Blog Archives - James Thornton Family Law

4 August 2025

Soft Loans, Hard Truths: Untangling Family Debt in Divorce

In JB v RB [2025] EWFC 194 (B), Recorder Allen KC was asked to answer a deceptively tricky question: when is a loan not a loan? The case delves into the increasingly common issue of "soft loans" from family members, and whether they should be treated as liabilities or mere gifts when dividing the matrimonial pot.

This case is a useful reminder for practitioners: not all IOUs are created equal—and unless properly evidenced, a loan may find itself at the back of the queue.

The Background

The husband (H) in JB v RB contended that two significant loans from his family—amounting to over £300,000—should be treated as matrimonial liabilities and reduce the net assets available for division. The wife (W) disputed this, claiming they were either gifts or at most soft loans unlikely to be repaid.

As is typical in these disputes, the “creditors” were H’s close family, and there was no independent documentation or third-party enforcement.

The Legal Framework: What Makes a Loan “Soft”?

The court in JB v RB adopted the approach endorsed in P v Q (Financial Remedies) [2022] EWFC B9 (HHJ Hess) and cited by Mr Justice Mostyn in P v Q [2022] EWFC 93, considering a range of factors when evaluating whether a loan should be treated as a genuine liability:

Was there a written agreement?
Were there any terms of repayment?
Was there interest?
Has any repayment actually been made?
Would enforcement be pursued?
Is the lender in the habit of enforcing such arrangements?

Where the answers to these questions suggest a “soft” arrangement—particularly where the parties would not expect the money to be repaid unless convenient—the court is more likely to treat it as a gift.

What the Court Found

In JB v RB, the judge concluded that the husband's claimed loans did not satisfy the criteria of a hard liability. Key points:

There was no loan agreement, no repayment schedule, and no evidence of enforcement.
The judge doubted the lender (the husband's mother) would pursue repayment if it meant her son being disadvantaged.
No repayments had been made.
The timing of the funds coincided suspiciously with the breakdown of the marriage.

The result? The sums were excluded from the schedule of liabilities. The husband's argument that they should be “added back” into the net asset pool failed.

Practical Guidance for Practitioners

Get it in writing: If family money is intended to be a repayable loan, make sure there’s documentation.
Ask the hard questions early: Consider early on whether the client’s claims about loans will stand up to judicial scrutiny.
Timing matters: Late-stage “loans” appearing post-separation are especially vulnerable.
Be wary of litigation risks: Contesting soft loans can be expensive and often yields little benefit.
Disclosure and evidence: Bank transfers alone won’t prove a debt exists. Courts want to see the paper trail and intentions behind the payment.

Conclusion: A Hard Line on Soft Loans

JB v RB confirms what family lawyers increasingly know: courts are sceptical of informal family loans, especially where they surface late in the day or are unsupported by clear documentation.

For spouses trying to insulate wealth or shrink the marital pot with a conveniently timed IOU, this case is a warning. If it walks like a gift and quacks like a gift—it probably won’t be treated as a loan.

Published by James Thornton in Blog

Tags: case law, soft loan

1 August 2025

How Private Is Your FDR? A Sacrosanct Warning from BC v BC

Is an FDR hearing truly sacrosanct? That’s the core question raised in BC v BC [2025] EWFC 236, a case that challenges the traditional shield of confidentiality that surrounds Financial Dispute Resolution (FDR) hearings.

Practitioners have long operated under the assumption that discussions at a private FDR are absolutely protected from later disclosure. But as BC v BC shows, even this “sacrosanct” zone may be pierced—when justice demands it.

The Background: A Dispute About Disclosure

Following a final hearing in financial remedy proceedings, one party in BC v BC sought to adduce material from the previous private FDR. This included:

Details of what had been offered or said at the FDR,
The tone and substance of the judge’s indications,
Written materials submitted for the FDR.

The opposing party objected, invoking the well-known principle that FDR hearings are off-limits—expressly confidential and protected from use in later litigation.

But the applicant argued that material from the FDR was necessary to:

Resolve questions about costs, and
Respond to representations made post-hearing that, it was claimed, mischaracterised what occurred during the FDR process.

