Family – application by the mother for financial provision from the
respondent for B.
[2013]JRC156
Royal Court
(Family)
5 August 2013
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Before :
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J. A. Clyde-Smith, Commissioner, and Jurats
Fisher and Olsen.
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Between
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I (the Mother)
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Applicant
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And
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J (the Father)
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Respondent
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Advocate A. T. H. English for the Applicant.
Advocate H. J. Heath for the Respondent.
judgment
the commissioner:
1.
The Court
sat for three days to hear the application of the applicant (“the
mother”) for financial provision from the respondent (“the
father”) for their daughter B, who is now aged 10 and who resides with
the mother. The application is made
pursuant to Schedule 1 of the Children (Jersey) Law 2002 (“the
Children Law”) and was originally filed on 26th September,
2011.
2.
The relationship
between the parties ended in November 2010, when the father moved out of the
family home, which he owns and which is adjacent to his garage business. After some nine months, the mother moved
out with their two children to rented accommodation and the father
returned. Today, the mother remains
in rented accommodation with her partner and the father in the former family
home with his partner, from where he continues to run his garage business. Their elder child, A, lives with the
father.
3.
The father
pays maintenance for B at the rate of £250 per month and has staying
contact with her during school holidays and during school terms every other
weekend and on Wednesday night every week.
4.
The
relationship between the parties has been acrimonious and there have been
continuous proceedings, mostly conducted before the Registrar, since 20th May, 2011,
when the father first made an application for parental responsibility for B
(which the mother gave him by agreement) and a residence order in respect of A. An application by the father for a
shared residence order in respect of B (inter
alia) made on the 10th
January, 2013, was heard in June of 2013 [and has been
dismissed]. It was the third
residence application brought by the father in respect of B.
5.
The
father, who in his own words is not an academic man, represented himself before
the Registrar (save for one occasion) and accepts that he did not conduct
himself well. For reasons which it
may become necessary to explore in any hearing over costs, he did not comply
with financial disclosure orders made against him.
6.
The Act of
Court of 31st May,
2012, records that the father had not complied with a disclosure
order made on 16th
February, 2012, and he was given until 19th June, 2012, to do
so. He failed to comply with that
order and the mother therefore applied to the Registrar for the matter to be
referred up to the Royal Court
and an order to that effect was made by the Registrar on 14th November, 2012.
7.
That order
appeared to galvanize the father into instructing Miss Heath to represent him
and the Royal Court
started the process of disclosure anew with directions to that end being issued
(in accordance with a draft prepared by Miss Heath) on 15th January, 2013.
8.
At a
directions hearing on 19th
April, 2013, Mr English for the mother informed Commissioner
Clyde-Smith that the mother had engaged a forensic accountant, with funds from
the Legal Aid vote, to assist in analysing the accounts of the father’s
company, X Limited (“the company”). It was made clear at that hearing that
if the mother intended to call the accountant as an expert witness, proper
notice should be given to the father so that the father could consider whether
to call his own accountant in response. At the commencement of the hearing the
father objected to the evidence of the accountant being heard, as he had not
received adequate notice and had not had time to instruct his own accountant to
give expert evidence in response.
9.
The
Commissioner upheld the father’s objections because the mother had failed
to give adequate notice as directed and to adjourn the case to enable the
father to call his own accountant was not in the interests of B (the experts in
the shared residence order application had been unequivocal over the need, in
the interests of both children, for the proceedings between the parents to be
brought to a close as soon as possible) and, having regard to the overriding
objectives set out in Article 4 of the Children Rules 2005, would be
disproportionate. The accountant
could and did assist Mr English in his cross-examination of the father.
10. The Court received the affidavits of the mother
and father as their evidence in chief, and heard them under cross-examination,
and received other affidavits and documentation to which we will refer. We have taken account of all of the
evidence before us for the purpose of determining the issues, even if we do not
make express reference to every part of it. We will set out the relevant facts as we
find them. For the avoidance of
doubt, in so far as the matters set out differ from the evidence of the mother
or the father, this is because we have preferred the evidence of the other of
them or because we consider that the documents produced confirm our findings of
fact.
