This is my latest post for The Times, which appears on The Experts blog.

Spousal maintenance is the most contentious area in family finance. Ex-husbands bitterly resent paying it and ex-wives fight tooth and nail to keep it. It is a tax-free income that some see as a continuing windfall and others a hard-earned necessity.

I wholeheartedly support the fact that judges have flexibility in deciding how to settle financial matters during a divorce, because a system based upon rigid percentage divisions can make for grave injustice.

However, every so often, judges dig themselves into holes. We have seen it with capital settlements to wealthy wives and also with pre-marital agreements.

Now we are seeing it again.

There is little judicial guidance on the correct period of time for maintenance payments to continue for less wealthy ex-wives. At what point should maintenance cease – if at all – during the joint lives of the parties, assuming the wife never remarries?

It all depends on the facts of each case and the opinion of the judge. Only if the judge is “plainly wrong” is his or her decision subject to appeal.

This problem becomes particularly acute when children are involved. Take a wife whose income prospects, unlike her husband’s, have been damaged following years of full-time childcare. Should she have her maintenance terminated before or even after the children have flown the nest? Should a poorer wife (unlike her wealthier sister, whose income claims have been bought off by a lump sum) be required to go to work, irrespective of the additional pressures it places upon her and her children? Should the husband or the father be entitled to keep everything he earns, despite the permanent disadvantage to the mother of his children?

The recent Court of Appeal case of N v N, innocuous at first glance, raises some very important issues to this extent.

Mrs N agreed to a fixed term of maintenance when she divorced in 2005, despite having two young children. When the fixed term was due to end, Mrs N’s circumstances and those of her children were such that she applied for an extension.

She represented herself, while her husband was able to afford solicitors and counsel. The district judge ordered that the term to be extended by little more than two years, to April 2012, by when her youngest child would still be a minor.

Mrs N appealed. The circuit judge set aside the original order, substituting a further term to August 2015.

A written application to appeal to the Court of Appeal was made by the husband’s lawyers and refused by Lady Justice Black. Mr N was then able to fund an oral hearing of the application at the Court of Appeal. Mrs N, representing herself, attended.

Lord Justice Thorpe granted permission for the husband to appeal. The judge praised Mrs N’s abilities in court, but then re-imposed the April 2012 order.

At least four judges have wrestled with the facts of this case so far. Each judge has their own opinion as to whether or not Mrs N’s maintenance should continue and for how long.

Mrs N is seeking permission to have her case heard by the Supreme Court, and perhaps – if this innocuous case advances that far – their Lordships will seize the opportunity to clarify the law.

Marilyn Stowe is the senior partner at Stowe Family Law

The first wife

The first wife cannot manage on her own, modest earned income following her divorce, and therefore she needs to have her income supplemented by maintenance from her former husband. He agrees and despite her being child-free and able to work, he does not insist on a cut-off point for maintenance even if she is still quite young. Perhaps he reasons that she will be self-sufficient at some point in the future. Perhaps he reasons she will remarry. Perhaps he feels guilty. Perhaps he wants it all over and done with without a fuss.

However the first wife will never get to taste the real fruits of their joint hard work begun and built up during the marriage. The rewards of status and financial success will be privileges reserved for the fortuitous second wife. By the time the second wife marries the husband and has his children, he has become financially prosperous. Together, they have a long and successful marriage.

The husband can always apply to terminate maintenance payments to his first wife, on the basis that at some point she should or has become self-sufficient. But there are a number of cases in which the divorce occurred at a time before wives were expected to become self-sufficient and maintain themselves. The only way these wives could realistically maintain themselves, hampered as they were by lack of training and by advancing age, is by the receipt of maintenance. In these cases, maintenance has been paid for a very long time. Although these wives are sometimes perceived by the media as greedy individuals, receiving hand-outs long after their sell by date was reached, realistically they have no option. They are the products of different times.

The law

In the absence of the first wife’s remarriage, or a court order terminating her maintenance obligations, the law states that payment is to be made until she dies.

