HNW Divorce Magazine - 2025 Valentine's Special Edition
INTRODUCTION
“On Valentine’s Day, we celebrate not just love, but the meaningful moments that make life richer.”
Unknown
Welcome to the Valentine’s Special Edition of HNW Divorce Magazine, Issue 20, where we explore the intersection of love, law, and finances in high-net-worth divorces. This edition delves into critical issues such as financial inequalities, outdated legal frameworks, and the impact of personal relationships on divorce proceedings. We examine the role of surrogacy law reform, the evolving landscape of prenuptial agreements, and how trust influences both marriage and asset protection. Additionally, we have included our first HNW Divorce wordsearch, fill in to redeem a 15% discount to one of our HNW Divorce events. Valentine’s Day: Happy or Not, may it bring you peace, love, or just a little bit of quiet.
Paul Barford Founder/Managing Director
3398 8510
Danushka De Alwis Founder/Chief Operating Officer 020 3580 5891
Rachael Mowle
020 3398 8560
CONTRIBUTORS
Stacey Nevin - Kingsley Napley
Christopher Pocock KC - 1KBW
Amy Scollan - Hunters
Nicholas Hockney - Serle Court
Dan Wheeler - Serle Court
Jennifer Pollock - Irwin Mitchell
Katie O’Callaghan - Boodle Hatfield
Cara Ramprakash - Seddons
Carmen Cheng - Karas So
Rachel Frost-Smith - Birketts
Emma Diack - Clarence Family Law
Ruben Sinha - JMW
Pamela Dick - JMW
Claire O’Finn - Keystone Law
Carys Mason - Keystone Law
James Scarborough - Tees Law
Joe Ferguson - Myerson Solicitors
Ben Parry-Smith - Payne Hicks Beach
Luke Scarratt - Payne Hicks Beach
Elissa Da Costa-Walderman
MIND THE GAP... ARE THERE FINANCIAL INEQUALITIES OF DIVORCE?
The principle of fairness is at the heart of the court’s consideration when dealing with financial claims arising on a divorce. Despite this, a recent study by Legal & General revealed that women see their household income fall by 41%, compared to 21% for men in the year following a divorce. The study of 2,750 UK divorcees concluded that women were more likely to face financial struggles following a divorce (24% of women versus 18% of men) and have greater concerns about meeting essential costs (21% of women versus 13% of men).
What may be causing these inequalities and should we, as lawyers, be doing anything differently to address them?
A “double loss” and the gender pay gap
According to the Office of National Statistics, in April 2024 the median hourly earnings excluding overtime for full-time employees were £19.24 for men and £17.88 for women. Marriage is not the cause of this, but decisions made during a relationship may widen this gap, with the consequences felt more by one party than the other in the event the relationship breaks down.
For example, many parents and care givers can find themselves in an economic dilemma. The average UK salary in 2024 was £37,340 gross and the average cost of full time nursery was 40% of that (£15,000 a year). It’s unsurprising why, in some families, the decision for one parent to step back from work is a necessity not a choice, and given statistics on pay suggest that it is more likely that in an opposite sex couple, the father will earn more than the mother, it’s logical for a couple to conclude that it makes more economic sense for mum to make this career sacrifice. Add to this societal norms - it is still the “norm” for women to take on the greater share of “unpaid labour” (a 2016 ONS study concluded that on average, women carry out 60% more unpaid work than men). If such decisions are made, it can see a wife suffering a “double loss” if a long relationship breaks down; a diminution on her earning capacity and the loss of share in her partner’s enhanced income.
Even where both parents continue to work, there is still an impact on earnings. A report published by the TUC in 2016 concluded that women who became mothers before 33 typically suffer a 15% pay penalty.
Advising our clients to help address these inequalities
Pensions
The abovementioned Legal & General study concluded that women were more likely to waive their rights to a partner’s pension as part of a separation. This is particularly worrying when considered against the studies conducted by the Royal London for Employers, which concluded that women are reaching retirement age with an average of 35% less pension income than men.
I have lost count of the number of times a client who is the main caregiver has told me she would rather have the house than the pension. This short sighted (but understandable) view can lead to long term financial inequalities. It’s essential that we, as solicitors, ensure our clients are receiving expert advice when considering offsetting a pension against other assets (and the number of professional negligence claims against solicitors who don’t properly advise their clients about this is sobering!).
The section 25 factors and the menopause
We frequently debate the financially weaker party’s earning raising capacity and when she (it is more often, she) can expect to fully utilise it. But what about the gender related factor that may lead to a decline in earning capacity, namely the menopause?
Research conducted by the Institute for Fiscal Studies in 2024 concluded that the menopause leads to a persistent decline in full time employment and earnings with losses amounting to 20% relative to pre-menopause levels. Perhaps less of a relevant factor for someone divorcing in their early 30s, but what about a wife who is divorcing in her mid to late 40s after a long marriage (with the menopause occurring, on average, at aged 51)?
It is entirely possible that in the near future, she may have to take time away from work or reduce her work due to the symptoms of the menopause, affecting both her income and her pension pot on retirement. Perhaps this is because it’s not discussed. I rarely see it mentioned
in Forms E and some women find it uncomfortable to talk about. I have never seen it factored into finance modelling. We, as lawyers, should be thinking about this and asking judges to consider it in appropriate cases.
Should we consider compensation claims more readily?
It has been five years since my colleagues and I acted for the wife in her successful compensation claim in RC v JC [2020] EWHC 466 (Fam). First established in 2006 in Miller v Miller; McFarlane v McFarlane, RC v JC was the first reported case in 14 years where the principle was successfully argued. In giving judgment, Mr Justice Moor was very clear that an award for compensation will only be made in cases where the circumstances are exceptionally rare. Yet in the five years since RC v JC, we have seen two more cases where the principle has been successfully argued; TM v KM [2022] EWFC 155 and AT v BT [2023] EWHC 3531 (Fam).
The compensation award was to reflect the “relationship generated disadvantage”. In all three of these cases, the wife stepped back from a potentially lucrative career. But, as referred to above, the scenario of one parent reducing their working hours or stepping back from work entirely is not uncommon.
Compensation has long been a controversial concept amongst legal practitioners, with debate raging as to whether or not there should be a place for it at all. Whilst still rare, the above three cases demonstrate it is very much alive and the principle should not be dismissed out of hand when considering the merits of any claims in appropriate cases.
Addressing the problem
We are stuck with a world where inequalities persist and even with a focus on fairness, the reality is that in many cases it will be harder for one party to financially recover than the other following a divorce. That does not feel fair, but nor does it feel fair for the other party to bear the burden of somehow correcting systemic inequalities.
We are stuck navigating our clients through an imperfect system in an imperfect world. We can’t change this overnight (and possibly never will), but solicitors and mediators must think thoughtfully about these real life dilemmas when helping their clients explore a route to settlement. A reality check can be sobering, but it will ensure that clients are making fully informed decisions as they move forward.
Leading family lawyers
We are a top-ranked leading team of family lawyers, known for our expertise in both complex finance and high profile children cases. Many of our clients or their spouses have international connections, are high net worth individuals, city professionals, or individuals with a public profile.
"The 'high-powered, well-respected' family team at Kingsley Napley LLP has a 'first-class reputation', and is 'often at the cutting edge of new developments'."
The Legal 500 UK
For further information about our practice, please use the contact details below.
kn.legal/tl4 +44 (0)20 7814 1200
Napley LLP is authorised and regulated by the Solicitors Regulation Authority (SRA number 500046).
Kingsley
What Are You Looking Forward To In 2025?
At work, getting to a final resolution of a particular case that has taken up much of my last couple of years. I’m not sure it will be possible, but I am hopeful! Outside of work, a trip to Sri Lanka for a good friend’s “big” birthday.
Who Has Been Your Biggest Role Model In The Industry?
Probably Barry Singleton QC, who led me on several cases and from whom I learned how to properly think about and prepare a case.
What Cause Are You Passionate About?
The preservation of the natural world. I am a keen fisherman and (these days occasional) birdwatcher and the real (for me) point of both is to be out of the city and surrounded by nature.
What Was The Last Book You Read?
Prisoners of Geography by Tim Marshall. A fascinating series of “potted histories” of nations describing how their physical geography has shaped their political history and current outlook.
Imagine You No Longer Have To Work. How Would You Spend Your Weekdays?
I have a surfeit of hobbies that will get me out of the house – see above, and add amateur astronomy. On the rare days I am at home, I imagine I shall cook more, and spend as much time as possible with my family.
60 SECONDS WITH... CHRISTOPHER POCOCK KC
What Do You See As The Most Important Thing About Your Job?
Getting it right, and being part of a system that (mostly) gets it right – increasingly often despite its ever-reducing resources.
What Motivates You Most About Your Work?
The success of a strategy/ argument/cross-examination/ whatever.
If You Could Start All Over Again, What If Anything Would You Do Differently?
Only one thing. I would not do a law degree, but a languages degree and then convert to law. I loved languages, but wanted to come to the bar. I thought (back then!) that that meant I had to read law.
If You Could Bring Back A Fashion Trend, What Would It Be And Why?
That’s easy – hats! I always think that a “proper” hat, on a man or woman, gives them a style otherwise lost in an age of ever-more-casual dress.
If You Could Give One Piece Of Advice To Aspiring Practitioners In Your Field, What Would It Be?
I don’t think it applies just to my area of the law. Your honesty and integrity are the most important attributes you have, and can never be regained once lost. Never lose, nor even jeopardise, either of them.
What Would You Be Doing If You Weren’t In This Profession?
I have no idea. As long as I have wanted to do anything in particular, it has been this. I wonder if I could earn a living as a fly-fishing guide?
What Is One Of Your Greatest Work-Related Achievements?
Notwithstanding my lack of judicial ambition, I have enjoyed “quasijudicial” work over recent years, and am extremely grateful and proud that very good lawyers are prepared to appoint me to arbitrate or to preside over a private FDR.
