Hutchings-Whelan v Hutchings [2012] EWCA Civ 38

Case No B4/2011/0175[2012] EWCA Civ 38
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
Venue CARDIFF COUNTY COURT (HHJ Masterman)
CF0800676
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 26/01/2012
Before
LORD JUSTICE MAURICE KAYLORD JUSTICE HUGHESLORD JUSTICE MCFARLANE
Between
MICHELE ANN HUTCHINGS-WHELANAppellantPAUL ALLAN HUTCHINGSRespondent
(Transcript of the Handed Down Judgment ofWordWave International LimitedA Merrill Communications Company165 Fleet Street, London EC4A 2DYTel No: 020 7404 1400, Fax No: 020 7831 8838Official Shorthand Writers to the Court)
Michele Ann Hutchings-Whelan appeared in person for in personPaul Allan Hutchings appeared in person for in personHearing Hearing date: 12 January 2012
JudgmentLord Justice McFarlane :Background
[1]This is an appeal brought by Paul Hutchings (“the husband”) in relation to a final order made in ancillary relief proceedings on 21st December 2010 by His Honour Judge Masterman sitting in Cardiff County Court.[2]Mr Hutchings and his former wife, Michele Hutchings-Whelan (“the wife”), were married in March 1980 and separated some time in the year 2000. They have three children, Michael, Harry and Jessica, all of whom are now grown up and aged between 25 and 30. A fact of note is that Harry suffered a serious personal injury when still a baby as a result of which he was awarded a substantial sum of damages which was held in trust until his 18th birthday.[3]Following the couple’s separation, the wife commenced divorce proceedings and a decree absolute was pronounced in January 2003. Issues relating to ancillary relief were compromised and a consent order was made in the Cardiff county court on 20th February 2004 on the basis that the wife would receive a lump sum of £176,000 in full settlement of her claims and on the basis of a clean break with respect to future maintenance.[4]The wife remarried on 19th July 2007.[5]Subsequent to the making of the February 2004 consent order, the wife became concerned as to the husband’s apparent wealth and she suspected that he had failed to make full disclosure of all his assets prior to the financial dispute being compromised. She applied to the court to re-open the matter and on 3rd March 2009 HH Judge Masterman ordered that the consent order should be set aside on the basis that the husband had apparently failed to make full and frank disclosure of his assets. In particular the judge identified that a property, 106 Commercial Street, Risca, Newport, Caerphilly, which had ostensibly been purchased in the name of the couple’s son, Harry, was in reality likely to be the husband’s property with Harry acting as a mere nominee. The existence of this property, let alone any interest that the husband might have in it, had not been disclosed at the time of the original divorce proceedings. The property, which had been purchased for £250,000, had subsequently been sold for around £1.3 million. In those circumstances the judge considered that the wife was justified in asking for the matter to be re-opened and evaluated in detail.[6]The detailed evaluation was undertaken by HHJ Masterman at a five day hearing commencing on 2nd July 2010 at which both parties were represented by leading counsel and during which detailed oral evidence was heard. Extensive written submissions were prepared on each side and expanded upon orally at a day’s hearing in September. Thereafter, on 18 October the judge circulated a draft written judgment at the close of which he indicated that he was inclined to award the costs of the hearing to the wife but that he wished to hear submissions on the question of costs on the occasion that judgment was handed down.[7]In short terms the judge found against the husband, who had maintained his case that he had no beneficial interest at all in the Commercial Street property. The husband had undertaken dealings with respect to a significant number of properties and had, from time to time, borrowed substantial amounts of money from acquaintances and business associates. The judgment reflects a process at the hearing in which the details of these many and various transactions had been teased out for evaluation. That process was, however, greatly impaired by an apparent absence of relevant documentary material, an inability on the part of the husband and his principal witness to recall the details of a number of the transactions and, finally, by the adverse view that the judge formed as to the credibility of the husband and his witnesses.[8]In relation to the Commercial Street property the husband’s case at the end of the hearing was summarised by

the judge at paragraph 32 of the judgment:

