This judgment was handed down remotely at 10.30am on 11 March 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
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THE HONOURABLE MR JUSTICE TROWELL
MR JUSTICE TROWELL :
- This is my judgment in the appeal in this matter which was listed before me on Friday the 7 March 2025. It is being written on Monday the 10 March 2025, and will be sent out in draft on the 11 March 2025. The appeal was listed for one day and there was not time after the conclusion of oral submissions for me to consider and deliver a judgment. There is some urgency in delivering this judgment because there is a possibility of a sale of a property, which, as things stand has been stayed. I will in this judgment not deal with all the points raised and argued in front of me, but I will set out the factors I have considered necessary to take into account and the reasoning which has led me to my conclusions.
- The decision which is being appealed is that of HHJ Spinks dated the 31 May 2024. It is described as a determination of a Barrell application. In this judgment I shall continue to use that description although it may be a misnomer given the Supreme Court decisions in In the matter of L and B [2013] UKSC 8 and AIC Ltd v Federal Airports Authority of Nigeria [2022] UKSC 16.
- The appellant, X (the wife), has been represented in front of me by Gina Allwood. She is instructed on a direct access basis. She was not trial counsel. The respondent, Y (the husband), has been represented by Katharine Bundell, who represented Y at trial. I am grateful to both for their assistance to me in their presentation of this matter. I have had the benefit of a bundle with relevant papers in the appeal and an authorities bundle.
The Background
- I will take this summarily. HHJ Spinks determined the financial remedy applications between the parties, ancillary to their divorce, by way of a reserved oral judgment on the 14 December 2023, a little under a month after a 3-day final hearing which started on the 15 November 2023. That judgment involved, amongst other things, an uneven division of the proceeds of sale of the matrimonial home because the wife had a significantly higher income and consequently bigger mortgage capacity than the husband. The husband needed more of the proceeds to provide him with appropriate housing. The split, as eventually drafted in the order, was 62.5% in favour of the husband less a sum of £26,500.
- On the 3 January 2024 the husband's father died. By then the order which would have flowed from the judgment had not been perfected. The husband brought an application to the court to oblige perfection on the 29 January 2024, together with an application for him to receive the share of the wife's bonus that would have been due to him pursuant to the judgment. That was heard on the 12 February 2024. He received the share of the bonus but rather than perfecting the order a timetable was drawn up to lead to perfection.
- On the 26 February the wife made an application under the Barrell jurisdiction, in the light of the financial impact of the death of the husband's father. She accompanied that with an open offer (since withdrawn) in which she indicated that she would settle the matter with an equalisation of the net proceeds of sale of the home less the share of the bonus paid, which would have left the husband with about £70,000 less than the amount due under the original judgment.
- Counsel then instructed were unable to find a time when they and the court were all available to hear the Barrell application. By agreement the parties invited the judge to deal with the matter on paper.
- He did, in a careful written decision of the 31 May 2024. He rejected the application. It is that decision which is being appealed.
- I should further note that probate was granted on the 25 May 2024. That is before the determination of HHJ Spinks but was not known to the judge when he made his determination. That is a source of complaint on the wife's side. The husband case in response is that (a) his side had sought information from the estate, and provided it to the other side in advance of the determination, (b) the figures in the estate account which they had provided are all but identical (£1 difference) from the figures in the Grant of Probate, (c) that they had provided a clear timetable to the grant, and matters had proceeded more quickly only because the Registry did not have the expected delays, and (d) they did not know about the grant (as the husband is not an executor) until the wife told him of it from the public source.
- The information provided by the husband in advance of the hearing before HHJ Spinks included estate accounts, a will, a letter of wishes in relation to a will trust, some pertinent emails from the husband's father, and a number of emails from the solicitors dealing with the father's estate explaining the situation.
- The wife appealed to this court on the 16 August 2024. The deadline for appealing was the 21 June 2024. She relies on the facts that she did not learn of the grant of probate until the end of June, and that she did not have lawyers acting for her, to explain the delay.
- The appeal has been managed by Mr Justice Keehan. I will not repeat his orders except to remark: (a) permission to apply out of time has not yet been granted, (b) permission to appeal has not yet been granted, and (c) there has been since the 7 February 2025 a stay in place bearing in mind the imminence of this hearing. This has been a 'rolled up' hearing with each application argued.