However if maintenance payments are to be terminated by the court, causing undue hardship to the payee, the court may order a capital sum to be paid instead on a ‘Duxbury’ basis, under section 31 of the Matrimonial Causes Act 1973. So when the divorced wife reaches at the age at which she is actuarially expected to die, having applied the lump sum on a part investment, part expenditure basis to produce her annual net income as assessed by the court, the lump sum will have been used up. This is called amortisation of the lump sum. (For more on this, see the leading case of Pearce v Pearce EWCA Civ 1054.)

Vaughan v Vaughan

The case of Vaughan (2010) EWCA Civ. 349, centred upon a 13-year marriage that ended in divorce in 1985. The wife was working part-time as an art expert; the husband, who had qualified as a barrister at the age of 24, had just become a QC. He was 42 and the wife was 37. There were no children.

At that time, relatively few wives in their 40s went to work full-time to support themselves. Nearly 30 years later, times have changed.

Mr Vaughan married the second Mrs Vaughan; she was 15 years younger than him and they had two children. He went on to become one of this country’s leading experts in EU law. (He became so well known, in fact, that the Court of Appeal had difficulty convening an impartial bench that could hear this appeal.)

In 1989, the first Mrs Vaughan’s attempts at building a career for herself had floundered and she applied to the court. It must have been a hotly contested application. In 1991 when judgment was ultimately given, the court found that the wife’s earning prospects were only £5,000 per annum and she clearly could not manage. Conversely, the husband by then had a gross annual income of £243,000. Mr Justice Booth found that the first Mrs Vaughan had income needs of £27,000 per annum. He set maintenance payments at that level, backdating the order to 1989 with no cut-off point. He declined to give Mrs Vaughan maintenance in excess of her comparatively modest needs, notwithstanding her former husband’s vast income, setting a substantial differential between living standards of first and second wife for the rest of their lives. The outcome was not generous to Mrs Vaughan.

Mr Vaughan is now 71, and the second Mrs Vaughan is 56. His health has deteriorated in the last three years, and his income is no longer what it was. However he has a pension pot worth more than £2.3 million, from which he intended to take a considerable deduction on the income, in order to benefit his second wife substantially in the event of his death. He also gave his second wife a share portfolio worth £330,000.  He and his second wife agreed that their jointly owned London home, worth some £4.3 million, should be sold and that they would move to a smaller property worth some £2 million or thereabouts. This would also give his second wife another £900,000 of liquid capital, after costs.

Back in court

Last year, in view of the loss of his earned income, Mr Vaughan applied to the court to terminate the maintenance payments that he was making to the first Mrs Vaughan.

The first Mrs Vaughan had never applied for an increase in her maintenance. She lived on her maintenance and also had pension income of £5,000 per annum. In terms of capital, she did come into an inheritance from her parents in 1988 and 2005. After spending an incredible £200,000 in legal fees fighting this case, she was left with liquid capital of £380,000 liquid: the balance of her inheritance. She also lived in a house now valued at £1 million which, it was agreed, needed repairs and redecoration. Mrs Vaughan also had a valuable Indian desk worth £300,000 from her original divorce settlement.

Mrs Vaughan cross-applied for capitalisation of her maintenance claims under section 31 of the Matrimonial Causes Act 1973. She requested a Duxbury lump sum of £560k, based on an increased maintenance need in excess of £50,000 per annum. She was asking for a lump sum to cover almost double the present maintenance and perhaps that was too high.

Although the parties agreed that Mrs Vaughan’s income needs had increased from £27,000 per annum, they could not agree upon a new amount. Mr Vaughan argued, in an 80-paragraph opening statement, that even if her needs had increased, because of the down turn in the husband’s income and her own inherited capital, he should not have to pay her any compensatory Duxbury settlement at all. She should be expected to manage on what she had.

In the lower court, with his formidable advocate Nicholas Mostyn QC, Mr Vaughan succeeded. The judge found that Mrs Vaughan could manage by amortising all her own liquid capital to provide for her future lifetime income needs, without the need for any capital payment by Mr Vaughan.

