Husband fails to have wife’s financial remedies application struck out

Divorce|January 15th 2019

This is an unusual one, at least in terms of reported cases. As explained by Mr Justice Cohen in the first paragraph of his judgment, the case AR v JR concerned an application by the husband for the wife’s financial remedies application to be struck out on the basis that it was (a), vexatious, and/or duplicative and/or (b), on the basis there had been a prior compromise.

The relevant facts of the case were as follows:

  1. The parties married in 1967 and are now in their late 70s.
  2. All of their present assets, amounting to a “small fortune”, were accumulated during the marriage, the husband having established a very successful business which, by the end of 2015, had a net equity of just under one billion US dollars.
  3. The marriage grew unhappy, and in 2010 the wife issued judicial separation proceedings, and made a financial remedies application within those proceedings.
  4. A decree of judicial separation was pronounced in August 2010.
  5. On the 14th of October 2011 a consent financial order was made, setting out an agreed financial/property settlement between the parties. The order provided for the husband to pay to the wife a lump sum of some $16 million, in settlement of the wife’s claims within the judicial separation proceedings.
  6. In August 2015 the husband filed a petition for divorce on the grounds of five years’ separation.
  7. In October 2015 the wife issued a financial remedies application within the divorce proceedings.
  8. The husband opposed the application, on the basis that it was an abuse of the court process, the wife having already received a financial settlement when the terms of the 2011 consent order were implemented. He therefore applied for the wife’s application to be struck out.

Mr Justice Cohen dismissed the husband’s application, for the following reasons.

Firstly, it was clear to him that the order of 2011, made in the judicial separation proceedings, was not intended to cover a subsequent divorce, and that neither party thought that it did cover a divorce.

Secondly, the argument put forward on behalf of the husband that the wife should in the judicial separation proceedings have made her full financial claim covering her entitlement in all respects arising from the marriage was unsustainable, because:

  1. There was no obligation to do so. Indeed, as the husband accepted, the anticipation of the parties was that they were to remain married.
  2. Divorce and judicial separation are not the same cause of action. Divorce terminates a marriage; judicial separation does not.
  3. On the facts of the case, the wife did not have the material upon which she could assess the value of her claim for a full share of the assets in 2011. The husband knew that as much as the wife – he had not provided full disclosure of his means. It was true that the wife might have been able to obtain disclosure via court orders, but she was under no obligation to do so. She was entitled to say: “We are still married and I want to remain married to you for many years, perhaps the rest of my life, and for as long as that remains the case, I am content to have my claims dealt with on a needs only basis.”
  4. Both parties were or must have been fully aware on the advice from their own lawyers that the wife’s entitlement claim had not been dealt with.
  5. They must both have been aware that there were matters that still had not been dealt with.
  6. There was no evidence that the wife misled the husband in any way at all.

In the circumstances the husband’s application failed. The wife’s financial remedies application must therefore proceed.

Mr Justice Cohen ended his judgment with this rather sad plea to the parties:

“They are now in their late 70s. It does not appear to me that either is in the best of health. This litigation has been going on for three years. They should not be spending time locked in litigation when there is plainly more than ample funds available in this case for it to be settled. I do urge them to consider mediation to try and bring matters to a closure.”

Let us hope they take heed.

You can read the full judgment here.

Author: John Bolch

John Bolch often wonders how he ever became a family lawyer. He no longer practises, but has instead earned a reputation as one of the UK's best-known family law bloggers.

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