1KBW has a pre-eminent reputation as family law barristers, both nationally and internationally. We are consistently ranked by the legal directories in the top tiers of leading sets for family law, and are unique in our strength in depth for both finance and children cases.
1 King’s Bench Walk
Temple
London
EC4Y 7DB
020 7936 1500
clerks@1kbw.co.uk
www.1kbw.co.uk
LOVE LOST
HELPING CLIENTS NAVIGATE THE COMPLEXITIES OF CO-PARENTING AFTER SEPARATION
Authored by: Jennifer Pollock (Senior Associate) - Irwin Mitchell
Divorce can be a complex and emotional process for any couple, but when significant wealth or international issues are involved, the challenges of co-parenting can become even more intricate.
For parents, the challenge lies in transitioning from partners to co-parents and ensuring that their children’s wellbeing remains paramount despite the emotional landscape. As professionals, our focus must be on providing careful guidance to ensure that the children’s best interests are prioritised, arrangements are handled respectfully, and needs are met without causing unnecessary conflict.
Understanding the Role of Lawyers in CoParenting Post-Divorce
A lawyer’s primary role after a divorce is to represent the interests of their client however, in the context of co-parenting, their responsibilities extend beyond this. Lawyers must be skilled in challenging thinking, adopting a solution-oriented approach and helping parents navigate the complexities of the arrangements in a way that will work in the long term. For high-net-worth clients, these solutions may require more sophisticated agreements due to the intricate financial implications of a separation and the need to manage the impact of public attention on the children.
Effective co-parenting requires both parents to collaborate in making decisions for the children’s wellbeing, and lawyers can play a pivotal role in facilitating this cooperation. Below are several ways lawyers can help clients co-parent more effectively after divorce.
1. Crafting a Careful Co-Parenting Blueprint
A well-structured parenting plan outlines each parent’s responsibilities and provides a framework for the children’s day-to-day life. This includes decisions regarding:
Arrangements for the care of the children: Determining where the children will live and when they will spend time with each parent.
Decision-Making Protocols: Defining how decisions regarding education, healthcare, and extracurricular activities will be made. This ensures that both parents are on the same page and that the children’s needs are consistently met.
Communication: Setting expectations for how parents will communicate with each other regarding the children and on what platform, especially if the divorce was contentious or if there are concerns about managing emotions.
Holidays and Special Occasions: Establishing how holidays, birthdays, and other significant dates will be divided to ensure the children can enjoy quality time with both parents.
For wealthy clients, the parenting plan may also need to address issues, such as the use of private tutors, travel arrangements, or care from additional staff. Lawyers must work to ensure that the plan works for both parties while keeping the children’s emotional and developmental needs at the forefront.
Voice of the Child: Considering how the children can feel heard and involved in the coparenting process both now and in the future in an age appropriate and supportive way.
personal grievances. Mediators can also assist in finding compromises on issues such as how to manage financial resources for the children, including private schooling, trust income or extracurricular activities.
3. Financial Arrangements and Child Support
For wealthy individuals, financial considerations often play a significant role in co-parenting. Although high-networth individuals may not face the same financial constraints as others, they still have a duty to provide for the children’s needs in a way that reflects their lifestyle, and this can cause tension.
Lawyers can help determine appropriate child support payments and provide guidance on setting up financial mechanisms that ensure long-term financial stability for the children, such as establishing family trusts or ensuring that appropriate financial safeguards are in place to protect the children’s inheritance or investments.
Effective co-parenting requires that both parents are at their best both physically and emotionally, Lawyers should encourage their clients to prioritise selfcare, not as a luxury but as a necessity.
2. Mediation and Dispute Resolution
Divorce can stir intense emotions, particularly when it comes to where the children will live and other parenting decisions. This is often exacerbated when financial disputes bleed into the arrangements for the children. Lawyers can help manage these tensions through role modelling respectful communication and encouraging alternative dispute resolution (NCDR) processes.
Mediation can help clients foster open communication and focus on the longterm welfare of their children rather than
4. Managing Emotional and Psychological Challenges
In cases where the separation is highly contentious or one party feels aggrieved, co-parenting can become challenging. For wealthy individuals, there may also be added pressures, such as public scrutiny or reputational concerns, which can influence their ability to parent effectively. Lawyers must be sensitive to the emotional and psychological challenges their clients may face and assist them in managing these issues.
Experienced family lawyers can recommend resources for additional support, including therapy or coparenting counselling, and can help clients focus on creating a stable, nurturing environment for the children. They can also advise their clients on how to handle public relations if necessary, ensuring that they protect their privacy and the wellbeing of their children.
5. Minimising Conflict and Maintaining Flexibility
In the aftermath of a divorce, coparenting arrangements need to be flexible. Circumstances may change, such as one parent moving, changes in the children’s needs, or shifts in the parents’ professional lives. Lawyers can ensure that the parenting plan includes provisions for periodic reviews and modifications to the arrangement as needed, helping both parents adapt to changes without unnecessary conflict.
For affluent clients, maintaining flexibility can be especially important as their professional obligations may require frequent travel or relocation. Lawyers can help build provisions into the parenting plan that allow for these changes while still ensuring the children’s needs are met.
Conclusion
Co-parenting after divorce is a difficult task for any couple, but it becomes even more complex when wealth and significant assets are involved. Lawyers play a vital role in helping affluent clients navigate these challenges by providing expert legal advice, helping to create a fair and detailed parenting plan, facilitating mediation, and managing emotional challenges. By working with a lawyer who understands the unique needs of high-net-worth clients, divorced parents can create a positive coparenting relationship that benefits their children, allowing them to thrive even after the end of a marriage.
THE EVOLVING DYNAMICS OF FAMILY LAW
CHALLENGING TRADITIONAL STEREOTYPES AND ADAPTING TO MODERN RELATIONSHIPS
Family law has long been shaped by societal norms and traditions. Starting out with the classic Valentine’s Day proposals of hearts and flowers to church wedding ceremonies, many aspects of family life have followed a well-trodden path, particularly in heterosexual relationships (which is the focus of this piece). Traditionally, the man proposes to the woman, the father walks the bride down the aisle, and the roles of the breadwinner and primary carer for any children are often divided along gender lines.
However, as societal norms evolve, so too does the landscape of marriage, divorce, and parenting. In today’s world, we are witnessing a fundamental shift in these dynamics, one that calls into question the legal frameworks that govern family life.
The Shifting Dynamics of Marriage and Divorce
The recognition through the Matrimonial Causes Act 1973 of one spouse’s non-financial contributions being of equivalent importance to the other’s financial contributions (which were historically prioritised) during a marriage, fundamentally changed the landscape of family law. The traditional home maker’s role was acknowledged and subsequently, in the landmark case of White v White, was given the same weight as that of the breadwinner when considering the financial outcome on divorce. At that time, gender roles in marriage traditionally placed men as the main financial providers and, as such, divorce settlements often resulted in women receiving what was seen by many as generous financial awards in addition to spousal maintenance (sometimes for their rest of their life).
However, as society changes, so do these dynamics. We now see more women occupying high-paying positions and serving as the primary earners in their families. According to recent studies, an increasing number of
women are financially stronger than their male counterparts, challenging the age-old notion that men should be ‘the providers’ in a marriage.
The rise of pre-nuptial agreements reflects this change, as both men and women increasingly seek to protect their assets and ensure equitable division in the event of a divorce.
Pre-nuptial agreements are no longer solely for the rich and famous, but a useful tool for couples who want to preserve their wealth and safeguard against the financial risks associated with divorce.
This trend signals a greater desire for financial autonomy and fairness, irrespective of stereotypical gender roles.
Evolving Parental Roles
In addition to the shifting economic landscape, there has been a marked change in how society views the roles of mothers and fathers in raising children. Traditionally, mothers have been seen as the primary caregivers, while fathers played a secondary role in child-rearing. On divorce and separation, it was common for the children to live with their mother whilst spending time at weekends and in school holidays with their father. This conventional view is now being challenged by the increasing involvement of fathers in the day-to-day care of their children, particularly since the Covid pandemic and the flexibility that many are now afforded through their work (and the fact that, as above, women are increasingly taking on more involved careers away from the home).
As fathers take on a more active role in child-rearing, there has been a noticeable rise in Court applications for true shared care arrangements upon parental separation. The increase in 50/50 child-arrangement outcomes reflects a growing recognition in the eyes of the Courts of both parents’ important roles in their children’s lives, regardless of gender, particularly where fathers demonstrate a willingness and ability to care for their children equally. It is no longer uncommon for a 50/50 outcome in children proceedings even if the division of childcare responsibilities was entirely unequal during a relationship.
childcare, claim a 50/50 split of both the overall wealth and of the children’s time. This perception of injustice stems from the notion that women, who have both earned the wealth and shouldered much of the child-rearing responsibility, are left feeling disadvantaged by a legal system that was traditionally structured around their financial dependence on their husbands.
Whilst the current law is designed to protect the financially weaker spouse by recognising non-financial contributions, some would argue that the complexity of modern relationships requires a more nuanced understanding of both financial and emotional contributions made by each. Having said that, our discretionary system already elicits wide criticism for its uncertainty and risk for those who are faced with the prospect of marriage breakdown and a deeper analysis of each spouse’s contribution during a marriage would only serve to underscore these issues further. The recent Law Commission report highlights this very issue.
call for more certainty and clarity and less discretion, these are unlikely to assist those who find themselves in a situation where they believe they have contributed far more to a marriage, both financially and non-financially, than their counterpart.
As Valentine’s Day reminds us of love, commitment, and the evolving nature of relationships, it also provides an opportunity to reflect on how far we have come in challenging traditional family law stereotypes. The rise of financially independent women, shared parental responsibilities, and diverse family dynamics demonstrate that love and commitment take many forms—far beyond the conventional.
