LB (former husband) and DB (former wife) [2020] EWFC B34 (OJ)

Many people will have settled the financial terms of their divorce or dissolution of civil partnership on or before the onset of the Coronavirus pandemic. Unfortunately values of properties, investments, pensions etc may have diminished and jobs may have been lost. What may have seemed fair and reasonable pre-pandemic could well have changed in the current climate we all now live in, resulting in one or both of the parties to a divorce or dissolution being decidedly worse off than they envisaged when reaching the settlement.

Questions may be asked therefore as to what can such people do to revisit their divorce settlement, and can it be varied or even set aside?

Applications to vary or set-aside financial orders in divorce are notoriously hard to achieve regardless of a global pandemic, as shown in the recent case of LB (former husband) and DB (former wife) [2020] EWFC B34 (OJ). 

LB and DB concerned an application by the former husband to enforce an order for the payment to him of a lump sum by his former wife. The former wife in response made an application to vary that order, to set aside and reopen, in the light of the change in circumstances since the order was made. “In other words a clear change of circumstances application” [par 15].

In this case, decided roughly two months after the UK lockdown, Deputy District Judge David Hodson sitting in the Central Family Court refused to set aside the earlier financial order because he was of the judgement that the reasons given by the wife weren’t “anywhere close” to the relevant tests of a significant change in circumstances.

He cited the case of Myerson v Myerson [2009] EWCA Civ 282:

  1. “I’m bound to say here, as I have elsewhere, that I felt there was a strong public policy impetus by Lord Justice Thorpe in his judgment. It seemed to be such a dramatic change in circumstances in such a short period of time but the judge knew that coming down the line would be many other claims arising from the impact of the global financial crisis at that time; the judicial anxiety about the floodgates.  Whether it was a public policy judgment or strictly according to previous judicial pronouncements doesn’t matter here.  Set aside or appeal was not allowed in this dramatic change which was certainly not expected at the time of the financial settlement.  This set the standard incredibly high for a set aside.  It will be the challenge to be faced by any seeking to set aside arising from the present pandemic.”

The judge did not accept the former wife’s case that significant changes had occurred by either a) a decrease in her earning capacity, with extra needs due to change in health; or b) the impact of the pandemic upon the reduction in property prices.

He said specifically regarding the pandemic:

  1. “….This is a complete unknown to this court in mid-June 2020. One does not know what will happen with the residential market.  If it bounces back, how quickly and how completely will that occur?  In respect of office space in central London, the question is far bigger.  What will be the demand after the working at home experience of lockdown?  What should the court do?”
  2. We now have the roadmap prepared by the President which indicates that some form of remote hearing will continue throughout this year. But cases are still being resolved in FDR and final hearings across the country. There might sometimes in family law be appropriate circumstances to adjourn certain categories of cases for e.g. a major reported decision in that area which will have a dramatic impact on the case, but even then for a relatively short period. But this is real property, both residential and commercial.  Family courts cannot simply adjourn all cases with real property for 12 months or more until we see conclusively what happens with the property market. Family justice has to work with what is available.  We have to produce the justice with the best available.”

In short, it is apparent that the judge thought that the former wife’s application was opportunistic. He said that it “was not an application that had considerable prospect of success”.

Being sympathetic to her predicament it could be said that the application to set aside/vary was brought too early; there had not been sufficient time to properly assess the effects of the pandemic and hence the significant change had not occurred.

It might be tempting for divorced couples to have a rethink about their financial settlement; particularly in the present circumstances where investments and property values aren’t what they were six months ago. However, the above case shows us that potential applicants should take care when embarking on any applications to vary or set aside orders. There is a stringent test to pass for success, as the judge here stated:

 “Given that finality is so fundamental, the family justice system needs to be even more cautious and careful in policing the circumstances when the shuttered door of finality is prised open. This is not the role of a mere Deputy District Judge. But it has to inform reflections when it is submitted a particular door, which may be starting to creak open on rusty hinges, should be pushed wide open.”

If you would like any advice about your finances on divorce, dissolution or separation; either agreed or proposed, please do not hesitate to contact one of our expert family lawyers: Andrew Smith in York; Richard Buckley in Sheffield; and Chris Burns or Sophie Arrowsmith in Leeds.

Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.

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