Family - application for periodical payments, lump sums and/or transfer
of property.
[2013]JRC185A
Royal Court
(Family)
24 September 2013
Before :
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Mrs Judy Marie O’Sullivan, Registrar,
Family Division.
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Between
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E (the Mother)
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Applicant
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And
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F (the Father)
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Respondent
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Schedule 1 Children (Jersey) Law 2002
Reasons
Advocate V. Myerson for the Applicant.
Advocate H. J. Heath for the Respondent.
judgment
the REGISTRAR:
Background
1.
This is an
application by E, ‘the mother’ for a Schedule 1 application for
periodical payments and/or a lump sum and/or a transfer of property and/or a
settlement of property and/or secured periodical payment for the benefit of A
born in September 2006, just 7 years old, against F ‘the
father’. The mother is 40 and
father is 48 years of age but will be 49 in October. The parties met in 1997 and the mother
says they began to cohabit in 1997 although the father says this was in
1998. The parents were never
married.
2.
The mother
filed her application on the 21st November, 2012. The father had submitted an application
for parental responsibility on the 11th October, 2012, and they
entered into a parental responsibility agreement on the 19th October,
2012. The father applied on 19th
December, 2012, for shared residence or an order for contact with A and a
contact order was made by consent on the 26th February, 2013. The father has contact with A in Week 1
during the school term after school on Tuesday until Wednesday morning and then
after school on Friday until 5pm on Sunday in Week 2. During the school holidays he has
contact with A at 9:00 am on Tuesday until 6 p.m. on Wednesday and Week 2 from
11.30 a.m. on Friday until 5.00 p.m. on Sunday. Provision is also made regarding
Christmas Eve, Christmas Day, Father’s Day, A’s Birthday, their
respective birthdays and as to removal from Jersey. The father accepted in cross-examination
that the mother is the primary carer of A and that the consent order made was
in accordance with the recommendations of the Jersey Family Court Advisory
Service officer so that each parent has one week-end with A.
3.
The mother
is represented by Advocate Victoria Myerson and the father by Advocate Heidi
Heath. Several bundles of documents
have been filed including Affidavits of Evidence in Chief, Open Positions
Statements and Skeleton Arguments.
I heard from the mother, the father and from Captain Clarke, the chief
pilot at Aviation Beauport. The
hearing took place on the 24th and 25th June, 2013. Having been informed by Advocate Heath
that a judgment was shortly expected on a Schedule 1 case in which she had
appeared before the Royal Court, now known as I-v-J [2013] JRC 156, the
matter was adjourned for oral submissions to be made after that judgment. Submissions were heard on the 16th
September, 2013, and 18th September, 2013, and on the 27th
September, 2013. Additional
documents were produced but I have not considered the affidavit of Cecilia–Anne
Scally dated the 1st August, 2013.
Open Positions
Child Maintenance
4.
The mother
was seeking child maintenance of £570 per month but this has risen to
£700 per month with the father paying A’s school fees of £339
per month. In addition she asks
that the father pays half of school/educational trips of approximately £5
per month which at present may comprise a visit to the zoo or somewhere else in
Jersey, reasonably incurred extra-curricular activities which are currently
violin and swimming lessons of £27.62 per month, medical costs not
covered by the mother’s insurance and dental costs which currently are
£10 per month. This totals
£1,081.62 per month. The
paternal grandfather has been paying one half of A’s school fees, of the
mother the other half.
5.
The father
proposed in June 2013 that he pay £565 per month child maintenance but is
now proposing £410 per month to continue until A reaches 16 or finishes
her secondary education, with a review if A goes to higher or tertiary
education. There is a provision for
a RPI review with father paying half of A’s school fees, plus half of
school expenses up to £750 per annum but not limited to extra tuition,
school uniform, computer equipment, sports and musical equipment and school
trips, the sums to be agreed in advance.
The father wants a review in respect of a material change of
circumstances to include a change in A’s residence and to share tax
allowances, with the father proposing that if he does not utilise the whole of
the allowance or in part, this can go to mother.
Accommodation
6.
The mother
wants the father to provide her with the sum of £300,000 towards the
purchase of a home for A to revert to the father when A attains 18 or leaves
tertiary education. In addition she
wants the father to bear the moving costs including stamp duty. The house she requires to be in her sole
name and the lump sum and any interest shall be repayable on the earliest of
the following determining events i.e. A attaining 18 years, or ceasing full-time
tertiary education.
7.
In
addition the mother requires £10,000 towards the costs of furnishing and
any repair works needed for a home for A.
Once the determining event has taken place, the house is to be sold and
proceeds applied first to conveyancing costs, estate agents fees and repayment
of £300,000 together with any proportionate increase, with the balance if
any paid to the mother.
8.
The father
makes no proposals in respect of any monies for a property.
Lump sum
9.
The mother
was seeking a lump sum of £60,000 towards her liabilities “incurred as a result of the
inadequate financial provision” the father made in respect of A and
in respect of legal fees, but the figure has risen to £86,285 due to
increased legal costs.
10. The father offers a lump sum of £4,000
but does not specify what the money is for.
Costs
11. In his open position, the father asks that
there be no order as to costs.
However in his skeleton argument, it was argued that the mother should
pay his costs as she declined on more than one occasion to attend mediation,
failed to set out her open position, cost him his full-time job and cost him
his lodger. The mother was seeking
a lump sum above to include legal fees, or a costs order but not on an
indemnity basis. Costs were ordered
against the father on the 15th May, 2013, due to his failure to make
some disclosure, and the mother’s lawyers are seeking £2,103.98 in
respect of that order.
History of child maintenance payments
12. Between September 2008 to September 2010, the
father claimed he paid child maintenance of £500 per month plus half of
A’s swimming fees, nursery fees and nanny’s fees and when questioned
about this said that the payment was not irregular. However, the mother says there was no
standing order and the contributions were sporadic. From September 2010 to December 2011 it
appeared that the father’s parents were making payments of £950 per
month as to £500 for maintenance and £450 for nursery fees. The father in his affidavit at paragraph
74 said “£950 per month was
paid ... by my generous father” and
indeed a standing order was going from the grandfather’s account. However the father was reimbursing his
father. In his affidavit at
paragraph 65 the father wrote “I
did not agree with paying that amount and setting a precedent” and in
cross-examination conceded that it was deliberate that he let the mother think
his father was paying whereas it was him that was in reality paying. He said that “at some stages he did not have a standing order” but
he was referred to a standing order payment to his father in September 2011 of
£950 appearing in his bank statement, so he was concealing the fact that
he was reimbursing his father. I
therefore find that he did mislead the mother as to who was paying and is
prepared to manipulate matters for what he sees as his own advantage. In January 2012 he reduced child
maintenance to £769.78 per month to take into account one further night A
spent with him. In April 2012 he
reduced payments to £678.49 per month plus half of school fees, and in
May 2012 went on holiday without making provision for maintenance. The mother contacted his father who gave
her £500 and the father then gave her £178.49 and continued to pay
£678.49 per month until 1st April, 2013, when he reduced
maintenance to £500 per month.
The mother pays half the school fees and the father’s father the
other half.
Contact arrangements
13. Both in his affidavit of evidence in chief and
in the skeleton argument filed on his behalf it was contended that there was a
complete lack of flexibility by the mother with regard to contact arrangements
and as a result the father had to sacrifice his full-time career. The mother denied she had been
inflexible prior to the making of the contact consent order on the 26th
February, 2013. In
cross-examination the father maintained that the mother was not flexible about
contact and it was due to her “intransigence”
that freelance work was imposed on him.
The father was referred to evidence of changes in arrangements as set
out in a letter from the mother’s lawyers dated the 17th October,
2012, and although the father said he could not remember these, there is no
letter from his lawyer refuting these.
The father did not provide documentary evidence about contact
arrangements, (having been asked prior to the hearing by the mother’s
lawyers to do so in a schedule of deficiencies), save for 5 e-mails, one of
which was undated asking for extra contact but no replies regarding these
e-mails were provided from the mother by him. He was invited to provide examples of
inflexibility in cross-examination but he said “I do not have any” whereas the mother had produced
contemporaneous notes of changes from 29th February, 2012, to July
2012 and for November 2012. The
father was referred to the mother’s notes and was taken through examples
where he conceded there had been flexibility by the mother on the 4th,
18th and 30th April, 2012, the 2nd and 12th
May, the 4th June, the 3rd July the 3rd, 6th
and 30th November, 2012.
The changes did not just involve work but also when the father was away
on holiday or he wanted to go Kite Surfing. The father did accept that she had
picked up the pieces when changes were required, and although he did accept
working freelance suited him, he would not accept that she was not to blame for
his working on a flexible basis. Having
heard Captain Clarke’s evidence he did say that it was a combination of
inflexibility and rigidity of working requirements but when pressed said that
the reason he was on flexible hours was due to the inflexibility of the mother. The mother gave evidence of the “multiple” last minute
changes by the father with contact arrangements for a variety of reasons, the
detrimental impact of changes on A and the recommendation from the JFCAS
officer that there should be a set pattern of contact. As a result of the JFCAS officer’s
recommendations a consent order regarding contact was made.
