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Morris v Morris [2016] EWCA Civ 812

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Appeal by husband against a suspended committal order, variation order and order for costs. The committal order was set aside due to procedural errors, the costs order falling with it, but the appeal against the variation order failed.

  • Neutral Citation Number: [2016] EWCA Civ 812

    Case No: B6/2015/3295

    IN THE COURT OF APPEAL (CIVIL DIVISION)

    ON APPEAL FROM

    HER HONOUR JUDGE HUGHES QC

    CENTRAL FAMILY COURT

    Royal Courts of Justice

    Strand, London, WC2A 2LL

    Date: 10/08/2016

    Before :

    LADY JUSTICE BLACK

    LORD JUSTICE FLOYD

    and

    MR JUSTICE MOYLAN

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    Between:

    PETER RODNEY MORRIS (Appellant)

    - and -

    JANE EDWINA MORRIS (Respondent)

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    Peter Duckworth (appearing pro bono) for the Appellant

    Damian Garrido QC and Jason Green (instructed by Setfords Solicitors, Guildford) for the Respondent

    Hearing date: Wednesday 6th July 2016

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    Judgment Approved

    Mr Justice Moylan

    Introduction

    1. In this judgment I will call the parties the husband and the wife although their marriage was determined in 2014.

    2. By a Notice of Appeal filed on 12th October 2015 the husband appeals from orders made by HHJ Hughes QC on 7th May 2015. They are

    (a) a suspended committal order made on the wife's application by way of judgment summons for arrears due under a periodical payments order made on 14th August 2014;

    (b) the variation of the periodical payments order by reducing the amount payable by the husband from £2,000 per month to £1,750 per month; and

    (c) an order that the husband pay the wife's costs assessed in the sum of £10,000.

    3. The husband does not need permission to appeal from the committal order but does need permission to appeal the variation order and, if distinct, the order for costs. Further, the appeal was filed out of time so he requires an extension of time in respect of all aspects of his appeal.

    4. The appeal first came before the court on 10th March 2016. The husband appeared in person at that hearing, having acted in person throughout the relevant proceedings. The case was adjourned in order to enable the husband to obtain publicly funded representation, to which he is entitled in respect of his appeal from the committal order. In fact, the husband has been represented at this hearing by Mr Duckworth acting pro bono. This was because, as Mr Duckworth explained during the hearing, he has chosen to act pro bono because he wants to give something back to the justice system. This is very commendable and also removes any difficulties that might otherwise have arisen from the fact that public funding would be confined to the committal appeal. The wife is represented by Mr Garrido QC (who did not appear below) and Mr Green. I am grateful to them for their respective submissions.

    5. At the outset of the hearing it appeared that the substantive issues which required determination were:

    (i) was the committal order validly made (procedurally and substantively);

    (ii) has the variation order been shown to be wrong.

    6. However, not long into the hearing, it became apparent that the wife conceded that the committal order had to set aside because of procedural failures. The parties sought to persuade the court that, despite this concession, guidance should be given on a number of issues relating to committals by way of judgment summons. As was made clear during the hearing, the court declined this invitation because these broader issues are not relevant to the determination of this appeal. In addition, whilst some of the issues were touched on in Mr Duckworth's written submissions, they had not been addressed in the submissions made on behalf of the wife. The court did not, therefore, have full argument on which to consider more general issues of importance. Following this indication, we heard no substantive argument in respect of the appeal from the committal order but only in respect of the appeal from the variation order.

    7. Although conceded, I propose to deal with the procedural failures which occurred in the committal proceedings, because of their wider significance but, first, I deal with the history of the appeal and then set out a summary of the background which I take largely from the judgment given by HHJ Brasse on 14th August 2014 when determining the wife's financial remedy application.

    History of the Appeal

    8. From email correspondence, it appears that HHJ Hughes' order was not finalised until 7th July 2015. Further, the husband appears to have been informed that his time for appealing was to start from the date the order was sealed.

    9. On instructions from the husband, Mr Duckworth told the court that the husband had delayed filing his appeal until 12th October 2015 because he did not receive a sealed copy of the order until then. Whilst the date on which the husband received a sealed copy was never established (the husband says it was on 12th October while the wife says it was on 22nd July 2015), it did become clear from correspondence provided by the Civil Appeals Office that the husband had, in fact, first sought to file a notice of appeal on either 4th or 7th September 2015. He did not, however, pay the fee as required but a lesser sum.

