A salutary tale about the implementation of a financial order
By:3 commentsMarch 6, 2018
Or: don’t count your chickens before they hatch!
I recall when I was practising often having to caution clients that getting a financial order on divorce was not necessarily the end of the matter. Many was the time, for instance, that clients would be champing at the bit to spend money they were due under the order, and I had to tell them not to spend anything until they actually received it – just because the order said they should receive it by a certain date did not mean that they would. For whatever reason the money might not be paid on time.
Anyway. That little anecdote sprang to mind because I have recently come across a couple of cases in which the implementation of the order, rather than the making of it, was the problem. Specifically, both cases involved orders requiring the sale of property by a certain date, but the sale not taking place by that date.
One of those cases was O’Connell v Lovell (divorce : property), decided in December but not published until January, for reasons that will become apparent. It is a brief but salutary tale about the consequences of a financial order, and the requirement to comply with it.
The story begins with the divorce of the parties in February last year (unusually the decree absolute was made before financial matters were resolved). A financial remedies hearing took place on 24 April, at which a final order was made. The order provided, amongst other things, what should happen regarding two flats in the same property: a first floor flat that was owned by the husband, and a ground floor flat that was owned jointly by the husband and the wife.
Under the order the wife was allowed to continue living in the first floor flat until 24 October 2017 or the completion of the sale of the ground floor flat, whichever happened first. Upon sale, the wife was to receive a lump sum of about £1.4/1.5 million. Meanwhile, the husband was to make various payments to the wife, totalling some £250,000.
Those payments were made, but for whatever reason, the flat was not sold by 24 October. Accordingly, under the terms of the order the wife was required to vacate the flat by 24 October. She did not, and the husband applied to the court for her committal to prison for breach of the order.
Hearing the committal application His Honour Judge Hess found that the wife could have made arrangements to live elsewhere after 24 October, for example in another flat she owned that was occupied by her daughter, or by using the money the husband had paid to rent another property. Accordingly, the wife’s argument that she could not move out did not hold water. The wife conceded that she was in breach of the order, and therefore Judge Hess made an order that she be committed to prison for two months, suspended on the condition that she move out of the flat within 28 days, i.e. by 18 January.
In addition, the wife was ordered to pay the husband’s cost of the committal application, which came to the remarkably high sum (for reasons explained in the judgment) of £24,085.
As I said earlier, this little judgment is a salutary tale to anyone who is tempted not to comply with a court order – family court orders must be obeyed. As Judge Hess explained, the wife knew precisely what was required of her, and of the risk that she would have to leave the flat before receiving her lump sum. As I also said at the beginning of this post: never assume you are going to have the money by a certain date, just because that date is set out in the order!
You can read the report of the case here (note that the requirement for the wife to vacate was actually contained in an undertaking, not the order itself – I have not mentioned this detail above, for the sake of simplicity).
Image by Kate Brady via Flickr under a Creative Commons licence
March 6, 2018
Categories: Family Law