V v W
| Jurisdiction | England & Wales |
| Judge | Sir James Munby |
| Judgment Date | 02 December 2020 |
| Neutral Citation | [2020] EWFC 84 |
| Court | Family Court |
| Docket Number | Case No: BV17D08211 |
| Date | 02 December 2020 |
[2020] EWFC 84
IN THE FAMILY COURT
At the ROYAL COURTS OF JUSTICE
(In Open Court)
Royal Courts of Justice
Strand, London, WC2A 2LL
Sir James Munby
Case No: BV17D08211
Mr James Finch (instructed by Pinder Reaux) for the applicant
The respondent in person
Hearing dates (by Zoom): 5 October, 12 November 2020
Judgment Approved by the court for handing down
In a suit for divorce in which the wife W (Ms W) was the petitioner and the husband V (Mr V) was the respondent, Ms W applied for financial relief. On 27 March 2018, Roberts J made an order providing for the instruction of a Mr A of a firm I shall refer to as XYZ as SJE to value a company which I shall refer to as S; the order provided that the report (the Report) was to be filed by 4 May 2018 and that Mr V alone was to be responsible for paying the SJE's fees. It was agreed that XYZ's fees would not exceed £62,500 plus VAT, a total of £75,000. Instructions were given to the SJE on 28 March 2018. Despite the terms of the order, the Report was not received by the parties until 5 June 2018. On 7 June 2018, a financial dispute resolution (FDR) hearing took place before Moor J.
On 10 December 2018, Roberts J made a ‘clean break’ order. So far as material for present purposes, it contained the following provisions: an undertaking by Mr V to provide security for the second lump sum payment of £1.1 million (para 15); an undertaking by him to continue to make payments equivalent to the periodical payments to Ms W notwithstanding her remarriage, until payment of the second lump sum (para 18); an order that he pay her lump sums (a) of £1m within 3 months and (b) of £1.1m by 19 June 2023 (para 24); an order that in the event of late payment of the lump sums simple interest should accrue on the remaining balance of the lump sum(s) at the rate applicable for the time being to a High Court judgment debt (para 25); an order that he pay her periodical payments at the rate of £50,000 per annum, ending upon payment of the second lump payment (para 33); and an order that he make payments for benefit of the child of the marriage at the rate of £25,000 per annum, the payments to end upon the cesser of full-time tertiary education to first degree level, including a gap year (para 34). There was also (para 40) the usual liberty to apply “concerning the implementation and timing of the terms of this order only.” The decree nisi of divorce was made absolute in January 2019.
On 14 April 2019, XYZ issued a claim form in the County Court Money Claims Centre against Mr V seeking payment of its unpaid fee of £75,000 plus interest amounting to £1,579.62. I shall refer to these as the civil proceedings. On 22 April 2019 S, by then insolvent, entered into a USA Chapter Eleven bankruptcy.
On 12 June 2019, Mr V filed his defence and counterclaim in the civil proceedings, signed by Leading Counsel. He denied liability, alleging (defence, para 17) that the valuation was one which no reasonably competent valuer could have reached and that Mr A had been negligent. So far as material for present purposes it was further alleged: that because of the late delivery of the Report he and his legal advisers “were prejudiced in their conduct of the FDR and of the financial proceedings” (defence, para 15); that at the FDR Moor J “gave a strong indication that any judge at the final hearing would most likely make findings of fact as to [his] total matrimonial assets, including his interest in S, which were based on the valuations in the report and that this would have a consequential effect on the size of capital and/or other payments which [he] would be required to make to [the wife]” (counterclaim, para 24); and that “In reliance on the Report and/or on the effect which the Report was likely to have on the reasoning of the judge hearing any final hearing” he and his legal representatives entered into negotiations and thereafter reached the settlement embodied in Roberts J's order (counterclaim, para 25). He claimed as damages “the difference between the sums which he has or is obliged to pay … under the order … and the amount which he would reasonably have had to pay, whether by way of settlement or order of the Family Court, if the value of his interest in S as at 5 June 2018 had been assessed correctly” (counterclaim, para 27.1); he put the difference as being between £1 million and £2.5 million (counterclaim, para 27.6).
On 20 June 2019, Moor J gave a ruling which is self-explanatory. It is convenient to set it out in full:
“1 I have received an application from … solicitors for a transcript of the hearing before me on 7 June 2018. [These] solicitors are not acting for either party to the proceedings but wish to have a copy of the transcript as it is said that Mr V has made representations to their client about what was said during the hearing by myself and he intends to rely on this in a claim against their client.
