S v S
| Jurisdiction | England & Wales |
| Judge | MRS. JUSTICE ELEANOR KING,Mrs. Justice Eleanor King |
| Judgment Date | 20 August 2008 |
| Neutral Citation | [2008] EWHC 2038 (Fam) |
| Court | Family Division |
| Date | 20 August 2008 |
| Docket Number | Case No: FD05D02891 |
[2008] EWHC 2038 (Fam)
IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mrs. Justice Eleanor King
Case No: FD05D02891
Martin Pointer QC and Justin Warshaw (instructed by Withers and Co) for the Applicant
Jeremy Posnansky QC (of Farrers &Co LLP) for the Respondent
Hearing dates: 31/7/2008
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
This judgment is being handed down in private on 20/08/08. It consists of 21 pages and has been signed and dated by the judge. The judge hereby gives leave for it to be reported.
The judgment is being distributed on the strict understanding that in any report no person other than the advocates or the solicitors instructing them (and other persons identified by name in the judgment itself) may be identified by name or location and that in particular the anonymity of the children and the adult members of their family must be strictly preserved.
This is a Case Management directions hearing in Ancillary Relief proceedings between Wife (W) and Husband (H).
W is 58 and H 61. They married on 23 September 1975 and separated in August 2004; this was therefore a marriage of 21 years. There are three adult children: A who is 30, B who is 29 and C who is 27.
W now lives with her new partner. H lives alone although he has a girlfriend.
W issued a Divorce Petition on 3 May 2005 and decree nisi was pronounced on 14 September 2005.
The parties are very wealthy. In late 2005 their total assets amounted to something in the region of £78m. The parties' cases are conventionally put: H was the wealth creator and W the home maker.
On 29 November 2005 a round table meeting was held in an attempt to resolve the ancillary relief proceedings by agreement.
H's case is that the decisions made at that meeting and the effect of subsequent negotiations that were necessary in order to refine details, drafting and collateral issues such as tax, amount to a concluded agreement (the 'agreement') between the parties. This 'agreement' he says has subsequently been implemented in its entirety (save for a modest pension share provision which cannot in law be implemented prior to the making of an order). The result is that W has had assets to the tune of approximately £34m transferred to her or her trusts pursuant to the agreement.
In those circumstances H submits that it does not matter that the final draft order was signed by W but not released to H's solicitors for reasons which are dealt with below.
W's case is that whilst there was an agreement that the assets should be divided as to 45% to W and 55% to H, there has not been a concluded agreement and there remain a number of unresolved and significant issues which require resolution via ancillary relief proceedings. Those proceedings can, it is said on her behalf, be dealt with in a somewhat truncated manner due to the agreement between the parties as to the proportions in which the assets were to be split. The outstanding issues will require the trustees of the family settlement to be joined as parties and may require the variation of nuptial settlements.
On 4 February 2008 W filed a Notice of Intention to Proceed with an application for ancillary relief: Form A. In it she indicates her intention to seek all forms of ancillary relief and to vary a nuptial settlement
On 30 April 2008 H issued a Notice to Show cause why an order should not be made in the terms of a draft order which H says had been agreed between the parties.
The matter came before District Judge Redgrave on 8 May 2008. The District Judge transferred the matter to the High Court and made directions which essentially allowed for either course to be pursued in that she ordered the filing of Forms E and of Questionnaires and Requests for Documents but listed a further directions hearing in the High Court in respect of both the ancillary relief proceedings and the H's notice to show cause.
So it was that the matter came before the court with H and W each represented by Leading Counsel: Mr Pointer QC for W and Mr Posnansky QC for H.
W seeks to persuade the court to make directions in the ancillary relief proceedings, albeit on a slightly more limited basis than would be normal given the concession made by W as to the proportions in which the assets should be held (although requiring replies to her questionnaire). H submitted that the court should stay the ancillary relief proceedings and hear the notice to show cause, with a view to making an order in the terms he submitted had been agreed. This course would leave open to the court the possibility of reinstating the ancillary relief proceedings in the event that the court was not satisfied that:
i) there was an agreement and
ii) that W should be held to its terms.
The case management decision which the court has to make is to decide which of these two approaches to adopt in giving directions for the future management of the case or whether to adopt either of them in their entirety.
The Legal Framework
The Court of Appeal recently considered case management issues in Crossley v Crossley [2008] 1 FLR 1467 This was an appeal against a case management decision of Mr Justice Bennett, where he had been asked significantly to limit the issues to be litigated at trial on account of the fact that there was one factor of such magnetic importance that it must necessarily dominate the application of s25 and the discretionary process.
In Crossley the Court of Appeal considered how ancillary relief proceedings could best be case managed in circumstances where there is a factor of magnetic importance. In that case it was a pre-nuptial agreement in the context of a 2 year, childless marriage where each party was independently wealthy.
Lord Justice Thorpe said:
[15] All these cases are fact dependent and this is a quite exceptional case on its facts, but if ever there is to be a paradigm case in which the court will look to the prenuptial agreement as not simply one of the peripheral factors in the case but as a factor of magnetic importance, it seems to me that this is just such a case. As to the second and third grounds, that the judge was bound by the provisions of r 2.61, I am quite unpersuaded, as was the judge, that these individual rules were intended to be some sort of straitjacket precluding sensible case management. I would particularly stress the overriding objectives that govern all these rules, carefully and fully drafted in r 2.51D. It is easy to attach this case on its facts to a number of the objectives there articulated. It is very important that the judge in dealing with the case should seek to save expense. It is very important that he should seek to deal with the case in ways proportionate to the financial position of the parties. It is very important, more so today than it was when these rules were drafted, that he should allot to each case an appropriate share of the court's resources, taking into account the need to allotresources to other cases. In his general duty of case management he is required to identify the issues at an early date and particularly to regulate the extent of the disclosure of documents and expert evidence so that they are proportionate to the issues in question.
I bear in mind Lord Justice Thorpe's observations throughout my consideration of this application.
I have been invited by both Mr Posnansky QC and Mr Pointer QC to look at a number of authorities which relate to cases where there has been an alleged agreement. It is no part of my case management task to decide whether there was in fact an agreement and if so whether W should be held to it. Consideration of the authorities is however, I accept, a necessary backdrop against which to assess the strength of H's submission that there is an agreement and if there is one, of its importance within the discretionary process upon which the court has to embark in order to achieve a fair outcome to the ancillary relief proceedings.
Mr Pointer submits that:
a) an application to stay the ancillary relief application is wrong
b) An application utilising the procedural route of a Notice to Show cause in order to obtain a determination of the status of 'the agreement' as a preliminary issue in isolation is wrong.
c) in any event, there is no concluded agreement in this case and the court's duty to consider all the s25 circumstances must lead the court to having an ancillary relief trial, albeit truncated as to disclosure, but, significantly, with the court able to make such orders as in its discretion it thinks fit, which orders may be different from those 'agreed' between the parties.
In any consideration of the authorities relating to 'agreements' the starting point must always be Edgar v Edgar and Lord Justice Ormrod's classic exposition of the law:
Under s25(1) it is the duty of the court to have regard to all the circumstances of the case and, in particular, to the matters detailed in paragraphs (a) to (g)………..
To decide what weight should be given in order to reach a just result to a prior agreement not to claim a lump sum, regard must be had to the conduct of both parties, leading up to the prior agreement, and to their subsequent conduct, in consequence of it. It is not necessary in this connection to think in formal legal terms, such as misrepresentation or estoppel, all the circumstances as they affect each of two human beings must be considered in the complex relationships of the marriage. So, the circumstances surrounding the making of the agreement are relevant. Undue pressure by...
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