“Eventually [the husband] was forced to concede in evidence that, on his own evidence, 80% of 106 Commercial Street was paid for ultimately by money derived from his own property. He said that this was “a gift” to [Harry]. When one takes account of interest payments it means therefore that [the husband] “gifted” his son something in the region of £1/4 million at a time when, as he claims, he was “broke”. ”
[9]As I have said, the judge rejected the husband’s case and found that he had a full beneficial interest in the Commercial Street property together with a number of other properties identified in the judgment. The judge awarded the wife an additional lump sum of £384,000 as representing a fair award in the circumstances. In due course I will turn to the basis on which the judge sought to calculate this figure.[10]On 21st December 2010, the date fixed for handing down of the judgment and determining any outstanding issues, including the question of costs, the wife was represented by leading counsel but there was no appearance by the husband. The judge assumed that the husband had had notice of the hearing and went on to make an order that he and his son Harry (who had been made a party to the ancillary relief proceedings) should pay the wife’s costs on a joint and several basis.[11]On 25th January 2011 the husband filed a notice of appeal against the judge’s orders.[12]On 15th August 2011 my Lord, Lord Justice Hughes, granted limited permission to appeal. The husband had sought to challenge the very basis of the judge’s conclusions and to re-assert his case that he had no interest in the Commercial Street property. Hughes LJ characterised much of the husband’s proposed appeal as being unarguable and declined to grant permission to appeal save upon the following limited basis: i) the judge had reached a figure of £1.066 million as being the profit realised upon the sale of 106 Commercial Street. The husband’s case was that the judge, in calculating the profit figure, had failed to take account of interest totalling £136,000 paid by him on loans with respect to the property and also had failed to take account of the provision of expenses relating to this ownership, including the obtaining of planning permission; ii) the judge had not taken account of £19,600 spent upon refurbishing two properties, one at 270 Greenway Road, Rumney and the second at Priory View, Danesbury, Newport; iii) the judge had placed a value of £50,000 upon a bracelet that the husband owned, which in reality the husband asserted should have been valued at £35,000. In the light of these three factors Hughes LJ concluded that the husband had an arguable case in submitting that the lump sum awarded to the wife may require revision in his favour.[13]In addition, by the time of the oral permission application in August, it was plain that the husband had not been given formal notification of the hearing on 21 December and had consequently not been given an opportunity at that hearing to be heard on the question of costs. He was therefore given permission to appeal in relation to the costs order.[14]Hughes LJ ordered a stay of the lump sum order to the extent that any payment was due over and above the sum of £200,000.[15]At this stage it is necessary to note that the original grounds of appeal were prepared by the husband at a time when he was acting in person. Shortly before the oral permission hearing counsel, Mr Robert Barrett, was instructed. Mr Barrett assisted the court by marshalling the husband’s arguments into a coherent order and presenting the court with a skeleton argument dated 15 August and appearing for the husband at the permission hearing.[16]On 28th September 2011 the wife’s leading counsel, Jonathan Furness QC, filed a full skeleton argument in relation to the appeal. On 26th October the husband, who was by then, once again, acting in person filed a further document entitled “Financial Explanation and Statement” within which he addressed a number of the points upon which leave to appeal had been given, but in the course of which he also sought to re-open the wider issues.[17]The appeal came on for the hearing on 27th October 2011 before a constitution of which I was a member together with my Lords, Lord Justice Thorpe and Lord Justice Longmore. Both parties appeared as litigants in person. At an early stage it became apparent that the skeleton argument of Jonathan Furness QC, which was being relied upon by the wife, may not have been seen by the husband. Upon perusing the document the husband applied for the case to be adjourned so that he might consider its contents more fully before responding to them. Reluctantly the court acceded to his request for an adjournment. He was directed to file and serve a skeleton argument in response to that of Mr Furness by 3rd November.