While progress has been made in recognising the changing roles of spouses and parents, the legal system must evolve to ensure fairness and equity for all.
Fair Outcomes
The evolution of gender roles and relationships can present new challenges for those who – during the marriage – have fulfilled the role of both the primary caregiver and the main breadwinner. This is an increasingly common scenario, particularly for women, and many in this situation feel that they are being unfairly penalised in divorce proceedings when their spouse, despite being less financially successful and less involved in
The Need for a Modern Legal Framework
The changing dynamics between husbands and wives, parents and children, demand that family law evolves to meet the needs of contemporary families. While traditional stereotypes around marriage, divorce, and child-rearing still hold sway in some areas, they are increasingly being questioned as society moves towards greater gender equality and recognition of diverse family structures. The fact that more children are now born outside of marriage than within and yet our cohabitation law remains completely outdated and not fit for purpose only serves to highlights this.
The Law Commission’s report has of course recommended several reforms to update the law in light of the shifting family dynamics. The report suggests that existing laws surrounding divorce, financial settlements, and child related arrangements need to be reconsidered to ensure that they reflect modern realities. Given the changes
Tackling tricky legal questions, complex transactions and difficult conversations for over 300 years.
With confidence. With consideration. With care.
www.hunterslaw.com
What Are You Looking Forward To In 2025?
I hope to be climbing Mount Kilimanjaro in June this year. Since Hunters went paper-light I have missed the exercise of carrying court bundles up and down the stairs in the office. Therefore, I thought I’d do the next best thing and climb the highest dormant stratovolcano in the East African Rift.
What Cause Are You Passionate About?
I was born in Yorkshire, so tea is a cause close to my heart.
Imagine You No Longer Have To Work. How Would You Spend Your Weekdays?
I split my time between London and Wakefield but love travelling to the US.
If I had a year to myself, I would hike the Pacific Crest Trail. This is a hike which starts in Mexico and ends in Canada.
What Do You See As The Most Important Thing About Your Job?
Proudly, I was one of the founding members of the Hunters’ ED&I committee. Despite its age, Hunters is a forward-thinking firm and it has approached new diversity initiatives with curiosity and humility. Like anything, it’s about balancing changes whilst retaining all the traditions and practices that work well. It’s a challenge but progress is happening.
60 SECONDS WITH... AMY SCOLLAN PARTNER HUNTERS
If You Could Give One Piece Of Advice To Aspiring Practitioners In Your Field, What Would It Be?
Law is as much about managing people as it is about legal advice. Reassuring clients, and supporting colleagues are as important skills to develop as navigating your way around the Red Book. The soft skills are the hardest to learn.
What Would You Be Doing If You Weren’t In This Profession?
Without question, I would have been a ballet dancer. Ballet was my first true love, and at 17 years of age I had the dilemma of choosing to either go to dance college or to continue with my academic education. Obviously, I chose the latter and I have no regrets.
What Is One Of Your Greatest Work-Related Achievements?
I have had a wonderful career so far. I get to work against lawyers at the very top of their game, day in and day out, on high value and complicated work, which challenges me. However, one client sticks in my mind, from early on in my career. I was acting for a terminally ill client who was at risk of eviction as her husband refused to pay the mortgage. She wanted to die in her own home, which was almost next door to the care home her disabled son lived in. Despite having the money to make the mortgage repayments herself, the bank would not accept money from her because the mortgage was not in her name. Creatively, I applied for an injunction against her husband which allow the court
to order that the bank should accept mortgage payments from my dying client. As a result, she was able to die in her own home, with her son at her side.
ALIENATING BEHAVIOURS V DOMESTIC ABUSE
The term Parental Alienation is terminology many family lawyers are used to. Recent guidance published by the Family Justice Council asserts that this should now be referred to as alienating behaviours. CAFCASS defines alienating behaviour as ‘’the unjustified resistance or hostility from a child towards one parent as a result of psychological manipulation by the other parent’’.
Following the recent judicial guidance on the issue of alienating behaviours, there has been much debate in the world of family law about the weight placed on alienation allegations and whether more weight should be placed on domestic abuse allegations.
The Family Justice Council stated within their guidance that although the courts are asked to consider and act upon an allegation of alienating behaviours there is a concern that the use of such a term accords misplaced legitimacy.
In Re C (‘Parental Alienation’: Instruction of Expert) [2023] EWHC 345 (Fam), it was set out that for the court to make findings of fact in relation to alienating behaviours, three elements need to be established:
1. The child is reluctant, resisting or refusing to engage in, a relationship with the parent or carer;
2. The reluctances, resistance of refusal is not consequence on the action of that parent towards the child or the other parent; and
3. The other parent has engaged in behaviour that has directly or indirectly impacted the child.
Sir Andrw McFarlane P, within this case, provided the following as a nonexhaustive list for alienating behaviours that may directly or indirectly impact a child:
• Repeatedly or constantly criticising or belittling the other parent;
• Unjustifiably limiting or restricting contact or undermining contact;
• Forbidding discussion about the other parent;
• Creating the impression that the other parent dislikes or does not love the child, or has harmed them or intends them harm; and
• Denying emotional responsiveness to the other parent or spurning, terrorising, isolating, corrupting, or exploiting them.
Authored by: Cara Ramprakash (Solicitor) - Seddons
However, it is the wording at point 2 above, ‘’on the action of that parent towards … the other parent’’, that causes certain difficulties in the context of domestic abuse allegations. Over half of all private law cases involving children include allegations of domestic abuse1, but often, where one parent makes a domestic abuse allegation, the other parent will counter that with an alienating behaviours allegation. The difficulty is that the domestic abuse allegation may have been made as a form of alienation, and/or the alienating behaviours allegation may have been made for domestic abuse to continue. A BBC investigation highlighted the latter showing how contact can be promoted in fear of alienating behaviours allegations with a failure to consider the aspect of abuse perpetrated by one parent. There are cases where the parent has used the threat of or made an alienating behaviours allegation to manipulate contact, exercise control and continue abusing the other parent, and in some circumstances the child.
The parent alleging alienating behaviours has the burden of proving that the behaviour has occurred. They do so in the standard way within family proceedings, by setting out their allegations clearly and providing evidence in support. The published guidance has assisted on the point if evidence, confirming that the behaviour of a child cannot be used as evidence of the adult’s behaviour.
should caution itself against appointing experts to assess a family where the expert has a financial interest in the delivery of subsequent services. The recently published guidance suggests that it is inappropriate for an expert to determine whether alienating behaviours have taken place and that it is for the court to decide. The idea being that an expert, such as a psychologist, would be used for advice on how it should be dealt with if proven.
The published guidance has suggested that ‘’allegations of domestic abuse and alienating behaviours cannot be equated’’, given that domestic abuse is a crime.
In December 2022, the United Nations said that they would be examining how Family Courts around the world dealt with an increase in alienating behaviour cases when used to counter domestic abuse claims. It is suggested that alienating behaviours will not be found in cases where findings of domestic abuse are made which have then resulted in a child’s appropriate justified rejection or protective behaviours / traumatic response on the part of the victim parent.
Many practitioners and charities are praising the guidance, hoping it will deter the misuse of alienation claims to silence domestic abuse victims. The judiciary also have to handle these complex issues, which if not dealt with properly (and as soon as possible) by the right level of tribunal, can result in significant delay and increase in costs for clients.
This has led to a call to ensure that family practitioners receive training in this particular area so they are equipped to deal with the nuances of these issues
effectively.
I was recently involved in a case where, thankfully, the Judge dealt with a raft of potential allegations of alienating behaviours raised by mother. Prior to any fact-finding hearing, the father had made various admissions which assisted in narrowing the points that were in issue and avoiding a costly and stressful three day fact finding hearing. Of course, there are cases where serious allegations do need to be considered by the Court before determining the best outcome for the child(ren). However, it is hoped that the new guidance can be used as a starting point with particular consideration being given to whether the parent citing alienation may be manipulating the system to continue to exert control and abuse over the other parent and child.
It is a complex issue within Family Law proceedings, and it may be argued that expert assessment is required. The President within Re C, as cited above, provided commentary that the court
In Hong Kong, much like the UK, parties are encouraged to use alternative dispute resolution (ADR) methods such as mediation and collaborative practice to facilitate speedy resolutions in family proceedings.
Whilst mediation continues to be the most common means of ADR in Hong Kong for family proceedings, the Hong Kong Judiciary introduced a new scheme in 2019, integrating mediation with financial dispute resolution (FDR) and/or children’s dispute resolution (CDR) proceedings, namely mediatorassisted FDR (MFDR) and CDR hearings (MCDR). This enables a mediator to attend FDR/CDR hearings and work alongside the Judge to help parties reach settlement.
BRIDGING THE GAP
HOW MEDIATORS ENHANCE FAMILY DISPUTE RESOLUTIONS IN HONG KONG
FDR and CDR Hearings
Before delving into MFDR/MCDR, it is important to first provide an overview on FDR/CDR proceedings in Hong Kong. The FDR scheme was implemented in 2003 and is governed by Practice Direction 15.11. It is triggered when an application for ancillary relief is made, and the court allocates a date for the First Appointment Hearing. Prior to the First Appointment, parties must provide financial disclosure by means of Financial Statements (Form E) among other documents. The Master will have preliminary conduct of the directions hearing and only when all outstanding directions are complied with will the case be transferred to a Judge for a case management hearing. On that occasion, the Judge will direct that the case be referred to FDR during the First Appointment hearing, unless he decides such a referral is inappropriate.
During the FDR hearing, the Judge acts as a facilitator. This means that the Judge may consider any without prejudice settlement offers and indicate his/her view of the likely outcome of the case including division of the matrimonial assets if the case proceeds to trial. The Judge may also have direct dialogue
with the parties who would generally then negotiate between themselves outside court, and provide updates to the Judge if settlement is reached.