FDR Confidentiality: Where We Stand

Under FPR 9.17(2), discussions at an FDR are “without prejudice”—they cannot be referred to in later proceedings. This rule aims to:

Encourage open, candid settlement talks,
Shield parties from their own tactical concessions being used against them,
Promote finality without fear.

The leading case of Clibbery v Allan [2002] EWCA Civ 45 and later authorities have affirmed that FDRs are quasi-privileged—not just confidential by practice but by rule.

So, how did the court square this with the request for disclosure?

What The Court Said in BC v BC

Mr Justice Mostyn reaffirmed the critical importance of FDR confidentiality, describing it as a "cornerstone" of the financial remedy system. However, he also acknowledged:

The tension between confidentiality and a party’s right to respond to unfair or misleading claims made outside court.
That once a party has referred to FDR discussions improperly, this may open the door to limited rebuttal disclosure.

This follows earlier dicta suggesting that confidentiality can be waived in narrow circumstances—particularly where it has already been breached by the other side.

The court struck a careful balance: most of the FDR material remained protected, but limited disclosure was allowed for the narrow purpose of correcting what had been said elsewhere.

Key Pointers for Practitioners

FDRs remain highly protected, and parties should never assume they can refer to them freely.
Courts may permit limited reference to FDR material—but only where necessary to correct misrepresentation or where one party has already breached confidentiality.
Be extremely cautious in costs correspondence or post-hearing communications. If you hint at what occurred during the FDR, you may unintentionally waive privilege.
Keep FDR notes and offers clearly marked as “without prejudice” and separate from open material.
Remember that confidentiality is not absolute—it exists to serve justice, not to obstruct it.

Conclusion: Still Sacrosanct, But Not Untouchable

BC v BC is a rare but important case in the FDR landscape. It reminds us that while FDRs are shrouded in confidentiality, that shroud can be partially lifted when fairness demands it.

For family lawyers, the case serves as a reminder to:

Take care in post-FDR communications,
Avoid casual references to the content of those hearings,
And prepare clients for the possibility that in exceptional cases, the court may permit limited disclosure.

The “sacrosanct” principle lives on—but not without boundaries.

Published by James Thornton in Blog

Tags: fdr, pfdr, privilege, without prejudice

25 July 2025

SJEs Still Stand: A Reaffirmation of Daniels v Walker and the Proper Use of Expert Evidence

In the world of family law financial remedies, expert evidence can make or break a case. But who gets to call the expert—and what happens when one party disagrees with the conclusions? The recent decision in BY v GC [2025] EWFC 226 (24 July 2025) provides a modern reaffirmation of the long-standing principles from Daniels v Walker [2000] 1 WLR 1382, supported by GA v EL [2023] EWFC 187.

Together, these cases make clear: Single Joint Experts (SJEs) remain the cornerstone of fairness, cost-efficiency, and procedural discipline in family litigation.

A Quick Recap: What Daniels v Walker Says

The 2000 Court of Appeal case remains the leading authority:

Parties may seek to rely on a second expert only if they have legitimate grounds for challenging the SJE’s opinion.
This must be done by application and in accordance with procedural rules—not via backdoor instructions or surprise evidence.
The court will balance the interests of justice, proportionality, and procedural fairness in deciding whether to permit departure from the SJE route.

BY v GC [2025] EWFC 226: A Sharp Reminder

In BY v GC, one party sought to introduce a second expert late in the day to counter a valuation provided by the SJE. The court took a firm line:

The application was refused as procedurally improper and unjustified.
There was no early indication that the SJE report would be disputed.
The second expert had not been jointly instructed and came without permission.

The judge reinforced the idea that where parties agree to a single expert, they are bound to that process unless a proper application is made, and even then, permission is granted sparingly.

GA v EL [2023]: More than Just Reinforcement

In GA v EL, Mostyn J addressed a similar issue—one party disagreed with the SJE report and tried to introduce a second opinion. He made clear:

There is no automatic entitlement to a second expert just because you disagree with the first.
Courts should discourage a “battle of experts” unless essential.
SJE procedure exists to reduce cost, delay, and forensic gamesmanship.