14. On the 6th November, 2013, a letter
was sent by the father’s lawyer offering the mother 3 options, namely to
work part-time, freelance or on a full-time basis but with flexibility
regarding contact arrangements. In
response on the 7th December, 2012, a proposal was put forward by
the mother as to contact by him on alternate week-ends with contact every
Wednesday. In the letter her
lawyers wrote “if there cannot be
flexibility on the part of the employer it seems incredible that your client
has couched his proposals in the terms he has”. The father issued a shared residence and
contact application on the 7th December, 2013, and an order was made
by consent, the parties having seen a JFCAS officer, as set out in paragraph 2
above. The mother accepted that
following the making of the consent order in February 2013, she did not want
the father to continue to make changes as she wanted the order to be complied
with, save in exceptional circumstances, and she gave evidence as to how much
happier A was following the contact order.
15. The father’s contention that he had had
to sacrifice his full-time career owing to the inflexibility of the mother was
not put to the mother by the father’s advocate in cross-examination. Indeed, the submission by the
father’s advocate was that this was dealing with matters that had passed
and there was no need to attribute blame and explore the reason behind him
working on a flexible basis. However
it was the father who was attributing blame and he continued to do so during
the hearing and the mother had to answer the allegations made by the father in
his affidavit and skeleton argument.
16. I find that there was flexibility by the mother
regarding changes to arrangements to accommodate the father prior to the order
made by consent with the father on the 26th February, 2013. I therefore do not find that the changes
in his income are as a result of inflexibility on the part of the mother.
Mother’s income and earning capacity
17. The mother has had a varied employment
history. She worked in Channel
Television when they first met, and from November 1997 to 1998 she became a
Customs Officer. From 2005 to 2006
she worked for Russia Today, a television station, and returned in February
2006 to recommence cohabitation. In
September 2006 A was born. The
parties separated in or about November 2008 and in December 2008 she started a
part-time job with a PR Company, Direct Input. In October 2001 she started work with a
radio station where she still works.
She now earns approximately £24,000 per annum but may earn
additional sums to cover for sick or absent members of staff or if she works an
early shift. Her gross salary at
December 2012 was £27,844.58 and the mother works 40 hours per week, and
she had no salary increase in April 2013.
Her net earned income is approximately £2,000 per month, although
on analysing the payments in her bank account her salary averages out at about
£2,167 per month. In 2012 she
was entitled to a reimbursement of GST in the sum of £218.36 as a result
of her low income. The father
considered she was not maximising her earning capacity, that she has a good
earning capacity “some of which is
presently unused.” He
said that there must be progress for someone like her but agreed she should not
have to work in Russia where she had earned more. He produced no evidence in support of
his contention that she was not maximising her income. She works 40 hours per week and is the
primary carer for A so cannot work more hours. I therefore find that the wife is
maximising her earnings.
Income needs of mother
18. The mother’s net income is approximately
£2,167 per month but her total monthly outgoing are £4,225 per
month, of which £1,318 are specifically related to A. Because her net income is approximately
£2,167 per month, this leaves a deficit of £2,058 per month. The father maintained that the
mother’s income needs were inflated and she “spends significant sums on herself”. He considered that the £450 per
month she spent on groceries and toiletries for herself and A was more than it
needed to be - £103 per week - but I do not find this excessive. She spends £25 per month on shoes
but he accepted he did not have much of an idea how much shoes cost. He writes that “A is not the cause of E’s financial difficulty, E’s’
financial imprudence is” and he warms to this theme by saying “her spending habits do not reflect
the behaviour of a person with a sound state of mind.” She has not put down any expenditure for
holidays or trips away from Jersey; a holiday she and A took to Hong Kong was
paid by her brother. He considers
that BUPA fee of £84.62 for herself and A is an unnecessary expense for
her and A but she says she has negotiated a good fee and that there is
hereditary cancer in her family. A
may require significant dental work in the future. She was unable to quantify how much
school trips could cost in the future, but as she is only 7 she would not be on
trips for some time. She gave
evidence that she buys things on Amazon such as toilet rolls which are cheaper
than in Jersey. She pays the whole
of the costs of A’s swimming lessons of £24.50 per month and also
violin lessons which are now £123 per term, as the father wants to pay for
those activities of his choice for A and apparently the lessons she has were
arranged without him. His main
concern was that she wasting money on a nanny costing £840 per month (a
maximum of 20 hours per week at £10 per hour) but she was not challenged
as to the cost of hiring an au pair.
She gave evidence as to the unreliability of the father and although in
the past his parents have helped with A they are elderly. She gave evidence that it will be
cheaper to have an au pair on the basis that food and accommodation is
covered. However her current
accommodation is such she cannot house an au pair. The father did accept that the mother
had a shortfall each month and was making up for lack of income by borrowing
and using a credit card, which included a £10,000 loan to consolidate her
debts. I do not find that the
expenditure she states is excessive and nor do I find that that it can be said
that her expenditure is that of someone who does not have “a sound state of mind.”
Mother and A’s accommodation
19. In September 2001 the mother bought J as a buy
to let property and it is where she now lives with A. It is valued at £275,000 and the
mortgage at December 2012 was £113,287 so the figure will be lower. Notional cost of sale of 2% amounting to
£5,500 leaves a net equity of £156,213. It is a small two bedroom cottage with
combined kitchen, living and dining area.
The second bedroom where A sleeps is approximately 7 feet by 7 feet and
so small that a full size single bed does not fit into it, so she presently
sleeps on a cabin bed. I accept
that as A is 7 years of age she will shortly require a full size bed. There is limited storage space, no room
for a desk for her, no room to play in her bedroom or elsewhere in the
property, and when friends came round to the house, they had to sit on the
floor to eat as there is only a small table and a few chairs. There is no outdoor play area and no
garden. There is a special small
size bath and no room for a tumble dryer.
The property requires a new heating system. The father’s view is that J still
meets A’s needs, but I find, having heard the evidence that this is not
so; there is not even room for a full-sized bed or for her to do her
homework. The mother therefore
needs alternative accommodation for herself and A.
Additional lump sum claim for furbishing and equipment
20. The mother is looking for an additional amount
of £10,000 toward furnishings and equipping a home for A and
renovations. She gave evidence that
she had little furniture because of the size of J and does need a desk for A, a
dressing table for her, a full size bed for her, a wardrobe for her,
kitchen/dining table and dining chairs, tumble dryer, a fridge/freezer, 3 piece
suite and if a 3rd bedroom, a bed and wardrobe for that. She said it was hard to quantify what
monies would be needed if she had to refurbish a bathroom or kitchen but costs
can be considerable. It was pointed out by the mother’s advocate that the
father had spent £5,000 on a bathroom in his own property.
Other assets and liabilities of the mother
21. The mother has a car worth £3,000. The mother has loans, credit card debts
and legal fees outstanding of £50,063 at the time of the hearing in June
but this has now risen to £86,285 on a legal aid basis and she produced
up-to-date statements and other documentation. The personal loan has decreased to
£10,985 due to payments made by her.
Her overdraft has now increased to £4,453.94. It was submitted that her debts had
increased since the start of the hearing because her financial position is
untenable and I accept that this is so because her income does not meet the
outgoings. Her family loans are
£13,759, which includes a £500 loan from her brother. She does not have the means to pay her
debts. It was not put to her that
the loans she has are soft loans.
Father’s employment and earning capacity
22. The father worked as an Air Traffic Controller
from 1996 to September 2008 where he earned about £70,000 to
£80,000 per annum and as a result of that employment has a Public
Employees Contributory pension fund of £661,204. The father left Air Traffic Control to
work as a private pilot but just before his induction the company he was going
to work for went bankrupt. He was
questioned about returning to air traffic control as apparently he could have
gone back and it was put to him that he had had conversations with Air Traffic
about this as they would have taken him back but his response was “I don’t know.” There is an issue between the parties as
to the father’s employment status thereafter as mother says he did not
work from November 2008 until August 2009, although father says he spent two
months working for Nigel Mansell, was made redundant, used some monies going on
two holidays but in the middle of December 2009, he started working for another
local man so he was off work for 8 months or so. From about mid May 2010 he worked for
Aviation Beauport, a charter business, on a permanent full-time basis earning
£50,000 per annum.
23. The mother’s case is that the father
intended to work freelance but this was denied by the father, who said he had
wanted to go part-time and earlier in the year of 2012 Aviation Beauport had
said he could go part-time.
Reference was made to an e-mail he sent in December 2008 to the mother
regarding a cohabitation agreement he proposed in which he said:-
“I would be more of a
house husband, freelance pilot, and property maintenance man in the mornings
and us going playing with A in the afternoons. And yes if the sun is out I may
sit in it. I suggest we would need to tell social security that I am looking
after the house or I am supposed to pay £400 a month.”
The mother was asked to explain the
reference to social security in the e-mail and this e-mail was also put to the
father. The mother explained the
father had attended at social security with A, attempting to claim a
carer’s allowance at a time when A was not living with him and he was not
her primary carer.
24. In the e-mail he said that he was desperately
keen to pursue his sporting interests before he got too old – “don’t begrudge me the trips. I
may go back to more formal employment when I am wrecked”. The father was then 44.