    10. The husband was informed by the Office by letter dated 7th September 2015 that he was required to pay the full fee before his appeal could be progressed. The husband replied saying that, subject to clarification of one point, he would pay the additional sum.

    11. On 23rd September 2015 the husband was informed that, unless he paid the full fee within 7 days, the papers would be returned.

    12. As I understand it, the papers were then returned because the full fee was not paid. It was only when they were re-submitted on 12th October that the husband paid the required fee.

    13. Mr Garrido also pointed to an email from the husband dated 16th July 2015 in which he said that he proposed filing an appeal "next week".

    14. I will deal with the question of extending the time for appealing below.

    Background

    15. The parties were married in 1988 and separated in 2013. They are both now aged 52. There are three children aged between 20 and 17.

    16. The wife worked in paid employment until the birth of the first child. After this she looked after the home and the children with occasional modestly paid employment. The husband earned, what is described as, a high income during the marriage which gave the family a good standard of living.

    17. The wife's financial remedy application was determined by HHJ Brasse's judgment and order of 14th August 2014 ("the 2014 order").

    18. In the course of his judgment HHJ Brasse refers to the proceedings as having been "bitterly contested". He found that the husband had deliberately failed to pay the mortgage instalments due on the former matrimonial home to put pressure on the wife to settle on his terms. The husband had written an email in which he said that he would

    "ensure that the costs in this case are maximised in order to reduce the capital available".

    The judge also found that the husband "preferred to control the flow of disclosure himself" and that his command of the detail did "not necessarily equate with candour". As a result the judge decided that he should take "a cautious and sceptical view of the accuracy of [the husband's] assertions regarding his receipts from the company".

    19. The judge found that the net available capital, after deduction of liabilities (excluding the wife's costs of £30,000), totalled £560,000. This comprised, largely, the net value of the former matrimonial home (taking a gross value of £1.25 million) and an inheritance received by the wife. In addition, the husband had pension funds valued at £270,000 and the wife £10,000.

    20. The wife's total annual income was £18,500 per year (£1,540 p.m.) including earned income (some of which was estimated/hoped) of £10,700. The balance comprised tax credits and child benefit.

    21. The husband had begun working as managing director for a new company in 2013. He had a minority (15%) interest in the company ("the Company") on which the judge decided it would be "unrealistic to attempt to place a value". Based, it would appear, significantly on the husband's drawings from the Company in the previous year, the judge decided that, "conservatively", the husband would be earning £75,000 net per year (£6,250 p.m.).

    22. It was agreed that the children would continue to live with the wife. It was also agreed that the wife should receive sufficient funds to enable her to purchase a mortgage free home. The wife sought between £450/500,000 for housing whilst the husband proposed £350/400,000.

    23. The husband's case was that he needed to rent a property. The judge rejected this and found that the husband would be able to continue living in a property rented by the Company, as he was at the date of the hearing.

    24. The husband owed the Company £366,000 and sought sufficient monies from the sale of the former matrimonial home to enable him to repay this amount. The judge rejected the husband's case that he needed to repay the Company "at once" because these sums had been, in effect, "his salary and his share of the company's profits". The judge decided the husband was effectively "in control of how and when, if ever, that money is repaid".

    25. The 2014 order provides for the immediate sale of the former matrimonial home with the net proceeds being divided so as to provide the wife with total resources of £495,000 and the husband £66,000 (out of £560,000 as referred to above). The husband was to receive a fixed sum with the balance of the net proceeds (after payments of a number of liabilities) being payable to the wife.

    26. The judge decided that this substantial disparity was justified by (i) the wife and children's overriding need for a home; (ii) the wife's lower earning capacity compared to the husband's substantially larger earning capacity and his ability to accumulate capital as a shareholder in the Company; (iii) the unequal pension division in the husband's favour. The judge made a pension sharing order giving the wife total pension funds of £70,000 and the husband £212,000.

    27. As for income needs, the wife sought an annual budget of between £46,000 and £49,000.

    28. The husband's income needs included school fees, estimated at £60,000 per year for 2014/2015 reducing to £30,000 until 2017. The order records that the husband's parents had agreed to pay half of the school fees giving the husband a liability of £2,500 reducing to £1,250 p.m. The judge found that the husband's own income needs were £1,750 p.m. Deducting £2,500 p.m. for school fees and £1,750 p.m. for living expenses, from the husband's net income of £6,250, left a "surplus" of £2,000 p.m.