However, if parties are unable to reach settlement at FDR, the case moves forward to trial. Given the privileged nature of the FDR hearing, the case would be passed to a trial Judge and the FDR Judge will have no further involvement except in additional FDR hearings (if any).
If children matters are included in the petition, the CDR procedure will be triggered alongside FDR.
The court may either direct a Children’s Appointment hearing be heard at the same time as the First Appointment for FDR, or at an earlier date if there is an urgent application. The aim of CDR is to support parents in effectively parenting their children post-separation whilst keeping the children’s best interests in mind. Under Practice Direction 15.13, parties will need to file and exchange the Children’s Form (Form J) and a concise statement of issues relating to the children.
Authored by: Carmen Cheng (Special Counsel) - Karas So
At the Children’s Appointment Hearing, the Judge will then give directions on the filing of Social Investigation Reports, expert reports, and/or affidavits. Although the same judge will preside over both the CDR and FDR hearings, CDR is not privileged, and the CDR Judge can hear the child-related matters at trial if settlement is not reached.
Blending the two processes together does not prove to be difficult either. The presiding Judge has the ultimate control of the process and decides whether a case is suitable for MFDR/ MCDR. At the hearing, the Judge directs the case and will still hear legal submissions from legal representatives. Before the hearing, the Judge will also receive a Note summarising the parties’ respective position prepared by the mediator based on the parties’ acceptance. The mediator assists the parties with negotiations when the case is stood down without assistance of the Judge. The communication between the Judge and the mediator are confidential and not privy to the parties.
As the process is still relatively new, it is important for family lawyers and mediators in Hong Kong to understand the MFDR/MCDR process, so they are well-positioned to suggest it to clients when appropriate.
Not all cases are suitable for MFDR/MCDR, especially those which involve small financial claims or litigants in person.
MFDR and MCDR Hearings
In 2019, MFDR and MCDR was introduced in the Hong Kong Family Court when the Court saw the potential for synergy between mediation and FDR/CDR processes.
The role of the mediator and the Judge is complementary. The mediator acts as the neutral facilitator and seeks to understand the parties’ respective needs. The mediator therefore has a more personal relationship with the parties as they build rapport and can also help to build trust between parties outside the court room which is conducive to settlement. The mediator can also suggest settlement options but should refrain from expressing his subjective view on the merits of the case. On the other hand, the FDR/CDR Judge encourages settlement, but does not establish rapport with the parties. The Judge’s role is more authoritative and can give views on the merits. The Judge therefore is in a stronger position to steer the parties to focus on substantive issues, but less able to give specific suggestions. Both roles working in tandem can focus the parties’ mindset on the key issues, helping to resolve any roadblocks and guide the parties towards settlement.
At any stage of the FDR process, the hearing may be adjourned but the mediator can continue to work with the parties. Depending on the progress of the mediation, the mediator may invite the parties to return to court to report on progress. If settlement is not achieved, given that MFDR/MCDR is privileged, the parties would not be prejudiced at trial. The mediator is still required to observe confidentiality with the parties in respect of discussions in their individual private sessions.
MFDR/MCDR has been largely successful. Based on statistics provided by the Judiciary in May 2024, there have been 54 mediator-assisted cases heard since 2019 to April 2024 (comprising 49 MFDR and 5 MCDR cases), of which 47 cases have completed including 33 cases which reached full or partial settlement. As the remaining 7 cases are ongoing, it produces a success rate of 70% which is most encouraging.
The key advantage of the MFDR/ MCDR process is the mediator’s role in facilitating the parties’ continued negotiations (through individual and/or joint sessions) outside court when the case is stood down. Rather than the parties continuing to be at loggerheads outside court and dispute over frivolous issues, the mediator can continue to focus the parties on the Judge’s indications as well as disputed issues and guide them in negotiations towards (potential) settlement.
The Way Forward
Overall, MFDR/MCDR is an additional ADR option providing enhanced support to parties throughout the FDR/ CDR process. Unlike private financial adjudication, this approach uses mediation in a court process and the parties benefit from the Judge’s input as well as the mediator’s continuous guidance to keep negotiations focused on the relevant issues.
COST ORDERS IN PRIVATE CHILDREN PROCEEDINGS
Many parents agree the arrangements for their children after they separate or divorce without the involvement of lawyers, or the family court. An increasing number cannot do so, and this has led to applications in private children proceedings rocketing in recent years. The family courts are generally overwhelmed, and steps have been taken to encourage parents to use alternative methods to court to resolve their differences, including mediation and arbitration.
ultimately cause harm to the children. Equally if a parent is unrepresented in the face of these tactics and has suffered abuse during the relationship they need the objective advice of a legal representative, and the protective barrier this can provide. They are unlikely to be eligible for public funding.
The cases that make it to the family court are often therefore what are described as ‘high conflict’, and some children are the subject of repeated applications. In the author’s experience the word ‘conflict’ is not always an accurate one to use when describing the dynamics involved in these cases as it implies that the parties are equally invested in and responsible for a disagreement. In practice there are many situations where one party pursues litigation about the children as a form of post-separation abuse, or because of what may be described as their ‘personality’ and inability to see the point of view of others.
The financial costs of contested children proceedings can be high. Experienced practitioners adopt strategies to try to keep their client’s costs down. However, if the other parent is determined to adopt a position and employ tactics that run up a client’s costs this can be very difficult to suppress and contain.
Following the significant reduction of public funding available in family cases, many parties represent themselves through necessity. Others choose to do so. If a parent represents themselves this can give them a licence to behave in ways that run up the other parent’s costs, delay the proceedings, and
The advice given to clients by family practitioners (the author included) is that it is extremely unlikely that they will recover any of their costs incurred in conducting private children proceedings. Based on current caselaw the situation must be ‘unusual’ or ‘exceptional’, the behaviour of the other party
Authored by: Rachel Frost-Smith (Legal Director and Solicitor-Advocate) - Birketts
‘unreasonable’ or ‘reprehensible’ for costs to be awarded. Clients understandably find this advice difficult to comprehend, coming from the perspective gleaned from civil disputes that costs should follow the event, and further that perhaps they should somehow be compensated for the emotional and psychological trauma of being the subject of litigation.
Clients are advised they may be ‘lucky’ and recover the costs of a hearing where for example allegations are made and all found to be entirely false. Clients are advised that this general default position taken by the family court is public policy, to avoid the perception of a ‘winning’ or ‘losing’ parent, and that costs orders in children proceedings are seen to be potentially harmful to an ongoing co-parenting relationship between the parents. On behalf of those resisting costs orders it is argued that they should not be put off pursuing allegations or a position in respect of a child they consider to be in the child’s best interests because of the ‘spectre’ (to quote Wilson J) that costs may be awarded against them.
court, serving and filing documents late and in breach of court directions and practice directions, dipping in and out of being represented, lodging completely unmeritorious appeals, not interacting with court professionals and experts, ignoring the advice and guidance of professionals, and launching multiheaded litigation if they have the means to do so to destabilise the other parent.
It is the author’s experience that these strategies are currently rarely, if ever penalised properly by way of costs orders in private children proceedings.
In this kind of dynamic, the view of the author is that a costs order will certainly not make matters worse given that the co-parenting relationship is already poor. On the contrary, if costs orders are not made, and a game player does not suffer any consequences, then the likelihood is that the behaviour will continue.
the process and criteria for assessing whether or not costs should be awarded and the assessment of how much should be awarded. Perhaps there should be a separate process for costs applications to be processed and assessed.
Correspondence and forms sent to the court should contain clear warnings that the court will consider making costs orders, and the default in orders should not be ‘no order as to costs’, but ‘costs in the application’.
The author considers that this default position in relation to private children proceedings needs urgent reform and consideration. Judges need more concrete guidance about when costs orders may be made in private children cases, and litigants should be managed pro-actively with clear warnings about the possibility of costs orders being made at various staging posts in the proceedings.
The approach to what constitutes ‘abuse’, ‘controlling and coercive behaviour’ and poor ‘litigation conduct’ needs to be re-examined (in line with the progression of understanding in general in the family court). The game playing that some litigants engage in that results in running up costs for the other party include: deliberating introducing delays, entering into excessive correspondence, making applications for interim hearings, making repeated applications, not attending
The family lawyer has some tools to try and prevent this, such as asking the court to make an order under S 91(14) of the Children Act 1989, but whilst these orders are somewhat easier to obtain than they used to be, they are still only an additional gatekeeping provision, not applying for example to applications to enforce an order or lodge an appeal.
This should enable the court to see patterns of behaviour and a comparison made with what could be seen as reasonable when assessing whether or not to make a costs order. The family court recognised a while ago that Scott Schedules with only a few allegations of abuse in them did not necessarily provide the court with sufficient information to assess if there had been domestic abuse. Instead, it was recognised that abuse can be seen better when the information presented can demonstrate patterns of behaviour. The author is of the view that this same lens needs to be applied to deciding whether or not to make a costs order.
In addition to the campaign on utilising ADR in private children cases, there should be a publicity campaign educating the public about the family courts and making it clear that the court will not tolerate misuse of the system, utilising litigation as a form of ongoing post-separation abuse, nor the making of unnecessary and repeated applications. The nettle should be grasped, and the family court should not be afraid to tackle abuse of the system using costs as a consequence or punitive measure. Not to do so is arguably institutional endorsement or abuse.
There is urgent need for clear guidance for the judiciary about when costs warnings should be given to litigants,
60 SECONDS WITH...
NICHOLAS
HOCKNEY PRACTICE
DIRECTOR
SERLE COURT
DAN WHEELER PRACTICE DIRECTOR SERLE COURT
What Are You Looking Forward To In 2025?