Mother’s financial position
11. The mother (who is 50) has no qualifications
and works as a self-employed carer for a 97 year old lady. Her normal hours are from 9:00am to
2:00pm and she earns £300 per week gross or £15,600 per annum. She works additional hours, including
evenings, weekends and bank holidays for which she earns £12 per
hour. In 2012, this provided a
further £3,600 income gross. B
often has to accompany her to work in school holidays and at weekends. Her total annual income is therefore
approximately £19,200 per annum to which must be added the £3,000
per annum she receives by way of maintenance for B, which brings her total
income to around £22,200 per annum.
She pays no Income Tax but being self-employed, has to pay her own
Social Security contributions which equate to £160.29 per month, or
£1,923.48 per annum.
12. She has no assets other than a 10 year old Audi
car which she values at £2,000 and the sum of £50,000, which she
says is still due to her from the father for her shares in the company which
she has transferred to him. She
lives in rented accommodation with her partner who has children from a previous
marriage, whom he supports financially.
His monthly income is £2,804.22 or £33,650.64 per
annum. He owns a property in
Plymouth worth £177,000 purchased through an inheritance, a lump sum from
his pension and his divorce settlement.
It is his intention to go and live there when his youngest child (who is
15) completes her full-time education.
13. She assesses the monthly income needs of
herself and B at £2,593 and B’s monthly additional needs at
£1,000, a total of £3,593 per month or £43,116 per annum,
which set against her monthly income gives rise to a substantial
shortfall.
Father’s financial position
14. The father (who is 45) purchased the garage and
adjacent residential premises in his own name in 2002 for £600,000 with
the benefit of a mortgage. The
garage business is operated through the company. Since April 2011, the accounts state
that he only owns one-third of the issued shares in the company (upon which we
comment below) but he confirmed that the Court should regard the assets of the
company as a resource available to him.
Indeed, he described himself as the sole owner and beneficiary of the business
and it is quite clear that that is the reality, whatever the accounts may
say.
15. The father draws an annual wage from the
company of £22,500. In
addition to this, the company meets a proportion of his personal expenses,
which he estimates, and we accept, at around £13,600 per annum, a figure
which needs to be grossed up to, say, £17,000 for tax. We assess his annual income from the
company in these two respects at around £40,000 gross. In contention is the true profitability
of the company and the extent to which the father is able to benefit
financially over and above this income, and this by way of dividend, loan or
other form of drawing.
16. The accounts of the company are drawn up to 30th
April each year and we have the accounts going back to the year ending 30th
April, 2010, (which show the comparative figures for 2009). These show the net profits of the
company after taxation (after payment of the father’s wage and expenses)
as follows:-
2009 £112,560
2010 £153,147
2011 £50,253
2012 £4,623
2013 £2,619
17. Substantial dividends are recorded as having
been paid by the company to the father as follows:-
2009 NIL
2010 £178,825
2011 £68,647
2012 £246,293
2013 £16,258
18. It is worth noting the turnover over this
period and the cash held at the bank (as at each year end) as follows:-
Cash at Bank Turnover
2009 £79,516 £1,751,196
2010 £223,564 £1,794,098
2011 £45,167 £1,771,154
2012 -£23,952 £1,648,502
2013 -£6,676 £1,479,329
19. Whether withdrawals should be accounted for as dividends
or shareholder loans would be for the father’s accountant to advise and
he would have been no doubt influenced by the change in the system of taxation
from 2009 when profits were attributable to shareholders. The father’s tax returns show an
unearned income of £276,134 for year ending 31st December,
2010, and £246,293 for year ending 31st December, 2011. There was no unearned income for 2012
and we do not have the tax returns for earlier years.
20. The mother maintains that these figures show
that the father has, on average over the last five years, an annual income of
some £200,000. It is the
case, that in addition to his monthly wage and payment of his expenses, the
father has been in receipt of the following substantial sums drawn from the
company:-
(i)
£187,356.34
on 17th April, 2008, to pay off the mortgage on his property.
(ii) £45,500 drawn out in cash between 18th
March, 2011, and 17th May, 2011, and paid (with a further
£4500 to bring it up to £50,000) in cash to the mother, so the
father maintains, for her shares in the company; an allegation the mother
vehemently denies.
(iii) £118,000 paid to a former girlfriend in
Hungary, C, between 11th March, 2011, and 19th April,
2011, for the most part in tranches of £10,000 each.
(iv) £100,000 paid by cheques as to
£85,000 in March 2011 and £15,000 in April 2011 to Mr D.
(v) Withdrawals of £10,000 on each of 14th
and 15th March, 2011, in cash at the time of the banking crisis,
because, the father says, the Jersey government would not guarantee that his
money would be safe in the bank.