The Law
- The 'meat' of this case is in the Barrell application, and in the application of the facts of this case to the law, rather than an exploration of the law, so I intend to take this section shortly.
- In relation to permission to apply out of time I have been referred to H (Children) [2015] EWCA Civ 583 and rules 4.5 and 4.6 of the FPR 2010. I shall not repeat here the matters set out in rule 4.6, but I shall hold them in mind.
- In relation to permission to appeal I have been referred to FPR rule 30.3 (7) (a), namely that the appeal must have 'a real prospect of success' if permission is to be granted.
- In relation to the appeal itself I have been referred to FPR rule 30.12 (3) that the decision of the lower court is (a) wrong or (b) wrong because of a serious procedural or other irregularity.
- Further, I note that Mr Justice Mostyn draws on Lord Kerr JSC (in paragraph 112 of Re B (a Child) [2013] UKSC) in Augousti v Matharu [2023] EWHC 1900 (Fam) to summarise the approach I must take to an appeal in relation to a discretionary exercise as follows:
An appeal against an exercise of discretion will succeed if the decision-maker has failed to take into account relevant matters, or has regard to irrelevant factors; or reached a decision that is plainly irrational. Otherwise, the review by an appellate court is 'at its most benign'. Even if the appeal court disagrees with the discretionary decision it cannot interfere.
- Similar cautions are given in other authorities. Given this is not in dispute I will not catalogue them here.
- Further still, there is no question but that the decision I am considering here is an exercise of discretion, or, as it is referred to in AIC ltd v Federal Airports Authority of Nigeria an 'evaluative exercise', which is to the same effect so far as appeal criteria are concerned.
- As to the principles to apply on the Barrell application they are set out in the decision of HHJ Spinks at paragraph 20. Neither party challenges his account of the law and having been referred by counsel to In the matter of L and B [2013] UKSC 8, and AIC Ltd v Federal Airports Authority of Nigeria [2022] UKSC 16, and AR v ML [2019] EWFC 56, I see no reason to criticise them. He sets them out as follows:
From these cases, I discern the following principles in particular:
a. There is no doubt that the court is able to reverse/alter its decision at any time prior to the order being perfected;
b. For the power to be exercised does not require 'exceptional' circumstances;
c. That where the request is made on the basis of new evidence that was not before the court first time round, there needs to be good reason (in which there is a "due diligence" requirement) to depart from the finality principle (AR -v- MR);
d. The 'finality principle' is of considerable importance in financial remedies cases (not least given the costs involved) and also, in particular, after a judgment given at a final hearing;
e. The issue should be approached from the perspective (or "through the prism") of the Overriding Objective;
f. A judge considering such an application should not start "from anything like neutrality or evenly-balanced scales…the question is whether the factors favouring re-opening of the order are, in combination, sufficient to overcome the deadweight of the finality principle…together with any other factors pointing towards leaving the original order in place" (AIC Ltd).
- Further, he does when turning to the facts of this case set out in its subparagraphs the overriding objective at paragraph 34. It cannot therefore be said that by merely naming the objective at (e) above he does not hold it in mind.
- The central criticism of the judge's approach that the wife brings is that he is too focussed on the 'finality principle' at the expense of rule 1.1 (1) of the overriding objective, dealing with the case 'justly'.
Application of the law
- The wife argues that she should have permission to bring this application out of time because it was not until the end of June that she knew probate had already been granted at the time of HHJ Spinks's decision; that she was a litigant in person at that time; and that the delay was not long.
- The husband says that the grant of probate is not material; that I should attach no weight to the fact that the wife was (by choice) a litigant in person; and the delay from the end of June to the 18 August is of itself more than 21 days.
- I do give permission to bring the application out of time. I attach no weight to the wife being a litigant in person. I accept the husband's account that he did not know that probate had been granted. I agree that in the ultimate analysis the timing of the grant of probate has very little materiality, but the references to the timing of probate in paragraphs 31 and 41 (c) of the decision of HHJ Spinks do support the wife's case that she thought that her discovery made a difference.