NH: This year, we’ve got a trip to the Cayman Islands in March – a fantastic destination for business and absolutely stunning. I’m also excited about our flagship New York Conference in November. On a personal note, I’m looking forward to spending some time on holiday.
Who Has Been Your Biggest Role Model In The Industry?
DW: My first senior clerk. I started with him in 1999. He is a true gentleman and a very good friend. I still see him regularly at the best football stadium in Europe.
What Cause Are You Passionate About?
NH: I take great pride in introducing the younger generation to the clerking profession. It’s one of those roles that people simply don’t know much about, so I feel it’s important to shine a light on it.
What Was The Last Book You Read?
DW: Ronnie O’Sullivan –Unbreakable
Imagine You No Longer Have To Work. How Would You Spend Your Weekdays?
NH: I’d spend my time on a boat on the Norfolk Broads, fishing all day and watching the world go by.
What Do You See As The Most Important Thing About Your Job?
DW: Helping my barristers achieve their goals and providing our clients with the best possible service
What Motivates You Most About Your Work?
NH: Knowing that I can make a real difference to the practices of the barristers we provide services for – I find this aspect of my work incredibly rewarding.
If You Could Start All Over Again, What If Anything Would You Do Differently?
DW: On a work front, nothing, I believe that everything works out the way it should. On a personal level, I would certainly consider whether being a football fan is worth the ruined weekends. I have also now inflicted this torture on my teenage son.
If You Could Bring Back A Fashion Trend, What Would It Be And Why?
NH: Curtains – such a great hairstyle back in the day! Sadly, the one thing I can’t bring back is the hair on my head!
If You Could Give One Piece Of Advice To Aspiring Practitioners In Your Field, What Would It Be?
DW: Be patient, don’t expect to become senior clerk in the first year. Enjoy the less stressful early years as the stressful ones soon come.
What Would You Be Doing If You Weren’t In This Profession?
NH: In order of preference – I’d be on the stage, working as a radio DJ, or living the dream as a singer.
What Is One Of Your Greatest Work-Related Achievements?
DW: Becoming joint Practice Director at Serle Court in May 2023 has to be the standout one for me.
First-choice chambers for complex matters
SURROGACY LAW REFORM
ADDRESSING OUTDATED FRAMEWORKS IN A CHANGING SOCIETY
Authored by: Emma Diack (Associate) - Clarence Family Law
Surrogacy Law in England and Wales is archaic and has remained fundamentally unaltered for 40 years. Surrogates and intended parents are currently left in a precarious legal position both during and after a pregnancy.
What is Surrogacy?
Surrogacy involves a woman carrying and giving birth to a child on behalf of another person or couple, with the understanding that the intended parent(s) will raise the child after birth. The surrogate may use her own eggs and the intended father’s sperm, or the eggs may come from one of the intended parents or a donor.
is considered the child’s legal mother at birth regardless of any biological connection to the child. If the surrogate is married/in a civil partnership at the time of conception, her spouse/partner is considered to be the child’s second parent.
Intended parents must wait until 6 weeks after the child is born to apply for a ‘Parental Order’ to be legally recognised as the child’s parents. Notably, the legal process begins only after the event of birth not beforehand. The Act prohibits any commercial surrogacy arrangements but does allow for the reimbursements for ‘expenses,’ a term that remains vague and undefined.
The court must ensure that the surrogate has given valid consent to the Parental Order, which must be provided freely, with full understanding of the implications, and without conditions.
Domestic Surrogacy
The regulation of surrogacy in England and Wales is governed by the Surrogacy Arrangements Act 1985. Under the current law, the surrogate
In 2019 the Law Commission conducted a consultation on reforming surrogacy laws, publishing its report in 2023. The proposed new framework would, among other changes, make the intended
parents the legal parents from birth. However, the Government has not yet acted on these recommendations, having only met with the Law Commission in November of last year. Comments from the Department of Health and Social Care are awaited.
International Surrogacy
International surrogacy is becoming an increasingly popular avenue for prospective parents due to challenges posed by the current surrogacy framework in England and Wales. This trend is likely to continue unless reforms are made to the outdated system under the 1985 Act.
In October 2024, Mrs Justice Theis issued a significant judgement that has added momentum to calls for reform in this area. The case, Z (Foreign Surrogacy) [2024] EWFC 304 concerned a same-sex couple seeking a Parental Order for their child, Z, born through a surrogacy arrangement in Cyprus.
(5) Role of Agencies: What role does any involved agency play in matching the surrogate with the intended parents?
(6) Surrogate’s Preparation: What information, preparation, or support has the surrogate received about any proposed arrangement?
(7) Language Barriers: Does the surrogate speak or read English or has a translator been utilised?
(8) Contact with the surrogate: Will the intended parents meet or have contact with the surrogate before deciding whether to proceed?
(9) Timing of the Agreement: When will the agreement between the intended parents and surrogate be made? Before or after the embryo transfer? What are the reasons for it being at that time?
Mrs Justice Theis’s judgement highlights the pressing need for clarity and reform over the 1985 Act. Societal attitudes towards issues such as IVF, surrogacy, and same-sex marriage have evolved significantly since 1985. The law must now catch up with these changes, providing a framework that reflects modern realities while safeguarding the interests of all parties involved.
The case presented numerous complexities; including the fact that that same-sex surrogacy arrangements were not legally permitted in either the surrogate’s home country, or the country where the child was born. Ultimately the court granted the Parental Order to ensure security and stability for Z.
Mrs Justice Theis emphasized the importance of caution when entering into surrogacy arrangements, particularly those involving international jurisdictions. She expressed hope that her judgement would serve as ‘a timely reminder of why such care is needed.’
The judgement outlined several key factors prospective parents should consider, including:
(1) Legal Framework: What are the relevant surrogacy laws in the country where the surrogacy arrangement will take place and where the child will be born? Is surrogacy permitted?
(2) Parental Recognition: Will the intended parents be recognised as the child’s parents in the country of birth? If so, by what mechanism – automatic legal recognition or additional steps (pre or post-birth).
(3) Surrogate’s Legal Status: What legal rights or responsibilities does the surrogate have regarding the child at birth?
(4) Surrogate’s Spouse: If the surrogate is married at the time of the embryo transfer and/or the child’s birth, what is the spouse’s legal status regarding the child?
(10) Contact during and after pregnancy: What arrangements are proposed for contact between the intended parents and the surrogate during the pregnancy and after the birth?
(11) Jurisdictional Issues: Where will the embryo transfer take place and where will the surrogate reside during the pregnancy?
(12) Change of Jurisdiction: Can the jurisdiction where the child is to be born be changed at any stage and, if so, by whom and under what circumstances?
(13) Child’s Nationality: What nationality will the child have at birth?
(14) Travel to the UK: What steps will be required to obtain travel documentation for the child to enter the UK, and how long will this process take?
(15) Immigration Advice: Will separate immigration advice be needed, and what will the child’s status be upon arrival in the UK?
(16) Documenting Events: Maintaining a clear chronological record of events and relevant documents is vital for a Parental Order application and for preserving the child’s background and identity.
Too often, when trusts are created, ultra-high net worth (UHNW) families are not considering fully the potential – and very serious impact – a divorce may have on their wealth and the substantial assets held within these complex structures.
Ruben Sinha (Partner) and Pamela Dick (Associate) of JMW, consider the ways in which trusts can be challenged on divorce and give their advice on asset protection in this context.
How might a trust be “attacked” on divorce?
Resource
Pursuant to s25 Matrimonial Causes Act 1973 (“MCA”) the court is required to consider the parties’ financial resources. If the beneficiary of a trust divorces, a claimant spouse may argue that trust assets are an available resource which should be considered when determining how wealth should be divided.
Charman (2005) remains one of the leading authorities on this issue. The case involved a Jersey law governed discretionary trust “the Dragon Trust”, which held assets worth circa £68m. This represented approximately 52% of the parties’ total wealth. The husband had settled the Dragon Trust in 1987. The original trustee was a Jersey based company. The beneficiaries of the trust were the husband, his wife, their children, the remoter issue of the husband, such charities the trustees might identify and such other persons the trustees might add. In 2003, the husband caused the Jersey trustee to retire. A Bermuda based corporate trustee was appointed and the governing law of the trust was changed to that of Bermuda.
The issue for the court was whether the assets of the Dragon Trust were a resource available to the husband. In
finding that the trust assets were an available resource, the factors the court considered to be significant included the husband being settlor of the Trust, the husband expressing a wish to be treated as primary beneficiary during his lifetime and the letter of wishes making clear the husband should “have the fullest possible access to the capital and income of the settlement”.
When considering a resource argument, the court will look at all circumstances of the case and the history of the trust including how the trust has been operated, managed, and used. In particular, the pattern of any previous distributions (of both capital or income) to the beneficiaries, the intention/ purpose of the trust and the nature of the wealth held in the trust.
Variation
If a trust is found to be a “nuptial settlement”, pursuant to s24(c) MCA, the court can make orders varying it. There is currently no clear legal definition or explanation of what the term nuptial means, and its interpretation is highly fact specific.
The original case on the meaning of nuptial settlements, Brooks (1996), provides a useful starting point. In that case, the House of Lords suggested that a nuptial settlement would be one which makes “some form of continuing provision for both or either of the parties to a marriage, with or without provision for their children”.(Enlarge) It is therefore a very broad definition and one which affords judges a great deal of discretion.
If a trust is “nuptial” there are serious implications. The court’s power to vary a nuptial trust extends to offshore trusts and, in theory, is both unfettered and unlimited. This power has, in various cases, ranged from adding or removing a beneficiary spouse from the trust to transferring some or all the trust assets to a non-beneficiary spouse.
The husband argued that this had been done with the wife’s agreement. The wife argued that the trust was a sham and of no legal significance.