This case is a strong follow-up to Daniels, warning litigants that the court will enforce the procedural framework strictly.

Top 5 Tips for Practitioners

Treat SJEs as binding unless there is a genuine, well-founded concern.
Use Part 25 and Daniels v Walker procedure if challenging the SJE—don’t cut corners.
File applications early, ideally after seeing the draft report, with an initial view from a “shadow expert” if needed.
Don't delay: lateness alone can justify refusal.
Make sure clients understand that once a SJE is agreed, it’s not just another opinion—it’s the only one the court may hear without permission.

Final Thought

Between Daniels v Walker, GA v EL, and now BY v GC, the message from the courts is clear: expert evidence must be managed with discipline and care. SJEs aren’t just convenient—they are central to justice in financial remedy cases.

As the latest case shows, parties who sidestep the rules risk more than just a wasted report—they risk judicial disapproval, costs consequences, and an uphill battle in court.

If you're advising on an expert issue, make sure you’re playing by the Daniels rulebook.

Published by James Thornton in Blog

Tags: daniels v walker, single joint expert, single joint expert report, sje, valuation

22 July 2025

When Does Conduct Matter? Two Recent Cases Clarify the Rules in Financial Remedies

Conduct arguments in financial remedy cases are famously hard to win. The bar is high, the principles are narrow, and the courts are cautious. But two recent decisions—MRU v ECR [2025] EWFC 218 (B) and Y v Z [2025] EWFC 221—help clarify the parameters of what counts, when conduct should be pleaded, and how a court might be persuaded that it should make a difference.

Case 1: MRU v ECR — Imprisonment and its Aftermath

In MRU v ECR, the wife had served a prison sentence for attempting to interfere with a judicial process in earlier Children Act proceedings. At final hearing, the husband sought to rely on this as conduct within section 25(2)(g) of the Matrimonial Causes Act 1973. The judge found that the wife’s actions had caused significant disruption and anxiety to the family and could not be ignored when considering the fair division of assets.

Although the case did not result in a punitive financial order, it did result in the husband keeping the former matrimonial home and the parties' pensions being equalised, reflecting his increased needs and financial vulnerability post-incident.

Key point: Serious criminal conduct, especially when linked to the family breakdown, can be relevant even in low-asset cases—particularly if it affects the other party's ability to rebuild financially or psychologically.

Case 2: Y v Z — Conduct vs. Nuptial Agreements

In contrast, Y v Z involved a dispute over how to interpret a pre-nuptial agreement (PNA) in light of the husband's alleged financial misconduct. The wife claimed he had taken millions from her accounts without consent and even doctored emails to hide it. But the question for Mr Justice Cusworth was procedural: should this be pleaded formally as conduct under section 25(2)(g), even though it was about how the PNA should be implemented?

The court held that yes, the wife should be allowed to amend her pleadings to include conduct, but that this was not a radical change—she had always intended to argue that fairness required a deduction from the husband's entitlement due to his financial behaviour. Still, the judgment highlights the fine lines between:

Unfair behaviour affecting what’s "owed" under an agreement; and
Gross or obvious conduct justifying a punitive financial adjustment.

Key point: If you're alleging dishonest or improper financial conduct, plead it properly under s.25(2)(g)—but courts may still consider fairness outside that framework if behaviour undermines the structure of an agreement or the division of assets.

Lessons for Practitioners: How to Succeed With a Conduct Case

Conduct will only bite financially in limited circumstances—but where it does, it must be:

Particularised with clarity (dates, figures, documents);
Linked to a financial consequence (loss, cost, waste); and
Pled early and explicitly under the correct statutory route.

You can’t smuggle in a conduct case “by the back door.” As Peel J warned in Tsvetkov v Khayrova [2023] EWFC 130:

“It is wholly inappropriate to advance matters at final hearing as being part of the general circumstances of the case which do not meet the high threshold for conduct...”

But Y v Z also reminds us that:

“There have hitherto been a number of situations where a question of how a party has behaved may well have been relevant...without either party invoking the conduct provisions.”

That nuance matters. Courts are mindful that bad behaviour may affect the fair implementation of pre-nups or entitlement to share—but that’s not the same as punishing it under s.25(2)(g).