25. The mother said he had said to her that if she
pursued an application for finances he would reduce his working hours and seek
more contact. She said that in 2011
he had told her he wanted to go freelance and reference was made to an e-mail
he sent on the 2nd May, 2011, to her saying he had spoken to
(Captain) Phil Clarke about doing this and the father wrote to Advocate Myerson
on the 13th May, 2011, saying
“I have written to the management at Aviation Beauport asking them to
confirm that they will allow me to work on a freelance basis.” but in
cross-examination he said this was a mistake and it should have read “part-time” but subsequently
in cross-examination he said that he didn’t know if he wrote or spoke to
Aviation Beauport and then said he didn’t remember writing. He said in cross-examination he wanted
to be part-time rather than on a flexible basis so he could look after A half
the time. In a further e-mail in
August 2011 he made reference to working freelance when not looking after A and
in an e-mail to the mother’s brother on the 6th August, 2011,
said “Hopefully I will be able to
work as a freelance pilot when I am not looking after A. I will also be able to
spend far more time maintaining my small property empire.” In his affidavit of evidence in chief at
paragraph 42 the father stated that Aviation Beauport agreed during the summer
of 2012 that he could work part-time for half of each week. Attached to the father’s affidavit
of evidence in chief were 3 letters from Captain Clarke. Captain Clarke thought that the first
time that part time working was mentioned was in 2012 but he then said the
father had talked about it before, but in June 2012 was the “first time he said I would do
it”. He said that the
father had asked to work half the time and he said that the letter written by
him on behalf of Aviation Beauport of the June 2012 reflects the discussions
about working part-time. The father
was to work from the 1st August 4 days per week for a trial period
of 3 months with a salary of £26,000. Captain Clarke gave evidence that the
trial period was put into effect.
It was intended to be a temporary trial of 3 months and they “bent over backwards” to
accommodate this. Captain Clarke
gave evidence that it became difficult to accommodate the arrangements. In his affidavit of evidence in chief,
the father wrote that by the autumn he wrote that “Aviation Beauport had become increasingly frustrated with the
situation“. In November
2012 he had suggested three options to the mother with regard to working
part-time, freelance or full-time if flexible arrangements as to contact could
be made. The mother said that the
proposals side stepped her concerns for A as to last minute changes to contact
and the father then put in an application for shared residence and contact on
the 7th December, 2012.
In his application for residence or shared residence dated the 7th
December, 2013, he stated, “I have
now adjusted my working hours and I can now care for A for 50% of the
time,” but this was at a time when according to his evidence he was
still working full-time. He
wrote in his affidavit “During
December 2012 I was told I could only work for the company on a freelance
basis.” Captain Clarke
was referred to the letter written by him on the 18th December,
2012, at page 166 in the bundle, to the father in which he had written that
they had being trying to accommodate the father’s fixed access
arrangements but that it did not fit in with the business model and by way of
example he, Captain Clarke, had had to work on his 60th birthday. As a result, the father’s
employment was being terminated on 3 months’ notice and from the 1st
April, 2013, he could only work freelance.
Captain Clarke was asked whether it must have been disappointing and he
replied “Yes, but he felt he (the
father) had to do this.”
He was asked if he was surprised to hear that on his, Captain
Clarke’s, 60th birthday which he had to work, the mother and A were in Hong
Kong and was asked what reason the father had given said “I’m not sure if he provided me with a reason.” He was asked whether the reason given by
the father for not working on the 60th birthday was that the father wanted to
spend time with his daughter and Captain Clarke said “if he was not available, he was not available”. This was subsequently put to the father
and he then said he was on holiday.
26. He was prepared to mislead his employer about
why he was unable to work on Captain Clarkes’ birthday and include in his
evidence filed at Court a letter giving an example of the mother’s
apparent intransigence which was not correct. Captain Clarke was referred by Advocate
Myerson to the letter written on the 4th January, 2013, to “To whom it may concern”. In that letter he said that at the latter
part of June (2012) “it was agreed
that, for a trial period…every attempt would be made to allow F off the
same regular days each week.”
He went on to write “To have
F approach me again a few weeks ago to say that this arrangement was not
working for the mother of his child and he needed to work on a part time basis
with the same three days off each week (one of which was a Saturday) was the
final straw… have bent
over backwards to accommodate F.” In his letter he went on to say that “Due to this intransigence, (by the
mother) I felt I had no option but to write to F and explain that the only way
out was for him to work for us on a freelance basis”. Captain Clarke giving evidence said that
he thought that the mother’s inflexibility was the crux of the problem
but agreed that the information as to the mother’s intransigence had come
from the father. However the father
in cross-examination said his freelance work started on the 1st April,
2013, and he “saw little point in
working part-time when I had not got her part-time” and he was
working full-time until April 2013.
His bank statements from June to July 2012 to December 2012 do show a
salary from Aviation Beauport of £3,191.75 per month so he was working
full-time. The evidence and letters
are inconsistent and there were discrepancies between the father’s
affidavit evidence and evidence given in cross-examination. He said that the decision for him to
work only on a flexible basis was because Aviation Beauport was frustrated with
the situation whereas it was he who told Aviation Beauport he wanted to change
the arrangements and on the 7th December, 2012, on his residence
application stated that he had adjusted his working hours and could care for A
50% of the time.
27. The father accepted that he had said to his
parents that if the mother sought increased child maintenance he would work
part-time and seek shared residence.
It was accepted by the father
it was his wish to work on a part-time basis, which wish was expressed
as early as 2008 and that when the father was served with the mother’s
application for finances on the 29th November, 2013; he then started
his application for shared residence/contact on the 7th December,
2013. I find that the father was prepared
to manipulate facts and his employer to his own advantage to carry out his wish
to reduce working hours, and carried out his stated intention to put in an
application for shared residence shortly after being served with the
mother’s schedule 1 application, and stated he had adjusted his working
hours so he could care for A 50% of the time when it was not correct.
28. Can the father now work full-time and is he
maximising his earning capacity? At
the hearing in June 2013 the father stated his gross income was £2,500
per month from Aviation Beauport i.e. he charges £250 per day as a
freelance working 10 days a month.
He pays tax at 20% so his net income is £2,000 per month and with
Social security deducted £1,850 per month.
29. Aviation Beauport had “lost” money but according to Captain Clarke finances “seem to be improving in the second
quarter.” He said that
the father was a good employee and does need to pass a medical from time to
time to continue working. Captain
Clarke gave evidence that a pilot gets 36 days a year off but must be available
for the remaining days, which could be at 2 hours’ notice. The father needs 5 days leave every 2
weeks to guarantee his availability to look after A under the current
arrangements. The majority of money
paid to the pilots is to ensure that they are on standby, given, because it is
not a scheduled airline, they cannot predict what will happen. He said that it is difficult for the
father to be on standby if he has A and it is difficult for anyone to have much
of a family life. However he said
that Aviation Beauport is understanding, hence the letter of June 2012. Before he became freelance, the other
pilots were working around his schedule of contact, and it was the father who
said to his employer that the arrangements were not working, not the other way
round. The father gave evidence
that if he is working freelance he can plan what he can do and if he does 10
days a month he can look after A 2/3rds of the time. This means that either his work is
predictable and therefore, if work is available he could work more, or if
unpredictable he could not guarantee to be available to look after A. In cross-examination after hearing
Captain Clarke’s evidence that father said “I’d happily work full-time if I could have sufficient time
with A. I could look after her
every week-end.” He
conceded he could earn £50,000 per annum but he said “It is far better for me to be freelance”. I find that the father has engineered
his work so he is currently working only 10 days a month but his earning
capacity is greater than 10 days a month and he could according to his own
words work full-time. Furthermore,
just as the father’s advocate submitted the mother could seek alternative
employment, although this was not put to her, it would be an option for the
father to find alternative employment.
Father’s Properties and income and expenditure on
them
30. The father now owns 3 properties and lives at B
on La Route de la Haule, St Lawrence, which he purchased in August 2004. In April 1997 the mother was a lodger of
the father at C, Victoria Avenue, but this property was sold by the
father. In addition to B, the rents
out his other properties, D, La Chemin des Moulins, St Lawrence and G, Victoria
Avenue, St Helier. He gave evidence
that looking after the properties takes up a lot of his time, the worst thing
being if a tenant leaves and the place then needs redecorating. He provided a schedule of expenses for
2010 and 2011 in respect of the properties prepared for tax purposes as he gets
relief of 20% on the expenditure.
He also provided a schedule of current income needs which includes
expenditure on the properties.
D
31. This was purchased in 1998 by the father from
his sister and he and the mother moved into it, it having three double bedrooms,
house bathroom, kitchen, lounge and utility area and garage. There is a garden and separate one
bedroom flat for rental accommodation and parking for 3 cars. It is valued at £525,000 and the
mortgage at December 2012 was £128,363 (although the figure will actually
be lower as the father continues to pay the mortgage.) Notional cost of sale of 2% amounting to
£10,500 leaves a net equity of £386,137. The main house is let at a rent of
£1,440 per month and the flat is let at £670 per month after Slomans
have deducted their 10% fee management fees of £160 per month. The total gross income he receives is
£25,320 per annum or £2,110 per month.