The judge concluded that two key points emerged. The first is that there must be a dishonest intent before the court will find an instrument to be a sham. The second is that where instruments or agreements are properly and formally drawn, absent a dishonest intent, there is a strong presumption that the parties intend to honour the rights and obligations within those. Therefore, to establish a sham trust, there must have been common dishonest intention from the outset.
If a trust is found to be a sham, the court will disregard it leaving the trust (and the assets held within it) potentially exposed. While the legal burden on a spouse seeking to prove a sham is onerous and not easily discharged, it is an important issue which ought to be considered when structures are being created.
Firewall Legislation
Firewall legislation is a common feature of trust law in several offshore jurisdictions. The primary purpose of this type of legislation is to shield offshore trusts from foreign orders. The legislation typically provides that any issues arising in respect of a trust must be determined in accordance with the law of the offshore jurisdiction. As a result, any foreign judgment (e.g. an English order varying a trust on divorce) which is inconsistent with that law will not be recognised. In practical terms, this type of legislation can make it harder to enforce an English family court order. Families will therefore need to consider carefully where they would like the trust governed.
Sham
Where a document purports to create a trust, a sham may be found if, when it was created, the settlor and trustee had a joint intention to create legal rights and obligations other than those set out in the trust document.
This point was considered as a preliminary issue in ND v SD & Others (2017). In this case, the husband set up an offshore trust into which he had settled most of the family’s wealth which had been built up during the marriage. The trust deed named the parties’ daughters as beneficiaries.
How might a trust be protected?
There are numerous protective measures which ought to be considered including:
Regular reviews
The potential exposure of a trust should be kept in mind during the entirety of its existence. The issues highlighted above should be carefully considered during each stage including:
• the creation of a trust; the marriage or remarriage of the settlor or any of the beneficiaries;
• when any substantial capital or income distributions are made from the trust; and
• as part of any restructuring, variation or amendment to the terms of the trust.
Nuptial Agreements
Pre and postnuptial agreements (PNAs) should be used in conjunction with any trust structuring. Carefully considered and well drafted PNAs can be very useful asset protection tools. These agreements can provide some certainty, reduce risk, and limit costs in the event of family litigation. Consideration should be given to specifically requiring (within letters of wishes) any beneficiary (or potential beneficiary) to enter into a PNA, failing which they will be excluded from the class of beneficiaries. If done properly, a well-drafted PNA in this context could help ring-fence and protect trust assets in addition to capital and income distributions made from a trust.
Trust on divorce is a complex and ever evolving area of matrimonial law and clients would be wise to take advice at the earliest opportunity.
Farrer & Co has an absolutely stellar team and the quality is throughout from top to bottom.”
- Chambers UK 2024 “
A world-class London law firm with an international outlook, Farrer & Co is synonymous with the highest quality legal advice.
For over three centuries, Farrer & Co has helped individuals, families and institutions navigate change. The firm spans a unique mix of thirty specialised legal practices, but a single-minded clarity of purpose endures; to provide both domestic and international UHNW clients with exceptional, commercially-driven advice. From family governance to divorce, tax planning to trust disputes, philanthropy to reputation management, Farrer & Co’s clients receive nothing short of service excellence. Experts across all legal disciplines bring intelligence, integrity and collaboration to their work, providing bespoke solutions to complex issues.
Farrer & Co: Thoroughly individual legal advice since 1701.
PRE-NUPS
THE ULTIMATE ACT OF LOVE OR THE MOST UNROMANTIC GESTURE EVER?
The history of Valentine’s Day is somewhat shrouded in mystery and there are several legends and stories about its origin. The most commonly accepted theory is that it originated as a Christian holiday in honour of a Roman priest named Saint Valentine who lived in the 3rd century AD.
According to legend, Saint Valentine was imprisoned for performing marriages for Christian couples, which was against the law at the time. During his imprisonment, he fell in love with the jailer’s daughter and wrote her a love letter, signing it
“from your Valentine.”
He was later executed on February 14, 269 AD, and his death has forever been commemorated as Valentine’s Day.
Over time, Valentine’s Day has become associated with romantic love and by the Middle Ages, it became a popular holiday for courtly lovers to exchange gifts and letters. Fast forward to the 19th century and we see the celebration in more parallels to today with the mass production of Valentine’s cards and gifts and all things red, pink and heart shaped.
Today of course Valentine’s Day is celebrated around the world as a day for expressing affection to those who we love, be that husbands, wives, partners, pets or those we hope to gain the attention of!
And it is against the positivity of Valentine’s Day that this article
Law
considers pre-nups. Often avoided for fear that any suggestion of one will be seen as pre-empting a marriage failing and therefore the accompanying assumption of a lack of commitment with an agreed “get out”, but perhaps pre-nups are, in fact, the ultimate romantic gesture? Are pre-nups actually the bedrock of a loving and committed marriage with the intention of avoiding future conflict?
Trust and clarity
Enduring relationships are built on mutual trust and communication. Entering into a pre-nup in sufficient time before marriage with full transparency in relation to both assets held and each person’s intentions in the event that the relationship breaks down in fact serves to heighten trust within a relationship.
As part of the process of entering into a pre-nup, questions are asked of each other in an open and safe environment and the reasons behind the decision to marry can be explored and ultimately, put to the test. In negotiating the terms of a pre-nup, a couple is encouraged to be financially open with each other and to have honest conversations about their finances including their expectations as to how those finances should be dealt with (and any ongoing financial support they may either expect or wish to provide) should the marriage break down.
with the liberty to follow their ambitions and financial ventures without impeding their marriage. Pre-nups can therefore propagate the notion that love must never restrict individual advancement but instead encourage it.
Ultimately, it can be argued that exhibiting mutual trust and openness to one another before marriage by entering into a pre-nup shows commitment to a lasting partnership. Or conversely, a lack of transparency or unwillingness to enter into a pre-nup may act as an alarm bell.
Protecting the ones you love
For those coming to a marriage with children from a previous relationship or indeed in considering the future children which the marriage might bring, a pre-nup plays a crucial role in safeguarding the financial future of the next generation.
Pre-nups not only preserve the wealth of the couple, but also can look to do the same for children and other family members.
In the event of a divorce or the death of one partner, a meticulously crafted pre-nup can act as a shield used to safeguard each individual, and by extension any children or family member as relevant to protect their economic wellbeing. The agreement can ensure that specific assets and possessions are divided justly and in accordance with the couple’s expressed wishes.
Allowing freedom for the future
Valentine’s Day is a celebration of the love between two people who unite while honouring each other’s uniqueness. In the same vein, a pre-nup permits a couple to endorse each other’s monetary and personal progress. It provides them with flexibility to decide how they wish to divide their assets in the event of divorce, including potentially how to manage their respective financial obligations and any debt.
Pre-nups can include provisions in relation to investments, businesses, inheritances and other individual assets (including those that predate the marriage), endowing each partner
A strong basis for a lasting marriage
A sound relationship needs effective communication and understanding. The process of entering into a pre-nup obliges couples to engage in open and honest communication about their financial ambitions, visions for the future and hypothetical circumstances –although we all highlight the crystal ball challenges of pre-nups to our clients.
These conversations at an early stage can foster mutual comprehension, enabling partners to synchronise their priorities and values. For the financially weaker party, this can sometimes be the first time such considerations even cross their mind. By tackling financial matters together, at the highest point, couples embark on their journey united, armed with the necessary knowledge and resources to surmount any challenge that may come their way. On the lowest, it can be an eye opener.
Conclusion
A prenuptial agreement should not be deemed as a sign of doubt or assuming the worst; rather, it can be seen as an explicit expression of affection in its own authentic way. It conveys a joint commitment by the couple to confront possible difficulties together and take accountability along the way. Taking the opportunity when a relationship is in a happy, balanced state to make decisions in the event of difficult times and to put a clear plan in place has a clear benefit of removing the potential for additional conflict and stress if the relationship were to break down.
By tackling financial matters preemptively, couples can fortify their connection and decrease any prospective sources of friction in future. It is a significant step which highlights both partners’ willingness to cooperate in establishing a dependable and safe life together, no matter what external unpredictability they may encounter.
A SHIFTING LANDSCAPE OF PRENUPTIAL AGREEMENTS?
Authored by: James Scarborough (Senior Associate) - Tees Law
Since the landmark decision of Radmacher v Granatino [2010] UKSC 42, prenuptial agreements have held increasing weight in the context of divorces.
They have become an important tool for those wishing to protect assets.
However, since that case, there have been a number of cases which highlight the need for those considering such agreements to ensure they have full and proper advice on the terms and, perhaps more importantly, the prospects of enforcement. This was brought into sharp focus with the judgment of AH v BH [2024] EWFC 125 last year. Such cases have created further uncertainty in determining whether the court will indeed hold parties to an agreement that was properly entered into at the time.
AH v BH
Last year, the High Court delivered a judgment in the case of AH v BH, a case involving a highly successful hedge fund manager (Mr AH) and his wife (Mrs BH), a former fashion executive. The couple, who had been married for 15 years and had three children together, had signed a prenuptial agreement prior to their wedding that stipulated Mrs BH would receive a modest settlement in the event of a divorce, irrespective of the growth in the husband’s wealth during the marriage.
When the couple’s marriage broke down in 2024, Mr AH sought to enforce the terms of the prenuptial agreement, which, under the agreement, left his wife with a relatively small financial settlement of £2 million—despite his estimated wealth now standing at £120 million, primarily accrued through the growth of his hedge fund. Mrs BH contested the agreement, arguing that it was unfair in light of their changed circumstances. She claimed that, although she had agreed to the terms of the prenuptial agreement at the time, the original settlement was no longer appropriate given her contribution to the family, the growth in the husband’s wealth, and the economic disparity between them.
Judge Hargrave concluded that while prenuptial agreements are generally enforceable, they must not result in an unjust or inequitable outcome.