- Bearing in mind the factors in rule 4.6 (1) FPR 2010 I reach the conclusion that the delay is not such to outweigh the interests of the administration of justice and that there is an explanation for the delay.
- The argument over whether or not the wife should have permission to bring her appeal is logically strained by the circumstances of this rolled up hearing. Almost inevitably I have reached a view on the merits of the appeal while being asked to determine whether or not the appeal has a realistic prospect of success.
- I shall for this preliminary purpose look at the strength of the wife's case absent the forceful expounding of the decision of HHJ Spinks that I have now had from the husband. In short, the wife's case is that:
a. It is obviously unfair in a needs case for the wife to take a lesser share in the proceeds of sale of the matrimonial home than the husband where, as here, the husband has just received a substantial inheritance.
b. Notwithstanding the way in which the husband's father's will is set up the court can expect the family will find a way to enable him to benefit from the inheritance.
c. The court has fallen into procedural error by not allowing the wife to challenge the husband's route to obtain a benefit from his inheritance.
- In her skeleton argument (paragraph 11) Ms Allwood put the husband's interest in his inheritance at approximately £1.1 million and pointed out (paragraph 13) that under the order he was to receive £140,000 more than the wife on the split of the proceeds of sale of the matrimonial home.
- Taken on its own that would suggest that there should be permission to appeal. I acknowledge that a reading of the decision of HHJ Spinks, even before reading the submissions of Ms Bundell suggests that the path to success will not be straightforward but I consider that there is on the face of the application sufficient reason to think that there is a realistic prospect of success. So, I grant permission to appeal.
- I turn then to the appeal itself and I must at this stage give the other side of the arguments.
- The judge has given a careful reasoned account of his decision-making process. He starts in paragraph 3 by recording the important aspects of the wife's case at trial: (i) the husband had undisclosed resources, (ii) the husband's family and his father in particular would help him if her were in a position of real need, and (iii) that he was likely to receive a significant inheritance on his father's death (who was aged 90).
- He then sets out the law, as noted above.
- He turns then to consider the application of the law to the facts of this case. At paragraph 37 he deals with three specific allegations:
a. Non-disclosure: he concludes that his finding of an 'absence of undisclosed assets' is strengthened by the new material. The new material refers to the husband as being in need and contains an email from his father requiring the executors to 'be very careful to have full control of [the husband's] portion of my will. Making sure that he cannot blow the money like he has done with Mama's and the proceeds of the sale of his house'. (That, I record, is an earlier property, not the matrimonial home.)
b. The asserted willingness of the husband's family to step in and help him: he concludes the new material does not support that. It shows relations were 'somewhat strained' and there is no 'unlimited munificence' as asserted by the wife.
c. The husband's knowledge of his inheritance prospects: the judge concludes it is not possible to develop those findings that he had previously made in any way and says that he dealt with 'the case on the basis that it was more likely than not that H would receive (or have to look to obtain) family assistance in due course given the scale of his indebtedness and his need for housing'.
35. The judge then turns to consider the change to the financial circumstance of the husband flowing from his inheritance at paragraph 41. The judge reasons as follows, and I comment in italics:
a. The husband is not likely to receive anything at all this year. That is in 2024.
b. He will receive around £43,500 from his father's nil rate tax band. This figure is dependent on other gifts made by his father and furniture in which the husband will have an interest but his stepmother will retain. It is a reasonable estimate. It is possible that it was received earlier than the judge estimated because probate was granted faster, but his estimate as to time was reasonable on the information before him. In any event this sum is consumed by the husband's outstanding costs, especially those from the Barrell application which despite winning he did not receive given he would have this extra money. Its early receipt will make no difference to this decision.
c. Beyond this, the judge says, the picture is uncertain. The figures are in a wide range from nothing to several hundred thousand pounds. This is subject to probate, where the H's stepmother is going to live, and there being no challenge to H's father's will. The husband's inheritance was by way of a will trust, as to 25% with his siblings, and subject to a life interest in the assets by his stepmother. There is a possibility of the stepmother's daughter (by a different relationship) buying out the father's estate's interest in the property the father had with stepmother, but there was also the problem that the running of the property would substantially reduce the other assets. There was to be borne in mind the substantial other assets of the stepmother which might have lightened the load.
d. As and when H does receive funds, it appears clear that they are to be put in trust. This is a reasonable assessment in the light of the information disclosed, including the emails from the father and the letter of wishes.