In the Court of Appeal

Should the first wife have been expected to use her parental inheritance to pay for her maintenance needs? In the Court of Appeal, Lord Justice Wilson delivered the judgement.

Applying Pearce, he attributed a net income need of £48,000 per annum to Mrs Vaughan. He found she could not adjust to the ending of her maintenance without undue hardship. The lump sum she required under the Duxbury tables, to give her £48,000 per annum for life, was about £500,000. It was wrong for her to be expected to “amortise” her inheritance (Lauder –v-Lauder 2007 EWHC 1227). He did take into account the £300,000 value of her Indian desk: the net proceeds of the desk would be “amortised”. This left a shortfall under the Duxbury tables of £215,000, which he ordered Mr Vaughan to pay.

Question: so if you are a first or second wife, which wife takes priority?

Answer: neither of them.

Lord Justice Wilson followed the case of Roberts  v Roberts (decided forty years ago in 1970 and still good law). While the court does not give priority to the claims of the first wife, the second wife took the husband “subject to all existing encumbrances” and so priority is not given to the claims of the second wife either.

As with much so much of our law, it is a balancing exercise. It is about fairness and, ultimately, the discretion of our judges if the parties can’t agree a sensible compromise between themselves, about figures which – with all due respect – do not seem to be rocket science.

There are still quite a few of these cases around. To people who have grown up in the ‘Noughties’ such decisions may, on the face of it, seem unjust. Certainly the comments I have read on newspaper websites seem to knock Mrs Vaughan very hard.

However it is worth remembering that in the 1980s, times were different for women. Today, young childless recipients of open-ended maintenance with no reasonable prospect of self-sufficiency are rarer. I suspect that the awards to the “Mrs Vaughans” of this world will, ultimately, become far fewer in number.

Image credit: Nanagyei.

The article concludes with a list of “big money” cases in which wives were given very substantial capital awards and maintenance after short marriages.

Given recent decisions such as Hvorostovsky v Hvorostovsky, one can see how all the excitement arises.  Mr Hvorostovsky finds, following a Court of Appeal, decision, that his maintenance liability should increase so that his former wife has some £37,500 per year more than she actually needs!  The reason for this increase was nothing more than the fact that the husband now has a much larger income of his own.  It is all too easy to assess the acute sense of grievance felt by such a husband, particularly where he presumably has to work very hard for this level of earnings where his former wife is able to live a life of leisure.

The shortcoming of this debate is that it concerns a vanishingly small minority of cases.  Even in specialist practices such as ours, the vast majority of our clients are working out how to deal with assets and financial resources which do not even meet both parties’ needs.  Most cases are about dividing up deficits rather than surpluses!  A cursory glance at the national divorce statistics shows why this is so.  The highest divorce rates are for men and women in their late twenties.  People like this are very rarely afflicted with large amounts of money!  The national statistics also show that more than half of all divorces come before the parties have been married for 12 years.  Again, this rarely reflects a husband who has reached the pinnacle of his career.  Ask a busy family law practitioner and you will be told that the typical divorce involves a couple in their late 20’s to mid-30’s with a ten year relationship behind them.  There will probably be a couple of young children.  The family wealth amounts to the equity in the house they live in and perhaps a bit of a pension that the husband has paid into.  The financial outcome for the husband and wife is usually highly unsatisfactory for both.   The husband is not going to see any money until the children leave home, as often as not; the wife is going to be living for years to come in the knowledge that one day the husband will have to receive some money because there is no way she can afford to buy him out at this stage.  In other words, a problem is saved up for the future.  In the meantime, the husband pays child maintenance only because that is all he can realistically afford.

The sort of cases about which Lady Deech is talking about are few and far between.  It is hardly a major matter of gender-equality deserving of major public attention or legislative time.  It may be old-fashioned, but marriage always seemed to be about sharing – sharing the good times in life and sharing the hard times too.