32. The father’s evidence was that he is
making a loss of £7 per month on letting D. On a tax rate of 20% he said the tax
payable is £422, with a net rental of £1,688 per month. In his evidence in chief he said that
there should be a discount for periods when D may not be let of 15% .i.e.
income times 85, a figure therefore of £253, a sub-total of £1,435
per month. The mortgage payment is
£980 per month. The total
figure for maintenance rates and expenses is £462, and if the 15%
discount is accepted, a loss of £7 per month. His advocate in her submissions provided
a schedule showing a net loss of £7 per month. However the tenancy of D is until March
2014, the tenant having been there since April 2012 and no notice period is
provided. The D flat has been let
to the same tenant since December 2008.
I therefore can see no reason why there should be a 15% discount.
33. It was only conceded by Advocate Heath during
re-submissions made by the mother’s advocate that the figures put forward
by the father were incorrect, save that he still maintained that there should
be a 15% discount. He had accepted
in cross-examination that the level of payments on D fluctuates. His gross income from D is £2110
per month. The mortgage payment for
D is £863.88 capital and £116.12 interest so the tax deductible
interest is £116. The
maintenance and rates figure is £462 which together with the £116
amounts to a profit figure (i.e. income less expenses figure) of
£1,532. Tax on this at 20% is
£306 and less the mortgage of £980 gives a net profit per month
figure of £362 per month, rather than the minus £7 per month, a
difference of £4,428 per annum.
It was submitted by Advocate Myerson that the father had been a landlord
for some years and therefore knows how tax is calculated, particularly as he
had previously been fined for non-payment of tax in respect of his rental
income. I accept this submission
and also that in his evidence he sought to establish a limited income which did
not accord with the facts.
G
34. In October 1999 he purchased G, which has two
double bedrooms, a single bedroom, two bathrooms, kitchen and lounge. It has a sea view, garden area and
balcony. It is valued at
£470,000 with no mortgage.
Notional cost of sale of 2% amounting to £9,400 leaves a net
equity of £460,600. He lets
the property out at a rental of £1,550 per month or £18,600 per
annum.
35. The father’s evidence was that on a tax
rate of 20% the tax payable is £310, the net monthly income being
£1,240. If the 15% discount
for non-letting is accepted of £186, the total is then £1,054 per
month. There is no mortgage but the
figure for maintenance and rates is £231, and thus there is a net profit
of £823. The current tenant
however has signed a 7 year lease from the 15th March, 2013 with no notice
period. I therefore do not accept
that there should be a 15% discount on the rent.
36. It was only conceded by Advocate Heath during
re-submissions by Advocate Myerson that the figures put forward by the father
were incorrect, save that he still maintained that there should be a 15%
discount. The correct calculation
for G is a gross income figure of £1,550 per month, less maintenance and
rates of £231, a figure of £1,319. Tax on this is £264 and the total
net profit figure is £1,055 per month rather than the £823 per
month put forward by the father, a difference of £232 per month or
£2,784 per annum. Thus the
total net income from his lettings is £1,417 per month or £17,004
per annum.
B
37. In September 2004 the father purchased the
property which is on the sea front at Bel Royal where he lives. It is a two-bedroom open planned style
apartment with parking, a double garage, balcony and sea view with access on to
the cycle track and beach. He did
have a lodger but in February 2011 the lodger was asked to leave so A could
have her own bedroom. It is valued at £750,000 and the mortgage at
December 2012 as £251,668 so the figure will be lower. The notional cost of sale of 2%
amounting to £15,000 leaves a net equity of £483,332.
H
38. The father has a reversionary interest in H
which has not been quantified, shared with his brother and sister. The property is subject to a lease made
by his father and aunts in favour of I Limited which the father, his sister and
brother have also signed so that in the “event
of the death of their father and aunts, the tenant would know that the lease
would continue for the remainder of the term.”. The youngest of his father and aunts is
about 85 year’s old. I accept
the mother’s contention that there is a value in his reversionary
interest although I am unable to quantify this.
39. His total net equity in the above properties,
excluding his interest in H, is £1,330,069.
40. It was put to the father that if, as he
maintained, D was costing him money each month, the sensible thing would be to
sell it but he did not want to do this.
Other assets of the father
41. The father had £2,402 in total in his
bank accounts. He has an endowment
policy with a surrender value as at September 2012 of £35,658, maturing
in September 2017. He has two cars
and a motorbike all valued at £18,000. His pensions have a CETV of
£665,195. £661,204 of his pension is Public Employees Contributory
Retirement Scheme pension and he has an option of drawing a cash sum of 25% of
his pension tax free at 60 so in 11 years’ time when A will be 17.
Income needs of father
42. Given the trenchant criticism of the
mother’s spending when she is A’s primary carer a total of
£2,747 on herself and providing a home for A and £1,015 per month
on A’s particular needs, I note the father in his affidavit of means
dated January 2013 put his own income needs as £4,865.50 per month saying
in the future it would be £5,598 per month. However by June 2013, in his affidavit
of evidence in chief he says that his income needs for himself come to
£6,650 per month and £217 for A, a total of £6,867 per
month. In his affidavit of evidence
in chief, he wrote that his concern is that he could not meet his income needs
in the future as his “net income
will be no more than £30,000 going forward” (£2,500 per
month). He then said his income
would be £1,850 from Aviation Beauport, he would have a net loss from D
and with the income from G would have a net income of £2668 per month,
which is not correct.
43. On analysing his schedule of expenditure he has
allowed for £800 for “income
tax if not deducted from salary” but tax is deducted. At paragraph 121 of his affidavit of
evidence in chief, he confirms the combined expenditure for D and G is
£694 and yet then adds for D the following expenditure of £31 for
house insurance, £17 for rental advertisement, £17 for parish
rates, management fees of £160 (already deducted to arrive at the net
income figure) garden maintenance of £10, planning applications of
£30 per month. In addition
for the net income figure for D, the mortgage of £980 per month has
already been deducted. With regard
to G, the house content is £25 and replacement items £17, a total
of £42. The father criticised
the mother for her expenditure but I note he has allowed for holidays of
£200 per month for which she has no provision, he has put replacement
household items twice, totalling £200 per month, whereas she has allowed
for £10 per month. He says he
is paying £250 per month to Appleby for legal fees but has paid nothing
as yet and he has provided for repayments to his father.
Liabilities of the father
44. The father says his legal fees of £37,665
are unpaid. He has family loans now
totalling £77,851. The father
was fined £110,000 for “wilfully
and negligently submitting incorrect Income Tax returns.” He borrowed £85,000 from his
father in respect of the fine and made 3 payments to him totalling
£30,000, the last payment being in August 2011. He thus owes his father £55,000
for this, but there is no set time for repayment and no interest due. The father says that the fact that he
has made repayments to his father shows that the borrowing is not a soft
debt. The mother however claims the
sums borrowed from his father are gifts as there are no formalities or
requirements for payment. I do
accept the father considers he is under an obligation to repay monies but is
not doing so at present, and rather than taking action to recover money from
him, his father has lent him more money.
He has a further loan of £22,581 used for legal fees, child
maintenance and school fees between June 2010 and April 2013 and in addition
owes outstanding tax for 2012 of £13,226. The father was ordered to use his best
endeavours to obtain an affidavit from his father as to financial support
received by him and what monies will be available to him in the future. No affidavit was provided, although a letter
was provided dated the 23rd December, 2012, by the father stating he
was owed £6,497.50 in addition to the £55,000. It has been submitted that his father
was complicit in the arrangement over the £950 maintenance per month, in
that his father paid the maintenance to the mother and he reimbursed his
father, and his father is also trying to help him by claiming the sums are due
when they are not.
45. A started at K School in May 2011. At present 50% of the fees are paid by
A’s paternal grandfather and 50% by the mother. The father wrote “At present I am not content to pay for A to be privately
educated whilst I am so unhappy about the access arrangements.” However he does now agree to pay half
the fees but also suggested the mother pays 3/14ths and also he said if he
asked “nicely” his father
may continue to pay towards A’s school fees.
Property particulars
46. The mother estimates that an appropriately
sized house would cost about £450,000. She proposes that she sells J, which has
a net equity of £156,213, and she has provided documentary evidence of a
borrowing capacity of £138,000.
She is looking to the father to provide a lump sum of £300,000
towards the purchase of a property.
She provided a list of properties of about £450,000 with one of
£415,000. The father’s
property is worth £750,000 whereas the mother is looking at 3 bedroomed
properties costing in the region of £300,000 less than his home. She says it is cheaper to hire an au
pair than to pay for childcare, hence she wants a third bedroom. She was not challenged on this but the
father pointed out that he or his parents could assist with child care
arrangements. The mother said that
last minute changes in respect of contact took place not just because of his
work but also because of his social life.
The father provided property details ranging from £279,000 to
£309,000 of flats and 2 bedroomed cottages, and in areas that the mother
did not wish to live with A. Only 1
had a garden patio but no parking.
He was asked whether he thought the properties he suggested were
suitable for A and the mother but his response was that he would like her to
spend more time with him.
47. The father says he cannot borrow any more money
to give the mother and I accept that on the current structuring of his
finances, this is correct. He was
asked about selling either G or D and said he could not live without the rent
from either property. This was at
odds with the evidence that he had given which was that he was making a net
loss from D of £7 per month.