(vi) £18,000 paid to E, a firm of
stockbrokers, on 24th March, 2011, together with two further
payments of £5,000 each on 12th May, 2011, and 13th
May, 2011.
(vii) £25,000 on 24th May, 2011,
which the father says was for work on his house.
21. The father points to the declining turnover and
profits (something the mother attributes to his fraudulently diverting cash
received at the business) and says that the 2010 and 2011 profits were
attributable in large part to a doubling in the volume of fuel sales following
an advantageous contract he had entered into with Rubis. Competition has since increased and it
is now costing him more per litre to acquire petrol than other outlets are
selling it for. He denied diverting
cash pointing out that in any event the petrol pumps were connected
electronically to the till and sales of fuel represented a large proportion of
his business.
22. The father says he is anxious about the future
trading prospects of the company which he says is struggling. He told us that two garages had closed
in the last eight months due to the recession and fuel price wars. There was a suspected leak in one of his
four petrol tanks potentially causing contamination and which may need to be
repaired at substantial cost.
23. In assessing financial provision for B, we were
looking at the father’s future available income. We had serious reservations about much
of the evidence of the father for the reasons set out below, but in terms of
the future profitability of the company, we felt unable to ignore:-
(i)
The
reduction in the company’s turnover set against inevitably increasing
costs;
(ii) A general decline in the local economy –
a factor taken into account by BNP Paribas Real Estate in their valuation report of
28th May, 2013;
(iii) The increase in competition in Jersey over fuel
prices from larger operators. Fuel
sales account for some 80% of the company’s turnover.
24. We were inclined to accept that the company had
enjoyed two good years in 2010 and 2011, but it was unrealistic to project
those good years forward and suggest that profits of some £200,000 per
annum would be generated in the future.
25. The accounts for 2013 show hardly any profit at
all. Mr English questioned a
write-off of £30,000 set directly against the profit and loss account for
which the accounts provided no explanation. The father said his accountant had
inserted this figure but he thought it might be for work to be done in the
future. In our view a write-off of
this kind would have to have come from instructions given by the father as the
sole director and we were not impressed by his professed ignorance. In any event you cannot write off
expenditure that has yet to be incurred.
Writing that figure back into the profit and loss account increases the
profit for the year ending April 2013 to £32,619.
26. In view of our findings below, we think the
father would be capable of diverting cash in order to reduce the apparent
income of the company but we think the opportunity for doing this is limited
because so much of the business relates to fuel sales, the balance being in the
main for repair work. He did not
sell food. He told us that he sold
six to eight cars a year for G which he placed on his (limited) forecourt which
sales would go through their books, his interest being in the repair work.
27. The father raised his health as a further
factor for us to take into account in the context of his earning capacity. He has back problems, suffers from a
hernia and is having investigation undertaken into suspected “carpel tunnel syndrome”. He produced a letter from his doctor
confirming the diagnosis of an emerging left inguinal hernia and various
letters showing appointments at the Clinical Investigations Department. A letter from his doctor on 26th
November, 2012, produced in the context of proceedings before the Registrar
said that he was suffering substantial chronic and ongoing stress. The mother engaged security consultants
to visit the garage on some four occasions from which it was clear that the
father was working and he did not seek to deny that. We have proceeded on the basis that he is
capable of working.
28. Apart from a pension with an equivalent
transfer value of some £38,000 and subject to what we say below, the
father’s only other material capital asset is the property and the
business that he runs from it. The
father produced a short valuation by Red Properties dated 30th April,
2013, which advised that the house, garden and forecourt together, on the basis
that there was no contamination, was valued at £520,000. If there was contamination, then the
house and garden were valued at £420,000 and the forecourt and workshop
at no value, because of the cost of decontamination. These valuations do seem surprising,
bearing in mind that the father acquired the property in 2002 for
£600,000 at a time when he says it was a wreck and on which he says he
has invested substantial sums on its improvement since.
29. The mother had commissioned a detailed report
from BNP Paribas Real Estate, which valued the residential element at
£425,000 and the petrol station and associated workshop (with the benefit
of the business run from it) at £695,000, a valuation which takes into
account the potential contamination. That gives a total value of the property
and business owned by the father of £1,120,000. We preferred the valuation of BNP
Paribas Real Estate.