    29. Based on this assessment, the judge ordered the husband to pay £24,000 per year giving the wife a total annual income of £42,500. With "sensible" economies this would meet the wife's needs for herself and the children.

    30. As for the term of maintenance, the wife sought a joint lives order whilst the husband argued for, it appears, a term of a few years. The judge decided that the order should continue until the husband attains the age of 65 (2029) but without a bar under section 28(1A) of the Matrimonial Causes Act 1973, so that the wife is entitled to apply for an extension.

    31. In addition, the husband was ordered to pay the mortgage instalments (of £3,867 p.m.) until the sale of the property and, as referred to above, the children's school fees.

    32. It can be seen that the husband's income liabilities under the 2014 order, until the sale of the former matrimonial home, totalled £8,367 p.m. a sum which exceeded his net income by approximately £2,100 p.m. This arose because the judge's calculation of, what he called, the "surplus" appears not to have taken the mortgage payments into account.

    33. +Before leaving HHJ Brasse's judgment, it is immediately apparent that, on the resources as found by the judge, it effected a substantial imbalance in the wife's favour both in terms of income and capital.

    34. The wife's judgment summons was issued on 3rd December 2014. I deal with the progress of this application below.

    35. The husband either did issue, or was treated as having issued, an application to vary the maintenance order in February 2015.

    36. After a number of interlocutory hearings (as referred to below) both applications were determined by HHJ Hughes on 7th May 2015. She heard evidence from both parties.

    37. As set out in HHJ Hughes' judgment the wife had obtained full-time employment very shortly after the August 2014 hearing. She found that the wife had a total income of £1,800 p.m., comprising net earnings of £1,300 and benefits of £500 which would reduce as the children finished their education. This was an increase of approximately £260 p.m. from her net income as found by HHJ Brasse.

    38. The husband's company went into administration (it appears on 24th September 2014). The assets were then acquired by another company for which the husband immediately began to work.

    39. In his statement dated 5th February 2015 the husband gave his net income as £6,228 p.m. Different figures were given in his unsigned Form E (served in March 2015). He gave his "anticipated gross income after costs" from September 2014 as £105,000 (plus a car) and his net income at £63,000 (£5,250 p.m.). However, the former figure is clearly more reliable because, in his opening statement dated 6th May 2015, the husband again said his net monthly income was £6,228, under a 6 month contract which was not renewed. The judge was sceptical about the duration of this contract but appears to have accepted that the husband was not earning at the date of the hearing but that, as he said, he would obtain employment after the conclusion of the proceedings earning £138,000 gross per year which the judge concluded would produce a net income in the region £7,000 p.m.

    40. At the hearing before HHJ Hughes the husband sought a reduction in the level of maintenance to £800 p.m. HHJ Hughes decided that, because of the increase in the wife's income, the maintenance should be reduced from £2,000 to £1,750 p.m.

    41. The former matrimonial home was not sold until August 2015. There was pressure from at least one of the mortgagees. On 26th March 2015 the husband sent an email to the wife's solicitors stating that he withdrew his consent to the sale contract, adding:

    "I am happy for the house to be possessed by (the mortgagee) and sold for the lowest price possible".

    Under the terms of the 2014 order, a reduction in the sale price impacted on the wife and not on the husband.

    42. In order to procure a sale the price had to be substantially reduced, by some £250,000, from the value taken in the 2014 judgment. This, obviously, similarly decreased the sum payable to the wife from the proceeds of sale. As a result, although the 2014 order still effected a capital imbalance, the impact of this was significantly moderated. Although, I should add that the sum notionally due to the husband was virtually eliminated because the 2014 order also provided for arrears (both in respect of the mortgage instalments and of maintenance) to be deducted from this sum.

    43. I now turn to deal with the appeal from the suspended committal order before addressing the appeal from the variation order.

    Committal by way of Judgment Summons

    44. Mr Garrido rightly conceded that, as a result of fundamental procedural errors in this case, the committal order must be set aside. The errors relate to the following procedural requirements, namely:

    (a) the respondent to a committal application cannot be required to give evidence; and

    (b) the respondent is entitled to legal aid and, if he is unrepresented, must be given a reasonable opportunity to obtain publicly funded representation if he wants to do so.

