K v K (Financial Remedy Final Order prior to Decree Nisi) [2016] EWFC 23

[2016] EWFC 23Case No BD14D01044
IN THE FAMILY COURT SITTING AT LEEDS
Coverdale House
East Parade
Venue LeedsDate 28/04/2016
Before
THE HONOURABLE MR. JUSTICE COBB
Between
K (husband)ApplicantK (wife)Respondent
The Husband in person for in personMiss Dornier Whittaker (instructed by Consilia Legal) for WifeHearing Hearing dates: 28 April 2016
JudgmentThis judgment was delivered in private. The judge has given leave for this version of the judgment to be published on condition that (irrespective of what is contained in the judgment) in any published version of the judgment the anonymity of the parties must be strictly preserved. All persons, including representatives of the media, must ensure that this condition is strictly complied with. Failure to do so will be a contempt of court.

The Applications

[1]Two applications are listed before the court today in the context of financial remedy proceedings which were issued in January 2015 by RK (“the husband”) against GK (“the wife”). They are:a. An application by the wife to enforce the final order made by District Judge (DJ) Heppell in those financial remedy proceedings following a contested hearing on 3 December 2015;b. An application by the husband for permission to appeal the order of DJ Heppell. These applications have been listed before me pursuant to an order made by HHJ Troy dated 10 March 2016.[2]The husband has made a further, recent, application (by notice dated 26 April 2016) to adjourn this hearing in order to obtain legal advice and representation. He tells me that he has instructed counsel on a direct access basis who is not available today. I have to say that I am not particularly impressed with the husband’s bid to have the case adjourned on that basis, but for reasons which follow, I decided to put on one side this application until I had determined a rather more fundamental issue.

Brief background

[3]The husband is 68 and the wife is 64. This was a second marriage for both. The parties were married in 1997, and the marriage effectively broke down after 17 years in late 2014. The wife left and the husband remained in the former matrimonial home, where he remains. In December 2014 the husband issued a petition for divorce and in the following month issued an application for financial relief. That latter application proceeded through the conventional stages of the process (albeit not without some difficulties caused by non-compliance with directions), including a Financial Dispute Resolution Appointment (August 2015), before being listed on 3 December 2015. At the final hearing, the wife was represented by solicitors and counsel (Miss Whittaker, who has ably represented the wife again today) but the husband was not represented.[4]At the conclusion of the hearing on that day, DJ Heppell delivered judgment. He made a number of adverse findings against the husband and his conduct; he found the wife to be a credible witness. He made a limited number of substantive orders. The principal order was the sale “forthwith” of the former matrimonial home, with 60% of the net proceeds of sale being paid to the wife. Otherwise, the District Judge ordered a clean break in respect of all other forms of financial relief, including pension. I note that following the words “It is ordered that” there followed the words “with effect from Decree Absolute”.[5]The judge’s order also reflected a number of provisions which were to have immediate effect:a. An order giving the wife unrestricted access to the former matrimonial home “forthwith” with the husband returning the wife’s key by 11 December 2015;b. The husband was to pay one-half of the value of the contents of the property to the wife by 14 December 2015 failing which she would have the buy them by the end of the year.[6]The District Judge further ordered the husband to pay £15,000 towards the wife’s costs “as a result of [his] conduct” in the litigation.[7]The husband sought permission to appeal from DJ Heppell, and this was refused.[8]I have seen a transcript of the judgment and the post-judgment discussions. It is illuminating to note that following the judgment, Miss Whittaker contemplated the possibility of the husband vacating the property “within the next 14 to 21 days” but did not pursue this only because “there would be nobody there to look after the animals and that would not be fair”. The District Judge indicates the need for the parties to “both arrange re-housing and move on … ‘get closure’”. The judge goes on to indicate that “the order I will make in relation to the contents is….that if the [husband] by 4pm on 10 December pays the [wife] and the [wife] receives cleared funds for the sum of £1,879, then ownership of the items ….passes to the [husband]”; he added (addressing the husband directly) “if you do not [pay the sum] then [the wife] can buy them from you, paying the same sum… by the end of the year”. This ‘order’ is reflected on the face of the sealed document as a ‘recital’.[9]The case summary prepared on behalf of the wife for this hearing contains the following passage:
“Following the hearing on 3rd December, W set about implementing the terms of District Judge Heppell’s order by instructing auctioneers and solicitors to act in the sale of the FMH. However contrary to the terms of the order, H would not allow W unrestricted access to the property … in addition, H failed to complete the necessary paperwork…”
It was only when considering enforcement measures, says Ms Whittaker, that the wife’s solicitors discovered that at the time of DJ Heppell’s order, decree nisi had neither been applied for nor granted.[10]On 23 December the husband lodged his application for permission to appeal with Grounds. By his Grounds, he contends that the order is ‘biased’, and ‘based on hearsay’; he disputes the judge’s assessment of the wife as a credible witness. Interestingly, he maintains in his Grounds that he “does not want to delay the sale of the home … [he] has already made the decision he is moving, the reason for the packing”. He disputes the provision for the sale of the property by auction.[11]In February 2016, the wife applied for leave to issue a fresh petition; in response, it appears, the husband applied for decree nisi, which was granted on 14 April 2016.[12]The obstacles encountered by the wife in seeking to implement DJ Heppell’s order have been set out in a statement which was lodged with the court in support of an application for enforcement, on 8 February 2016. In view of the uncertainties about the validity of the final order, this application was not in fact issued.