However, there is another aspect of fairness that Lady Deech appears to have overlooked entirely.  During the first ten years of a marriage, the husband is often getting firmly established in his chosen career.  If, after ten years, the marriage ends, the wife finds herself in the position of having been her husband’s helpmeet and support in those critical early years, but cut adrift just as he can expect to see a return on his efforts.  Is it remotely fair for such a wife, having been promised by the husband as part of the marriage that she will share in everything he has, to be told that now all bets are off and she must get herself back out and find whatever employment she can, probably circumscribed by childcare commitments?  This is the key distinction between marriage and cohabitation – marriage is all about commitment.  We live in a modern world in which cohabitation no longer has the old stigma and it is regarded as a perfectly reasonable alternative.  If a man chooses to promise to his life partner a full commitment of sharing everything, how then can he complain when a Court expects him to deliver on it?

The reality is that the series of lectures is of tiny significance only to the ordinary run-of-the-mill cases which occupy Courts on a daily basis up and down the country.  For the overwhelming majority of professionals, high-flown arguments about a judge’s discretion are interesting but don’t change anything.  In the main part judges are exercising their discretion to decide how inadequate resources should be apportioned to limit the misery to both parties, not how to divide a superabundance.

Stowe Family Law is the UK’s largest specialist family law firm, with offices and divorce solicitors in London, Yorkshire and Cheshire.

With an outstanding national and international reputation, the firm provides a full range of private client family law services. Our divorce solicitors are praised by clients, the media and legal guides for their knowledge and expertise.

Marilyn Stowe and members of the Stowe Family Law team

Wedding cake image credit: weelakeo.

The judgment in the latest installment of the never-ending divorce saga that is McFarlane  v McFarlane, (2009 EWHC 891) landed on my desk yesterday morning. A judgment from Mr. Justice Charles, it is characteristically lengthy. Thirty-five pages in length, it takes a long time to read . It takes even longer to consider the meaning and impact, this judgment being his Lordship’s interpretation of what the House of Lords may have had in mind (but never expressly stated) by a “deferred clean break”, payable at some stage in the future, by Mr McFarlane to his former wife.

I was in two minds whether to write about the latest twist; after all, what relevance does any of it have to those of us who live relatively modestly in the real world? However, this case has wider implications. It reminds me of a seesaw. On one end: the stay-at-home wife and her children. On the other: the working wife and her children. In the middle, sliding from one end to the other: the husband. Does English family law substantially favour the stay-at-home wife, at the working wife’s expense? Does it curtail a second wife’s freedom to leave her job and become a stay-at-home mum?

Let me explain. The McFarlanes litigated themselves all the way to the House of Lords in their original divorce. They split their capital roughly 50:50. Both came away with about £1.7 million. Both purchased substantial properties for more than £2.5milllion apiece.

In Europe the wife’s claims would have ended there. In England and Wales, however, Mrs McFarlane’s income needs still had to be met – and at the time there was insufficient capital to provide a clean break divorce. (NB. If any case shows how important it can be for a husband to try and obtain a clean break settlement in his divorce, it is this one!)

The divorce was dragged through four courts, yielding various decisions about the ongoing maintenance to which Mrs McFarlane was entitled. Her actual needs were estimated at £150,000 – £180,000 per annum. However the final arbiter, the House of Lords held that, as she had given up her career as a solicitor to care for the couple’s three children, she should receive more in recognition of her lost earning capacity. The House of Lords confirmed a higher award of £250,000 per annum, substantially in excess of her needs – with no cut-off point.

The words “relationship-generated disadvantage” became a buzz-phrase, until Mr Justice Coleridge pointed out that the phrase did not actually exist in statute. This prompted the President of the Family Division to issue a clarification in which he made it clear that in big money cases, the issue of “relationship-generated disadvantage” would arise simply as a strand or element of fairness. Precisely!