[18]Prior to 3rd November 2011 the husband filed a document raising a number of points in relation to the wife’s claim to have served him with Mr Furness’s skeleton argument prior to the aborted appeal hearing in October. The husband took issue with the wife’s assertions and sought a preliminary hearing on the question of service of that document. Other than filing submissions in relation to the service of the document, the husband had failed to produce a written skeleton in response to its substance. On the 18th November I refused the husband’s request for a preliminary hearing and directed that he must file his skeleton argument in response by the 28th November.[19]Thereafter the husband did indeed file a purported response to the skeleton, which in effect simply seeks to rely upon the earlier document filed by his then counsel, Mr Barrett. By then, however, the husband was indicating to the court that his psychological and emotional health were compromised and that he had made a power of attorney authorising a solicitor to act on his behalf. Having considered the papers on 9th December 2011, I directed that the appeal should be listed for hearing early in 2012 and that any further application that the husband might make for the adjournment of the appeal would only be entertained by the court if it was supported by a detailed medical report from a suitably qualified doctor, including details of: i) The appellant’s current condition; ii) His treatment; iii) His capacity to attend court and conduct litigation; and iv) The prognosis including advice upon when, if at all, the appellant may be fit to attend court and conduct litigation in the future.[20]In the period leading up to this hearing the husband has indeed sought to have the proceedings adjourned on the basis that he is not capable of conducting the litigation as a result of depression, anxiety and the consequences of recently diagnosed diabetes. On 10th January I directed that the case should remain listed for a full hearing but that the court would entertain any renewed application for an adjournment as a preliminary issue.[21]The husband attended court on the morning of 12th January and renewed his application for an adjournment. He was supported by a number of letters and/or reports prepared by medical professionals and in particular by a short report dated 21st December 2011 by Dr A Swarnkar, a consultant psychiatrist and a report dated 11th January 2012 from Stephanie Johns, a community mental health nurse. The documents show that the husband was referred to the community mental health team by his GP in November 2011 and was supported by the Home Treatment Team and latterly by the Community Mental Health Team having displayed symptoms of anxiety, depression and lack of sleep. He is currently in receipt of medication by way of tranquilisers and sleeping pills. Dr Swarnkar indicates that, in spite of the medication, the husband remains anxious and low in mood “which may affect his ability to understand the ongoing court proceedings about which he is very concerned”. Dr Swarnkar therefore requests a delay in the proceedings until the husband is well enough and more able to cope; such a delay also enabling the mental health team to undertake further work with him. Stephanie Jones’ report is in similar terms and records that the husband is “extremely concerned” about the court proceedings and “majorly concerned” about issues regarding his home.[22]The wife opposed any adjournment and pointed to a history of the husband seeking adjournments and otherwise failing to engage in the legal process when it may suit him to do so.[23]My Lords and I took time to consider the adjournment application but in the event refused to grant an adjournment. In brief our reasons were: i) The continuation of the proceedings, and a failure to achieve a resolution with respect to this couple’s finances some twelve years after they separated, appeared to be a major cause of the husband’s current decline. Adjourning the proceedings further would seem only to prolong and potentially to exacerbate the situation with no indication of when the husband’s circumstances might be said to have improved to render him more able to contribute to the forensic process; ii) Despite the court receiving the medical reports to which I have referred, neither the husband, nor the solicitor who apparently has power of attorney with respect to his affairs, has produced a medical report which compiles with the direction that I made in December requiring information as to the prognosis and the stage at which the husband may be likely to be said to be fit to attend court; iii) The issues in the appeal, following the limited grant of permission, are very narrow and relate to matters more akin to arithmetic than principle; iv) The Court now has a wealth of written material setting out the arguments on each side in respect to the remaining points and it is questionable what further illumination might be achieved from oral submissions by litigants in person on both sides. v) The husband has on his own account a solicitor with power of attorney and a charging clause, who could act for him, but has elected not to take any steps to enable him to do so, or even to ask him to come to this court.