30. The father’s partner runs her own health
food business, which he informed us had never been very successful and he has
helped her out from time to time with loans towards the purchase of stock. She is the secretary of the company, for
which she receives no remuneration, but she helps out at the garage with paper
work and collecting parts, etc. The
company has provided her with a car, but she is not in a position to make any
significant contribution towards the household expenditure, although she helps
with the two children.
31. Even accepting our findings below and our
serious reservations generally about the father’s evidence, we think the
underlying reality of the profits that he can derive in the future from what
is, after all, a small business, is nowhere near the figures put forward by the
mother. When ordering a party to
make financial provision out of income, we have to be satisfied that it is
truly available to that party and we conclude, having taken into account all
the evidence and adopting a cautious approach, that the father can rely on
profits, over and above his salary and expenses, of at least £20,000 per
annum. That means that in all, we
find that the father’s annual income is at least £60,000 gross.
Undisclosed assets
32. We now turn to the explanations given by the
father as to how he says he has disposed of some of the substantial sums he
drew from the company as listed at paragraph 20 above (apart from the money
used in 2008 to repay his mortgage, the sums invested with his brokers and the
sums spent on home improvements).
33. The father alleges that on 17th May,
2012, he met the mother at Belcroute Slipway, near Noirmont and handed over a
bag of money containing £50,000 in cash. This he had withdrawn over a period of
three months in tranches of around £2500 totalling £45,500. This was done, he says, because the
mother was trying to receive rent rebate and other benefits which she would not
have been entitled to if the Social Security Department found out that she had
received £50,000. The balance
of £4,500 came from monies he had withdrawn during the banking crisis
when he lost faith in the safety of his money placed with the bank. He had withdrawn two sums of
£10,000 in order to protect his position in this respect. He also alleges that the mother threatened
him that if she did not receive the £50,000, he would not see the
children again. He referred us to a
number of text messages sent by the mother (out of context), which he said
supported this assertion. He also
says that around this time, he went to see Sinels, Advocates, with a view to
drawing up an agreement in relation to the children and for the payment of a
sum of money to the mother.
34. The mother categorically denied receiving this
sum in the manner alleged or at all and there is no evidence of cash being
credited to her bank account. We
did not interpret the text messages as supporting the father’s assertion
and found it implausible that the father, a competent businessman, and who had
consulted lawyers at that time, would pay over such a large amount of cash in
such an unaccountable manner to someone with whom his relations were so
acrimonious. This was alleged to
have taken place three days before he filed with the Court the first of his
many applications. We therefore
preferred the evidence of the mother and conclude that this sum was not paid to
her.
35. Turning to the sum of £118,000 paid to
his former Hungarian girlfriend C between 11th March, 2011, and 19th
April, 2011, he explained that she had become his girlfriend some four or five
years ago at the time when he was still in a relationship with the mother. She had had a serious epileptic seizure
in early 2011 and had to return home to Hungary. He paid her these sums, he said, because
they were thinking of buying a café or restaurant in Hungary. No particular business had apparently
been identified and certainly there was no documentation provided by the father
to support his evidence.
36. In or about the same time, the father stated
that he paid £100,000 by two cheques of £85,000 and £15,000
each to Mr D, who he thought was a principal of G, and who was “maxed
up” on his stock and at the limit of his overdraft of
£150,000. This loan was
apparently interest free and unsecured and there is no documentation to support
it. It transpires that Mr D is an
employee of G, the principal being Mr L. It seems implausible that an employee
would personally borrow large sums to assist his employer’s business.
37. The father then says that he read in the Jersey
Evening Post that a restaurant business was in trouble and that Mr L was the
person to contact if anyone was interested in the lease. He said he had always wanted to run a
restaurant and therefore contacted Mr L with a view to acquiring the
lease. He agreed to pay a
non-refundable deposit of £210,000.
This sum came from the monies he had transferred to his girlfriend C and
to Mr D who in turn passed it on to Mr L.
He says that unfortunately, due to the stress of the Court proceedings,
which had taken much longer than he had expected, he felt that this was too
large a project for him to take on himself and he therefore pulled out of the
agreement in August 2011, losing the deposit of £210,000.