Discussion of the issues

[13]Crucial to my consideration of either of these parties’ applications is the status of DJ Heppell’s order, made before the grant of decree nisi.[14]It is trite law that orders for financial relief may only be ‘made’ (“the court may make”) on the “granting of a decree of divorce, a decree of nullity of marriage or a decree of judicial separation or at any time thereafter (whether, in the case of a decree of divorce or of nullity of marriage, before or after the decree is made absolute)” (see the opening words of section 23 of the Matrimonial Causes Act 1973) (emphasis by underlining added).[15]The wife contends here that the otherwise strict wording of section 23 must be read in the context of rule 29.15 of the FPR 2010 which reads as follows:
“A judgment or order takes effect from the day when it is given or made, or such later date as the court may specify”
. Although the wife accepts that the order was made prior to the grant of decree nisi, she advances a case, through counsel, that proportionality, and adherence to the overriding objective (rule 1 FPR 2010), should encourage the Court now to find a way of sustaining DJ Heppell’s order, so that the order can be declared as “taking effect” from a date after 14 April 2016, even if that means restoring the case back to DJ Heppell at this stage for his further ruling in that regard. Ms Whittaker concedes that the order for the sale “forthwith” of the property meant what it said, and that the suffix “with effect from Decree Absolute” was included in the order merely to regularise the position as between the parties in relation to proceeds of sale of the home and pension entitlement.[16]The husband has not complied with the order for serving a skeleton argument on the substantive applications listed above, as he says he wished legal assistance. His Grounds of Appeal do not address the point in issue; he told me that he was unaware of the point until this morning. He leaves it to me to resolve it.[17]An issue similar to the one which has arisen here was considered in Munks v Munks [1985] FLR 576. In that case the Court of Appeal concluded that an order made prior to the grant of decree nisi could not be corrected by amendment under the slip rule. In Board (Board Intervening) v Checkland [1987] 2 FLR 257, the Court of Appeal considered (and rejected) the argument that the defect could be remedied under the inherent jurisdiction. Next came Pounds v Pounds [1994] 1 WLR 1535, [1994] 1 FLR 775 where the court considered RSC O42 r3 (which was drafted in similar terms to the current relevant provisions of rule 29.15 above) in relation to a consent order; the decision of Singer J (that the consent order was a nullity) was overturned in the Court of Appeal, which held that the District Judge had the power to approve a financial consent order in advance of decree nisi on the basis that it was not to take effect until a later date.[18]It is also noted that the financial remedy dispute of McCartney v Mills McCartney [2008] EWHC 401 (Fam), [2008] 1 FLR 1508, which was conducted in the High Court over many days, led to a lengthy and detailed judgment of Bennett J. This hearing had been conducted prior to the obtaining of the decree nisi. But in McCartney, Bennett J plainly had this in mind (or had it drawn to his attention), and in the concluding section of the judgment ([322]) he makes clear that the ‘husband’ would pay to the ‘wife’ the relevant award of the lump sum “on or after decree nisi”.[19]The issue was most recently and helpfully considered in NP v JP [2014] EWHC 1101 (Fam) by Eleanor King J (as she then was). In that case it appears that at the time of the contested hearing and ‘determination’, the Deputy District Judge (DDJ Cornwell) and counsel appearing were fully aware that decree nisi had not been granted. Indeed DDJ Cornwell had specifically provided in that case in his order for the wife to obtain decree nisi, and further ordered the matter to be listed for mention upon pronouncement of the decree, and in Eleanor King J’s words “undoubtedly had in mind the provision of section 23 of the MCA 1973”.[20]In NP v JP Eleanor King J, in allowing the appeal against the setting aside of DDJ Cornwell’s order, made a number of key points. In summarising and paraphrasing them, I trust that I do not distort their essential meaning:a. The district judge had power under rule 29.15 of the FPR 2010 to direct that a judgment shall take effect from such later date as the court may specify [35];b. Rule 29.15 applies equally to consent orders and to orders generated at the conclusion of a contested hearing [34(c)]; However in that regard…c. It is necessary to look at whether the judgment delivered at the end of a contested hearing is a “final determination taking effect from the moment of judgment” or “an indication of outcome with the consequential order to be drawn and made at a later date, (here upon the making of decree nisi).” [49];d. If the order is to be made at a later date (i.e. after decree nisi), there is no necessity or requirement for any fresh appraisal [52]; there are “rare cases where circumstances change fundamentally between judgment, (or approval of the consent order), and decree nisi but the court has in its arsenal the ability to deal with such situations” [53];e. “if the court purports to make an order or provides for a judgment to take effect prior to decree nisi, the resulting order will be a nullity and cannot be saved by rule 29.15” [52].[21]I apply these principles when considering the instant case.