48. It was suggested in submission made by the
father’s advocate that rather than sell one of his properties the mother
could let her property on a rental of about £807 per month but given that
the mortgage payments are £850 per month and her expenditure exceeds her
incomes this was not a viable option, and was not explored in depth.
49. No details of rental properties were provided
by the father for the mother to consider and nor was the mother asked about
renting a property by the father’s advocate.
The Law
50. Article 15 of the Children (Jersey) Law 2005
provides that:-
“The court may make orders
for financial relief with respect to any child in accordance with Schedule
1.”
51. Paragraph 12(a) of Schedule 1 provides that an
order may be made requiring one of both parents to:-
“(i) to make such
periodical payments and for such term,
(ii) to secure such periodical payments and
for such term,
(iii) to
pay such lump sum, and
(iv) to
transfer such property to which the parent is or the parents are entitled, as
may be specified in the order to the applicant for the benefit of the child or
to the child personally.”
And Paragraph 12(b):-
“(b) a settlement to be made for the benefit of the
child and to the satisfaction of the court of property to which either parent
is entitled and which is specified in the order.”
52. Paragraph 4 of Schedule 1 provides that the
court must have regard to all the circumstances including:-
“(a) the income, earning capacity, property
and other financial resources which each person mentioned in sub-paragraph (4)
has or is likely to have in the foreseeable future;
(b) the financial needs, obligations and
responsibilities which each person mentioned in sub-paragraph (4) has or is
likely to have in the foreseeable future;
(c) the financial needs of the child;
(d) the income, earning capacity (if any),
property and other financial resources of the child;
(e) any physical or mental disability of the child; and
(f) the manner in which the child was
being, or was expected to be, educated or trained.”
53. There are provisions relating to lump sums in
paragraph 5, including at sub-paragraph 1:-
“Without prejudice to the
generality of paragraph 1, an order under that paragraph for the payment of a
lump sum may be made for the purpose of enabling any liabilities or expenses
reasonably incurred before the making of the order to be met which were incurred in connection
with the birth of the child or in maintaining the child.”
54. I have been referred to numerous cases, 38
cases in total by the father’s advocate and 12 by the mother’s
advocates and have considered them all.
55. There are three reported cases in Jersey
regarding financial provision under Schedule 1, the latest being I-v-J
[2013] JRC156, a decision of Commissioner Clyde-Smith, the two earlier cases
being decisions of Registrar Obbard, namely C-v-L [2009] JRC165A, and A-v-B
[2012] JRC165A. All three cases
make reference to English case law, in particular the Court of Appeal case of Re
P (Child: Financial provision) [2003] 2 FLR 865. At page 877 Bodey J outlined the
following considerations:-
“(a) the welfare of the child while a minor, although
not paramount, is naturally a very relevant consideration as one of all the
circumstances of the case;
(b) the length and nature of the
parents’ relationship and whether the child was planned are generally of
little or no relevance, since the child’s needs and dependency are the
same regardless of these circumstances (J v. C (Child: Financial provision),
[1999] 1 FLR 152, considered);
(c) one of the “financial needs of
the child,” to which the court must have regard under para. 4(1)(c) of
the Schedule, is to be cared for by a mother who is in a position, both
financially and generally, to provide that caring. It is well established that
a child’s need for a carer enables account to be taken of the caring
parent’s needs (Haroutunian v. Jennings (1977), 1 FLR 62, considered; A
v. A (A minor) (Financial provision), [1994] 1 FLR 657, considered);
(d) under para. 4(1)(a) and (b), the court
must take into account the parents’ respective incomes, earning
capacities, property and other financial resources, together with their
respective financial needs, obligations and responsibilities. A child is
entitled to be brought up in circumstances that bear some relationship to the
father’s current resources and present standard of living (J v. C (Child:
Financial provision), per Hale, J.);
(e) the court must, however, guard
against unreasonable claims, going potentially far wider than those reasonably
necessary to enable a mother properly to support a child, made on a
child’s behalf but which would be for the benefit of the mother rather
than the child (J v. C (Child: Financial provision));
(f)
if the father’s resources permit and the mother lacks significant
resources of her own, she will generally need suitable accommodation for
herself and the child, settled for the duration of the child’s minority
with reversion to the father; a capital allowance for setting up home and for a
car; and income provision (with the child’s education expenses generally
paid by the father directly to the school);
(g) such income provision can be reviewed
from time to time, according to the changing circumstances of the parties and
child; and
(h) the
overall result achieved by an order under Schedule 1 should be fair, just and
reasonable, taking all the circumstances into account.”
Lump sum
56. The Re P case was a big money case where
the father described himself as immensely wealthy and conceded he could pay
£10 million if ordered to do so.
Bodey LJ said that in bigger money cases, the court should not get
bogged down in detailed analysis of budgets, whereas Thorpe LJ said that the father
may be entitled to reasonably detailed accounts of expenditure so none goes to
the personal or exclusive benefit of the mother.
57. The case of I-v-J is unusual in that
whereas the younger child lived with the mother, the older child lived with the
father. Furthermore, in paragraph
73, the court said that the younger daughter may choose to live with her father
in only a year’s time paragraph 73 (i):-
“it is possible that she will
elect to do so (as did her sister) in only a year’s time. Substantial costs
(stamp duty and legal fees) will be incurred in purchasing a house, only to be
sold (with further attendant costs) in short order, in order to repay the
father. Lump sum payments for the purchase of accommodation are more suitable
where the accommodation is going to be required for a lengthy period of time,
i.e. for younger children ( in A-v-B, the younger of the two children concerned
was six) where it is settled that the mother will be the primary carer for the
children’s minority.”
58. In this present case, A is just 7 and the
mother is the primary carer. In the
I-v-J case, the Court stated that the mother already had an adequate
home, the cost of which she shared with her partner, and in the circumstances
when the younger daughter may move within a year, the court did not provided
monies for alternative accommodation.
J is not an adequate home for A.
If any accommodation is to be purchased it will therefore be for a
lengthy period of time. Furthermore
the mother does not have a partner with whom she shares costs.
59. In the I-v-J case, the mother said she
could borrow about £100,000 to purchase a property but provided no
documentary evidence that she could do so, although she indicated this would be
offered when a lump sum was made available. The court said that “taking on such a liability
would do little to increase her financial security”. The mother in this case has produced
property particulars and although has a mortgage capacity, depending on the
amount of the lump sum, is likely not to have to obtain a mortgage, hence a
saving of £850 per month.
This increases her financial security. In the I-v-J case, the court was
not prepared to provide the mother with a further lump sum by way of security
to cover rent whilst she found alternative employment on the basis that they
did not need to do so as she will find other work, she was in a stable
partnership and matters could be dealt with by way of a review of
maintenance. The mother in this
case is not seeking a lump sum to find alternative employment.
60. In the I-v-J case, reference was made to
the proposition, that the “prevailing trend is to meet genuine
needs in a generous way wherever possible.” There is a genuine need for A and her
mother to live in a larger property which as Bodey J said in re P should bear “some
relationship to the father’s standard of living”. Commissioner Clyde-Smith accepted at
paragraph 62 that in quantifying a lump sum the Court is entitled to adopt:-
“a broad –brush
approach and is not required to carry out a detailed accountancy exercise.
However some form of overall analysis is always required to demonstrate, in
broad terms how the figure has been reached (see DE-v-AB (Financial Provision
for Children) [2011] EWHC 3729 ( Fam) at paragraph 40). In making a lump sum
order for the benefit of the child, the Court must be satisfied , … that
the father is able to pay that amount.”
61. In the I-v-J case, Advocate Heath,
notwithstanding she had appeared as an advocate in the case, submitted that the
father’s home and business were separately valued, although from the
judgment it is clear that the property combines both a home and business for
him. She submitted that the father
in the I-v-J case was in a secure financial position; he had a property
mortgage free and a business worth £1,120,000 and other assets, and thus
in a similar position to the father in this case. The father in the I-v-J case had
an annual wage and personal expenses of £60,000 so he earned more that
the father is this case. In the I-v-J
case the court had said “the father’s property and
business is worth £1.12 M but it is illiquid and combines both a home for
him and A and his business, from which he derives his income. There can be no
question of the court making an order that would place the continued ownership
of that property and the conduct of that business in jeopardy.” However, the elder child A was
living with the father and the court went on to point out that the younger
child might do so within a year. In
this present case the father has 3 properties, one of which is his home. Advocate Heath submitted that the father’s
properties are his business and he needs the properties to meet his day to day
living expenses even though he is making a loss on D (which she later conceded
was not the case) and to build up a nest egg for financial security. However the court’s concern is not
as to whether he builds up a nest egg and an inheritance for A for the future
(even were house prices to rise) but the welfare of A is a relevant
consideration, and there is a need is to provide A with a reasonable home and
adequate maintenance now.
62. In the I-v-J case, the Court was
critical of the father in respect of the reliability of his evidence, they were
neither impressed by “his professional ignorance”
nor satisfied with his claim for a reduced income. He had disposed of substantial sums that
he withdrew from his company and the court did not accept his explanation as to
what he had done with the monies.