    45. Given the failures which have occurred in this case, it is clear that the husband's time for appealing against the committal order must be extended. The court could not allow the order to stand in such circumstances merely because the appeal was filed a few weeks out of time.

    46. Although the appeal has been conceded, I propose to deal with the errors which occurred because it is clearly of considerable importance that the proper process is followed whenever an application is made by way of judgment summons. I first set out the history of the application.

    Judgment Summons Proceedings

    47. On 27th October 2014 the wife applied for a judgment summons in respect of alleged arrears totalling £11,733, consisting of two months spousal maintenance and two months mortgage instalments. Two statements were filed in support.

    48. A judgment summons was issued on 3rd December 2014.

    49. The first hearing took place on 22nd January 2015. It was listed before a deputy district judge who did not have jurisdiction to determine the summons. At this stage the only application before the court was the judgment summons. A number of directions were given. These included an order that the husband "shall file and serve a comprehensive statement of his affairs …" (my emphasis).

    50. This order also provided that, in the event of the husband applying to vary the maintenance order, both parties should file Forms E. The matter was listed on 30th March 2015 for the hearing of the wife's summons and for further consideration of any variation application made by the husband.

    51. In February 2015 the husband served a copy of the front page of a variation application. It is not clear whether this has ever been issued but it has been treated as such.

    52. The husband provided a statement dated 5th February 2015 headed "Statement of the respondent Judgement Summary (sic) …".

    53. At some point (in March 2015) both parties served Forms E.

    54. The First Appointment of the husband's variation application was originally listed on 29th May 2015.

    55. On 30th March 2015 the case was again listed before a judge who did not have jurisdiction to determine the judgment summons. A number of directions were made as to the service of additional evidence. These included a direction that the wife serve evidence relating to her new employment and her inheritance and that the husband serve bank statements for the last 12 months. The First Appointment in the variation application was re-listed for 7th May "alongside" the adjourned judgment summons.

    56. On 7th May 2015 HHJ Hughes determined both the judgment summons and the variation application. She heard oral evidence from both parties.

    Procedural Errors

    57. A judgment summons is a form of criminal proceeding: Mubarak v Mubarak [2001] 1 FLR 698. As a result a respondent to such an application:

    (i) is not and cannot be required to give evidence (as also provided by the Family Procedure Rules 2010 r.33.14(4)); and

    (ii) is entitled to legal aid so that he can be represented.

    These are fundamental procedural requirements. As I have said, Mr Garrido was right to accept that the failure to comply with these requirements in this case means that the committal order must be set aside.

    58. A committal by way of judgment summons is an application under s.5 of the Debtors Act 1869. Its provisions enable a judgment creditor to apply to the court for the committal to prison, for a maximum of six weeks, of a judgment debtor in respect of a maintenance order.

    59. The section reads as follows:

    "Subject to the provisions hereafter mentioned and to the prescribed rules, any court may commit to prison for a term not exceeding 6 weeks, or until payment of the sum due, any person who makes default in the payment of any debt or instalment of any debt due from him in pursuance of any order or judgment of that or any other competent court provided:

    (1) …

    (2) That such jurisdiction shall only be exercised where it is proved to the satisfaction of the court that the person making default either has or has had, since the date of the order or judgment, the means to pay the sum in respect of which he has made default and has refused or neglected, or refuses or neglects, to pay the same."

    60. The Family Procedure Rules 2010 contain further provisions applicable specifically to a judgment summons: Part 33 (rr. 33.9 – 33.17).

    61. Rule 33.14(4) expressly provides that:

    "The debtor may not be compelled to give evidence".

    62. In addition, the respondent to such an application is entitled to legal aid to fund representation. An unrepresented respondent must be informed of this and must be given an opportunity to obtain such representation.

    63. The above requirements are well established: see Hammerton v Hammerton [2007] EWCA Civ 248, [2007] 2 FLR 1133; Chelmsford County Court v Ramet [2014] 2 FLR 1081; Re K (Return Order: Failure to Comply: Committal: Appeal) [2014] EWCA Civ 905[2015] 1 FLR 927, [2015] 1 FLR 927; Inplayer Ltd v Thorogood [2014] EWCA Civ 1511; and in L (A Child) [2016] EWCA Civ 173. They apply equally to a judgment summons which, as referred to above, is a form of criminal proceeding in common with other committal proceedings.

