sitting alone |
Between |
D |
Petitioner |
|
|
|
And |
R |
Respondent |
In the matter of an application by the Respondent for disclosure, which application was settled by a consent Order.
Application by the Respondent for the costs of and incidental to the application for disclosure.
Advocate Mrs. M.E.Whittaker for the Petitioner
Advocate M. St. O'Connell for the Respondent
judgment
the deputy bailiff:
1. The wife has applied for an order that certain information concerning a trust known as the A Trust should be disclosed and that the Trustees of that Trust should be convened in order to give disclosure. That summons has today proceeded by consent and the Court has therefore made the necessary orders. However, I have been asked by the wife to order the husband to pay the costs incurred in connection with this summons.
2. The background is that the wife has, for a considerable period, been asking for information about this Trust. It appears that it is a trust of which the parents of the husband are the settlors, or it may be just the father. Initially the beneficiaries were the husband, the wife, their children and the brother or sister of the husband. However, in January, 1988, both the husband and the wife were removed as beneficiaries, although it would appear that they were not made excluded persons, so that it would in theory be possible for either of them to be put back as beneficiaries.
3. During the correspondence the husband has sought to distance himself from the Trust and has asserted repeatedly that it is not really relevant. This was asserted finally, and most clearly, in a letter from his Advocate dated 9th November in which she said:
"It is clear that this trust is irrelevant. D is neither a settlor, trustee or beneficiary."
4. It now transpires that although the husband may not technically be the settlor, he provided the funds to his father who in turn contributed them to the Trust. It is clear on any view that this is a Trust which was of sufficient possible relevance to the resolution of the matrimonial affairs between these parties that it ought to have been fully disclosed. The husband now accepts that and Advocate Whittaker on his behalf today accepted that it was relevant and should be disclosed. Of course the information which leads to that conclusion was at all times known to the husband.
5. In the ordinary course I would have had no hesitation in saying that the wife had acted perfectly reasonably in maintaining this summons, that the husband should have agreed to it and that therefore the husband should pay the costs because of the fact that the matter has had to be brought to Court.
6. Mrs. Whittaker raises two points to support her argument that I should either make no order as to costs, or order costs in the cause, or reserve the costs of this matter to the trial judge. First, she points to the fact that there was a hearing before the Commissioner in June and that, although in her case statement prepared for that hearing she alluded to the Trust and as to whether it remained a live issue, Mr. O'Connell, appearing for the wife, said nothing at that time, although he did, of course, write within a matter of days seeking further information about the Trust. Nevertheless, she says that if he had raised it at the hearing, the Commissioner could have sorted it out then and there and many costs would have been saved. I should add in parenthesis that it is quite clear that this matter has given rise to very considerable costs because of the voluminous correspondence through which I have been taken, indicating that the wife has been pressing relentlessly for information about the Trust, particularly in recent months.
7. Mr. O'Connell's response to the point in relation to the June hearing is that that was a summons to deal with the major issues. He hoped at that stage that disclosure concerning the Trust would proceed voluntarily and he concluded that the right time to raise the matter was in the questionnaire which the Commissioner ordered should be filed by his client. He went on to say that, indeed, he was not really ready to argue the point at that stage. No preparation had been made for a contested hearing on whether there should be discovery concerning the Trust. I conclude that it was not unreasonable for Advocate O'Connell to wish to proceed by agreement and, therefore, I do not think that any criticism can be laid at his door for failing to raise the matter in June.
8. The second point which Mrs. Whittaker raises is that it transpires that the wife was in possession of a number of documents concerning this Trust, and its underlying company, which she had removed from the matrimonial home some time ago. She has clearly been in possession of these documents throughout these proceedings. However, that was not made known to the husband until early in November, at which time Mr. O'Connell sent a draft of an affidavit, with these documents, that he proposed to file if the matter could not be resolved. It may be the case that he had sent the documents a few days earlier.
9. Mrs. Whittaker's point, as I understand it, is that these documents should have been disclosed at an earlier stage. Had that occurred, the costs would have been dramatically reduced because the husband would then have agreed that disclosure of the Trust should be given. In support she relied upon an extra judicial lecture by Mr. Justice Wilson in England (Conduct of the Big Money Case [1994] Family Law: p 504) in which he discusses the issue of at what stage a wife should disclose copies of documents which she has taken secretly in relation to her husband's affairs. He said this:
"When a wife has taken photocopies of documents, whether on legal advice or otherwise, the second difficult question is to identify the stage at which they should be disclosed to the other side. Here, views seem to run the whole gamut from an obligation to disclose forthwith after copying, to a right to keep the documents up one's sleeve until cross-examination at the substantive hearing. My own view is that the copies are discoverable documents which should logically be disclosed at, but only at, the discovery stage, or earlier, if the husband's solicitors so request. In other words, they can, absent such a request, be withheld until after the husband has sworn his affidavit of means and until the wife's questionnaire is served."
10. Mrs. Whittaker argues therefore that in accordance with those views the wife should have disclosed these documents when she filed her questionnaire either in September 2000, which was when she filed a questionnaire on her husband's first affidavit of means, or at the very latest in her questionnaire of August, 2001, when she filed a questionnaire in relation to the husband's second affidavit of means, which apparently had been sworn in January.
11. I have to say that that argument is, on the face of it, not particularly attractive. The duty to make disclosure in relation to this Trust rested on the husband. The fact that the wife may secretly have documents which confirm the duty of the husband to make disclosure is not relevant as to whether the husband is under that duty or not. If he is under a duty, it is for him to make disclosure regardless of whether or not the wife has such documents. Furthermore it is clear that there is a difference of views as to the right stage at which documents such as these need to be disclosed. Mr. Justice Wilson himself made it clear that views differ in England and he was expressing his personal opinion. I do not wish to suggest in any way that it is right to keep documents up one's sleeve until cross examination; on the contrary, documents should be disclosed at an early stage because this enables the Court to know the real issues. I agree, therefore, that it is strongly arguable that it would have been preferable, perhaps, for the wife to have disclosed these documents at the time of the questionnaire in August 2001. But I do not think she can be said to have acted unreasonably, or contrary to accepted practice, by holding them until later. It is asserted that she wished to give the husband every opportunity of making voluntary disclosure although it is clear that towards the end she was probably withholding them for tactical reasons to see if he was going to make disclosure voluntarily or not. Be that as it may, I am quite satisfied that this Trust should have been disclosed at an earlier stage and that this summons has become necessary because, despite prolonged correspondence and requests from the wife, the husband did not procure the necessary disclosure. It seems to me the costs have been run up because of his approach and therefore I order that he pay the costs of and incidental to this summons on the standard basis.
Authorities
Wilson J: Conduct of the Big Money Case [1994] Family Law: p. 504.