- The judge says at paragraph 42 that he cannot just endorse the wife's open offer because the husband will be left needing to find £70,000 in the next year, which given his situation of real need is problematic.
- The judge sets out at paragraph 43 that if he grants the application, and embarks on a re-determination he will be involving the parties in additional costs, delay, and allotting additional court resources to this case. He says that the benefits of doing so at this stage are uncertain at best.
- The judge then considers at paragraph 44 issues as to overall fairness. Each side had made allegations of family wealth on the other side, beyond the fact that the husband's father had now died the position remains uncertain. How, he asks, could he provide fairly for a situation whereby the wife will inherit in due course?
- The judge considers that the welfare of the children needs to be considered at paragraph 45, which is appropriate given the overriding objective here being applied is that under the FPR. And he distinguishes this case at paragraph 47 from the Barder application in the case of Critchell where the needs issue was much more acute.
- It is for these reasons that the judge rejects the Barrell application. In essence, this analysis can withstand Ms Allwood's criticism of it. The judge has rightly considered that this is not simply a husband inheriting over £1m and still wanting a greater share of the matrimonial resources as if he did not have that £1m. It is a husband who can hope with good cause for assistance over time from what was his father's money and is now held in trust. There is force in Ms Allwood's criticism that in normal circumstances one would expect to be able to question the reality of the situation and argue that money might come by advancement from the trust sooner, or the trust might choose to assist in buying a property. However, there is nothing outside the bounds of judicial discretion in HHJ Spinks saying that in these circumstances, i.e. after judgment, that level of enquiry into what the trustees and estate might or might not do is not appropriate.
- I reach that conclusion for the following reasons:
a. The judge recorded that there had already been substantial cross examination on the subject of family support.
b. The judge recorded that he had in the original decision already factored in support from his father being available to the husband.
c. The judge had expressed horror as to the level of costs already expended in his original decision, a further enquiry would cost more.
d. The judge worked for the purposes of the Barrell decision on the information from the probate lawyers, one of whom would be a trustee. In circumstances where there had been a trial already it was a matter for the judge whether he considered it appropriate to open up matters again for further enquiry, including (probably) the cross examination of that lawyer.
- Given the manner in which HHJ Spinks has reasoned the exercise of his discretion in favouring finality over re-opening of the case in these circumstances, it is not for me to interfere with that exercise. There may be occasions when the exercise is irrational or takes into account matters it should not or fails to take into account matters it should. This is not such an occasion. And, I must remind myself that HHJ Spinks was the trial judge.
- I will turn briefly to the filed Grounds of Appeal to pick up details not dealt with in the above analysis.
Ground 1
The only additional point to deal with here is the argument that the judge placed great weight on the belief probate would take a significant period of time to be granted. He did, think it would take longer than it did, but that was not a point on which great weight was placed. It was a factor which he considered would slow down the first payment.
Ground 2
The judge did not name interim trust payments as a way the husband might have received money, but that was one of the points that would have been considered on the re-opening which he considered and rejected.
Ground 3
The judge did not expressly consider a partial reconsideration, but that could only arise by a reopening of the decision. Either he holds to his original decision, or he changes it. Child maintenance (including applications for school fees) does of course remain open regardless of this decision.
Ground 4
The judge did not apply an 'exceptional' threshold.
Ground 5
The judge it is said misinterpreted findings as to the husband's credibility and financial situation. He did not. He did trust what the probate solicitors told him but that is not a reason to allow this appeal.
Ground 6
The 'late; disclosure of the estate summary and financial disclosure did not give rise to procedural irregularity. The disclosure was before the submissions from wife's counsel and there was no request for more time. Indeed, there was an agreement that the judge could deal with the matter on paper.
Conclusion
- For these reasons I:
a. Allow the application to be brought out of time;
b. Allow permission to bring the appeal;
c. Dismiss the appeal.
- The stay should be discharged.
- I look forward to receiving a draft order.
Mr Justice Trowell
14 March 2025