    64. The relevant principles are summarised by Jackson LJ in Inplayer Ltd v Thorogood, paras 40-49. In brief:

    (i) the respondent has the right to remain silent and must be told that he has this right (Inplayer, paras 40-41); and

    (ii) the respondent is entitled to legal aid so that he can be properly represented. He must be informed of this right and then given an opportunity to instruct lawyers (Inplayer, paras 47-49).

    65. Given what happened in the present case, as Jackson LJ said in Inplayer: "there can be no question of upholding findings of contempt against a person who has been deprived of valuable safeguards …" (para 45).

    66. The errors which occurred in this case arose in part because the judgment summons and the variation application were dealt with together. This was also the source of errors which arose in both Hammerton v Hammerton and Inplayer Ltd v Thorogood. As was said in Inplayer (para 41):

    "If the committal application is heard at the same time as other issues about which the alleged contemnor needs to give evidence, he is placed in the position where he is effectively deprived of his right of silence. That is a serious procedural error".

    Accordingly, for the same reason, the applications in the present case should not have been determined at the same hearing.

    67. In summary there were the following significant procedural errors:

    (a) the order of 22nd January 2015 required the husband to file and serve evidence in breach of the Rules and his right to remain silent;

    (b) the husband gave evidence at the hearing on 7th May 2015 without being informed of his right to remain silent;

    (c) the husband was not informed of his right to legal aid (until his first appearance in the Court of Appeal).

    68. Accordingly, the committal order must be set aside (with an extension of time for appealing).

    69. In my view, it follows that the order for costs must also be set aside. This featured little during the appeal hearing but during the course of her judgment HHJ Hughes said,

    "I have ordered him to pay £10,000 towards the wife's costs because it is his behaviour which has caused the issue of the judgment summons."

    The costs order was clearly made consequent on and in respect of the suspended committal order. As this has been set aside, the order for costs cannot be sustained.

    70. This leaves the question of what should happen to the judgment summons. Given the procedural failures, the subsequent sale of the former matrimonial home (and the deduction of arrears from the husband's notional sum) and looking at the issue proportionately, it is clear to me that the summons itself should be dismissed.

    Variation Appeal

    71. In revised grounds Mr Duckworth sensibly confines his case to two matters in respect of the appeal from the variation order:

    (1) The judge failed properly to carry out the section 25 exercise in that she "isolated one factor (W's increased earnings) and used that as the entire basis of her decision";

    (2) A proper weighting of the section 25 factors, taking into account the husband's decreased income, his housing needs, his debts and the wife's improved financial circumstances, should have led to a substantial reduction in the maintenance and/or the imposition of a shorter term ceasing on the youngest child's 18th birthday.

    72. In his submissions Mr Duckworth suggests that the court, when determining a variation application, must consider the matter "de novo", relying on Lewis v Lewis [1977] 1 WLR 409 and Flavell v Flavell [1997] 1 FLR 353. I recognise that his submissions are more broadly based than this but, nevertheless, I propose specifically to address this point. They are more broadly based because he acknowledges that the exercise need not be undertaken as "exhaustively" as in 2014 and he also appeared to accept that the court can confine its consideration to factors relevant to the variation. However, given he contends that the court must carry out the section 25 exercise "again", it is appropriate to deal with this narrower submission.

    73. Mr Duckworth also submits that, under section 31(7)(a) of the Matrimonial Causes Act 1973, HHJ Hughes was required to consider whether to impose a clean break or reduce the term provided in the 2014 order.

    74. Mr Duckworth submits that the judge's approach was "light touch, in the extreme" and did not sufficiently analyse the relevant factors. He relies on a number of changes notably that the Company had gone into administration; that the husband no longer had a flat available to him through the Company; and that the wife's income had increased. He also made a number of observations about the effect of the 2014 order.

    75. As to the first change, the Company having gone into administration, Mr Duckworth submits that this has had a number of consequences. One of these was that the husband no longer had access to the Company's account to fund his expenses. Although I am, at this stage, simply setting out the parties' respective submissions, I can say immediately that this was not a substantial change or, indeed, a change at all because the only relevant determination in the 2014 judgment was that the husband's income was £6,250 p.m. Mr Duckworth also submits that the demise of the Company led to the husband's income reducing to £5,000 p.m. Another consequence, he says, is that, following the husband's debt to the Company being written off, he has an additional potential tax liability. This last point is said by Mr Duckworth to be connected with a loan which, he says, the husband obtained from his business partner and is repaying at the rate of £1,000 p.m.