Final Word

Together, MRU v ECR and Y v Z show us both ends of the conduct spectrum—from clearcut wrongdoing with real-world fallout, to sophisticated financial gamesmanship that might affect entitlement but not necessarily trigger punishment.

If you’re going to plead conduct, do it early, do it properly, and make sure you can prove both what happened and why it matters financially. If you’re opposing it, challenge its scope and the causal link to the outcome. The courts will listen—but only if the case is made carefully, not emotionally.

Published by James Thornton in Blog

Tags: case law, conduct, s 25(2)(g)

16 July 2025

When Disclosure Fails and Borders Blur: Family Law Challenges in PZ v ZD

In PZ v ZD [2025] EWFC 171 (B), Deputy District Judge Gwynfor Evans faced a case that was modest in financial scale but immense in evidential and procedural complexity. It illustrates how procedural diligence and judicial perseverance are just as vital in modest asset cases as they are in “big money” disputes.

This case is a goldmine of practice points for family lawyers, particularly on adverse inferences, cross-border evidence-taking, and how disclosure failures can frustrate even straightforward needs-based applications.

Modest Assets, Major Complications

At first glance, this was a typical Schedule 1 and Matrimonial Causes Act 1973 case involving a medium-length marriage, three children, and modest disclosed assets. But beneath the surface lurked a web of withheld financial information, dubious bank closures, and dubious claims about living off family largesse.

The judgment makes clear that non-disclosure is not tolerated simply because the pot is small. DDJ Evans explicitly rejected any suggestion that "big money" legal principles don’t apply to smaller cases. As he said: “I reject that in its entirety”.

Adverse Inferences: A Judicial Tightrope

The judge found the husband to be evasive, inconsistent, and untruthful—particularly in claiming zero income and no bank accounts despite large inflows from service stations and a history of complex financial dealings.

Applying the well-established principles from NG v SG [2011] EWHC 3270 (Fam) and Moher v Moher [2020] EWCA Civ 467, the court made robust findings and drew adverse inferences, awarding lump sums based not just on what was disclosed, but what clearly wasn’t.

Key point: even where precise quantification isn’t possible, courts may infer the existence of undisclosed assets or earning capacity if the evidence supports it.

Remote Evidence from Abroad: The Pakistan Dilemma

A standout issue in this case was the husband's application to give evidence remotely from Pakistan. This posed unique challenges, as Pakistan is not a signatory to the 1970 Hague Evidence Convention, and the UK has no standing arrangement for taking evidence from Pakistan via video link.

Despite conflicting guidance—from the Family Procedure Rules, PD22A, and the Foreign, Commonwealth & Development Office—the judge allowed remote evidence, relying on practical considerations and leadership guidance. However, he later regretted this, as the connection was unstable, and proceedings were frequently disrupted.

Practice tip: Counsel and parties must plan early when witnesses are abroad, especially outside Hague Convention countries. Seek official permissions, use Annex 3 of PD22A, and liaise with the Foreign Office well in advance.

Court Orders Must Mean Something

Multiple disclosure orders were made. The husband ignored most of them. Bank accounts were allegedly closed “by the banks” just before disclosure deadlines. Key documents were missing until penal notices were issued.

The judgment is a sobering reminder that failure to comply with disclosure can be more costly than disclosure itself. Judges may—and should—fill in the gaps with common sense and robust inference.

When Modest Meets Complex

This case underscores a central truth in family litigation: complexity does not correlate with asset value. Even where the finances are modest, gamesmanship, non-cooperation, and international entanglements can make for highly technical, demanding litigation.

Final Thought

PZ v ZD may not involve millions, but it showcases the full weight of the court’s powers when faced with persistent non-disclosure and cross-jurisdictional complications. It’s a cautionary tale for parties who believe that living overseas, pleading poverty, or closing bank accounts will shield them from judicial scrutiny.

For family lawyers, it’s a timely reminder that careful preparation, technical awareness (particularly around remote evidence and disclosure), and a firm hand on procedure are essential—even in “small” cases.

