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Case study 1 Divorce – Financial provision – Ancillary relief – Periodical payments – Post-divorce cohabitation – Wife entering into new relationship following divorce – Surveillance suggesting wife to be cohabiting with new partner – Husband relying on evidence of cohabitation to contest application for periodical payments – Judge making order for periodical payments – Husband appealing – Whether judge erring in failing to make finding of fact as to alleged cohabitation – Whether judge erring in law as to consequence of post-divorce cohabitation. Held – The evolution in the court’s approach to pre-marital cohabitation did not inevitably lead to a re-evaluation of the impact of post-divorce cohabitation on a claim for periodical payments. As the law stood, the wife had no legal entitlement to financial contribution or benefit from T either during the relationship or on its breakdown. The husband’s argument did not run unless and until she acquired a statutory claim against the new partner. However, it had plainly been open to the judge in the instant case to discount the periodical payments claim to reflect the wife’s new relationship, applying the orthodox line of authority. That outcome was not dependent upon any reconsideration of principle. The judge’s findings on the factual issues had been plainly inadequate and the submission that there was no evidence to justify a finding of cohabitation had to be rejected. The unchallenged evidence established actual cohabitation throughout the five weeks of surveillance and the commencement of a situation in which T had been a regular member of the household. That should have led the judge to a clear finding that, whatever the future might hold for them, the wife and T were a couple and the financial consequences of that development had to be investigated and assessed. The judge could not be fair to the husband as the payer without investigating whether T was making any financial contribution to the household and, if not, what his capacity to make contribution was. Accordingly, the appeal would be allowed and the case would be remitted to the judge for an assessment of T’s financial circumstances and his capacity to contribute to the wife’s economy; Fleming v Fleming  EWCA Civ 1841 applied. Case study 2 Divorce – Financial provision – Ancillary relief – Supervening event – Mistake – Wife commencing ancillary relief proceedings notwithstanding existence of separation agreement – Wife subsequently agreeing to consent order – Husband selling shareholding in company for large sum shortly after making of order – Judge holding wife able to reopen consent order – Husband appealing – Whether change in value of husband’s shareholding constituting Barder event – Whether reopening of order justified by mistaken assumptions as to shareholding’s value. Held – When a party sought to be relieved of the consequences of an ancillary relief consent order on the alternative grounds of a Barderevent and/or a vitiating element such as mistake, the judge should, logically, rule first on the alleged vitiating element and then, if that ground failed, proceed to rule on the Barder event, such being akin to frustration. Mistake as to value was no longer regarded as falling within the Barder principle. In the instant case, the wife’s reliance on mistake was unpersuasive because there had been no consensus as to the value of the shares. The parties and their solicitors had most regularly fenced in that area and, in reaching a compromise in January 2007, each must have taken a view as to that dominant unknown and been satisfied that the highly speculative value of the shareholding was duly reflected in the compromise. Furthermore, her application could not be made good under Barder principles. On the evidence, it could not possibly be said that the sale of the husband’s shares was either unforeseen or unforeseeable. The history and negotiations between the parties demonstrated decisively that the sale was precisely what had been expected, albeit not so soon after the compromise had been achieved. Accordingly, the appeal would be allowed; Barder v Barder (Caluori intervening)  2 All ER 440 andJudge v Judge  2 FCR 158 considered. Case study 3 Divorce – Financial provision – Ancillary relief – Variation – Parties having two children prior to divorce – Wife’s application for periodical payments being adjourned generally in light of maintenance agreement – Husband subsequently re-marrying and having two further children – Wife successfully seeking maintenance uplift in light of husband’s increased earnings – Wife appealing against quantum of order – Whether judge erring by failing to inject compensation for relationship-related disadvantage into award – Whether award appropriate having regard to need for proportionality. Held – (1) Compensation for relationship-related disadvantage might be a very important ingredient in many cases, particularly in the assessment of the original division of capital and foreseeable income. If reflected at that stage, it would find its continuing reflection on a variation hearing without fresh assessment. However, the endeavour to assert a relationship-related disadvantage in the instant case had not been necessary. The reality was that the wife had given up her career only shortly before its natural close. There was no evidence that she had made any sacrifice. Whatever she had given to the husband and children was aptly assessed under the heading of ‘contribution’; that, rather than ‘relationship-related disadvantage’, was the language of the 1973 Act. (2) The factors which had led the judge to conclude that the wife had pitched her case too high did not bear the weight that the judge had given them. Clearly the incidence of UK tax, the husband’s obligations to his second family and the length of the marriage had been appropriately weighed. However, the uncertainties of a performing artist’s life and the time elapsed since the failure of the marriage hardly affected quantification. The instant case was a paradigm variation of an original division of capital and anticipated future income. The fundamental changes of circumstance that had to be weighed in the judgment were the changes in the wife’s budgeted needs and the changes in the husband’s circumstances. The single factor of greatest significance was the husband’s greatly increased income. In the circumstances, the judge had erred by not standing back from the figures to judge the overall proportionality of his conclusion. Had he carried out a percentage comparison between the original order and the order on variation, it was likely that he would have adjusted the award upwards; after all, even £285,000 of gross earnings before