The court ruled that the wife’s financial position had been severely impacted by the prenup, and the change in circumstances—particularly the dramatic increase in the husband’s wealth—meant that the original terms were no longer fair. The court adjusted the settlement, awarding Mrs BH a significantly larger sum, recognising both her contributions to the family and the disproportionate financial growth experienced by Mr AH during their marriage.
Reflecting back on the Commission’s 2014 recommendation of ‘Qualifying Nuptial Agreements’, for which it found there remained support, the Report noted the importance of retaining protection for needs to be met. It is now up to the Government to consider the Report and respond – so, any change in the law is not on the immediate horizon.
The Implications for Family Law
AH v BH was not the first of its kind. Whilst cases such as MN v AN [2023] EWHC 613 (Fam) reflect how courts continue to be willing to upheld prenuptial agreements in the right circumstances, recent case law has emphasised the latitude and flexibility that judges still have when considering parties’ circumstances on divorce and makes it plain that courts are, as much as ever, prepared to depart from preagreed terms in the pursuit of fairness.
AH v BH reinforces the principle emphasised in Radmacher, that prenuptial agreements cannot be enforced to the detriment of fairness, particularly when there is a significant shift in the financial landscape. The decision highlights not only the broad discretion the family court has in determining financial remedy outcomes, but the fact that prenuptial agreements, while valuable tools for asset protection, must be flexible enough to adapt to changing circumstances—especially when one party’s wealth has increased dramatically during the course of the marriage.
The recent Law Commission Scoping Report considered the introduction of binding pre-nuptial agreements as part of potential reform involving greater codification of financial remedy law as a whole.
For the time being then, family lawyers advising clients entering into pre-nuptial agreements continue to have to balance a client’s wish for certainty with the need for sufficient flexibility to enhance the prospects of an agreement being upheld. It is difficult to predict how, and to what extent, parties’ wealth will develop in the future whilst still ensuring the agreement will be considered fair in those future circumstances. A preferable method of grappling with such a challenge is to ensure the agreement is reviewed regularly (and certainly on significant change of circumstance), but that of course relies on both parties agreeing to renewed terms.
Conclusion
A prenuptial agreement should not be seen as a rigid, one-time contract but as a part of an ongoing dialogue between partners.
Regularly reviewing and updating prenuptial agreements in light of evolving circumstances can help ensure fairness and prevent lengthy and costly legal battles in the future. Parties must ensure they have proper legal advice if they are to try and maximise the prospects of those agreements being upheld.
THE BIGGEST THREAT TO THE FAMILY BUSINESS? LOOK TO THE MARRIAGE BED
Business owners focus on so many potential risks to their businesses: cyber security, admin, HR –the list goes on.
But what if the biggest threat of all is coming from inside the house?
Businesses, in particular SMEs, become a central focus of many marriages. This can be either because the spouse is an employee or a shareholder or indeed the parties are “co-preneurs” having founded and run the business jointly.
Divorce and the associated financial settlement does not typically make for good date-night-chatter. However, there are studies which suggest that unanticipated, dramatic crises like that of a divorce are the very crises that are the most difficult to recover from, particularly in SME businesses. This
may be as a result of a spouse’s key role within a business or indeed the stresses associated with divorce.
Post-divorce financial concerns are usually found to be one of the highest stress indicators for both men and women according to studies.
This in turn may impact on the ability to focus attentions on key business matters in an effective way.
Most people are harbouring under the misbelief that 50% of marriages end in divorce. This is not true; the real figure is around 42% and the divorce rate now is the lowest it has been since 1971.
Nevertheless, divorces now are more complicated than they were in 1971. There are more asset classes to consider, the cost of living is higher, the law is different and all of this is taking place in an increasingly global world. Your client may have a crypto wallet in the British Virgin Islands, a house in London and a pied-à-terre in Morzine. This can make simply understanding where to get divorced more complicated – before computation and negotiation even commences.
Authored by: Joe Ferguson (Associate) - Myerson Solicitors
Accordingly, it is very important for business owners to consider how they can mitigate the risks associated with divorce as well as simplify the process, as they do in every other area of their business. Family lawyers are likely to advise that a nuptial agreement would be helpful in such circumstances, as it can include consideration of a business as “separate property”.
Nuptial agreements were, of course, found to be valid as an asset protection tool in the case of Radmacher, in which the Supreme Court stated that:
[The] court should give effect to a nuptial agreement that is freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to their agreement.
In the period since the Supreme Court ruling, there has been a wealth of cases which have helped to hone this area of law, each specific to their own facts and circumstances. Specifically:
• In Luckwell v Limata, it was held that if the effect of the agreement would leave one party “in a predicament of real need” while the other party is comfortably provided for, this is likely to be unfair.
• In the case of Versteegh v Versteegh [2018] EWCA Civ 1050, Lewison LJ stated that if a nuptial agreement is unfair in the circumstances, it should be tempered to take account of the unfairness. This approach was subsequently adopted by Mostyn J in the case of Cummings v Fawn [2023] EWHC 830 (Fam) in which Mostyn J said (emphasis added):
Imagine that the discretionary range is a line of books on a shelf bracketed left and right by book-ends. The bookends may be quite far apart. The right book-end represents a comfortable, perhaps even luxurious, life-style. The left book-end represents a spartan lifestyle catering for not much more than essentials. The space in between is the discretionary range. When the Supreme Court says that it may not be fair to uphold an agreement which leaves the applicant in a predicament of real need, it is clearly saying that if the result of the agreement would place the applicant in a standard of living to the left of the left-hand bookend, then that would be unfair. It is also saying that to make the agreement fair it should be augmented by no more than is necessary to move the applicant’s lifestyle just to the right of that left-hand bookend.
• In CMX v EJX (French Marriage Contract) [2022] EWFC 136, the wife had signed a French pre-nuptial agreement without the benefit of independent advice or disclosure. The court nevertheless found that she had a full appreciation of what she was signing.
• In MN v AN [2023] EWHC 613 (Fam), Moor J reinforced the legal status of nuptial agreements. The nuptial agreement which protected H’s pre-marital assets of £32m, was found to be fair despite assertions of pressure (which was not found to be undue pressure – therefore not making it a vitiating factor) and leaving W in a predicament of real need. The court found that the deal was reasonable and the outcome fair. Moor J stated that one possible way of characterising the role of the court in these cases is to perform the test undertaken when a court hears an appeal.
In other words, is the provision that the PNA provides for the Wife and children outside the bracket of reasonable awards that a court might have made, such as to make it unfair.
This shows how far the court have moved – nuptial agreements have gone from being a circumstance of the case to the starting point of the case in less than 15 years.
The wealth of case law in this area has made nuptial agreements incredibly popular – not least because they can make divorces faster as well as less acrimonious and stressful and as such they should be considered as part of a holistic approach to asset protection and estate planning.
LITIGATING RESPONSIBLY
COSTS IN CHILDREN PROCEEDINGS
Ben Parry-Smith and Luke Scarratt acted for the respondent father in the recent private children case YE v ZY [2024] EWFC 293 (B) which emphasises the need to be reasonably when conducting litigation or face potential penalties in costs.
Costs in children proceedings
It is rare for costs orders to be made in private children proceedings as the focus is upon finding a resolution that is in the best welfare interests of the child. The rationale behind this approach on costs is that parents should not be prevented from taking steps that they believe to be in the best interests of their child due to fear of costs orders being made. However, the Court has shown itself to be increasingly willing to make costs orders where one party has been unreasonable in the way in which they have conducted the litigation.
The relevant costs provisions can be found in Part 28 of the FPR and practice direction 28A.
The court has discretion to make such costs orders as it considers just1 The general rule that costs follow the event are disapplied in private law proceedings and costs orders have been rarely made historically. CPR 44.2(4)-(5) applies within private law proceedings and requires the court to have regard to whether a party has succeeded in full or in part and the conduct of the parties before and during the proceedings. This includes considering whether it was reasonable for a party to raise, pursue or contest an issue and the manner in which they have conducted their case.
The facts
In September 2024 the mother made an urgent application seeking the sole care of C (14 year old boy). At the time of her application C was hospitalised and believed that he was paralysed. In fact, he was suffering from a functional neurological disorder that caused him to believe that he could not use his limbs. However, there was no physical reason why he could not move normally. It is believed that the conflict between the parents was at the root of the issues being experienced by C. The mother had alleged domestic abuse against the father which he denied.
Early on in the proceedings the father’s solicitors wrote to the mother’s advisers setting out a comprehensive set of proposals providing for how the child would divide his time between them and proposals to establish significant therapeutic support for C.
This letter was described by the judge as, “a comprehensive and thoughtful letter. It was a letter that was deserving of a response.”
Authored by: Ben Parry-Smith (Partner) & Luke Scarratt (Senior Associate) - Payne Hicks Beach
The mother failed to respond constructively to the father’s proposals. Ultimately the proceedings were compromised by a consent order which substantially reflected the father’s original proposals. However, it was the mother’s delays in responding to correspondence that brought the parties to the door of the court and caused them to incur substantial costs.
The father argued that the mother’s failure to engage and her continued allegations of abuse were unreasonable and amounted to litigation misconduct. The mother would not accept the expert’s views and continued to maintain that the father was controlling. She maintained that his behaviour was abusive and controlling when the experts characterised this as a difference in approach - put simply, that the father had a more boundary led parenting style than the mother. The mother was also misleading in her presentation to the court that social services were concerned about parental alienation –the mother implied it was concern about the father’s behaviour when in fact they were concerned about her behaviour.
The father alleged that the mother’s litigation misconduct spanned the whole case - before proceedings were issued, since issue and thirdly in implementing the terms. Taking a proportionate approach he sought one-third of his costs. M said that her behaviour was entirely driven by her concerns for C and as such could not be characterised as unreasonable.
Expert psychological evidence was provided which indicated that the mother had a tendency to demonize the father and to encourage C to believe he was ill. The expert emphasised that the mother needed to undergo significant therapeutic help herself. The conflict between the parents was believed to be at the heart of the problems experienced by C and needed to be addressed.