The Court drew an inference that the funds have been hidden and are
still available to the father. The
father alleged he had bad health which affected his earning capacity but the
court did not believe him. He
undervalued his property and business by about £600,000. They concluded that his account was
wholly implausible and he had done what he could to defeat the mother’s
claim which included litigation misconduct for failing to disclose some
assets. He was also criticised in
respect of what he was saying to his children. Notwithstanding this the mother was only
awarded a lump sum of £5,000 and I note the father in this case is only
offering £4,000. Advocate
Heath submitted therefore that it does not follow from I-v-J that as a matter of course a lump sum
should be provided for a house.
63. However, even though the positions of the
fathers may appear to be somewhat similar, the fundamental difference is that
the father in the I-v-J case was already providing a roof over the head
of one child and fully maintaining her and there is a possibility that the
other daughter will also live with her father in only a year’s time.
64. Advocate Heath submitted that guidance from the
case is that a lump sum must be affordable, and a court must be satisfied that
the father can pay the sum ordered.
I agree that this is so.
65. In A-v-B [2012] JRC 165A, the mother
asked for child maintenance, a lump sum to cover her mortgage of £240,000
and £24,867 to cover purchase cost and replacement items for the
children. She also sought her legal
costs of just over £36,000.
The mother’s net pay was £2,868 although subject to
variation and father’s net income £58,224. The father had savings of £135,000
and his company accounts revealed cash reserves of £750,000. The mother was awarded £150,000
towards reducing her mortgage which was to be returned to father when the
youngest surviving child reached 18 or finished full-time tertiary
education. Interest of £3,000
would be paid to the father to compensate for any increase in the value of the
property. The father had already
given the mother £11,000.
66. In the case C-v-L [2009] JRC 165A the
mother sought maintenance of £690 per month, which was agreed, and a lump
sum of £15,000. Registrar
Obbard declined to make a lump sum order as the mother had £9,000 of
savings left and the father would have savings of about £12,500. He was reluctant to make a costs order
by penalising the mother because she failed in her application.
67. I was referred by Advocate Heath to the case of
MB-v-KB [2007] 2 FLR 568 in which she wrote in the skeleton argument
that Baron J said there is a “definitive home in which this lady
and her child can live assuredly for the rest of the child’s minority”.
This was a case where the parents
had been married and financial orders already been made in the matrimonial
proceedings. Baron J said that the
issue of estoppel simpliciter was not appropriate especially when dealing with
the developments needs of a child but what she actually wrote at paragraph 35
is that there is “there is no definitive home in which the this lady and her child
can live assuredly for the rest of the child’s minority”. With regard to the present case, an
issue is whether J is appropriate for A’s needs; it is not.
68. In the case of N-v-D [2008] 1 FLR 1629
DJ Harper said that in making a lump sum order a court “has to be satisfied that
the father is able to pay that amount.” In the case of DE-v-AB (Financial
Provision for child) [2011] EWHC 3792 (Fam). Baron J on appeal did not reduce the
housing fund of £250,000 given to the mother saying it was
justifiable. Although the mother
had to sell her home, the father had to contribute £250,000 of his
£358,000 equity to house the child and mother but she reduced the sum
that had been ordered towards the mother’s debts from £85,000 to
£40,000. The father as a
consequence had to sell his home and was left with limited capital. The mother was able to purchase a home
with a manageable mortgage.
69. In A-v-A (A Minor) (Financial Provision)
[1994] 1 FLR 657, the house in which the family had lived was settled on trust
for the child expiring 6 months after the child had attained the age of 18 or
completed full-time education, including tertiary education. The child was 10. In T-v-S (Financial Provision for
Children) [1994] 2 FLR 883 Johnson J made an order postponing sale until 21
or all the children had completed their full-time education. In Re N (Payments for Benefit of
Child) [2009] 1 FLR 1442, Munby J did say that the judge had erred in
directing the property was to be settled until 21, but he went to say “any
capital settlement under schedule1 should be expressed as termination upon the
child reaching the age of 18 or completing tertiary education.”
70. In the skeleton argument provided on behalf of
the father I was referred to the case of K-v-K (Minors: Property Transfer)
[1992] 2 FLR 220, CA an application under the Guardianship of Minors Act
1971 where there was a direct transfer of a council tenancy but there is no
tenancy in this case.
71. Paragraph 5 of Schedule 1 states:-
“Without prejudice to the
generality of paragraph 1, an order under that paragraph for the payment of a
lump sum may be made for the purpose of enabling any liabilities or expenses
reasonably incurred before the making of the order to be met which were
incurred in connection with the birth of the child or in maintaining the
child.”
And notwithstanding what was said in I-v-J
it is therefore possible to backdate a claim to before the schedule I
application; see A-v-B.
Advocate Heath in accordance with I-v-J submitted that it was not
possible to backdate a claim, but I note that in the skeleton argument filed on
behalf of the father dated the 17th June, 2013, she had accepted
that schedule 1 para 5 does permit the court to grant a “retrospective lump
sum” for the purpose of meeting liabilities and expenses already
incurred with the birth of the child or in maintaining the child. The mother is in this case is claiming a
lump sum on this basis. Her debts
are a HSBC loan account now standing at £10,985, her family loans are
£13,759 and her overdraft has now increased to £4,453.94.
Periodical payments
72. In respect of this schedule 1 application, the
court must look at paragraphs 4 (a), (b) (c) and (f) of Schedule 1 which are
set out above. This court uses the
2000 CSA formula as a guideline when deciding the level of maintenance to be
paid as referred to in S-v-G [2003] JRC 091A and in A-v-B [2012]
JRC165A the father was ordered to pay 20% of his net income for the 2 children
or £485 per month for each child in accordance with the guideline. However, in the case of SW-v-RC
[2008] EWHC 73 (Fam), Singer J said that:-
“maintenance can be paid from
accumulated capital or borrowing.”
And in FG-v-MBW [2012] 1 FLR 152
maintenance was ordered from capital.
In the case of DE-v-AB [2010] EWHC 3792, the court ordered
maintenance on the basis of earning capacity not on actual income. In that case Baron J had said that a
father is not obliged to “bail out” the mother, “she
cannot expect the father to bail her out as opposed to make proper provision
for his (daughter)” and in N-v-D [2008] 1 FLR 1629 the
mother is “not entitled, on any basis, to be the recipient of an financial
benefit from him ( the father)”. Although a court must guard against
unreasonable claims with the disguised element of providing for the mother, the
welfare of the child was a constant influence on the discretionary outcome, and
one did not just look at needs referable only to the child but this encompassed
enabling the mother to meet the child’s needs to include maintaining a
home for the child:-
“It was not realistic simply
to apportion items of budget as referable only to the child’s needs,
because financial position had to be made for the mother to enable her to meet
those needs.”
73. Having heard the evidence I do not find that
the mother is making “gold-digging
claims” as submitted by the father’s advocate. I was referred to Burns-v-Burns
[1984] FLR 216 where a woman was claiming an interest in a house on the basis
of a resulting trust. The mother in
this case is making no such application.
74. In respect of the father’s earning
capacity in the I-v-J case, the court stated that when making financial
provision “we have to be satisfied
that it is truly available to that party” and as a result submitted
that one must adopt a cautious approach.
It was submitted that Aviation Beauport had a bad quarter but the
evidence from Captain Clarke was that finances improved in the second quarter
of the year. The father indicated
he could work full-time and would do so if he could have A with him every
week-end. He also has an additional
income from his property. Advocate
Heath pointed out that the mother in the I-v-J case has lower earnings
than the mother in this case, but that mother had a partner with an income of
£33,650 per annum so shares expenditure with him. In the I-v-J case, the court
found that the father’s income was higher than stated by him and this is
the position in this case.
75. In the case of FG-v-MBW [2012] 1 FLR
152, Charles J confirmed this approach and said that there is not a
mathematical or formulaic approach but one should look at all the relevant
circumstances including affordability, the standard of living during the
relationship, and present and expected standard of living.
Legal fees
76. The father in his skeleton argument was seeking
costs on the basis she declined to attend mediation, failed to set out her
position, has cost the father his full time job and cost him his lodger. However the mother did attend mediation,
set out her position at the settlement meeting which took place a few weeks
before the hearing, she has not cost the father his full-time job and the
reason there is no longer a lodger at the father’s home is so that A has
her own bedroom when she stays with him.
It was submitted on behalf of the father that the mother made no
response to the father’s offer dated the 6th November, 2012,
but that is not correct as a response was made on the 7th December,
2012, offering the father alternate week-end contact and mid-week contact
albeit not staying overnight.
77. The mother is seeking a lump sum to cover her
legal costs or in the alternative her costs in respect of the schedule I case
and residence case on a standard basis.
In I-v-J the mother was on Legal Aid and her costs at Legal Aid
rates for the schedule 1 and children hearings was £140,000. Under the Legal Aid Guidelines where a
cost order is made, the advocate seeking costs is entitled to claim costs at
the full rate from the other party, not just the legal aid rate. The costs in this case on a 100% basis
are £131,857 without any uplift, as well as disbursements of £500. In this present case the mother is
paying half the legal aid rate. A
concern for the Court in I-v-J was that the lump sum payment, periodical
payments and arrears of periodical payments were not used toward a contribution
to the mother’s costs. The
issue did not arise if the mother’s lawyers were able to confirm that
none of the sums would be taken by her advocates as a contribution to their
fees and the question of costs was left over. The court declined to award the mother
costs as part of a lump sum order but stated it wished to deal with the
question of costs separately.
