You may remember that I recently looked at the case of a Mr and Mrs Bokor-Ingram. I examined the Mesher order to which the wife had agreed; at the time, she did not know that Mr Bokor-Ingram’s finances were a lot healthier than she had been led to believe. After discovering that her husband had been negotiating a better-paid job at the time of the split, Mrs Bokor-Ingram took her husband back to court. She argued that if she had known the truth, she would never have agreed to the Mesher arrangement in relation to the couple’s former marital home. The case went as far as the Court of Appeal; Mrs Bokor-Ingram finally settled out of court, with the BBC reporting that the ownership of the house would be transferred to her in full.
Although that case is now closed, there has now been a further development. It’s an interesting one and, since my post about Mesher and Martin orders has become one of this blog’s most popular pages, I’d like to share it with you and find out what you think.
When I first wrote about this case, I focused upon the Mesher order because I was not happy that the husband had, in effect, been allowed to get away with his non-disclosure. When the case was heard in the High Court the judge, Mr Justice Charles, found that its outcome was not prejudiced by the husband’s failure to disclose that he had a lucrative employment contract in the offing. He appears to have concluded that because the proposed contract was unsigned, it should not have been disclosed.
The Court of Appeal has now taken the unusual step of giving Mr Justice Charles’ judgment a red light, even though this case had settled before they heard it. This public judgment was published on 26 May. I view it as a robust and salutary reminder to practitioners and clients, that full and frank disclosure must always be made. Read it, and you will see that they make no bones about this.
Judgment is rarely given by the Court of Appeal when a case is settled. However, as Lord Justice Thorpe put it, the “learned in the extreme discussion and explanation” given by Mr. Justice Charles was “causing or was likely to cause difficulty for specialist practitioners and judges in this field of ancillary relief.”
(Not to me it wasn’t. I think it has been evident from my blog posts that, as a practitioner, I know the tricks that people can play – and do play – even by staying silent and hoping they can get away with it.)
Just in case practitioners and clients, unintentionally or otherwise, still don’t get it and carry on dishing out the silent treatment to the other side, Mr Justice Thorpe added: “the duty of disclosure is not only that it should be full and frank but also clear.” He quoted the words of Lord Justice Sachs in the case of J-v-J in 1955, commenting that the standard he set has never varied.
Mr Justice Thorpe went on: “We are concerned that the judge’s erudition may have blinded him to the simplicity of the case and its proper outcome. Had there been full and frank disclosure…it is inconceivable the wife would not have raised her sights.”
Disclosure of the negotiations for the husband’s new contract of employment, “was essential…the duty to disclose extends beyond what is certain on the date that the order is made to any fact relevant to the court’s review of the foreseeable future.”
“The judgment of [Mr Justice Charles] should not be treated as a precedent or followed insofar as it expresses views beyond or inconsistent with those expressed in the judgment”
It couldn’t be clearer, could it? Whether it will have the desired effect remains to be seen. There are too many occasions when practitioners, acting in what they consider to be their duty to their client, choose to limit the extent of their client’s disclosure. Thus I have been involved in cases where companies are being sold for far more than their disclosed value, cases where the othern party is moving jobs (as in this case) and even cases where there has been no change of job, but a huge hike in salary and benefits on the horizon once the wife has been taken care of.
Non-disclosure issues surface when the facts come to light months or years down the line. By then, it may be too late for the wife to do anything about it. Certainly, costs and anxieties will often prevent the wife from doing so; indeed, it may be an insurmountable burden for her to prove that in fact the husband knew at the time of the matrimonial negotiations exactly what was going on.
This judgment clearly increases the burden of disclosure upon the parties. In future, practitioners who are in any doubt at all would do well to remember these words of approval from Lord Justice Thorpe of his fellow judge Lord Justice Sachs 54 years ago. Not only must disclosure be full and frank, it must be clear.