Outcome

[22]Having considered the documents, and listened with care to the arguments of Miss Whittaker, I find myself having to distinguish this case from the facts in NP v JP. In that case, it appears that the DDJ Cornwell, at the conclusion of the hearing, had given “a judgment indicating that ‘the appropriate terms of the resolution of the financial applications would be for there to be an equal division of the assets'” (see NP v JP [2]). Eleanor King J concluded that:
“… it is apparent from the wording used by Deputy District Judge Cornwell that he was giving an indication of outcome by way of a judgment with the order to be made at a later date pursuant to r 29.15 of the FPR 2010 the date being the granting of decree nisi. In accordance with that indication, an order was made after and not before decree nisi.”
[23]In this case:a. It appears from all that I have read that at the time of the final hearing of the financial remedy application on 3 December 2015 DJ Heppell was under the misapprehension that decree nisi had been granted;b. Counsel and solicitors for the wife were under the same misapprehension;c. The husband told me today that he did not know the significance of obtaining the decree nisi prior to the final hearing;d. The judgment of DJ Heppell is expressed as a final determination taking effect from the moment of judgment: (see [20(c)] above); it does not read as “an indication of outcome with the consequential order to be drawn and made at a later date” (ibid);e. The order was drawn up shortly after the hearing and sealed;f. There are provisions in the order (albeit expressed as recitals) which were to be acted upon within a matter of days, failing which sanctions would follow;g. The provisions which were to be acted upon within a matter of days (see (f) above) were so acted upon by both parties;h. The wife plainly contemplated that the order was to have immediate effect given the preparatory steps which she took, immediately following the judgment, as described in her counsel’s position statement, and indeed in her own statement in support of the enforcement application.[24]I am driven in these circumstances, to the conclusion that DJ Heppell had purported to make an order which would take immediate effect, prior to decree nisi, and that his order will therefore be a nullity; I cannot accede to the submission of Miss Whittaker that DJ Heppell can now direct a new date on which his order is to take effect. Regrettably the order cannot be saved by rule 29.15 (see [20(e)] above).

Conclusion

[25]As indicated earlier, I took the view that it was unnecessary and probably unhelpful to deal with the husband’s application for an adjournment of this hearing in order that he could obtain legal representation prior to determining the issue above. The need to set aside the earlier order made by DJ Heppell has become, for reasons which I hope I have sufficiently elaborated, unavoidable; given the husband’s dissatisfaction (whether justified or not, I have not investigated) with the substance of the order itself, this is as good an outcome as he could possibly have achieved had he been represented.[26]This, I recognise, is a depressing outcome for both parties, who are now returned to the place they were in shortly before the final hearing in December 2015. It is I recognise particularly frustrating for the wife who, perhaps with justification, considers that the husband has taken steps along the way to frustrate the process. I agree with Ms Whittaker that this outcome appears to militate against the fundamental objective of disposing of cases justly, fairly and with an eye to their cost. A return for a re-hearing feels disproportionate, and I am conscious that it is undoubtedly profoundly unwelcome to the wife. I trust that the case can nonetheless be listed swiftly, and with minimal further preparation.[27]I propose to remit the case back to a District Judge (but not DJ Heppell given that there remains the husband’s unresolved application for permission to appeal against the earlier order) for re-hearing. I shall give directions myself in order to ensure that the relevant up-to-date material is before the court for that hearing, and shall take steps to achieve an early hearing date. There is now no disagreement about the sale of the property in principle; at least it appears that the issues may therefore have narrowed.[28]That is my judgment.

Cited in 1 later judgment