Hanne & Co in second only reported case concerning S.15 (1) (c) Part III claims following an overseas divorce

This case (A v B [2023] EWFC 241) is the second only reported case dealing with a S.15 (1) (c) Part III MFPA 1984 claim which was solely relying on an interest in a matrimonial home in this jurisdiction. This has the effect of limiting the award to the equity in the property.

In this case the Former Matrimonial Home (FMH) in London was worth £1.4 million and was mortgage free. It had been inherited by the Husband before the marriage and lived in by the parties before and after the marriage. The parties had extensively renovated the property during their marriage and largely lived in rental accommodation while this took place. In 2009, shortly after they returned to live in the property the parties then decided to emigrate to New Zealand, where the Wife was originally from.

The parties separated in 2011 and then embarked on 12 years of litigation in New Zealand on financial and children matters.

In the ‘relationship property’ claims the Judge held she did not have jurisdiction to make orders on real property in England. However, she did go on to order for the Wife to be 50% liable for the Husband’s debt to his mother for the costs of renovating the property. Following an unsuccessful appeal in 2019 this debt was reduced slightly to NZ$397,000. The Husband then instigated bankruptcy proceedings against the Wife.

The Wife therefore commenced proceedings here for permission under S.15 (1) 9(c) Part III MFPA 1984 which was initially unsuccessful but overturned on appeal before Moor J. The parties were unable to agree directions and the court directed limited Form E’s. Following an unsuccessful FDR the matter proceeded to a 3 day final hearing in front of HHJ Evans-Gordon.

The parties were agreed that Wife’s debt to husband would be waived. Wife also sought a lump sum of £800,000 to cover cost of housing in New Zealand, repay her debts including legal costs and to cover medical treatment. Husband’s last open offer was for £650,000 but reduced to £550,000 by the time of the final hearing as it was to reduce in line with his legal costs.

The Judge considered the relevant factors under S17 and S.18 of Part III MFPA 1984 including the connection to this jurisdiction and the welfare of the parties dependent children. Consideration was also made of the period of time the property had been the Former Matrimonial Home. The Judge concluded the husband’s needs were largely met from his other resources. The Wife’s reasonable housing fund was assessed at £521,750 to include furnishings and moving costs. No funds were awarded for medical needs. The Judge awarded further fund to cover hard debts only, declining to award the sums sought to repay loans from the Wife’s mother who gave evidence in proceedings. The total award was therefore £563,862.

A successful claim under Part III enables the English courts to make an order for financial provision where inadequate financial provision has been made overseas. Part III proceedings can be particularly useful where the country of divorce does not allow orders to be made in respect of assets in foreign jurisdictions.

Being only the second of its kind, this judgment provides much needed guidance on the procedure and scope of awards under S.15 (1) 9(c) Part III.

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