    76. As to the second substantive change, the loss of the flat, this is said to have created a housing need of £2,500 p.m. which the husband cannot meet. The husband had had no choice but to live with his partner to whom he makes a contribution of £1,000 p.m.

    77. As to the third change, Mr Duckworth submits that the wife's income had increased to £1,930 net p.m. based on her Form E. I can also deal with this point immediately because, in my view, Mr Duckworth's reference to the Form E does not effectively undermine the judge's finding that the wife's total income had increased to £1,800 net p.m.

    78. Mr Duckworth raised other points including that the wife is entitled to an income from her late mother's estate and that the husband pays significant sums for the children.

    79. Mr Garrido submits that the court was not required to undertake a full review of the section 25 factors so soon after the previous order. The court can consider the changes and undertake a broad assessment. He submits that the judge dealt with the variation application lightly but this does not make the outcome wrong. She is an experienced judge and it cannot be argued she would not have had regard to sections 25 and 31.

    80. As for the variation of the term imposed by the 2014 order, Mr Garrido submits that Mr Duckworth is repeating the submissions made by the husband in 2014. He also submits that this application is without merit given that the wife has a continuing need for maintenance which cannot be capitalised.

    81. As for the alleged changes relied on by Mr Duckworth, Mr Garrido submits that they do not bear the weight which Mr Duckworth seeks to put on them.

    82. In respect of the changes alleged to be consequent on the liquidation of the Company, Mr Garrido submits that there is no evidence that the husband has a tax liability (nor, he says, was this raised by the husband before the judge) nor of his alleged payments to his business partner which were not referred to in the husband's statements for the hearing on 7th May 2015. If there is such a tax liability, the husband can seek a variation when it crystallises.

    83. As for the husband's income, Mr Garrido submits that there was a complete absence of clarity at the time of the hearing below. He provided no supporting documents with his Form E and incomplete bank statements. Further, on an income of £7,000 p.m., as found by the judge, the husband can fairly meet the award of £1,750.

    84. There was likewise a lack of clarity about the husband's housing situation. The agreement with his partner is dated 1st September 2014 which does not tally with his having had to leave the Company flat in December. There is, Mr Garrido submits, no justification for taking the husband's housing costs at £2,500 p.m. given that he was living with his partner.

    85. Mr Garrido also dealt with the contributions the husband makes to the children's expenses which, he submits, are no more than as at the date of the 2014 hearing. The wife's inheritance had been taken into account as capital (to meet her housing need) and should not also be taken into account as providing an income.

    Determination

    86. I deal first with Mr Duckworth's submission that the judge failed properly to carry out the exercise required of her by section 31 of the MCA 1973.

    87. On a variation application is the court required to consider the matter de novo? In my view, the simple answer is that it is not. The court must conduct an exercise which is proportionate to the requirements of the case. They might warrant a complete review but they can also justify, what Mr Duckworth refers to as, a light touch review. In this respect, Mr Duckworth was right to acknowledge that the court can confine its consideration to factors relevant to the variation application.

    88. I do not consider that the authorities on which Mr Duckworth relies support his submission that the court must undertake the exercise de novo. He can point to the passage in Ward LJ's judgment in Flavell v Flavell when he says (at p. 357):

    "the court is not required to proceed from the starting-point of the original order but looks at the matter de novo."

    But, this has to be seen in context, namely that it was in response to a submission that the court does not have jurisdiction to vary an order unless the applicant can show exceptional circumstances or, at least, a material change. Further, Ward LJ's observation is not the same as saying that the court is required to consider the matter de novo. That Ward LJ is not saying this is clear because he agrees "entirely" with what Cazalet J had said in Garner v Garner [1992] 1 FLR 573:

    "Almost invariably, an application to vary an earlier periodical payments order will be brought on the basis that there has been some change in the circumstances since the original order was made; otherwise, except in exceptional circumstances, the application will, in effect, be an appeal. If an order is not appealed against, or is made by consent, then the presumption must be that the order was correct when made. If it was correct when made, then there will usually be no justification for varying it unless there has been a change in the circumstances."