Advocate Heath further submitted that in the I-v-J case, the
father’s unreasonable behaviour did not lead to a cost order but the
question of costs is still to be decided.
The mother in this case is liable to her advocates for legal fees
incurred on her behalf and is paying towards her costs at the rate of
£200 per month.
78. In A-v-B the mother was seeking
£240,000 but was awarded £150,000 and a further lump sum of
£11,000. Registrar Obbard
said “the
mother has been obliged to spend her time, effort and expense in pursuing her
claim” and ordered the father to contribute £10,000 toward
the mother’s costs, the total cost being £36,335.
79. In SW-v-RC [2008] EWHC 73 (Fam) the
mother had a deficit of £17,000 in respect of costs order. Singer J said:-
“on a financial application
legitimately brought and pursued which is for the benefit of the parties’
child, I cannot see how an exercise of discretion as to costs hardship would be
an improper consideration.”
80. In this case the mother does not have the funds
to pay her legal costs.
81. In the case of KS-v-ND (Schedule 1: Appeal:
Costs) [2013] EWHC 464 (Fam), in a Schedule 1 application appeal, where the
mother was awarded a small amount towards her costs, Mostyn J considered that
overall the father had been more successful in the case than the mother. He said that pre-proceedings conduct can
only be relevant where it has a “direct causal connection to the later
generation of costs.” but did accept that the economic impact of
costs is a consideration.
82. In addition to her schedule 1 costs, the mother
is seeking payment by the father of her costs in the shared residence
application amounting to £3,103.43.
In the English case Gojkovic-v-Gojkovic (No 2) [1991] 2 FLR 233
it was held that while costs follow the event, it is unusual to order costs in
children cases although the behaviour of a party is a material factor as to
whether or not cost will be awarded.
In Keller-v-Keller and Legal Aid Board [1995] 1 FLR 259 Neill LJ
said that the court still retains the jurisdiction and discretion to award
costs, and this included where a party has been guilty of unreasonable
behaviour or where there was such a disparity between the finances of the
parties. In CF-v-KM [2011] 1
FLR 208 the mother was seeking costs not only in a schedule 1 application but
also in her application as to where the child should live and be educated. This was an interim application. The court held that the “equality
of arms” argument could apply to both sets of proceedings and a
sum was awarded in respect of both proceedings. In M-v-H (Costs: Residence
Proceedings) [2000] 1 FLR 394 on a father’s application for shared
residence the mother was awarded 75% of her costs because the application was
unrealistic and the father had made allegations he did not genuinely believe
in, had been difficult and obstructive over mediation, had improperly
encouraged the children to express a wish for shared residence and ignored the
mother’s pleas for settlement to avoid financial hardship for her. He took advantage of his financial
superiority. A court does however
have to bear in mind that inappropriate costs order may have an adverse impact
on a relationship. Michael Harrison
QC considered that generally it is wholly undesirable when the parents have reached
agreements about residence and contact that the cost issue should turn into an
acrimonious hearing. He examined
the chronology, considered that the father’s response was “tactical”
and that in the end the father achieved little more that the mother had been
prepared to offer. He made a cost
order in the mother’s favour.
83. I was referred to the case B-v-A [2010]
JLR 462 by the father’s advocate.
This was an appeal against a shared residence order so I am unclear as
to the relevance of this case. In
the supplemental bundle were 2 cases which were accepted were not relevant so
they have not been added to the authorities bundle. R-v-G [2006] JLR Note 20 was a
case where the husband had failed to make prompt and proper disclosure of his
financial position. The husband was
ordered to pay a sum due to his litigation misconduct and on appeal the costs
awarded against him was raised. In
that case the issue was as to whether such an order could be made against a
legally aided litigant but in this case the father is not legally aided so I am
unclear as to why it was included.
In Re G (Costs: child case) [1999] 2 FLR 250 costs were awarded
to the legally aided mother in a removal from jurisdiction case and the father
appealed and costs were set aside.
In that case the Court of Appeal did not find that the father had acted
unreasonably; hopelessness of a case and unreasonableness were not necessarily
the same thing and more generosity would be awarded where the litigant was
acting in person. I was also referred
to K-v-P [2009] JRC 170A an application for interim maintenance
including an application for contribution to fees. Here the wife was paying her costs on a
private basis but would qualify for legal aid and Registrar Obbard did not
agree the husband should contribute to her costs. The mother in this case is legally
aided.
84. Advocate Heath submitted that the mother is
estopped in claiming costs now in respect of the previous consent order. Despite Advocate Heath submitting that
one should only look at Jersey cases in respect of costs as the situation in
England was different, she referred to the case of Thoday-v-Thoday
[1964] P 181 which was a case regarding a contested divorce and the
wife’s appeal that estoppel did not arise. It was held, allowing the wife’s
appeal that the power to strike out a pleading was only to be exercised in a
plain and obvious case. However
there was no order at all made as to costs in the residence order. I was also referred to Minories
Finances-v-Arya [1994] JLR 149 but having considered this I cannot see it
is relevant to the case before me.
85. When deciding a Schedule 1 case a court has to
look at the financial needs and obligations of each party which does include
liabilities including legal costs.
Decision
86. J is not suitable for the needs of A,
particularly bearing in mind the financial circumstances of the father as he
owns three properties. Having
considered the financial positions of the parties, I accept that the father cannot,
because of the way his finances are currently arranged, raise a further
mortgage to pay the mother a lump sum to provide more adequate accommodation
for A. However if he sells D there
will be net proceeds of sale of £386,137, having taken into account the
costs of sale and the father will no longer have to service a mortgage of about
£128,000. The mother will
sell J providing her with a net equity £156,213. I reject the submission from the
father’s advocate that the mother should only receive £4,000 and if
J is not sufficient to meet A’s needs the mother will need to rent. I note that the father provided no
particulars of rented properties, and the mother was cross-examined about the
cost of purchase not about renting.
What amount should be ordered towards the cost of a property? I do not consider that the property
particulars of about £300,000 provided by the father are suitable for his
daughter, bearing in mind the location and type of property in which the father
resides and which is worth £750,000.
The mother produced details of 3 bedroomed properties being marketed at
£450,000. I consider that she
should be looking to purchase a home in the region of about £410,000 for
A and herself, which she should be able to do with the £250,000 from the
father. I accept her evidence that
she needs a further sum of £10,000.
The purchase cost is to be paid by the father which will be about
£7,000. The mother is seeking
a sum towards debts and I order that she is paid a sum of £11,000 in
respect of retrospective” lump sum” for the purpose to be used
towards liabilities and expenses already incurred in maintaining A, evidence of
which was provided. I accept that
her spending has not been reckless and there has been a shortfall of income
over expenditure, and the money she owes to her family is not a soft loan, but
I am aware that this will not cover all her debts. This amounts to a total of £278,000
from the net proceeds of D of £386,137, leaving a sum of £108,137.
87. In respect of maintenance, the father has
offered £410 per month or £4,920 per annum. In his schedule of expenditure it states
that he is spending £200 per month on holidays and £200 per month
on hobbies and entertainment. He is
offering up to £750 per annum, £62.50 per month maximum on
additional items for A and his latest schedule show him spending £200 per
month on replacement household items (excluding G) and has provided a figure of
£125 per month repairs on his own home. He does offer to pay half A’s
school fees but I have referred to this above. He had put forward a figure of
£565 per month in June of this year.
I am ordering the father pays £590 per month until she reaches the
age of 18 with the usual provision that the matter can be reviewed if it
appears in due course she will continue at an educational establishment or will
undergo training for a trade, profession or vocation. I accept that if he continues as a pilot
he has to take a medical but there is proviso for a review in respect of any
material change of circumstances and this is one and likewise should his father
and aunts die. I am not ordering
that the periodical payments be secured on the father’s home as if there
is an order, I consider he will comply with it. The mother’s income will be about
£2,167 plus the £590 per month maintenance a total of £2,757
and on her present outgoings a shortfall of £1,468. If she buys a property mortgage free,
there is a saving of £850 per month, if she no longer has to pay a legal
fees contribution and the flexi loan a saving of £400, if she buys a
drier a further saving of £15 per month, and £169.50 if the father
(or his father) pays all the school fees, a saving of £1,434.54 per
month, but still a shortfall. There
will also be a small reduction if the father pays half of the dental and
medical costs fees, and extra-curricular lessons of about £42 and school
trips. In cross-examination she
said that if she no longer has a mortgage then she could cover child care costs. If she can hire an au pair she gave
evidence that there will be a saving.
However she will need to pay sums to her family in respect of the loans
and to pay off her overdraft.
Costs
88. In the I-v-J case, the court decided to
deal with the question of costs separately, and therefore the issues of costs
was left over, so yet more costs will be incurred in coming back to Court. Although Advocate Heath stated that the
lawyer for the mother in I-v-J will “have
to forgo costs” this is not correct as the matter of costs has been
left over, not dismissed. I have
been addressed on the issue of costs by both advocates and will therefore deal
with the issue now. The mother’s
costs were at the last hearing £62,677 on a 50% Legal aid rate. The mother’s advocate said that at
no stage did she say that she would charge at a private client or even 100%
legal aid rate and she was not seeking indemnity costs. In the I-v-J case, the court was
concerned to ensure that the lump sum order was not taken as a contribution to
the mother’s legal costs.