[24]In the circumstances the husband’s application for an adjournment was refused.[25]On being told of our decision in relation to the adjournment the husband indicated that he wished to leave the courtroom on the basis that he was unable to contribute to any ongoing process. After it was explained to him that the case was now likely to proceed on the basis of the written material that had been submitted and that reserved judgments would be delivered at the earliest opportunity, he left the courtroom.[26]In keeping with the view that we had formed as to the limited value of any further oral submissions, we did not require the wife to make any submissions herself. The case was therefore adjourned after what was a very short hearing for the preparation of reserved judgments. The judge’s judgment[27]The judgment, which runs to some 60 closely structured paragraphs, indicates that the judge undertook a very detailed investigation of the factual background surrounding 106 Commercial Street and a number of other property transactions undertaken by the husband. The learned judge concluded that the husband had consistently lied about his financial position to the wife, to the court and, indeed, to HMRC.[28]With regard to the Commercial Street premises the judge held that Harry was a bare nominee for the husband (albeit that some of Harry’s damages had been used in the initial purchase but later repaid to Harry). The judge held that the profit from the sale (after taking account of costs of sale and the repayment of a loan which was by then secured on the property) was £1.066 million. The judge accepted that the husband had made substantial repayments on a number of loans taken out from friends, but expressed difficulty in coming to any clear picture or final conclusions relating to the husband’s financial affairs, largely because of his persistent attempts to conceal the true picture.[29]Given the narrowness of the points that remain for consideration on this appeal, it is unnecessary for this judgment to include a survey of the entire landscape as it was described by the judge in his judgment. It is, however, of note that, at paragraph 51, the judge found that the profit resulting from the sale of 106 Commercial Street was sufficient to purchase four other properties outright. However, the husband used these four properties as security for further loans and the judge raised the question “where did the money thus raised go?” After describing the scale of the sums involved, after giving the husband the benefit of at least one “generous assumption” and after recording that the husband has been untruthful and has effectively provided no satisfactory explanation for the use to which the money raised on these loans was put, the judge concluded “there is therefore an unexplained sum of about £496K which ought to be brought into account”.[30]Later, at paragraph 53, the judge stated: “a further concern is that [the husband] has carried out the majority of the transactions referred to in this case with long-standing friends and business associates. These include Mr D, Mr and Mrs C, the S’s, Mr GH, Mr G and doubtless others, quite apart from his own sons. Added to this [the husband] has demonstrated that he is quite ready to lie to lending institutions and to the court about his income and the true ownership of properties. He is extremely resentful of the fact that he may be ordered to pay a further sum to [the wife]. He has shown reluctance to engage in these proceedings and I draw the inference that he has only unwillingly provided the documents necessary for full and frank disclosure, and these of course are incomplete. To some extent this may well be because he conducts his business by word of mouth with trusted associates and is, as he says, not good with paperwork. This removes pure arithmetic from assessment of the overall position and means certain assumptions have had to be made. But the overall picture that emerges is of [the husband] going to considerable lengths to disguise his financial position, both from HMRC and [the wife]. If this is wrong then [the husband] has only himself to blame due to his secrecy and failure to produce a candid account of his dealings backed up by credible records”.[31]Doing the best he could, and on the limited amount of detail that had been made available to him, the judge concluded that the husband had, at the time of the hearing in 2010, available assets of £742,000, a figure that included the unexplained borrowings of £496,000 to which I have already made reference.[32]After rehearsing the various factors that were in play by reference to the structure of Matrimonial Causes Act 1973, s 25, and giving the husband credit for the fact that his fortunes improved radically after the parties separated, albeit that the foundation was laid during the 20 years of marriage,