Published by James Thornton in Blog

Tags: adverse inferences, cross border, evidence, moher, ng v sg, non disclosure

15 July 2025

Too Late to Wait: When Non-Compliance Justifies Setting Aside a Pension Sharing Order

In AP v TP [2025] EWFC 190 (B), His Honour Judge Farquhar delivered a pointed and practical judgment showing that while final orders are meant to be just that—final—there are limits to judicial patience, especially where one party repeatedly obstructs their implementation.

This decision illustrates the continuing relevance of the Thwaite jurisdiction in family law and offers important clarity on when a Pension Sharing Order (PSO) can be set aside—not because circumstances have changed, but because one party has simply refused to cooperate.

The Background: Final Order, Endless Delay

The parties had reached a financial settlement in April 2023 that included:

The sale of the family home (split 47/53);
A Pension Sharing Order of 48.94% in favour of the wife (TP) from the husband's Aviva pension (worth £193,000).

But two years later, the husband (AP) remained in limbo. Now 70, in poor health, and unable to access his pension, AP faced the stark reality that he could not retire—not because of the court order, but because the PSO had never been implemented. The reason? The wife refused to complete the basic paperwork, despite being chased, ordered, and reminded repeatedly.

The Thwaite Jurisdiction: Equity in Action

Unable to vary the order under section 31 MCA 1973 (because the Decree Absolute had been granted years before), AP turned to the Thwaite jurisdiction, stemming from Thwaite v Thwaite [1981]. This line of authority allows the court to refuse to enforce or adjust executory parts of an order where it would be inequitable to enforce them due to subsequent developments—particularly deliberate frustration.

Judge Farquhar canvassed several key authorities:

Bezeliansky v Bezelianskaya [2016] EWCA Civ 76: endorsing the ability to adjust executory orders obstructed by one party;
BT v CU [2021] and SR v HR [2018]: Mostyn J’s scepticism of the doctrine;
Hersman v de Verchere [2024] and Rotenberg v Rotenberg [2024]: more recent judgments reaffirming its viability.

His conclusion? The Thwaite jurisdiction remains good law, though to be used carefully. And this was a textbook case.

Why Not Barder?

Interestingly, the court explicitly declined to rely on the more stringent Barder test. That doctrine, used to set aside orders due to unforeseen and fundamental changes of circumstance (e.g., sudden death, collapse of a business), did not fit here. This wasn’t about change—it was about non-compliance.

The Result: Final Warning Before the Final Cut

Judge Farquhar ruled that it would be inequitable to uphold the PSO when the wife had spent two years refusing to implement it. He proposed to set aside the PSO entirely unless she complied within 28 days.

The warning was stark—and printed directly into the order:

“This will result in you losing the benefit of approximately £94,000 worth of pension benefits… Your ability to obtain this pension benefit will be lost forever.”

The judge considered and rejected a Pension Attachment Order, as that would undermine the clean break agreed by both parties and lacked jurisdictional support.

Key Points for Practitioners

Non-compliance can void orders: If a party actively obstructs an executory provision, the court may remove it entirely.
Thwaite lives on: Despite some judicial scepticism, the doctrine remains available—especially where enforcing the original order would now be inequitable.
Clean break still holds weight: The court was reluctant to undo the clean break to salvage the PSO—underscoring the importance of structuring settlements properly from the start.
Final means final, but fair must remain fair: The Family Court retains equitable discretion to undo unfairness—but only when the behaviour is egregious and the solution proportionate.

Final Thought

AP v TP reminds us that court orders are not mere aspirations—they are meant to be implemented. When they’re not, and especially when one party stands in deliberate obstruction, the courts are willing to act—even if that means ripping up a carefully negotiated pension share.

For lawyers and clients alike, the case is a clear message: a signed order is not the end of the story if it’s never allowed to begin.

Published by James Thornton in Blog

Tags: barder, pso, thwaite, thwaite jurisdiction

14 July 2025

Set Aside Under Pressure: When Billion-Pound Deals Unravel in Divorce

In PN v SA [2025] EWFC 141, the Family Court delivered a landmark judgment in what is believed to be the third-largest financial remedy case in English legal history. Behind the billion-pound headlines lies a powerful cautionary tale about pressure, emotional coercion, and the proper legal scrutiny of post-separation agreements.