Mr McFarlane has remarried, to a partner at his accountancy firm. They have a son, who is now three years of age. Mr McFarlane’s career has continued to flourish. In 2007, one year after the House of Lords’ judgment, his former wife issued an application to the court for increased maintenance for the children, who are now aged between 13 and 20. She subsequently applied for an increase for herself and capitalisation of her maintenance claims. Last week the judgment was handed down…

The court has a duty to consider if a clean break is possible; if so it can, if it wishes, order payment over a term of years after which a clean break will occur. That is what Mr Justice Charles did, but he made an order to fund an eight-year, deferred clean break, all payable out of the former husband’s post-divorce income – to which his second wife contributes, and his first wife does not.

From 25 June 2007 (when Mrs McFarlane issued her original application for an increase), Mr McFarlane must now pay his former wife:

40% of his net income up to £750,000

20% of his net income up to £1 million

10% of his net income thereafter, until 31 May 2015 when maintenance stops and Mr McFarlane retires.

The judge calculated that this would give Mrs. McFarlane an unearned tax free income just shy of £350,000. As he backdated the award by two years, there will be the differentials to pay for those two years as well. In eight years’ time she could have received around £2.5 million.

What a whopping award! It makes you wonder why Mr McFarlane doesn’t just throw in the towel and live off his second wife’s income. It also makes you wonder how hard it is to earn this kind of money – and if this is sufficiently appreciated by the court. It certainly doesn’t grow on trees if all those professionals I represent or see on trains and planes, sweating profusely, banging on laptops, e-mailing and making non-stop mobile calls on a 24/7 basis are anything to go by!

From now on, the first Mrs McFarlane must have one of the highest unearned, tax-free incomes in the country. It amounts to £200,000 more than her needs as found by the Court.

So I ask myself the question: is the carve-up of Mr McFarlane’s income truly representative of “fairness”? Is this what the House of Lords intended? I ask this because in the same case, the High Court and the Court of Appeal were far less generous to Julia McFarlane. I must say, I find it hard to see why there should have been an adjustment in the current payments.  The wife’s compensation claim is one strand in the element of fairness.

Turning back to the seesaw: we must not forget the very substantial contribution of the second wife to Mr McFarlane’s post-divorce income, running the home and – as the judge acknowledged – taking on the brunt of the couple’s childcare while holding down her top-flight job as a senior partner at Deloitte.

I am certain that many first wives will rejoice at the huge financial success of one of their number. No doubt there is considerable sympathy for a wife who has been abandoned with children, and relatively little sympathy for the second wife. But several years ago the first Mrs McFarlane came out of the marriage very well, financially. She has now done even better, long after the divorce. One may feel that by now, she could – and should – be providing far more appropriately for her own future, off her own bat.

Second wives are frequently castigated by the first family, and are frequently left to bear the brunt of the marital breakdown alone. The husband sits helplessly in the middle of the seesaw. Second wives have complained to me that their husbands never overcome the guilt of leaving their first wives. Instead, these men allow themselves to be turned into tireless “dogsbodies”, to try and demonstrate to the world that they are nice guys after all. Meanwhile, first wives complain that these men are under the thumbs of their second wives and do not pay as much as they should to them and their children.

In many cases, the second family’s standard of living slips. The pressure to keep earning, to keep two families living well on one income means that a second wife can have no choice but to keep working. Her desire to stay at home and look after children can be thwarted by the large monthly payout to the other household. The resulting bitterness, pressures and remonstrations – “why is she doing nothing with her life, when I’m working like this to keep them in luxury?” – can destabilise even the strongest second marriages.

I wouldn’t dream of denying Mrs McFarlane her fair share. However from a personal perspective as a working wife and mother, who has always contributed to the family budget, overall I believe that Julia McFarlane’s latest award is excessive. I also believe that it pays scant regard to the impact of this award, in a number of ways, upon Mr McFarlane and his second family.

Image credit: rachelvoorhees.

Heather Mills may have done well out of her marriage to Paul McCartney. But to get there the couple waged a vicious and unnecessary war

By Marilyn Stowe

Millions of spectators round the world have been following the divorce battle between the McCartneys. It has grabbed media attention like no other case since the divorce of the Prince and Princess of Wales.