the judge moved to his conclusion at paragraph 59:

“I have therefore come to the conclusion that the fair way of approaching the apportionment of the parties’ assets after this period of time is to award [the wife] one half of the value of plot 1, Tyr Winch Road as at 2004 (which should have been brought into account at that date) evidenced by sale price of £315K, i.e. £157K. [The husband] benefited from the sale of 106 to the tune of £1.066M but from that must be deducted the CGT payable of £384K leaving £682K and I consider that [the wife] should now be awarded a part of that profit discounted to reflect the matters set out in the preceding paragraph [credit to the husband for radical improvement of finances post separation]. One half would be too much and one quarter too little. One third amounts to £227K. If one adds that to the £157K the result is £384K. Applying the equality yardstick, that sum happens to be less than half of the parties’ joint assets of £804K. These various sums are deliberately expressed in “round figures” because of the inevitable degree of inference, estimate and assumption but that is a useful comparison to make. I therefore conclude that the fair sum to award [the wife] is £384,000.”

Profit from 106 Commercial Street

[33]Of the points upon which permission to appeal has been given, by far the most significant relates to the starting point taken by the judge in determining the profit figure of £1.066M relating to 106 Commercial Street.[34]The appellant’s case is that the original purchase price of £250,000 for this site was achieved by a loan of £200,000 from his acquaintance Mr S. That loan was repaid, as the judge found, with the addition of £40,000 interest. In addition, at a later date the husband borrowed £100,000 from another friend or associate, Mrs C, which was redeemed some two and a half year’s later for £196K, with the £96K element being ascribed to interest, a rate which the judge described as “exorbitant”. Mrs C was repaid out of a loan that the husband obtained from Link Lending Limited for over £200,000 and this loan in due course was repaid to Link Lending Limited when 106 Commercial Street was sold. The repayment to Link Lending Limited was taken into account by the judge in reaching his net profit figure of £1.066M. The husband’s case on appeal is that the two sums of interest £40,000K and £96,352.50 totalling £136,352.50 should have been taken into account by the judge as money spent by the husband with respect to the Commercial Street property before arriving at any figure in which the wife may be said to have a share.[35]On behalf of the wife, part of Mr Furness’s argument is that it ill behoves the husband now to be making detailed claims for payments in respect of this property which he has throughout claimed was not his. It is to be recalled that the husband’s case before the Judge was that payments made, including interest on loans, were made by him as “a gift” to his son Harry. Mr Furness therefore submits that the husband cannot now be heard to complain that the judge has failed to take this sum into account.[36]For my part, I have more than a little sympathy for the principle that underlines Mr Furness’s submission. A litigant who, as the judge found, has gone out of his way to disguise, hide or otherwise cover up his financial affairs cannot later be heard to complain that the judge has missed one or other point of detail in his attempt to delineate the husband’s finances through the haze created by the smoke and mirrors that the litigant has deployed.[37]Mr Furness’s submission however, cannot apply in full to the figure of £40,000. The judge was able to determine that interest in that sum was paid by the husband to Mr S in respect of the loan which, the judge found, facilitated the original purchase of the plot. It is therefore directly connected to this development and I can readily see how my Lord, Hughes LJ considered that, arguably, the Judge should have taken it into account.[38]It is, however, important not simply to focus on this one loan in isolation. I have described the judge’s attempt to track the borrowings on this property after the original loan to Mr S was repaid. It is plain that once the property was for a time mortgage free, the husband re-mortgaged it to Mrs C, he later discharged that loan through the further mortgage from Linked Lending Limited and it was that final loan which was accounted for by the judge in the sum of £232,000 in computing the profit figure.[39]The loan to Mrs C and its successor to Link Lending Limited would seem to have nothing to do with achieving the purchase or development of the Commercial Street premises; they were simply secured on it. Arguably, therefore, the judge need not have taken the final loan into account when computing the profit figure. The husband had been unable to explain in any manner that the judge found to be acceptable the twists and turns of his financial dealings during this period. The judge might well have been justified in holding that the final Link Lending Limited loan should not be brought into account when computing the net profits on the Commercial Street premises, but the judge made a favourable decision towards the husband in that regard.[40]In what I have said thus far I have dealt obliquely with the loan to Mrs C and the husband’s claim for credit in relation to the exorbitant sum of interest attached to it. On the information before this court it is not possible to tie the obtaining of that loan to the increase in value of the Commercial Street property. Its only established connection with the property is that for a time the property was used as security for the loan. I have no difficulty, therefore, in concluding that the judge was justified in ignoring the £96,000 interest when computing the level of profit.[41]In order to succeed in relation to the interest claims on appeal the husband must persuade this court that the judge was plainly wrong in failing to add the disputed sums into his calculation. For the reasons that I have summarised, in my view it is simply not possible to characterise the judge’s approach in that way. In allowing for the deduction of the final loan in £232,000 the judge dealt with matters in the round in a way that permitted credit to be given with respect to the cost of borrowing attached to the development. He allowed for the sum of £32,000 interest in that loan, where he might have substituted that figure for the original £40,000, but he was not plainly wrong to have done so.[42]I would therefore hold that the husband’s grounds in relation to the computation of interest on Commercial Street fail.[43]Permission to appeal was also given with respect to the ownership and development costs, for example planning permission, connected to Commercial Street. I can deal with this aspect far more shortly. In his “Financial Statement and Explanation” dated 26 October 2011 in relation to planning permission the husband says “no documentary evidence, as to payment, estimation/assessment sought,” as to flood risk assessments and mining surveys again “no documentary evidence as to payment, estimation/assessment sought,” and as to the time expended by the husband and Harry in relation to this project over the course of three years the husband estimates a figure of £40,000.[44]It is now a year since the husband filed his Notice of Appeal and over four months since permission to appeal was given. In the light of the judge’s adverse findings as to the husband’s credibility and the husband’s failure to produce any documentary evidence to support this aspect of his appeal, I consider that an appeal based on this ground can only fail.