tax seemed comparatively little for the husband’s first family given his increased earnings. Accordingly, having regard to the need for proportionality, the wife’s periodical payments would be increased to £140,000 pa and the children’s orders would be increased to £15,000 pa. Per curiam. There is much to be said for trial judges continuing to direct themselves by reference to paras 105 and 106 in Cornick v Cornick (No 3)  2 FLR 1240 (where Charles J clearly stated a rule of fairness, namely that just as an income fall justifies an application for downward variation, so an income rise justifies an upward variation) and to eschew sophistication that has crept into the territory of s 31 of the 1973 Act. Case study 4 Divorce – Financial Provision – Ancillary relief – Appeal – Husband and wife compromising ancillary relief application at financial dispute resolution appointment – Wife’s portion of settlement to be provided in cash by instalments and by transfer of property – Husband retaining large shareholding in AIM-listed company – Company shares decreasing in value during period of global economic crisis – Husband applying for permission to appeal against order giving effect to compromise – Whether natural processes of price fluctuation in share prices and house values constituting grounds for reopening ancillary relief order. The husband was a fund manager operating through Principle Capital Holdings Ltd (PCH), a company quoted on the AIM Exchange. On 28 February 2008, an ancillary relief application brought by the wife was compromised at a financial dispute resolution appointment. It was agreed that, of the assets then valued at £25.8m, the wife would receive approximately £11m and the husband would retain the remainder. The wife’s portion was to be provided as to £9.5m in cash and the balance by transfer of a property valued at £1.5m. The husband’s assets consisted of a very substantial shareholding in PCH and various properties. At the date of the compromise, the PCH share price stood at £2.99 per share, valuing the husband’s holding in the company at just over £15m. The order to give effect to the compromise was perfected on 19 March, by which time the share price was approximately £2.77 per share. The order required the payment of the lump sum of £9.5m by a first instalment of £7m due on 3 April 2008 and by four further equal instalments of £625,000 due on 3 April of the four subsequent years. The first instalment was duly paid. The PCH share price remained at over £2.00 per share until July 2008 but, by 4 November, had fallen to £1.40. On that date, the husband applied to vary the order of 19 March. Since it was held that the judge who had conducted the financial dispute resolution appointment lacked jurisdiction to hear the variation application, it was listed to be heard by another judge in July 2009. On 23 December 2008, by which time the PCH share price had fallen to 72.5p per share, the husband applied for permission to appeal against the order of 19 March. By the date of the hearing, the share price had fallen to 27.5p per share. Focusing on the contrast between the division of assets on 19 March (57% to the husband, 43% to the wife) and the corresponding division some nine months later (14% to the husband, 86% to the wife), the husband submitted, inter alia, that the drop in share prices and house values constituted new events which were sufficiently dramatic to fall within the first condition in Barder v Barder (Caluori intervening)  2 All ER 440. He also invited the court to take judicial notice of the global economic collapse and submitted that, in conjunction, those considerations destroyed the basis or fundamental assumption upon which the order had been made, namely that the overall division of assets was fair and that compliance with the terms of the order was practicable. He indicated that, if the appeal were to be allowed, he would probably seek the repayment of all or part of the first instalment of the lump sum in exchange for transferring to the wife an unspecified number of his shares in PCH. Held – (1) The first condition in Barder did not demand the identification of some concrete new event such as the liquidation of a company; events in that context embraced happenings, developments or occurrences. However, the natural processes of price fluctuation, whether in houses, shares, or any other property, and however dramatic, did not satisfy the Barder test. Accordingly, although the instant case had dramatic features, the established principles clearly pointed to the dismissal of the husband’s appeal; Barder v Barder (Caluori intervening)  2 All ER 440 and Cornick v Cornick  2 FCR 1189 considered. (2) There were a number of additional grounds for refusing the husband relief in the instant case. First, the order had not been imposed but was the product of the will of the parties. The husband, with both private and public knowledge, had agreed to an asset division which had left him captain of the ship, certain to keep for himself whatever profits or gains his enterprise and experience would have achieved in the years ahead. Secondly, when a businessman took a speculative position in compromising his wife’s claims, the court should not subsequently relieve him of the consequences of his speculation by re-writing the bargain at his behest. Thirdly, he continued to enjoy control of the corresponding opportunities. Although the market might take a pessimistic view of his future prospects, he might not share that view; unusal opportunities were created for the most astute in a bear market. Fourthly, since the payment of the lump sum was spread over five instalments, there existed, and the husband had invoked, the statutory power of variation. If the circumstances justified the reopening of the consent order, the judge would have the jurisdiction to re-write that part of the consent order. Given the width of that discretion, an appeal directed to the majority of the lump sum already paid and/or the transfer of property order had most uncertain prospects of success; Barder v Barder (Caluori intervening)  2 All ER 440 considered. Per curiam. There may be many who are contemplating an attempt to reopen an existing ancillary relief order on the grounds of subsequently encountered financial eclipse. All in that situation should ponder Hale J’s analytical characterisation in Cornick v Cornick 2 FCR 1189 at 1196 and ask themselves whether the events upon which they intend to rely can be  2 FCR 1 at 3 brought within either the second or the third category. Even then they would be well advised to heed the warning that very few successful applications have been reported. The application for permission to appeal would be granted but the appeal would be dismissed.