It was vicious. It was played out for all it was worth. On the one side: the abhorred but greatly distressed wife, who acts and speaks before she thinks. On the other: a tight-lipped phalanx of the most expensive black-suited lawyers in the country, out for a big win.

And now that it is over, it seems clear to me that there are no winners. Instead, everyone has come away humiliated.

McCartney publicly dumped Heather Mills. He issued proceedings against her based on her “unreasonable behaviour“. Knowing her as well as he did, what did he expect her reaction would be? Deeply wounded, she emerged to fight back in every way she could – and the parties went to war.

If ever there was a way not to conduct a divorce it was this.

In this divorce case, as in many others up and down the country, the wife had reasonable needs that the husband was obliged to meet. Although McCartney is known for his frugal lifestyle, the parties nevertheless enjoyed a high standard of living during the marriage, with multiple homes and expensive trips overseas. More importantly, they have a child. The figures involved in this case are stratospheric, but the needs of the couple’s daughter Beatrice come first. English law recognises that McCartney and Mills share care of her, and will continue to do for the rest of their lives.

Even so, Mills had no hope of sharing jointly in her husband’s wealth. According to the law, she was entitled to provision for her housing and associated needs, and maintenance that would be “capitalised” – given to her as one lump sum.

What was needed was a pragmatic, ego-free settlement. This could have been concluded a year and a half ago, and would have allowed both parties to walk away with a private, dignified deal. They should have negotiated a commercial settlement. Instead, each one sought victory at the expense and humiliation of the other. The result: a horrible, prolonged court battle.

Mills has been vilified and has not succeeded in cutting a sympathetic figure – despite her best efforts. When she made a spectacle out of herself on GMTV, I found it difficult to pity her. Mired in a soup of anger and self-righteousness, she was out of control: “on a frolic of her own”, as lawyers are wont to say. When she walked into the high court last month, determined to represent herself after dispensing with the services of a top London law firm, I described her as a deluded fool. Her proposal for £125m to fund a billionaire lifestyle based on a four-year marriage defied sensible logic.

However, McCartney’s own conduct has been reproachable. I find it ironic that Nicholas Mostyn QC, the man who has done so much to increase wealthy wives’ settlements, was leading his team of lawyers. This is because the £15.8m offer made to Heather Mills, in the context of this particular case, was simply too low. Moreover, it signalled an intention to fight on and take no prisoners.

Now these two are licking their wounds. McCartney has been ordered to pay £10m more than he offered – a vast sum – plus his own towering legal costs. Heather Mills seems to have not the slightest appreciation of how well she really has done. To get this avoidable result, both have inflicted dreadful wounds upon one another and themselves – and upon the most innocent loser of all, their child.

Marilyn Stowe

Settle your case on a continuing maintenance basis, and it can come back to haunt you…

For many people, a financial settlement represents the final chapter in a divorce. Generally, it comes to all concerned as a huge relief. Parties can begin to rebuild their lives, putting the unpleasantness of a break-up behind them. For those who achieve a clean break settlement, it will most likely be the end. However, for those who continue to pay or receive maintenance, this is not necessarily the case.

Maintenance may be paid for a period of time, with the court reserving the power to extend that period – or not, as the case may be. Maintenance may cease on cohabitation and will automatically end on the recipient’s remarriage. In other cases, maintenance will have no cut-off date and will only be stopped on the orders of the court, or on the death of the payer or payee.

If one of the parties wishes to bring an open-ended maintenance order to an end, this may occur by mutual consent. Both parties may agree that the time has come for the order to cease, the recipient spouse being able to manage alone.

Solicitors are consulted usually when there is no such agreement, and one party does not want to end or reduce the obligation.

Variations of maintenance orders are expensive and risky. As with the original application for a capital and income award, it involves going through the County Court or Principal Registry in London. The costs will be high – and as a result obtained for either party is likely to be disproportionately expensive. In a straightforward case, it makes sense to negotiate or proceed via the Magistrates Court. This is a simpler and cheaper process. However, when larger sums of money are involved, an experienced Judge will be required to make the determination.

