How to implement a property adjustment order: soldier on or start afresh?

A recent case before Mostyn J provides a helpful reminder of what a court can, and cannot, do when seeking to implement a final financial order. The case is SR v. HR (SC (as Trustee in Bankruptcy of SR) intervening) [2018] EWHC 606 (Fam). A consent order had been approved in 2012 which included property adjustment orders in respect of three properties. The order was rearranged (but not substantively) in 2013. Due to what Mostyn J refers to as “wearily familiar reasons” (arguments over sale prices and estate agents etc.), the final 2013 order was not implemented. He refers to the commencement of “implementation litigation”, the all-too-familiar hole into which the unlucky, or the downright stubborn, can fall.

The matter came to be reconsidered on the wife’s application in 2017 when a judge sought to deal with the case afresh. He made clear that he was not exercising appeal powers, but stated that because the order remained executory, he considered that the final order could be discharged and a new order made in its place.

Mostyn J calculated that the new order took around £46,000 from the husband and gave it to the wife. Mostyn J fundamentally disagreed with the judge’s approach and allowed the husband’s appeal against the ‘new’ order. In setting out the reasons for his decision, he provides a helpful summary of the court’s powers of implementation. In particular:

1. An order for sale can be made under section 24A of the Matrimonial Causes Act 1973 but should not be used to vary the “underlying capital award to which it attached”, para [8];
2. A “liberty to apply” clause “does not entitle a court to rewrite non-variable capital awards and to make different ones” [9];
3. “The fact that a dismissal clause does not take effect until there has been full compliance with certain transfers and payments plainly does not entitle a court to replace an executory order with a new one” [9];
4. The court has the power to set aside an order on the basis of fraud, mistake or supervening event (i.e. in Barder cases), as set out in rule 9.9A of the Family Procedure Rules 2010, but “mere delay in implementing a routine property adjustment order could never amount to a ground for a set aside” under this rule [15].

Finally, Mostyn J considered the scope of the case of Thwaite v. Thwaite [1982] Fam 1 which the wife had relied upon. In that case, Ormrod LJ had stated that “where the order is still executory…and one of the parties applies to the court to enforce the order, the court may refuse if, in the circumstances prevailing at the time of the application, it would be inequitable to do so”. Mostyn J explored the authorities which gave rise to the principle set out in Thwaite, and found that they were “a far cry from rewriting a final order anew” [11]. He concluded that “any application under the principle in Thwaite should be approached extremely cautiously and conservatively” [13].

Mostyn J allowed the husband’s appeal, finding that the judge below had no jurisdiction to make a completely new order. He set the 2017 order aside, which left the 2013 final order in place. The wife was ordered to pay the costs of the husband and intervener.

This is therefore a sobering tale and a reminder to carefully consider before making any application (i) what the client is trying to achieve and (ii) whether the court has power to make the order sought.

The Becket Chambers Family Finance team has considerable experience in advising on financial orders and their implementation.