The Case in Numbers

Estimated marital wealth at separation: over £1.5 billion
Legal costs spent: approximately £5.5 million
Final settlement: over £460 million in divisible assets
Payment made pre-judgment (to maximise tax advantages): $95 million offshore

But it wasn’t just the size of the estate that caught the court’s attention—it was the way the wife had been manoeuvred into signing a post-separation agreement under intense emotional and psychological pressure.

2023 Settlement Agreement: Fair Bargain or Coerced Consent?

The case turned on two agreements: a 2021 Post-Nuptial Agreement (PNA), which provided for equal division, and a 2023 Settlement Agreement signed after the parties separated. The husband argued the latter reflected a considered, updated agreement on asset division. The wife claimed she had signed under duress.

Mr Justice Cobb agreed with her.

Drawing on Edgar v Edgar [1980] 1 WLR 1410 and Radmacher v Granatino [2010] UKSC 42, the judge was clear: while separation agreements carry weight, they must be freely entered into. And here, the wife’s will had been “overborne”. The court accepted she had been subject to emotional, psychological, and financial pressure, including threats that the husband would “explode” the offshore trust structures and “destroy” their fortune through punitive tax events if she did not comply.

Legal Principles Reaffirmed

Undue Pressure: As per Royal Bank of Scotland v Etridge (No 2) [2001] UKHL 44, coercion need not amount to duress to be actionable. Persistent psychological pressure—especially in the context of an emotionally fraught divorce—may suffice.
Set Aside Jurisdiction: The court reiterated that even “signed” agreements may be displaced if enforcing them would result in injustice.
Edgar Factors: In weighing the agreement, the court considered knowledge, legal advice, bargaining position, and changes in circumstance.

High Value, Higher Scrutiny

The court was also unimpressed by the suggestion that fairness had been achieved simply because both parties would receive over £200 million each. Fairness is not just about quantum, but process—and whether each party freely and knowingly entered into the deal.

Lessons for Practitioners

Don’t Assume Size Shields: Even in ultra-high net worth (UHNW) cases, the basic principles of fairness and free will apply.
Be Alert to Emotional Dynamics: Particularly where one party is financially or emotionally vulnerable post-separation.
Process Matters: Attempts to short-circuit independent legal advice or use pressure tactics—even subtly—can invalidate agreements.
Beware “Exploding Trust” Threats: This modern metaphor for financial destruction was critical to the court’s finding of pressure.

Final Thought

This case is a timely reminder that even where couples share phenomenal wealth, the emotional currents of divorce can distort negotiations. Agreements reached under pressure—however cleverly disguised—will not be rubber-stamped by the court. Family law’s guiding principle remains the same: fairness, not force.

Published by James Thornton in Blog

Tags: case law, separation agreement, set aside

30 June 2025

When Trusts Become Trouble: Family Business, Dispositions, and the Cost of Conflict

In BM v MB & Ors [2025] EWFC 129, Fiona Hay (sitting as a Deputy High Court Judge) presided over a case that had it all: dynastic business assets, disputed share transfers, intergenerational family conflict—and over £1.1 million in legal fees.

It is a masterclass in how financial remedy litigation can escalate dangerously when asset protection measures intersect with family breakdown.

The Setup: Complex Structures and S.37 MCA 1973

The case centred around a longstanding family business, held by the husband (H) and various family members. Crucially, just months before the parties separated, H moved:

25% of his shares in the business into a discretionary trust for the benefit of the children;
Multiple parcels of land into a Limited Liability Partnership (LLP) structure.

The wife (W) argued these were calculated attempts to defeat her financial claims, and sought to set aside the transactions under section 37 of the Matrimonial Causes Act 1973—a provision empowering the court to unwind dispositions made to frustrate financial relief.

What the Court Found

Judge Hay found that although the trust and LLP structures had been under discussion for some time, their implementation closely aligned with the breakdown of the marriage. Crucially:

The wife was not fully informed of the transfers;
The husband failed to demonstrate that the transactions weren’t motivated by a desire to reduce W’s claim;
While pitched as inheritance tax planning, the timing and secrecy raised red flags.

