Phillips v Peace
| Jurisdiction | England & Wales |
| Judge | SINGER J |
| Judgment Date | 27 January 2005 |
| Court | Family Division |
Child – Financial provision – Property – Adjustment order – Settlement of property – Transfer of property – Settlement of property order made against parent for benefit of child – Other parent applying for further property adjustment orders – Jurisdiction – Children Act 1989, Sch 1, para 1(5)(b).
The parties were never married and their relationship had ended before their child was born. In proceedings relating to financial provision for the child, the High Court had, inter alia, ordered the father to pay a lump sum and to make a settlement for the purpose of acquiring a home for the mother and the child. The settled property would eventually revert to the father. The father complied with the order and a flat selected by the mother was acquired by the trust. Some eight years later the mother applied under Sch 1 to the Children Act 1989 for, inter alia, orders for a lump sum, a settlement of a new property for the benefit of the child, and a transfer of property for the benefit of the child. She contended that the existing flat had become too small and a larger property was needed. The court had power under para 1(2)(d) of Sch 1 to the 1989 Act to make an order for settlement of property for the benefit of a child and under para 1(2)(e) for the transfer of property for the benefit of a child or to a child but para 1(5)(b) provided that the court could not make more than one order under para 1(5)(d) or (e) against the same person in respect of the same child. A hearing was held to decide which if any of the parts of the application should proceed. The court considered (i) whether it had jurisdiction to make either of the orders sought in relation to property; and (ii) whether the mother’s application for an order for a lump sum in essence to finance a larger home should be allowed to continue. The mother contended (i) that the word ‘or’ in para 1(5)(b) was disjunctive and permitted a subsequent transfer of property order where a settlement of property order had already been made; and (ii) that the award of a lump sum for the purpose of housing could be subjected to conditions such as would require the money to be used toward housing which would in due course revert to the father in accordance with the trust provisions for the mother’s existing accommodation.
Held – (1) On the true construction of para 1(5)(b) of Sch 1 to the 1989 Act an application for a transfer of property order was precluded where a settlement of property order had already been made. The legislative intention was very clear. Orders for the benefit of a child for the transfer and settlement of property were to be regarded as different methods of dealing with the same, one-off, need for property adjustment in an appropriate case. The word ‘or’ linking the
designation of the two types of order was conjunctive. In the instant case a settlement of property order had been made and the mother’s applications for an order for the settlement of further property and for an order for the transfer of property would therefore be struck out.
(2) It would be a misuse of the court’s power were the mother to be enabled by claiming a lump sum to circumvent the prohibition on a second property adjustment order created by para 1(5)(b). The essence of a lump sum was that it was paid once and for all and used to reimburse past expenditure or spent on current or future needs. The device of a lump sum subject to conditions which required, in effect, its repayment in due course, or treating the money or what was acquired with it as a repayable loan, produced an effect which was very close to an order for settlement of the money or whatever it was used to purchase. Accordingly, the case would proceed on a basis which excluded the mother’s attempt to seek to finance the upgrading of her accommodation by the lump sum limb of her application; J v C (child: financial provision) [1998] 3 FCR 79 and Re P (a child) (financial provision) [2003] 2 FCR 481 applied.
Cases referred to in judgmentA v A (Financial Provision for Child) [1995] 1 FCR 309, [1994] 1 FLR 657.
Chamberlain v Chamberlain [1974] 1 All ER 33, [1973] 1 WLR 1557, CA.
J v C (child: financial provision) [1998] 3 FCR 79.
Lilford (Lord) v Glynn [1979] 1 All ER 441, [1979] 1 WLR 78, CA.
P (a child) (financial provision), Re[2003] EWCA Civ 837, [2003] 2 FCR 481, [2003] 2 FLR 865.
Application for financial provisionThe mother instituted proceedings against the father under Sch 1 to the Children Act 1989 and applied by Forms C1 and C10 for an order for interim periodical payments, periodical payments with security, a lump sum, a settlement of a new property for the benefit of the child and a transfer of property order for the benefit of the child. On 14 May 2004 District Judge Bradley transferred the application to the High Court and directed it be listed for a case management conference hearing to decide which if any of the component parts of the application should proceed. The facts are set out in the judgment.
Howard Shaw (instructed by Lloyd Platt & Co) for the mother.
Barry Singleton QC and James Roberts (instructed by Davenport Lyons) for the father.
Cur adv vult
17 November 2004. Singer J announced that the application would be dismissed in part for reasons to be given later.
27 January 2005. The following judgment was delivered.
SINGER J.[1] On 5 March 2004 the mother (M) instituted proceedings under Sch 1 of the Children Act 1989 for a range of financial provision orders in relation to her daughter C who is now 10. The respondent to the application, C’s father (F), and M were never married. M’s application is the most recent in-court litigation between the parents, the first round of which was decided by Mr Justice Johnson in January 1996 and is reported as Phillips v Peace[1996] 2 FCR 237.
[2] On 14 May 2004 District Judge Bradley transferred the application to the High Court at the invitation of counsel then appearing before her, and directed that it should be listed for what was described as a case management conference to decide ‘which if any of the component parts of the application should proceed’. That hearing took place before me on 17 November 2004 when I heard submissions from Mr Howard Shaw for M and from Mr Singleton QC appearing with Mr James Roberts for F. I announced my decision there and then and gave directions intended to facilitate and govern the efficient expeditious and proportionate disposal of the issues which remain between the parties. This now is my judgment which I give leave to report.
THE BACKGROUND[3] M is now 41 and F 47. Their relationship lasted about six months from March to September 1993. C was born the following June. M at some stage made application to the Child Support Agency (CSA), and it seems that in parallel to the intermittent court proceedings which I shall describe there has been a running battle of applications and other proceedings under the Child Support Act 1991. At the outset of his 1996 judgment Johnson J referred to the seeming absurdity that F’s liability could under the regulations then extant be calculated at zero when he lived in a house worth well over £2m, had the use of three motor cars which cost £190,000, and enjoyed a corresponding lifestyle.
[4] For reasons which are elaborated in his judgment Johnson J rejected the invitation advanced by Mr Posnansky QC (who then appeared for M) which would have allowed a hard case to make bad law, and declined to adopt the expedient of dressing periodical maintenance payments up as a lump sum payable by instalments. What he did do however was to fix the sum which F should settle for the purpose of the acquisition of a home for M and C until, in accordance with the terms of the trust deed the detail of which was thereafter agreed between the parties...
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