Given the indication from the mother’s lawyers I am ordering that
the father pays the mother’s costs on the schedule 1 application and in
respect of financial issues prior to the application (which I have been told
amount to £4,484.09) at the 50% legal aid rate, to be taxed if not agreed
on the basis that the mother’s advocates do not look to the mother for
any further costs. The father is of
course to also pay the costs previously ordered of £2,103.98 in respect
of his lack of disclosure. I am
making the order for 2 main reasons; the mother has largely succeeded on her
financial application given the father only offered a lump sum of £4,000
and because of the hardship to the mother if she had to meet her own costs from
any lump sum ordered. In addition
however I have noted the litigation conduct of the father. The mother’s advocate submits that
a greater part of the preparation was in respect of the father’s
assertion that the mother’s inflexibility led to the father not being
able to work full-time job and time was spent on this during the hearing. This was not put to the mother by the
father’s advocate in cross-examination, and Advocate Heath submitted that
there was no need to attribute blame, when it was her own client who was
attributing blame and continued to do so during the hearing, which was then
abandoned in the submission made by his advocate. If that was going to be the
father’s position, it should have been made clear at the start of the
hearing. It was submitted by
Advocate Myerson that Advocate Heath insisted on a large number of cases being
added to the bundle of authorities and then Advocate Heath announced after the
first day of the hearing that she was only relying on the leading cases. Advocate Myerson submitted that it took
her 1 day to read these other cases and I sympathise with her as I too had to
read them. She said these
unnecessary authorities added to her client’s cost by £4,000 adding
that Advocate Heath had refused to put them in a separate bundle despite an
order made by the court and the usual practice in producing authorities, so the
mother’s lawyers had to incur cost in collating the bundle to include
these authorities. It was submitted
on behalf of the father that the number of authorities produced for the father
was because he did not know what the mother’s position was, but a few
weeks before the hearing there was a settlement meeting at which the
mother’s stance was the same as at the start of the hearing, and once the
skeletons were filed Advocate Heath could have reviewed the authorities. Half way through closing submissions,
Advocate Heath produced a further bundle of over 100 pages, without having even
notified the mother’s lawyers that she would be doing so, and Advocate
Myerson was therefore not in a position to deal with this as she had not had
time to consider the documents when preparing for her re-submission. Time was spent in argument as to whether
to adjourn and why the bundle was filed so late and why Advocate Myerson was not
even forewarned about the contents of the additional bundle. Advocate Heath stated that it was due to
pressure caused by her status as a sole practitioner. The mothers’ advocate submits that
her client should not have to bear the costs of this and I agree that this did
lead to unnecessary costs and her client should not meet these costs and the
costs in respect of unnecessary authorities. The father provided incorrect figures to
the Court as to his income from his lettings when he should have known the sums
were incorrect as they do not comply with Income Tax guidelines, and time was
wasted at the hearing on his incorrect evidence and it was only conceded that
the figures were wrong when the mother’s advocate was making her
re-submissions. The father accepted
that he had responded tactically to the mother’s schedule 1 application
by failing to instruct lawyers about this at the same time as instructing
lawyers on his shared residence application. While waiting to give evidence Captain
Clarke was provided with an extract by the father’s advocate of the
mother’s witness statement with her diary regarding contact and also had
with him a roster which had been requested for months from the father but had
not been provided, so time was spent in argument as to the contamination of his
evidence.
89. Costs are not normally made in children cases,
but I consider that the father should pay 50% of the mother’s cost at the
legal aid rate of 50% to be taxed if not agreed. When she put in her application for a
schedule 1 order he then, as he had previously informed her he would do,
applied for contact or shared residence but refused to instruct lawyers on the
schedule1 application for tactical reasons. The father agreed that he had also said
to his parents that he would put in a children application if she put in a
schedule 1 application, and did so very soon after her application. The mother’s evidence that the
father had told her in correspondence that if she put in an application for
finances he would reduce his working hours and seek to secure more contact was
not challenged by the father. He
maintained that she was inflexible about contact which I found not to be
correct.
90. With regard to the parental responsibility
application, the mother did say she had agreed he should have parental
responsibility but she did not sign a parental responsibility agreement and I
do not accept the mother’s submission that the father should pay her cost
on that application.
91. What is the overall effect on the father and
can he pay what is ordered? On the
basis of the lump sums totalling £277,000 and net proceeds of sale of D
of £386,137, there is a balance of £109,137. If the father then has to pay a maximum
figure for the mother’s legal costs of say £60,000 there is a
balance left of £49,137. He
can utilise this if he wishes to clear his legal fees outstanding and may also
be able to clear his income tax liability of £13,226. The father can, should he consider he
ought to do so, make a lump sum repayment to his father by cashing in the
endowment policy which has a surrender value as at September 2012 of
£35,658 or use this to reduce his mortgage on his home.
92. The father will lose the net income from D of
£362 per month but he will no longer need to service the mortgage of
£980 per month or pay for the upkeep of the property, and the costs on it
as set out in his up-dated schedule of needs. If his own legal fees are paid out of
the sale plus the legal fees to Appleby there is a further saving of £500
per month. I have already the father
is not maximising his income and if he so chose could earn £50,000. I am not ordering that he pays
£700 per month but I consider that the figure of £590 per month is
certainly a figure he can afford. I
am also ordering that he pay A’s school fees, and he may choose to do so
or ask his father to pay them on his behalf, given that his father is already
paying one half and the father indicated in evidence that if he asked his
father nicely, he may be willing to pay for his granddaughter’s school
fees.
93. In summary, the father will pay the mother a
lump sum of £250,000 toward the purchase of a property for A to be held
in the sole name of the mother together with the cost on purchase to include
stamp duty. The lump sum will be
secured by a judicial hypothec in favour of the father on the basis that the
lump sum together with any increase in the value of A’s primary home
proportionate to his contribution to the purchase price (if any) will be
returned to him on the earliest of the determining events, namely when A
reaches the age of 18 or ceases full-time tertiary education, whichever is the
later, or the mother elects to sell the house. Upon the occurrence of a determining
event, A’s primary home shall be sold for such price as may be agreed
between the parties of in default of agreement, as determined by the Court. The proceeds shall be applies as
follows:-
(i)
in payment
of the conveyancing costs and disbursements in connection with the sale;
(ii) in payments of estate agent charges;
(iii) in repayment of the £250,000 provided by
the father, together with any increase in the value of A’s primary home
proportionate to his contribution to the purchase price ( if any);
(iv) in payment of the balance to the mother.
94. In addition the father will pay a further lump
sum of £10,000 toward the cost of furnishing and equipping A’s
primary home and a further £11,000 for the purpose of being used towards
liabilities and expenses already incurred in maintaining A.
95. The father shall pay child maintenance to A at
the rate of £590 per month until she reaches the age of 18 or ceases
secondary education, whichever is the later. There is to be a review if she enters
higher or tertiary education. There
is to be a review on material change of circumstances, and the usual cost of
living increase. In addition the
father will pay her school fees (although he seemed hopeful that if he asked
his father would pay A’s school fees) and one half of school/education
trips; reasonably incurred extra-curricular activities, medical/costs not
covered by the mother’s medical insurance and dental costs. In addition the father shall pay the
mother’s cost on the schedule 1 application as to the 50% legal aid rate
on a standard basis and cost regarding finances prior to issue, to be taxed if
not agreed, the costs previously ordered, and as to the residence application
as to 50% of costs incurred as to the 50% legal aid rate on a standard basis,
to be taxed if not agreed.
Authorities
I-v-J [2013] JRC 156.
Children (Jersey) Law 2005.
C-v-L [2009] JRC165A.
A-v-B [2012] JRC165A.
Re P (Child:
Financial provision) [2003] 2 FLR 865.
MB-v-KB [2007] 2 FLR 568.
N-v-D [2008] 1 FLR 1629.
DE-v-AB (Financial Provision for
child) [2011] EWHC 3792 (Fam).
A-v-A (A Minor) (Financial Provision)
[1994] 1 FLR 657.
T-v-S (Financial Provision for
Children) [1994] 2 FLR 883.
Re N (Payments for
Benefit of Child) [2009] 1 FLR 1442.
K-v-K (Minors: Property Transfer)
[1992] 2 FLR 220 CA.
Guardianship of Minors Act 1971.
S-v-G [2003] JRC 091A.
SW-v-RC [2008] EWHC 73 (Fam)
FG-v-MBW [2012] 1 FLR 152.
DE-v-AB [2010] EWHC 3792.
Burns-v-Burns [1984] FLR 216.
KS-v-ND (Schedule 1: Appeal: Costs)
[2013] EWHC 464 (Fam).
Gojkovic-v-Gojkovic (No 2) [1991] 2
FLR 233.
Keller-v-Keller and Legal Aid Board
[1995] 1 FLR 259.
CF-v-KM [2011] 1 FLR 208.
B-v-A [2010] JLR 462.
R-v-G [2006] JLR N 20.
Re G (Costs: child case) [1999] 2 FLR
250.
K-v-P [2009] JRC 170A.
Thoday-v-Thoday [1964] P 181.
Minories
Finances-v-Arya [1994] JLR 149.