Greenway Road and Priory View, Danesbury

[45]When giving permission to appeal Hughes LJ considered that it was just arguable that the judge should have brought into account two smaller sums namely, costs incurred in refurbishing two properties at Greenway Road and at Danesbury in a total sum of £19,628. This figure is to be found at File 4, pages 399 and 400 of the bundle, yet the judge referred to the fact that the costs in relation to Danesbury were “not in evidence” and he made no allowance for Greenway Road at all.[46]On this point Mr Furness submits that this was not an argument that was made before the judge. He submits that the husband can readily point to schedules of costs, such as those which are found at pages 399 and 400 of the bundle, because he is engaged in property development. There is no finding that those documents relate to either of these properties. Given the judge’s overall findings as to the husband’s credibility, Mr Furness submits that the judge cannot be criticised for failing to latch on to these figures and bring them into account with respect to these two properties.[47]In his judgment in this regard the judge says, at paragraph 51 “Danesbury has been subject to renovation work and an extension, the cost of which is not in evidence….270 Greenway Road likewise, awaiting redevelopment”. Taking account of Mr Furness’s submissions, I consider it is not possible to say that the judge’s finding that the cost of the Danesbury work was not established in evidence is plainly wrong.[48]Insofar as the judge found that, as yet, with respect to Greenway Road there had been no costs because it was “awaiting redevelopment” his conclusion, it seems to me, is not open to challenge. In this regard, again in paragraph 51, the judge gives the husband credit with respect to the mortgage on the Danesbury property because this may be used to fund the renovation work. Thus, to that extent, and probably over-generously, the husband has been given credit for this very element.[49]Moving away from the detail, however, the bigger point with respect to this appeal would seem to be that these two properties did not play any direct part in the attribution of shares to the wife undertaken by the judge. They were simply relevant in forming an overall view as to the husband’s general worth.[50]In the circumstances I consider that it is just not possible to say that the judge was plainly wrong in failing to give specific arithmetic credit for the cost of improvement work to either of these two properties because: a) the husband made no specific claim for such costs in the case presented by his QC; b) they were not established in evidence; c) they have no direct arithmetical relevance to the lump sum awarded.

Bracelet

[51]The husband purchased a number of items of jewellery out of the proceeds of sale of 106 Commercial Street. They included a bracelet for which he paid £50,000. At trial he produced a purported valuation (bundle 4, page 394) of £35,000. That valuation was not accepted by the wife and the valuation evidence was not called. The husband’s case on appeal is that the judge was wrong not to work on the lower valuation and that therefore a credit of £15,000 must be introduced in the husband’s favour in any calculation.

The judge dealt with the jewellery at paragraph 48 in these terms:

[52]“…and I find that he could, if he had to, sell the jewellery as well which I take (in the absence of any better evidence) to be worth the £75K he paid for it.” [the sum of £75K includes the £50K for the bracelet.][53]By implication, if not, indeed, expressly, the judge rejected the lower valuation figure. This point was not argued in the written closing submissions on behalf of the husband. In any event, its only relevance is to form a modest element in the overall computation of the husband’s worth which the judge used as a rough and ready yardstick in looking at the overall fairness of the lump sum to which he eventually arrived. At the risk of reiterating a point that I have already made, it is very difficult for an appellant who has been found to be dishonest and opaque about so much of his financial circumstances as to cause the judge to estimate, assume and at times, no doubt, guess at his finances, to pick upon a small yet specific element and argue for pound for pound credit in his favour in that regard. If the husband had conducted this litigation in a co-operative, open and honest manner, setting out in credible detail the minutiae of his finances then, of course, it might be possible to identify, understand and correct any specific arithmetical or evidential error in the calculation. The description that I have just given, however, is the antithesis of the manner in which this husband has conducted himself over the course of a decade in relation to resolving the financial issues that remain between himself and his former wife.

