16 April 2025

Conditional Appeals in Family Law: A Rare but Powerful Tool – Lessons from Ahmad v Faraj [2025] EWCA Civ 468

A decision from the Court of Appeal in Ahmad and IIB Group Holdings v Faraj [2025] EWCA Civ 468 has caused a stir among family law practitioners. In an unusual but not unprecedented move, the court held that the husband could not proceed with his financial appeal unless and until he complied with a Legal Services Payment Order (LSPO). The message is clear: litigants cannot ignore financial obligations imposed by the court and still expect access to the appeal courts.

The Background

This judgment followed a sprawling financial remedy case between Mr Ahmad (H) and Ms Faraj (W), with IIB Group Holdings also entangled due to property ownership and funding arrangements. The husband had been ordered to pay a substantial lump sum to the wife following findings that he had assets of over £20 million, including a controversial £16 million in disputed accounts.

To ensure parity in representation at the appeal stage, the court made a Legal Services Payment Order (LSPO) requiring H to pay £120,000 + VAT toward W’s legal costs. The wife lacked means; the husband, according to the court, did not.

But H did not pay. Despite having permission to appeal and a stay on enforcement of the lump sum, his refusal to comply with the LSPO put him on a collision course with the court.

What Did the Court Do?

The court deployed a rarely-used but powerful procedural device: a Hadkinson order, preventing the husband from being heard on his appeal until he purged his contempt by paying the LSPO. In the alternative, the court considered but declined to issue an "unless order" (which would have automatically dismissed the appeal unless payment was made).

As Lady Justice King made clear:

"The husband's failure to pay £120,000 + VAT to the wife is deliberate and wilful."

The Hadkinson order was deemed proportionate and necessary to ensure the wife’s access to justice and maintain the integrity of the court’s process.

What Is a Hadkinson Order?

A Hadkinson order is a form of case management order that prevents a party from being heard in court while they remain in contempt—typically by failing to comply with a previous court order. The name derives from Hadkinson v Hadkinson [1952] FLR Rep 287, where the Court of Appeal held that disobedience to a court order could justify limiting a party's right to participate in proceedings. These orders are exceptional and must meet strict criteria: the party must be in contempt; the contempt must obstruct the course of justice; and denying a hearing must be proportionate. In family law, Hadkinson orders are often deployed to secure compliance with financial orders—especially where one party seeks to exploit their financial advantage to the detriment of the other.

Is This Common?

No. While Hadkinson orders are part of the legal arsenal, they are described as a "case management order of last resort" (see Assoun v Assoun (No 1) [2017] 2 FLR 1137). They are reserved for situations where a party is in contempt and their behaviour impedes the course of justice.

That said, the Court of Appeal has signalled that where an LSPO has been properly made and appealed without success, failure to pay it will not be tolerated.

Why It Matters

This case is a shot across the bows for financially dominant parties who attempt to weaponise their wealth. As Peter Jackson LJ stated in De Gaffori v De Gaffori [208] EWCA Civ 2070:

"Failure to pay a legal services payment order is an impediment to justice."

The court’s message is unmistakable:

  • You cannot starve your opponent of legal funding.
  • You cannot defy a court order and still expect to be heard.
  • You cannot hide behind appeals to delay enforcement.

Practical Takeaways for Practitioners

  1. Take LSPOs seriously. Failure to pay can result in Hadkinson orders or strike-out consequences.
  2. Appeals are not an escape route. Even where permission to appeal is granted, compliance with ancillary orders may be a precondition.
  3. Use Hadkinson requests wisely. They are potent tools but must meet strict criteria: proven contempt, impact on justice, and proportionality.
  4. Advise clients early. Especially those with resources, that non-compliance carries reputational, procedural, and financial risk.
  5. Expect robust case management. The family courts are increasingly assertive in managing litigation conduct and ensuring fairness.

Conclusion

Ahmad v Faraj serves as a stark reminder that access to justice cuts both ways. A party cannot pursue their own appeal while denying their ex-spouse the means to respond. In a financial remedy landscape where inequality of arms is a real concern, the conditional appeal offers a dramatic, but justified, judicial solution.

29 October 2024

When Can a Financial Remedy Order Be Successfully Appealed? Lessons from Dr. Ebenezer Adodo v. Geok Kheng Tan [2024] EWCA Civ 1288

The Court of Appeal’s decision in Dr. Adodo v. Tan [2024] EWCA Civ 1288 provides clarity on the conditions for successfully appealing financial remedy orders on the grounds of mistake or misrepresentation. This case underscores the legal principles of full and frank disclosure, the admission of new evidence on appeal, and the specific requirements for setting aside a final financial order due to material error.

Case Background

In this appeal, the husband argued that a significant error affected the final financial remedy order due to a misrepresentation regarding the wife’s Central Provident Fund (CPF) account in Singapore. Initially, the wife had represented that these funds were inaccessible until she reached the age of 65. However, it emerged that the funds were accessible upon the sale of her Singapore property, which could have made approximately £325,000 immediately available—a detail that was not disclosed during the original hearing.

The husband's appeal raised two key issues:

  1. Mistake: Did the initial ruling contain a material error due to incorrect information about the wife’s financial assets?
  2. Misrepresentation: Did the wife’s inaccurate portrayal of her CPF account constitute a misrepresentation that justified setting aside the order?

Legal Framework: Grounds for Appeal on Mistake or Misrepresentation

The Court of Appeal explored several critical legal principles relevant to setting aside a financial remedy order due to misrepresentation or mistake, as well as requirements for full disclosure. Below are key takeaways from this judgment.

