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Time limit for a financial order?

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Is there a time limit after divorce for applying to court for a financial order?

This is an interesting question for family lawyers and former spouses alike.  There have been various comments made in recent years about imposing a time limit on such claims being made in the same way as there are time limits for other types of claims.  One judge (Mostyn J) has suggested that this be 6 years which is the same as breach of contract claims in civil law.

But a case recently heard by the Supreme Court is perhaps one of the best examples of delay in recent years so it is interesting to look in more detail at that case and in particular the outcome to try to find if there is an answer to the question above.  This is the case of Vince v Wyatt.

Vince v Wyatt – the facts

Kathleen Wyatt and Dale Vince married in December 1981. Kathleen had a daughter from a previous relationship and they had one child together (born in 1981). The court accepted Dale’s asserted date of separation being 1984 meaning the parties were only really married for 3 years.  Kathleen asserts they reconciled in 1989 but Dale disputes this.  In any event, the marriage was legally brought to an end in October 1992 when Decree Absolute was made in the divorce proceedings Kathleen had initiated.  The entire period of marriage, including a period when the parties were separated, was therefore just less than 11 years.

Also significant is that when Kathleen and Dale divorced, neither of them had any assets of any real value nor any income.  They had adopted a ‘New Age/Traveller’ lifestyle.

Around 3 years after the divorce, Dale set up a wind farm company which went on to be a very successful multi million pound business.

Round 1 – Kathleen’s application

In May 2011, when both of the children were over the age of 18, Kathleen made an application to the court for a financial order and for an order that Dale be ordered to pay her legal costs in bringing the claim.  She tried to justify the delay in bringing the claim by saying that she saw 4 solicitors between 1984 and 2002 but the system had failed her.

Round 2 – Dale’s counter application

Following receipt of notice of Kathleen’s application, Dale applied to strike out the case on the basis that her application is an abuse of the court’s process and she didn’t have reasonable grounds to make the application.

Dale’s barrister raised various points on his behalf to justify the counter application.  The main ones related to:

  1. the court files in relation to the divorce proceedings having been destroyed;
  2. none of the solicitors who had acted for Dale or Kathleen at the time of the divorce or Children Act proceedings were able to produce any relevant documents or recollection of events to assist;
  3. it may have been that Kathleen had already made a claim to the court for a financial order and that this was dismissed but as the court file had been destroyed and solicitors were unable to provide paperwork, Dale was prevented from proving this so was inordinately prejudiced as a result; and
  4. the marriage was just 3 years long and if Kathleen had made a claim for a financial order at the time of separation/divorce, her claim would have been dismissed.  At that time neither had any real assets or income.

The outcome of the hearing was the judge refused Dale’s application and ordered him to pay Kathleen’s costs.  Not surprisingly, Dale appealed to the Court of Appeal.

Round 3 – the Court of Appeal

The Court took the view that Kathleen’s case did not have any real prospects of success so Dale’s appeal against the decision to refuse to strike out Kathleen’s case and pay her costs succeeded.

Round 4 – the Supreme Court

Naturally, Kathleen was unhappy with the Court of Appeal decision as the practical effect would have been that she did not receive any lump sum or assets from Dale so she appealed to the Supreme Court against the decision.

The outcome of this case was eagerly awaited by family lawyers and the majority seemed to take the view that Kathleen’s appeal and therefore application for a financial order would be dismissed.

Today we found out that Kathleen’s appeal has succeeded meaning Dale’s strike out application has been dismissed.  The Court said that her application for a financial order should proceed to a short hearing and one of the judges indicated that she may receive a modest award.  This decision is particularly interesting for family lawyers.

Why is Vince v Wyatt so interesting?

As mentioned above, one of the most interesting features of the case is the huge 19 year delay in Kathleen making her application to the court for a financial order.  There are other interesting features also which work against Kathleen, including:

Length of marriage – Dale and Kathleen were in what we can describe as a marital relationship for just 3 years, and married for 11.  The 3 years would usually be the amount of time the court considers as the length of the marriage when determining how the spouses’ assets and liabilities should be distributed.  Usually a 3 year marriage would not result in an equal sharing of the marital assets unless this was necessary to meet housing needs.   That said, assets which are strictly matrimonial, such as the family home are always at serious risk of sharing despite the length of the marriage and ownership; and

Post - marital assets – there can be no doubt that the wind farm company Dale set up and which created his current wealth was a post – marital asset.  The company was set up 3 years after the marriage had been legally brought to an end by the Decree Absolute and Kathleen had not made any contribution whatsoever to it.  This is interesting because the courts treat post-marital assets differently to a matrimonial assets; the usual starting position is that matrimonial assets will be shared equally between the spouses unless there is a good reason not to, and post or pre – marital assets which only be shared to the extent that is required to meet the needs of the financially weaker spouse.

Undoubtedly the length of the marriage in this case, will be a significant factor for the judge to consider, as will be what the assets during the marriage actually were.

Concluding thoughts

It is very surprising that Kathleen’s case has not been struck out and that the Supreme Court indicated she may receive a lump sum or assets from Dale in light of the interesting features of the case as outlined above.  I expect the only comfort to Dale is the Court’s indication that Kathleen will receive a more modest settlement and not the £1.9 million sought.  Perhaps this is little consolation at the present time.

So in answer to the question at the start of this blog, no there is not a time limit after divorce for applying for a financial order in England and Wales.

This reinforces the advice I always give to my clients to resolve financial matters at the same time as divorce by way of a Consent Order which is a document setting out the agreement reached.  It is submitted to the court and once approved becomes a legally binding court order.  Had a Consent Order providing for the usual clean break been obtained in Vince v Wyatt, Kathleen would have been prevented from bringing her claim and put frankly, Dale would have been able to retain his wealth.

Another point to bear in mind when spouses separate is jurisdiction as in which courts should deal.  I always advise clients who have the opportunity to use the courts of a different country to take advice from a lawyer there to see which court is likely to deliver the more favourable outcome.  

If you have any questions please do not hesitate to contact me via justine.osmotherleyy@clarionsolicitors.com or on 0113 336 3323

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