2023 Feb 15
The parties divorced in 2010 and by consent obtained a final order concluding their respective financial remedy claims in relation to total disclosed assets in the region of £16m. Subsequently, it was found on two separate occasions in 2015 and 2016 that the husband had, first, misrepresented his assets and, second, failed to make appropriate disclosure of likely significant capital accumulations in the foreseeable future. Consequently, the courts had set aside two “final” financial relief orders. In 2022 the wife applied for a third determination of her claims. The judge relied upon the determination made by the judge in the 2016 rehearing, that she had received an appropriate share of, what was effectively, the husband’s company in 2010. The wife contended that she could not receive a fair resolution of her claim without a root and branch investigation of all financial matters de novo; to do otherwise meant that the husband had benefitted from the fraud he perpetrated.
On the wife’s appeal—
Held, appeal allowed. (1) Supreme Court authority relating to ordinary civil proceedings did not overrule the approach laid down by the family court in cases in which there had been fraudulent non-disclosure in financial remedy proceedings (“the Kingdon approach”). Although the Family Division was not a legal island with its own laws and principles, it was relevant to observe the differences that did exist between family proceedings and ordinary civil proceedings, namely that in applications for financial orders there was no such separation as existed in civil proceedings between issues of liability and those of quantum. Care must be taken not to elevate the exact approach into principle. The court retained a wide flexibility to adapt or “enable the procedure to fit the case”; it might be possible to isolate the issues to which the non-disclosure related and thereafter to rectify the defect without the need to dismantle the whole order. It would be inappropriate to fetter the exercise of judicial discretion by sub-principles or overlay it with other asserted overarching considerations. The procedure had to be “bespoke” and fact specific. In those circumstances and without hesitation, the wife’s invitation to suggest guidelines for when the Kingdon approach was or was not applicable on a restored application after set aside on the basis of fraudulent non-disclosure was declined ( paras 50–52, 79, 80).
(2) As to whether it was appropriate for the judge to adopt a Kingdon approach in the present case, the husband’s fraudulent non-disclosure in 2016, particularly when seen in the context of his previous fraudulent non-disclosure was so far reaching that it positively required the judge to consider “the entire financial landscape” completely anew. Consequently, the judge was wrong to determine the wife’s application by segregation of the capital award agreed in 2010 and confirmed in 2016. Accordingly, the judge erred in the exercise of his discretion in adopting the Kingdon approach (paras 75–76, 79, 80).
Peter Mitchell KC and Simon Webster KC (instructed by Irwin Mitchell Solicitors) for the wife.
Timothy Bishop KC and Richard Sear (instructed by Pinsent Masons Solicitors) for the husband.