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12 January 2017

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Goddard-Watts v Goddard-Watts [2016] EWHC 3000 (Fam)

Family Division: Moylan J

Marriage — Financial provision — Non-disclosure — Rehearing of wife’s financial remedy claim after original award set aside for husband’s material non-disclosure — Whether original award to be completely disregarded in determining matter — Whether fair and appropriate to retain original award and deal only with non-disclosed assets as discrete issue — Whether non-disclosure to be reflected in award

The parties had divorced in 2010 and by consent obtained a final order concluding their respective financial remedy claims in relation to total disclosed assets in the region of £16m. In 2015 the wife successfully applied for that order to be set aside based upon the husband’s non-disclosure of his interest in two trusts valued, in 2010, at £9·6m and £4·14m.

At the rehearing the wife contended that the original asset sharing which had taken place in 2010 was no longer of any relevance and that her award should be determined by reference to the parties’ current financial situation, particularly where, she alleged, the husband had subsequently utilised the non-disclosed assets to accumulate further wealth.

Amid ancillary arguments concerning the exclusion of some of the trusts’ assets from the marital acquest, the husband’s position was that the terms of the original order were and remained fair save that the wife should now receive a further lump-sum payment to reflect her interest in the value of the trusts’ assets in 2010 together with an “up-lift” or “compensation” to recognise that she had been entitled to receive that sum in 2010.

On the rehearing of the wife’s application—

Held, application granted. It was simply not correct to say that at a formal rehearing the only way of achieving a fair outcome was to base an award on the current value of the assets. Established principles emphasised that the court had “enormous flexibility” in deciding how to determine the claim and it was not helpful to subject that discretion to sub-principles or other inflexible overarching considerations.

In order to determine what was now fair due regard was to be had to all the circumstances of the case including: the current resources of the parties, the division that had been effected previously, and the fact that such a division had been procured by non-disclosure. In the present case the original division of the disclosed assets had been, and remained, fair; the non-disclosed assets were easily isolated and could be dealt with as a discrete issue.

Therefore, on the basis that (i) 35% of the shares held by the trusts were not attributable to the marital acquest, (ii) the remaining shares contained within the trusts represented a resource that was available to the parties and (iii) no part thereof reflected post-separation endeavour on the part of the husband, the wife would be awarded a lump sum of £6·22m equal to half of the remaining 65% based on the current valuations.

That amount would be further increased by £200,000 to reflect the fact that the wife ought to have received that element of her award earlier, and the remaining amount owed by the husband from the original division under a lump-sum by instalments order would also now be payable immediately (paras 88, 89, 94–95, 102–104, 106–108).

Kingdon v Kingdon [2011] 1 FLR 1409, CA and Sharland v Sharland [2016] AC 871, SC(E) applied.

Appearances: Martin Pointer QC and Simon Webster (instructed by Farrer & Co LLP) for the wife. Tim Amos QC and Mr Sear (instructed by Pinsent Masons LLP) for the husband.

Reported by: Thomas Barnes, solicitor.

Solicitors Journal case digest is prepared by the Incorporated Council of Law Reporting for England and Wales

Categorised in:

Family Marriage & Civil partnership