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WIlliam Lindsay

Wyatt v Vince [2015]- Supreme Court financial remedy decision – A brief overview

The Supreme Court decision in Wyatt v Vince [2015] UKSC 14 has clarified the extent of the court’s jurisdiction to strike out an application for a financial order under rule 4.4 of the Family Procedure Rules. It also provided some useful commentary on the issue of delay.

The case had an unusual background. It involved an application by an ex-wife for a financial remedy brought some 19 years after the decree absolute. At the time of the divorce the parties had very little by way of financial means; however, in the intervening years the husband had become a self-made multi-millionaire.

Perhaps unsurprisingly, the case attracted much negative press attention.

The background

The parties married in 1981. They had a son and the husband treated the wife’s daughter from a previous relationship as a child of the family. They separated in 1984. The wife looked after the children. The husband led a New-Age traveller lifestyle, and he did not make any substantial financial contribution towards the wife and children. The couple divorced and decree absolute was pronounced in October 1992.

The court file was mislaid and it was unknown what order was made at the time regarding financial provision. However, the court proceeded on the basis that the wife’s application had not been dismissed.

In the late 1990s the husband, described by the court as “a remarkable man”, set up Ecotricity Group Ltd and he eventually became a multi-millionaire. In 2011, the wife made an application for financial provision in the form of a lump sum.

The husband applied for the wife’s substantive application to be struck out pursuant to Rule 4.4 of the Family Procedure Rules 2010 which provides:

“(1) … the court may strike out a statement of case if it appears to the court –

a) that the statement of case discloses no reasonable grounds for bringing or defending the application; b) that the statement of case is an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings …”

The court as first instance dismissed the strike-out application. The husband appealed to the Court of Appeal, who struck out the wife’s application for financial provision. The wife appealed to the Supreme Court, who unanimously allowed the appeal and directed that the matter be listed for a financial dispute resolution hearing.

The decision

The references in FPR 4.4 to “no reasonable grounds” and “abuse of the court’s process were intended to bear the same meaning as the equivalently worded strike-out provisions in the rule 3.4(2) of the Civil Procedure Rules.

The civil rules contain a power to give summary judgment (CPR 24.2) on the basis that a party has no real prospect of success or that there is no other compelling reason why the case should be disposed of at a trial. The court concluded that there is no equivalent power of summary judgment within the family rules. The omission is deliberate because the court has a duty under section 25(1) of the Matrimonial Causes Act 1973 to determine the application having regard to all the circumstances of the case and the section 25 factors. The assessment is not apt for summary determination.

FPR 4.4(1) has to be construed without reference to real prospects of success. For the purpose of FPR 4.4(1) (a) an application has “no reasonable grounds” only if it is not legally recognisable such as because there has already been a final determination of the proceedings or because the Applicant has remarried.

The wife’s application was legally recognisable and it was not an abuse of process. Her appeal against the strike-out therefore succeeded.

Delay

There is no time-limit for seeking orders for financial provision or property adjustment for the benefit of a spouse following divorce. The court felt that this is consistent “with the potentially life-long obligations which attend a marriage”.

The court acknowledged that there was a prominent strain of public policy hostile to “forensic delay”. The court will look critically at explanations for it; and, even irrespective of its effect upon the respondent, will be likely to reduce or even to eliminate its provision for the applicant subject to the potency of other factors.

It is important to look at the effect of the delay upon the respondent. In some cases, a respondent might be able to show that he had assumed financial obligations or otherwise arranged his financial affairs in the belief that the Applicant would not make a claim against him such that it would not be reasonable for him to put them into reverse. In other cases a respondent may be able to argue that factual issues such as the dimming of memories or the disappearance of witnesses over the period of delay no longer permits an accurate determination.

Merits

The court considered that the wife faced formidable difficulties in seeking to establish that a financial order should be made in her favour, including the short duration of the marriage, the fact that it broke down 31 years ago and the fact that the husband had not begun to create his current wealth until 13 years after the breakdown.

The court considered that the wife’s pleaded claim for £1.9 million was ill advised and was “out of the question”. Lord Wilson considered in Wyatt that:

“It is a dangerous fallacy, albeit currently propounded by those who favour reform along the lines of the Divorce (Financial Provision) Bill currently before the House of Lords, that the current law always requires rich men to meet the reasonable needs of their ex-wives” [33]

The court felt it was unclear whether the wife would be able to sustain her claim on the basis of need generated by her relationship with the husband however her greater contribution in the upbringing of the couple’s children over many years was a factor which might justify a comparatively modest sum.

Case management

It is important to identify issues in the application for the purpose of efficient future case management in order to dictate the nature, and in particular the length, of the substantive hearing.

Implications

Wyatt has raised the awareness with the general public that there is no statutory time limit for making an application for ancillary relief.

In my view such historic claims are likely to become more common as a result of the decision however the courts are likely to use their robust case management powers to give firm directions and to limit the issues.

Many individuals who are unsure as to whether their historic arrangements with ex-spouses had fully addressed all financial matters are likely to obtain legal advice as to whether they can make, oppose or resolve such a claim. Those who have acquired wealth post-divorce are likely to be particularly concerned about responding to potential claims.

Above all the case highlights the importance of resolving all financial issues upon divorce.

William Lindsay

William practices in all areas of family law, including ancillary relief and private or public law applications. Read William’s profile.