  1. Duty of Full and Frank Disclosure: The decision reaffirms the principle that all parties in financial remedy proceedings must disclose all relevant financial resources. As outlined in Livesey v. Jenkins and reiterated by Lord Brandon, a court can only exercise its discretion lawfully and properly if provided with accurate, complete, and up-to-date information on each party's financial resources under Section 25(2)(a) of the Matrimonial Causes Act 1973. A failure to meet this duty may render a financial order substantially unfair and open to challenge.
  2. Materiality of Non-Disclosure: Following Sharland v. Sharland and Gohil v. Gohil, the court clarified that for a non-disclosure to justify setting aside an order, it must be “material.” This means the order would have been “substantially different” had the true facts been known. Not every minor omission or misstatement suffices for an appeal; the undisclosed information must be significant enough to affect the fairness of the outcome.
  3. Route of Appeal vs. Set-Aside Applications: Under Section 31F(6) of the Matrimonial and Family Proceedings Act 1984 and Family Procedure Rule 9.9A, a party can either appeal the decision or apply to the same court to set aside the order. The choice of approach depends on the circumstances, including whether issues of fact need resolution. In Adodo, the court considered an appeal appropriate due to the nature of the issues at hand, which involved assessing the original financial information presented.
  4. Burden of Proving Material Difference: In cases of non-fraudulent misrepresentation, the burden lies with the party challenging the order to show that the disclosure failure led to a materially different result. However, Lady Hale in Sharland noted that in cases of intentional misrepresentation, materiality is presumed, shifting the burden to the misrepresenting party to prove that the non-disclosed information would not have affected the order.
  5. Admission of New Evidence on Appeal: The appellate court has discretion to admit new evidence if it meets the Ladd v. Marshall test: (1) the evidence could not have been obtained with reasonable diligence at the time of the original hearing, (2) it would likely influence the case outcome, and (3) it is credible. In Adodo, the husband’s new evidence about the CPF account accessibility was relevant, as it showed that the financial information originally provided to the court was incomplete.

Key Takeaways for Practitioners

  1. Full and Transparent Disclosure: Practitioners must advise clients to provide comprehensive financial disclosure from the outset, as even minor omissions can lead to costly appeals. Failure to disclose all material assets not only risks unfair judgments but can lead to future litigation to amend orders.
  2. Careful Assessment of Materiality in Appeals: Only substantial errors in disclosure or misrepresentations are likely to succeed on appeal. Lawyers should assess whether the non-disclosure truly affects the fairness of the original order before recommending an appeal.
  3. Selecting the Right Legal Route: Determining whether to appeal or apply to set aside a financial order is critical. Practitioners should evaluate the complexity of the factual issues, as appeals may be more suitable for cases involving straightforward materiality claims, while factually dense cases may benefit from set-aside applications in the same court.
  4. Meeting High Standards for New Evidence: Appeals based on new evidence are difficult to succeed. Lawyers must demonstrate that the evidence was not available during the original hearing, would likely affect the outcome, and is credible. Early, thorough financial investigations are essential to avoid complications later.

Conclusion

The Adodo v. Tan ruling clarifies that successful appeals based on mistake or misrepresentation in financial remedy cases must meet high standards of materiality and relevance. This case reinforces the duty of full and frank disclosure, highlighting that only substantial non-disclosures affecting the fairness of a financial order justify its reversal. For practitioners, the case serves as a reminder of the importance of rigorous preparation and transparency in financial remedy proceedings to ensure just outcomes.

 

Reading List for Mistake and Misrepresentation in Financial Remedy Orders

  1. Livesey v Jenkins [1985] AC 424
    • A foundational case on full and frank disclosure, Livesey establishes that parties must provide complete and accurate financial information for the court to exercise its discretion properly under Section 25 of the Matrimonial Causes Act 1973.
  2. Sharland v Sharland [2016] AC 872
    • This case clarifies that misrepresentation or non-disclosure impacting the outcome of a financial remedy order can justify setting the order aside. It emphasises that materiality is presumed in cases involving fraud, shifting the burden of proof to the misrepresenting party.
  3. Gohil v Gohil [2015] AC 849
    • In Gohil, the Supreme Court discusses non-disclosure in financial remedy orders, emphasising that orders affected by substantial non-disclosure are susceptible to being set aside. This case also clarifies that the Ladd v Marshall test does not apply to setting aside orders based on non-disclosure.
  4. Daniels v Walker [2000] 1 FLR 28
    • This case discusses the use of Single Joint Experts (SJE) and the procedural standards required when challenging or seeking further expert evidence. While it focuses on SJE protocol, it underscores the importance of transparency and thoroughness in all evidence presented to the court.
  5. KG v LG [2015] EWFC 64
    • Here, the court reiterates that non-disclosure will only justify overturning an order if the omitted information would have led to a materially different outcome. It builds on the principles in Livesey, emphasising that minor or trivial omissions do not meet the threshold for setting aside.
  6. J v B (Family Law Arbitration: Award) [2016] 1 WLR 3319
    • This case reinforces that the party alleging non-disclosure must demonstrate that the omission would have influenced the court’s decision materially. The ruling also provides a clear example of applying the burden of proof in cases of alleged misrepresentation.
  7. Ladd v Marshall [1954] 1 WLR 1489
    • This seminal case sets out the test for admitting new evidence on appeal, relevant in cases where appeals are based on new information not presented in the original hearing. Although primarily applied in civil cases, it provides guidance on the standards for new evidence in financial remedy appeals.

These cases collectively shape the principles governing appeals based on mistake, misrepresentation, and non-disclosure. They offer essential insights into the rigorous standards applied by courts to maintain fairness and accuracy in financial remedy orders.

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