    89. In addition, in Lewis v Lewis [1977] 1 WLR 409, that great family judge, Ormrod LJ, also does not say that the court must start de novo:

    "I am bound to say that it has always seemed to me … that the powers of variation, which were given by statute to this court in a series of enactments going right back to 1857, have been, if anything, progressively enlarged, and that the intention of Parliament is that, in handling these family matters where money is concerned, the court should have as unfettered a discretion as possible to deal with the situation as it is when the matter comes before it" (p. 412F).

    90. Further, although not referred to during the course of the hearing, the overriding objective requires the court to deal with cases proportionately. Thus, although section 31(7) requires the court to have "regard to all the circumstances of the case", this is not the same as requiring the court to undertake the section 25 exercise de novo. It is instructive to see what the Supreme Court said recently in respect of case management in a financial remedy claim. In Wyatt v Vince (Nos 1 and 2) [2015] 1 WLR 1228 Lord Wilson JSC (with whom the rest of the court agreed) said (para 29):

    "… by rule 1.4(1) of the family rules, the court must further the overriding objective by actively managing cases, which, by rule 1.4(2)(b)(i)(c), includes promptly identifying the issues, isolating those which need full investigation and tailoring procedure accordingly. This exercise will dictate the nature, and in particular, the length of the substantive hearing."

    91. In Sharland v Sharland [2015] 3 WLR 10170, Lady Hale (with whom the other six Supreme Court Justices agreed) said, at para 43:

    "This court recently emphasised in Wyatt v Vince (Nos 1 and 2) [2015] 1 WLR 1228 the need for active case management of financial remedy proceedings, "which … includes promptly identifying the issues, isolating those which need full investigation and tailoring future procedure accordingly": para 29. In other words, there is enormous flexibility to enable the procedure to fit the case. This applies just as much to cases of this sort as it does to any other".

    92. The court has "enormous flexibility" to determine the "nature" of the substantive hearing. This includes, as Mr Duckworth accepts, focusing on the relevant factors and in my view also, where appropriate, conducting a light touch review. Specifically, to require the court to undertake the exercise de novo would be contrary to the overriding objective and the obligation for a case to be dealt with proportionately.

    93. Turning next to Mr Duckworth's submissions in respect of section 31(7)(a) which provides:

    "(a) in the case of a periodical payments or secured periodical payments order made on or after the grant of a decree of divorce or nullity of marriage, the court shall consider whether in all the circumstances and after having regard to any such change it would be appropriate to vary the order so that payments under the order are required to be made or secured only for such further period as will in the opinion of the court be sufficient … to enable the party in whose favour the order was made to adjust without undue hardship to the termination of those payments."

    94. HHJ Brasse specifically considered the duration of the maintenance order. He decided to impose a term, namely until the husband reaches the age of 65 (2029).

    95. Was the court required to consider whether to vary this term and, if so, should HHJ Hughes have reduced the term to October 2016 as submitted by Mr Duckworth? Whilst section 31(7)(a) requires the court to consider whether to impose a term, in my view, the flexibility referred to above applies equally to this aspect of the case.

    96. Given that the final order had only been made in August 2014, the husband's application to alter the term imposed by that order, so soon after it was made, would have required more significant changes than have occurred in this case. Whilst it is, of course, possible to postulate sufficiently significant events to justify such an application so soon after a previous order, there are no such events in this case. Changes in employment and changes in income, as occurred in this case, are not unusual and they are not sufficient to support the need for a substantive review of this element of the 2014 order. In any event, as Mr Garrido submits, a reduction in the term is not justified having regard to the wife's continuing income needs.

    97. Turning, finally, to the husband's appeal from the specific variation effected by HHJ Hughes. Was this order wrong?

    98. The husband sought a reduction, as recorded in the judgment, to £800 p.m. This represents a difference of £950 p.m. or £11,400 per year from the order made by the judge. It is worth noting that this represents just under 14% of the husband's future net income, as found by the judge, of £7,000 p.m., a relevant factor when considering whether the order is outside the bracket of fair awards. Further, during the course of his submissions, Mr Garrido demonstrated that £1,750 p.m. is a sum which the husband can afford to pay after allowing for school fees (of £2,500, assuming the husband has to pay the full sum rather than half as recorded in the 2014 order), housing costs (of £1,000) and his own other income needs (of £1,750).