She had not behaved reasonably and had been “myopic…. Fixated on the father, rather than on her own conduct.”
The necessary therapeutic work had still not begun.
The mother had also failed to engage with the father’s solicitor’s correspondence on costs which was sent in April before the hearing in August.
The judge remarked, “It was a robust letter, but it wasn’t unkind or unreasonable.
She wholly ignored that correspondence until five working days before this hearing, and even then, refused properly to engage: instead she characterised the fact of the notice of application to seek costs and additional further attempts to negotiation as simple abusive behaviour.” The mother had started the proceedings. The father had engaged fully and been constructive in making child focussed proposals throughout. He had followed the advice of the medical and safeguarding professionals but “he has at times been frustrated by the mother’s failure properly to engage.” The mother had not conducted herself reasonably within the proceedings. The court ordered the mother to pay one-third of the costs.
At the heart of the court’s decision making in respect of children is the need to carefully consider the welfare of the child. In Re B (A Child) (Unnecessary Private Law Applications [2020] EWFC B44 HHJ Wildblood warned parties,
“do not bring your private law litigation to the Family court here unless it is genuinely necessary for you to do so…. If you do bring unnecessary cases to this court, you will be criticised and sanctions may be imposed upon you.”
In that case the parties were arguing over the minutiae of drop off arrangements for contact.
The court’s findings
The court found that the mother was completely entrenched in her belief that the father was abusive but there was no evidence to support her claims. Her failure to engage with the father’s proposals to resolve the matter had continued and exacerbated the parental conflict.
Implications
This decision sits comfortably with the courts increased emphasis on the need for the parties to engage properly in NCDR and to conduct themselves properly in efforts to resolve matters at all times before the matter falls to be adjudicated upon by a judge.
As the judge in this case said, “litigation is expensive, but it has consequences.”
Conclusion
Whilst historically the courts have been slow to make costs orders in private children law proceedings the tide may be turning very slightly. Applications should not be made if they are capable of resolution outside of the court and the court will look dimly on applications dealing with minor details.
Proper efforts must be made to explore and engage in NCDR and to revisit that possibility throughout proceedings.
And above all litigation must be conducted in a proper and reasonable manner; if reasonable proposals are made by one party, the Court will expect a reasonable response by the other party. Failure to adhere to the highest standards of principled litigation conduct may result in costs sanctions.
CONDUCT IN FINANCIAL REMEDY CASES
As love and romance fill the air on Valentine’s Day, we would prefer to focus on conduct that brings people together, not the stuff that drives them apart and could possibly feature as conduct in a Financial Remedy (FR) matter.
In OG -v- AG [2020] EWFC 52 Mostyn J expressed strong views on financial misconduct and litigation misconduct. The former affects the award whereas the latter affects costs. OG -v- AG addressed four ‘conduct’ scenarios-
a) Gross and obvious personal misconduct meted out by one party against the other, normally, but not necessarily, during the marriage
b) Add-back
c) Litigation Misconduct
d) Drawing inferences (Shaded box)
Gross and Obvious Personal Misconduct
Mostyn J returned to the language of section 25(2)(g) MCA 1973 before the 1984 amendment which amended ‘conduct’ from ‘gross and obvious’ to ‘that which it would be inequitable for the court to disregard’. The pre-amendment wording is clearer for both practitioners and their lay clients to understand when considering what conduct is appropriate for the court to consider, examples of gross and obvious conduct abounding in the case law.
Add Back
Several authorities consider add back in circumstances of ‘wanton dissipation’ or financial improvidence. In Evans -vEvans [2013] EWHC 506 (Fam) Moylan J (as he then was) described behaviour that may lead to the reattribution of assets ‘as a form of conduct and as such it would be inequitable to disregard it.’ In modest money cases, the funds are not there to add back – once it’s gone its gone and indeed, not all addback claims are successful.
This concerns how the litigation is run and covers cases where a party does not comply or engage with the procedural aspects of the case, often deliberately putting the ‘innocent party’ to expense in an attempt to wear them down into submission. This can be a continuation of economic abuse, previously a feature of the marriage.
Practitioners should be alert in FR proceedings to those who continue their economic abuse in the litigation so that the economically abused party is not disadvantaged. Resolution’s recently published report on Domestic Abuse in FR Proceedings provides helpful recommendations in this regard.
Where are we now?
Guidance on s25 conduct (as opposed to litigation misconduct) was given in Peel J’s judgment in Tsvetkov -vKhayrova [2023] EWFC 130, a high asset case and recommended reading.
The case is interesting on several levels; however, our emphasis is on the conduct guidance. Peel J begins with the statutory definition at s.25(2)(g) MCA 1973 and then considers Mostyn J’s four scenarios from OG -v- AG. The most important part of the judgment on this point is at paragraph 43-
stage two requires consideration of how the misconduct and its financial consequences, should impact on the outcome of the FR proceedings, by undertaking the familiar s25 exercise, involving balancing all relevant factors.
Peel J criticised usual practice when completing Forms E where parties either reserve their position on conduct or recount a litany of prejudicial comments which do not remotely approach the requisite threshold (and, as the authors believe, in many cases are not remotely relevant to the financial issues in the case). Such practices are to be ‘strongly deprecated and should be abandoned.’ They should indeed, because sadly, parties often use the conduct box in Form E to rant at their former spouse over matters which have little to do with the finances yet everything to do with the relationship breakdown. How often do we have to explain to clients that the FR court is concerned only with money and not their broken relationship?
Helpfully the judgment provides the procedure to be adopted in a conduct case, set out at paragraph 46 and paraphrased below-
i) Conduct is a specific s25 factor and must always be pleaded as such. Parties should not be advancing matters at the final hearing which do not meet the high threshold for conduct. Query whether there would ever be circumstances in which it would be appropriate to bring conduct in at the final hearing. Perhaps, if conduct emerged in evidence, then it could be addressed in closing submissions, although it is difficult to envisage circumstances where the offending conduct could not have been raised earlier.
iv) The court is duty bound by FPR 2010 1.1 to have regard to the overriding objective, and to identify the issues, with power to determine which issues should be investigated.
v) The first appointment is the opportunity to case manage how the alleged misconduct should be dealt with and the court may at that stage make an order preventing the party who pleads conduct from relying upon it, if satisfied that the exceptionality threshold would not be met. Proportionality is a consideration also, as to whether the allegations should proceed, since often conduct claims have the effect of increasing costs and reducing the chance of settlement.
A party asserting conduct must, ….. prove:
i) the facts relied upon;
ii) if established, that those facts meet the conduct threshold, which has consistently been set at a high or exceptional level; and
iii) that there is an identifiable (even if not always easily measurable) negative financial impact upon the parties which has been generated by the alleged wrongdoing. A causative link between act/omission and financial loss is required……..
Stage One above provides that an assertion of conduct, requires a basis in fact. Having established stage one,
ii) When raising the other party’s conduct, do so as soon as possible and
a. particularise the allegations,
b. state how they meet the threshold criteria for a conduct claim, and
c. identify the financial impact caused by the conduct.
As in all litigation, the other party is entitled to know the case they must meet.
iii) As a first step, if relying on conduct, allegations should be clearly set out at Box 4.4 of a party’s Form E.
Question also whether the allegation, even if proved, would be material to t he outcome. Judicial focus must be on the fair outcome, and the allegation, even if proved will not impact that outcome, it should be withdrawn.
vi) The judgment recognises that there will be occasions when conduct is not apparent until after exchange of Forms E, for example where a party wantonly dissipates monies in the lead up to trial. Should the other party seek to advance a conduct claim, this must be brought before the court as soon as possible to be appropriately case managed. Query when is too late to advance a conduct claim, and how soon after the alleged misconduct is ‘as soon as possible after knowledge’ satisfied?
vii) Even if pleaded initially in Forms E, a short conduct statement will be helpful and must set out in particularised detail
a. the facts asserted,
b. how such facts meet the conduct threshold, and
c. what consequential financial loss or detriment has occurred.
This is not a requirement when a party wants to raise litigation conduct, which will likely be visited in a costs order at the conclusion of proceedings.
Domestic Abuse Allegations and the Interface with Conduct
Are there different considerations when there are allegations of domestic abuse? In N -v- J [2024] EWFC 184, Peel J said no, clear that ‘the increasing awareness of the incidence of domestic abuse, and its harmful and pernicious effects, does not lower the conduct hurdle to be surmounted in FR proceedings.’
He repeated the conduct guidance from Tsvetkov -v- Khayrova and his conclusions in N -v- J are -
i) The high bar to conduct claims is not changed by the recent focus on domestic abuse in society and the family justice system.
ii) whilst there is a possibility of conduct being taken into account without a financial consequence, the authorities indicate that such cases will be rare.
iii) The authorities are clear that financial consequences are a necessary ingredient of a conduct claim.
iv) The alleged conduct (even if it reaches the threshold and has a financial consequence) must be material to the outcome. A fair outcome is ascertained by reference to the other s25 criteria without needing to examine conduct.
v) To inquire into conduct must be proportionate to the case as a whole.
Take Aways for Running a Conduct Case!
• Conduct must be pleaded – if not in form E , raise it as soon as possible
• There needs to be evidence –‘he who asserts must prove,’ still operates and mere assertions or hunches are not enough
• Conduct statements are very helpful for final hearing
• Raising conduct in closing submissions without notice to the other party or the court is not usually appropriate
• Do not wait for the final hearing to raise these issues – In the words of Lewison LJ in Fage UK Ltd –vChobani UK Ltd [2014] EWCA Civ 5 at [114] –
‘the trial is not a dress rehearsal – it is the first and last night of the show.’
• Domestic abuse, unless there is a financial consequences, is unlikely to influence the outcome.
