Judge calls for mediation in financial dispute

Divorce|June 29th 2015

A former husband in his 50s has won an appeal against the terms of the financial settlement ordered by a family court.

In JM v MM, both the husband and the wife were aged 58 and had been married for 13 years. He was managing director of a small company, of which he owned 51 per cent and his wife 49 per cent. She, meanwhile, worked in a primary school. The couple had no children.

The relationship broke down the parties began divorce proceedings. The couple had total assets of £300,000, including the company. The husband’s income, derived from the company, was substantial, while the wife’s primary school work brought in just £1,187 per month.

A District Judge ruled that the former matrimonial home should be given to the wife, along with a slump sum payment of £99,600 in exchange for her share of the company. In addition, she was to receive monthly maintenance of £2,250 and a share of her husband’s pension.

The husband appealed the ruling, arguing that the couple’s assets had not been properly assessed by the District Judge who had heard the case.

Sitting in the family court at Bristol, Judge Wildblood QC agreed, briskly declaring:

“I regret to say that I consider it obvious that I will have to allow the appeal and hold a rehearing.”

The QC criticised many aspects of the financial settlement ordered by the District Judge. It had not properly taken into account the husband’s debts, or the tax liabilities he would incur through the transfer of the wife’s shares, and had also not fully considered whether the husband could raise the money required to pay the wife the required lump sum.

In addition, ruled Judge Wildblood, the District Judge had been overconfident in his assertion that the husband’s income would return to the £8,000 per month he had previously enjoyed. The profitability of the husband’s existing business had declined and he had since established an additional business servicing machinery. This suggested that his original was unlike to the profitability it had formerly achieved. The District Judge’s assessment of the husband’s business interests had not been “analytically sound”, Judge Wildblood declared.

The case would have to be reheard, ordered Judge Wildblood, a situation he described as

“…highly regrettable in a case where the costs of the parties are so disproportionate and they both seem locked into conflict.”

During the case, the couple had incurred joint costs of as much a £127,538.

The Judge continued:

“Pending that re-hearing, this is a case that cries out for mediation. I would strongly recommend to both parties that they either arbitrate on their differences or mediate.”

The judgement is available here.

Photo by s_falkow under a Creative Commons licence

Author: Stowe Family Law

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