There aren’t any winners in a Maintenance Variation. I don’t recommend it unless it is absolutely necessary, and legal costs are not an issue.

This isn’t all. Section 31 of the Matrimonial Causes Act 1973 permits somebody who is in receipt of maintenance to apply for a lump sum of capital, instead of continuing payments. This capitalisation of maintenance can be a very attractive prospect. It can be particularly attractive when a recipient is involved in another relationship which, if it turned into marriage, would mean that the maintenance was no more.

In many such cases, a clean break was impossible at the time of the divorce, due to insufficient capital. Years later, the financial positions of both parties may have altered. A husband may have rebuilt his capital and be about to retire. If his overall income is about to reduce, he may well wish to hold onto all of his pension.

I advise those who prefer to pay maintenance to bear section 31 in mind. If they can afford a clean break settlement at the outset, this can be the best course to follow as there will be no ‘comebacks’ in the future.

Even so, some people prefer to pay maintenance. They reason that their former spouses are likely to remarry, whereupon maintenance will cease. They believe that on balance, maintenance is a more cost-effective option.

However, it is important to note that applications for an order under section 31 of the Matrimonial Causes Act 1973 are often made in response to an application to vary maintenance downwards or terminate it.

This happened recently in a case called Dixon v Marchant. The judgment was given by the Court of Appeal on 24 January 2008.

Mr Dixon had been paying maintenance since 1993. In 2005, as he approached retirement, he wished to vary his maintenance downwards. Negotiations ensued about paying a lump sum in lieu, under section 31.

His former wife consistently rejected any suggestion that she was cohabiting. Eventually, the parties settled. Mr Dixon paid his former wife £125,000 to end all liabilities for maintenance. This was probably not as much as she might have achieved in court.

Within a few months, the former Mrs Dixon remarried and became Mrs Marchant. Mr. Dixon applied to the court for the return of his £125,000, claiming that this event was what lawyers call a “Barder” event and as such, he was entitled to the return of his money.

A “Barder” event is something with which I am familiar, having been involved in one of the reported cases on the subject (SvS (2002) 1FLR 992).

Such a case concerns a new event that would have materially impacted on the original settlement. The event occurs within a relatively short time after an award has been made, leave to appeal is made very quickly after the supervening event has occurred. It is also a requirement of such an event that if an order is set aside, no third parties will be adversely affected.

The evidential bar is high. It is vital that any “Barder” case must be dealt with very promptly as soon as the new event occurs, as a delay can be fatal to the case.

In S v S, I represented Mr. S. The late Mrs Justice Bracewell held that the groundbreaking 2000 decision of the House of Lords in White v White was indeed capable of being a “Barder” event. However she found that Mrs. S’s own lawyers should have been aware that the decision was shortly to be made. Instead, they had advised Mrs S to agree to an earlier settlement, calculated on different principles, without waiting for the judgment to come out. As a result, Mrs S’s award was well over £1million too low. My client successfully defended her “Barder” application and did not have to make up the difference. He was fortunate.

By a 2:1 majority, the Court of Appeal this year in Dixon v Marchant found that Mrs Marchant’s remarriage was not a Barder event, and that she could keep her settlement. Lord Justice Ward found that there was no basis at all that the deal would founder, if the wife remarried. Lord Justice Collins concurred.

Lord Justice Wall disagreed. He delivered a judgment with which I agree. He went through the “Barder” conditions, applying them to the facts of this case. They all appear to fit. I think Mr. Dixon was unlucky.

There are a number of other reported cases about Barder events. I think this is a tricky and very interesting subject. The case of Dixon v Marchant also struck me as interesting for other reasons. It raises the question of whether Mr. Dixon was right to try and reduce his maintenance in the first place. The stakes were high, because both parties were at risk of paying all the legal costs involved. Litigating about principles does cost dear.

If you are about to settle your case on a continuing maintenance basis, bear in mind that section 31 of the Matrimonial Causes Act 1973 can loom large years down the line. It can come back to haunt you – or hand you a tidy little windfall as good as a first-class win on the Premium Bonds.