2 According to my records, the hearing on 7 June 2018 was a Financial Dispute Resolution appointment. This has a very significant consequence. In accordance with paragraph 6.2 of PD9A, to the Family Procedure Rules:-
“… Non-disclosure of the contents of (FDR appointments) is vital and an essential pre-requisite for fruitful discussion directed to the settlement of the dispute between the parties … As a consequence of Re D [1993] Fam 231, evidence of anything said or of any admission made in the course of an FDR appointment will not be admissible in evidence, except at the trial of a person for an offence committed at the appointment or in the very exceptional circumstances indicated in Re D”
3 In essence, the “very exceptional circumstances” involves the safeguarding of children or others.
4 It therefore follows that I cannot agree to a transcript of the hearing being provided to [the] solicitors for use in any other context, including litigation. Equally, however, it is quite wrong and impermissible for Mr V to attempt to rely on something that I am alleged to have said during the hearing in any claim he may have against [the solicitors'] clients.
5 I will, however, give [the solicitors] liberty to apply if they challenge this conclusion or wish to make any further application arising out of paragraph 6.2.”
On 12 July 2019, XYZ filed its reply and defence to counterclaim, signed by Counsel, comprehensively disputing Mr V's allegations in his defence and counterclaim. So far as material for present purposes: in relation to what was pleaded in para 24 of the counterclaim, it “denied that [he] is entitled to rely on any such indication in light of the ruling of Mr Justice Moor of 20 June 2019” and asserted that “Any attempt to do so is liable to be struck out” (defence to counterclaim, para 46(b)); in relation to para 25 of the counterclaim, it asserted that “If [he] considered the Report to be negligently defective … he should not have settled in reliance on it” (defence to counterclaim, para 46(a)(i)).
On 19 May 2020 (by which time the civil proceedings had been transferred to the Queen's Bench Division), Master Cook made an order, requiring Mr V within 14 days to “issue any application to the … Family Division for permission to rely, for the purposes of these proceedings, on a transcript of the [FDR] (or such other material connected with that hearing which is relevant to [his] defence and counterclaim)” and, within 28 days of receipt of the ruling of the Family Division pursuant to such application to serve on the claimant a draft amended defence and counterclaim.
On 27 May 2020 Mr V accordingly made the application which is now before me. It was supported by his witness statement also dated 27 May 2020. I shall refer to this as the disclosure application. It seeks “permission” to disclose certain specified documents, “as part of his defence” to the civil proceedings. The disclosure application was put before Moor J, who declined to deal with it: see Myerson v Myerson [2008] EWCA Civ 1376, [2009] 1 FLR 826. I understand that, in the course of ruling that he would not deal with the application, Moor J made certain observations and that by an order made by Holman J on 31 July 2020 Moor J's ruling was ‘sealed’ with a direction that it should not be before the court at any hearing of Mr V's application. I have seen neither Moor J's ruling nor Holman J's order.
On 25 September 2020, Mr V issued an application on Form A, applying, as it was put, to “vary” both the lump sum order and the periodical payments order. I shall refer to this as the variation application. Specifically he seeks: to be released from the undertakings in paragraphs 15 and 18 of the order made by Roberts J on 10 December 2018; that paragraph 24(b) of the order be set aside; that the interest rate in paragraph 25 of the order be varied to UK Sterling LIBOR + 1%; that paragraph 33 of the order be set aside; and that paragraph 34 of the order be varied so that child periodical payments should terminate upon the child of the family attaining 18 years or completing full-time secondary education, whichever is the later.
Mr V's application of 27 May 2020 was in due course directed to be heard by me on Monday 5 October 2020 at 2pm. By email on the morning of the hearing, the court office brought Mr V's variation application to my attention.
At the hearing, Mr V was represented by Mr James Finch of counsel. Ms W appeared in person. I referred to the variation application, saying it was not clear to me whether it was also listed before me – it turned out...
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LS v PS
...Direction is now reflected in PD9A para 6.2 of the Family Procedure Rules 2010. Its effect was considered by Sir James Munby in V v W [2020] EWFC 84. That case concerned a separate civil claim brought against a respondent husband (H) in financial remedy proceedings by a single joint expert ......
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LS v PS
...Direction is now reflected in PD9A para 6.2 of the Family Procedure Rules 2010. Its effect was considered by Sir James Munby in V v W [2020] EWFC 84. That case concerned a separate civil claim brought against a respondent husband (H) in financial remedy proceedings by a single joint expert ......