Overview

[54]In approaching a case such as this, with detail contained in bundles which run to pages numbered in the thousand, where oral evidence as to many various financial transactions is given over the course of five days and where many detailed points are raised, it is important not to lose sight of the overall task of the judge which is to fix upon one single lump sum as being the fair and just outcome of the entirety of the proceedings. Where the lump sum is calculated on the basis of sound and meticulously enumerated elements it is of course possible to identify aspects of the calculation in respect of which a judge may or may not have fallen into error. The case faced by HHJ Masterman was unfortunately not of this character. Having found that there had been a very substantial element of non-disclosure with respect to a property which had netted over £1 M, he then had to move through a sea of evidence within which there was little or no solid ground and yet fix upon one finite lump sum figure. At paragraph 43, as I have already observed he says:
“this removes pure arithmetic from assessment of the overall position and means that certain assumptions have had to be made”
That conclusion seems to be inevitable from the manner in which the husband had conducted himself and the evidence, or lack of it, that had been produced.[55]If the judge had continued to acknowledge that “pure arithmetic” was removed from his armoury and simply had come to an assessment of a figure that he thought was fair, in the light of the general view to which he had arrived as to the husband’s overall worth, I consider that he could not have been criticised, or certainly not criticised by the husband. The judge, however, went on to identify some arithmetical or rational basis for the figure arrived at by attributing a one half share of one property and a one third share of another property to the wife. He then, from a different perspective, observes that this is something short of 50% of the overall joint assets as he has, in very broad terms, estimated or assumed them to be. As I have said, for my part the judge did not have to rationalise his figure to this degree. That he did so has laid the judgment open to the potential criticisms that have been raised in this appeal. For the reasons that I have given I do not consider that any of these individual criticisms have any merit and certainly insufficient merit to hold that the judge’s overall conclusion was plainly wrong. In any event, in a difficult case, where all the difficulties faced by the judge originated from the husband’s own conduct, it is impossible for the husband now to complain that the judge exceeded the generous ambit of discretion open to him in fixing upon an additional lump sum of £384,000 in this case. For all of the reasons I have given I have no hesitation in dismissing the husband’s appeal against the substantive order.

Costs

[56]The husband had no notice of the hearing on 21st December 2010 at which the issue of costs was determined against him. He has permission to appeal on that point and it is therefore necessary to look at the judge’s determination in that regard.[57]The relevant rule at the time of the hearing was Family Proceedings Rules 1991, r 2.71 (4) which reads as follows:
“The general rule in ancillary relief proceedings is that the court will not make an order requiring one party to pay the costs of another party; but The court may make such an order at any stage of the proceedings where it considers it appropriate to do so because of the conduct of a party in relation to the proceedings (whether before or during them).”
[58]Rule 2.71 (5) sets out the various factors to which the court must have regard if it is minded to make a costs order.[59]In his skeleton argument the husband’s counsel submits that if the judge had intended to make any adverse findings in relation to the husband’s litigation conduct, the alleged conduct should have been clearly set out and the husband should have been given an opportunity to make representations in response.[60]In his skeleton Mr Furness observes that, unusually, on behalf of the wife in closing submissions the question of costs was addressed.[61]In his “Financial Statement and Explanation” for this court the husband refers to the question of costs only to seek an order for costs in his favour for the proceedings below and this appeal.[62]Due to an administrative error the husband was not given notice of the December hearing and was therefore not heard on the question of costs. The consequences of that error have now been addressed by the ability of the husband to put in detailed submissions as to costs during the year that has passed since issuing his Notice of Appeal and in the period between granting permission in August and the apparent deterioration in his emotional equilibrium in November. No substantive or particular submissions have been made.[63]Standing back and looking the whole course of this litigation through the lens of the judge’s findings as to the husband’s conduct both generally and in the course of the litigation itself, I not only consider that an award of costs against the husband was palpably justified but regard such an order as being the almost inevitable consequence of the manner in which the husband had conducted himself. I can therefore see no reason to take any course other than to dismiss the husband’s appeal in relation to the costs order.[64]For all of these various reasons I would therefore dismiss this husband’s appeal in its entirety.

Lord Justice Hughes:

[65]I agree

Lord Justice Maurice Kay:

[66]I also agree