    99. My concern as to the order derives principally from the submissions made by Mr Duckworth as to the effect of the 2014 order. This did, as he submits, create a capital imbalance in the wife's favour, although significantly reduced in amount following the reduction in the price achieved on the sale of the former matrimonial home. Further, the level of spousal maintenance appears to have been calculated without reference to the additional obligation imposed on the husband to pay the mortgage instalments. The former was based on a "surplus" of £2,000 p.m. which was more than eliminated by the mortgage instalments of £3,866 p.m. As referred to above and as noted by HHJ Hughes, the husband was not able to meet all the income liabilities imposed on him by the 2014 order (£8,366 p.m. against a net income of £6,250).

    100. However, as Mr Duckworth rightly concedes, this is not the hearing of an appeal from the 2014 order. He relies on the above points principally in support of his application for a revised term order (which I have dealt with above) rather than as to the quantum of the award, in part, no doubt, because the husband's obligation in respect of the mortgage instalments came to an end not long after the May hearing following the sale of the property in August 2015.

    101. I return to the question of whether HHJ Hughes' determination of the variation application was deficient such that her decision is wrong.

    102. I do not consider that the judge's approach to the application was too restrictive. To use Mr Duckworth's phrase, it was light touch but, in my view, in the circumstances of this case not to the extent that the judge can be said to have failed to undertake the statutory exercise required by section 31. The judgment was brief but included an assessment of the parties' respective incomes which, importantly, resulted in the husband's (future) net income increasing by £750 p.m. and the wife's increasing by £260 p.m. from those found by HHJ Brasse (respectively £6,250 to £7,000 and £1,540 to £1,800).

    103. I also bear well in mind the guidance given by Lord Hoffman in Piglowska v Piglowski [1999] 1 WLR 1360 at 1372 G:

    "The exigencies of daily courtroom life are such that reasons for judgment will always be capable of having been better expressed. This is particularly true of an unreserved judgment such as the judge gave in this case but also of a reserved judgment based upon notes, such as was given by the district judge. These reasons should be read on the assumption that, unless he has demonstrated the contrary, the judge knew how he should perform his functions and which matters he should take into account. This is particularly true when the matters in question are so well known as those specified in section 25(2). An appellate court should resist the temptation to subvert the principle that they should not substitute their own discretion for that of the judge by a narrow textual analysis which enables them to claim that he misdirected himself … The same is true of the claim that the district judge 'wholly failed' to carry out the statutory exercise of ascertaining the husband's needs."

    104. Did the judge's decision, to reduce the maintenance by £250 p.m., fail to give proper weight to the relevant factors including in particular the changes relied on by Mr Duckworth? In order to succeed, Mr Duckworth must establish that the judge's determination fell outside the bracket of fair awards.

    105. With all due respect to Mr Duckworth, it was often not clear whether his submissions were based merely on instructions from the husband or were based on evidence provided to HHJ Hughes. For example, Mr Duckworth initially submitted (see para 75 above) that the husband's net income had reduced to a little under £5,000 net p.m. This ignored that the husband had said his net income was £6,228 (see para 39 above). It also ignored the judge's finding that his net income would be £7,000 p.m. which Mr Duckworth later, and rightly, accepted he could not go behind.

    106. Did the judge fail to give proper weight to the other changes referred to by Mr Duckworth in the course of his submissions and, in particular, as set out in para 71(2)? I do not propose to repeat them.

    107. In my view, Mr Duckworth has failed to demonstrate that the judge's approach to the discretionary exercise was flawed or that her decision was outside the bracket of fair awards. In his succinct submissions, Mr Garrido dealt with each of the changes relied on by Mr Duckworth and provided a sufficient answer to each of them. The husband's income had not decreased to any material extent, as referred to in para 105 above. The husband's housing needs were in fact met. The case as to the husband's debts was, as Mr Garrido submits, not supported by the evidence.

    108. Given that I have considered the merits of the variation appeal at some length, I propose also to extend the time for appealing this part of the order and give permission to appeal but to dismiss the appeal.

    109. In conclusion, I would dismiss the appeal from the variation order but otherwise allow the appeal for the reasons given above.

    Lord Justice Floyd:

    110. I agree.

    Lady Justice Black:

    111. I also agree.

    Judgment Approved by the court for handing down.


Published: 11/08/2016

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