The court set aside both the share transfer to the trust and the transfer of land to the LLP under s.37.

The Cost of Litigation

One of the most sobering aspects of the case was the scale of legal costs:

W: £480,248
H: £392,642
H’s mother and others: over £237,000 combined

As the judge noted, the dispute “could and should have been resolved” without this financial destruction. She quoted Baroness Hale in Sharland v Sharland [2015] UKSC 60, who emphasised that adversarial financial disputes are corrosive not only to wealth but to the family itself.

The damage here extended beyond finances: the adult children were drawn into the litigation, cross-examined against their parents, and the family fabric unravelled.

Lessons for Practitioners

Disclosure still rules: Attempts to ring-fence assets before or during divorce must be transparent. Even long-considered tax plans will be scrutinised if implemented around separation.
Timing matters: The court will look closely at when and why transactions occurred. Close proximity to marital breakdown may indicate intention to defeat financial relief.
Litigation restraint is key: The case is a warning against unbridled adversarialism, especially when adult children are involved.
Proper planning requires proper process: H's failure to inform or include W, even nominally, undermined his case. Asset protection strategies must anticipate future scrutiny.
Section 37 remains potent: Though rarely invoked, s.37 can unravel sophisticated structures where they frustrate fairness.

Final Thoughts

BM v MB is not just about trusts and land transfers. It’s about what happens when private family succession planning collides with public duties of disclosure and fairness. While the structures were technically competent, they failed on transparency and timing.

For family lawyers, the case is a reminder: substance, not just form, governs outcomes—and that litigation, left unchecked, can cost more than it’s worth.

Published by James Thornton in Blog

Tags: case law, s37, set aside, trusts

27 June 2025

Can You Strike It Out? M v B and the Limits of Summary Justice in Family Law

When is a bad application so hopeless that it can be struck out without a full hearing? That question lies at the heart of M v B [2025] EWFC 182, a case that dives deep into the contested territory of strike out powers in financial remedy proceedings.

This judgment, delivered by Sir Jonathan Cohen, is more than just procedural housekeeping—it's a clear-eyed look at a developing legal battleground: whether and how family courts can dispose of unmeritorious applications summarily, and what safeguards must be observed.

The Background

The case began with a substantial consent order: the husband (H) agreed to pay his wife (W) £5.5 million across three instalments. In 2020, following business losses, H applied to vary the order under the Thwaite jurisdiction (on the basis that the order was still executory). That led to a reduced payment agreed in 2021.

In 2024, H returned again, citing further financial deterioration. W responded with a strike out application under FPR 4.4(1)(a) and (b), arguing that H's new application was hopeless and an abuse of process. The issue was whether the court could—legally and fairly—terminate the application before a substantive hearing.

The Core Issue: Does Summary Justice Exist in Family Law?

At the centre of the case was whether FPR 4.4 and PD 9A para 13.8 give family courts the power to strike out or summarily dispose of a set aside or variation application.

Sir Jonathan Cohen's conclusion: the answer remains unclear, and courts must tread carefully.

He highlighted conflicting views:

Roberts J (AB v CD [2022]): She accepted that PD 9A para 13.8 permits summary disposal of applications to set aside financial remedy orders, where appropriate.
Francis J (Ma v Roux [2024]): He supported a real prospect of success test akin to CPR summary judgment principles, arguing that new rules and PDs supersede earlier limitations.
Cohen J's view: Practice Directions cannot create new powers not conferred by the rules. Following Roocroft v Ball, the court should avoid using “summary strike out” procedures that sidestep proper process—especially where the effect is to foreclose on a potentially legitimate claim.

What is the Main Practice Point?

Despite W's argument that H was in flagrant default and raising no new issues, the court refused to strike out the application summarily. Instead, Cohen J opted for an abbreviated hearing later on—recognising both parties’ right to be heard and the danger of short-circuiting justice.

This approach avoids appeal risk and delay. It also affirms a key principle: in financial remedy cases, procedural shortcuts must not undermine fairness.

