When is a final divorce settlement not final?

As divorce lawyers we always advise our clients with confidence that the final  financial settlement that they have incorporated into a Court Order  is exactly that i.e. final. We always have to add that there is some small print however that the chances of their Order being anything other than final are very slim indeed.

Family lawyers all over the Country therefore will be interested to say the least  in the Court of Appeal’s recent decision in the case of Critchell –v- Critchell.

The Court of Appeal has upheld Mrs Critchell’s appeal against an Order that was made determining their financial settlement on Divorce.

The original decision of the Court for Mr and Mrs Critchell was that Mrs Critchell could remain in the family home but that Mr Critchell would retain a 45% interest in it. The intention was to broadly speaking achieve equality with Mr Critchell being able to use the money he had received from the property in due course to discharge debts.  This is what we lawyers call  a needs based case i.e. Mrs Critchell needed a home and Mr Critchell needed some money to pay off his debts at some point and the Court has to weigh up and balance those needs.

However, within a month of the Order being made by the Court Mr Critchell’s father sadly passed away.   Mr Critchell inherited his father’s Estate in the sum of £180,000.   The wife sought to appeal against the original order  of the Court saying that the husband no longer needed the money.  Her argument was that there had been a Barder event which invalidated the basis upon which the Order had been made. She has been successful and Mr Critchell’s interest in the family home has now been transferred to Mrs Critchell and he will not receive any share of the property  in the future.

So how can this be possible?

What is the Barder event that Mrs Critchell’s lawyers argued on her behalf?

Back in the 1980s Mr and Mrs Barder divorced.    Mrs Barder was looking after their 2 children and, based  upon her need for housing, the Court Ordered Mr Barder to transfer to his ex wife all his interest in the family home.

However, somewhat tragically only 5 weeks after the Order was made by the Court and before the house had actually been transferred to Mrs Barder, Mrs Barder committed suicide having first killed their 2 children.

Mrs Barder’s will left all her estate to her mother who argued that Mr Barder should transfer his interest in the property to her.  Mr Barder appealed  to the Court.  He asked the Court to allow him:

1. To appeal out of time (there are fixed and strict time limits upon appealing to the Court after an Order has been made) and
2. To appeal against the Order itself.

In that case the Court decided that Mr Barder would be allowed permission to start his appeal outside of the usual time limits and that his  appeal would succeed.   The Court in that case set down principles which have been applied ever since.

In the Barder case Lord Brandon relied upon the fact that the Order that was made by the Court was made on a reasonable assumption that for “an indefinite period to be measured in years rather than months or weeks” the wife and the 2 children of the family would require a suitable home in which to reside.  That assumption of course was invalidated when the wife and children died within 5 weeks of the Order.

The test or principles that were set out by the Court in the Barder case can be summarised as follows:

1. The new event or events that occurred since the making of the Order invalidate the basis or fundamental assumption upon which the Order was made.     This is such a stringent test that in deciding whether or not to grant leave to appeal out of time the Judge has to be satisfied that the actual appeal itself would be certain or very likely to succeed.
2. That the change of circumstances / event has occurred within a relatively short period of time  after the order had been made.
3. That the Application to the court has been made quite quickly after the relevant event or change of circumstances.
4. That the appeal should not prejudice third parties who have acquired an interest in the relevant property.  For example if a house had been sold on to a third party buyer then, changing the basis of the matrimonial Court Order, could have serious consequences for those purchasers and that would not be reasonable.

In deciding the case of Mr and Mrs Critchell following the death of Mr Critchell’s father, Lady Justice Black commented on how rare it is for a case to actually satisfy the tests set out in Barder.    She made it clear that her decision was not intended to indicate a shift in the legal principles and the test to be applied.   She stressed that the case of Mr and Mrs Critchell was being  decided based purely upon the facts.  The inheritance that Mr Critchell was to receive,  to which he became entitled very shortly after the matrimonial Court Order was made, would enable him to meet his needs by discharging his debts.    That had been a fundamental change and justified an appeal.