Strike Out Procedure: A Quick Refresher

Under FPR 4.4(1), the court may strike out a statement of case if:

(a) it discloses no reasonable grounds for bringing or defending the application;
(b) it is an abuse of process or likely to obstruct justice;
(c) there has been a failure to comply with rules or orders;
(d) both parties consent (in matrimonial applications).

But this power is narrower in the family law context than in civil claims. As Vince v Wyatt and Roocroft v Ball remind us, family proceedings are uniquely sensitive to fact-specific fairness and procedural equality.

Final Thought

M v B confirms that while the strike out rules exist, their reach is limited and heavily scrutinised. As tempting as it may be to rid the system of hopeless applications, family courts must continue to ensure that parties are heard, not just managed.

For practitioners, the message is clear: if you're seeking to strike out a set aside or variation application, expect a high bar—and always prepare for an abbreviated hearing instead.

Published by James Thornton in Blog

Tags: case law, strike out, summary judgement

23 June 2025

Dissipation in a Modest Pot: Add-Back in MNV v CNV [2025] EWFC 176 (B)

When we think of asset dissipation and the “add-back” principle, we often picture yachts, casinos, or private jets. But in MNV v CNV [2025] EWFC 176 (B), Deputy District Judge Bradshaw dealt with these concepts in a far more relatable setting: a modest Midlands home, a VW van, and a husband who moved abroad to care for his elderly mother—taking a substantial slice of the matrimonial assets with him.

This case is a masterclass in how serious the consequences of financial decisions can be, even in low-asset cases. And it clarifies how the courts handle claims of dissipation and the potential for add-back when the matrimonial pot is small.

The Setup

The parties were long-term LGV drivers with a 14-year relationship and a teenage son. Their principal asset was the former matrimonial home, valued at around £181,000, with equity of £138,814. At separation, the husband held various assets—savings, a van, and a motorbike—amounting to approximately £50,000.

Post-separation, he transferred £17,000 to his brother abroad, later recovered it, sold the van for £27,000, and moved permanently to Country X to care for his mother, bringing the money (and some chattels) with him. The wife argued he had dissipated those funds and should not receive a further share of the remaining matrimonial assets.

The Add-Back Argument

The judge applied the established authorities on add-back, including Martin v Martin [1976], Norris v Norris [2003], Vaughan v Vaughan [2008], and MAP v MFP [2016]. From these, the following modern test was distilled:

Was the expenditure reckless or wanton?
Did it disadvantage the other spouse?
Can the add-back be applied without frustrating the court’s ability to meet needs?

The judge found that the husband’s removal of £47,000 was:

Reckless: He took the only liquid assets while knowing there were none left for his wife or child.
Wanton: He prioritised his mother’s needs (post-separation) over those of his spouse and child.
Disadvantageous: His actions left the wife with no accessible funds.

Yet, the court did not add the £47,000 back into the schedule for distribution. Why? Because this was a “needs” case, and doing so would have left the husband with no ability to meet his own housing need. Still, the judge notionally treated the £47,000 as received for purposes of fairness—not to be repaid, but to calibrate how much more (if any) the husband should receive.

The Result

The husband received a modest lump sum of £6,500 to help rehouse himself in Country X—where property prices were far lower—and the wife retained the FMH. She was not ordered to pay ongoing maintenance, and a clean break was achieved.

Had the wife not raised dissipation and add-back arguments effectively, the result may have looked quite different.

Key Lessons for Practitioners

Dissipation can be found even in modest cases—it’s not just for HNW disputes.
“Add-back” is a powerful tool, but not always one that leads to pound-for-pound redistribution.
Judges may recognise dissipation but still decline a strict add-back if doing so would frustrate fairness or needs.
Evidence of reckless or wanton conduct must be clear—but moral culpability is not always enough (see MAP v MFP).
Consider proportionality of legal costs: here, the judge adjusted the husband's debt to reflect overspending on legal fees, citing YC v ZC [2022].

Final Thought

MNV v CNV demonstrates that even modest financial decisions can carry disproportionate consequences—and that the family court will examine behaviour with just as much scrutiny in a £150,000 case as in a £15 million one. For litigants and advisors alike, the message is this: the smaller the pot, the bigger the impact of each mistake.

Published by James Thornton in Blog

Tags: add back, case law, dissipation

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