38. The father produced an affidavit from Mr L
dated 22nd May, 2013, purporting to confirm these arrangements. He explained that the previous tenants
had got into extreme financial difficulty trading from those premises and could
not pay their rent. In May 2011
therefore he bought back the lease from them. Quoting from his affidavit:-
“6. [The
father] paid me a deposit of £100,000 by way of two cheques, one for
£85,000 on 21 March, 2011, and the second for £15,000 on 19 April,
2011. These monies were paid to my
employee Mr D, which were originally paid to him by way of a loan from [the
father].
7. [The father] then paid me
the balance of the lease in the sum of £100,000 paid by C, his girlfriend
at the time. [The father] took over
the premises from 1st August, 2011, on a nine year lease at an annual rent of
£40,000.
8. For reasons unclear to me,
[the father] decided not to operate the restaurant and told me he was not going
to pay any rent. [The father]
acknowledged he would forfeit his deposit and ingoing monies he had paid to us.
9. As a result we have been
unable to rent out the premises until now and a new lease to M is being drawn
up for the new tenants to take over on 1st August, 2013.
10. I can confirm that [the father] no
longer owns the lease of the property together with any of the fixtures and
fittings.
11. I can confirm that I am not holding
these funds, nor any other funds for the benefit of [the father].”
39. The Court had directed that notice should be
given by 4th June, 2013, if either party required deponents of
affidavits provided by the other party to be available for
cross-examination. Mr English had
not given notice to Miss Heath that he wished to cross-examine Mr L and he made
the application to do so on the second day of the hearing. The Court ordered the Viscount to
convene Mr L, but it transpired that he was out of the Island and would not be
returning until after the case had finished. There was no application to adjourn the
hearing for the purpose of his being cross-examined and we can say that no such
application would have been granted in any event as it was, as we have said
before, in the overriding interests of B and indeed of the family as a whole
that this long delayed application be completed without further delay. The affidavit remained in evidence but
it would be a matter for the Jurats as to what weight should be given to it,
bearing in mind that it had not been tested.
40. Appended to Mr L’s affidavit were two
letters dated 1st August, 2011, on Mr L’s letter head, the
first appearing to be an invoice for the sale of the restaurant for the sale
price of £210,000, signed in manuscript by Mr L “Received with thanks” and dated, we think, 2nd
August, 2011. The second letter is
in the same terms but has an added provision indicating the annual rent of
£40,000 per annum with three year RPI rental increase and “Lease to be signed on receipt of non-returnable
deposit and ingoing”. That
letter indicates that a deposit of £100,000 had been paid, leaving a
balance due of £110,000.
Again, it is signed by Mr L “Received
with thanks” again we think dated 2nd August, 2011. Also appended to his affidavit is a nine
year lease dated 1st August, 2011, signed by Mr L as an authorised
signatory on behalf of N Limited, we presume the owner of the property, and the
father. Both their signatures
appear to be witnessed. There is no
inventory attached to the lease.
41. Mr L says that the sum of £100,000 had
originally been loaned to his employee Mr D (but apparently for the benefit of
his own business G), but the two cheques he says he received bear the same date
as the cheques that the father says he issued to Mr D, namely 21st
March and 19th April, 2011.
It would seem that nothing was actually paid to Mr D.
42. The mother says that this account is wholly
implausible and we agree. The
father is a mechanic by trade, working full-time in his garage business. He was an experienced businessman,
having acquired the garage business in 2002 and operated it ever since, and it
seems incredible that:-
(i)
He should
transfer to a girlfriend in Hungary (whose relationship with him had ended or
was about to end) such a substantial sum for the acquisition of some
unidentified foreign business.
(ii) He would loan to someone whose business was
financially stretched another substantial sum apparently unsecured and interest
free; someone who it transpires was a mere employee of that business. Even if Mr D did receive that sum, he
appeared to be able to pay it over fairly promptly to the real principal behind
the business Mr L for a quite different transaction.
(iii) He would pay a non-refundable deposit of
£210,000 for a lease of a restaurant (for which there appears to be very
little demand as the premises have since remained un-let for two years) to the
same Mr L, a kind of business which he had never run in the past; he did not
even sell food from his garage. He
would appear to have taken no legal advice on the transaction of any kind and
the lease contains no inventory of the fixtures and fittings. Indeed there is nothing on the face of
the lease that goes anywhere near justifying a premium of this magnitude. Apart from the documents appended to Mr L’s
affidavit, the father produced no documents of his own in relation to this
substantial investment. There
appears to have been no inquiries made or checks carried out by him or on his
behalf as to the landlord’s title and the permissions that would be
required to operate a restaurant business (with, we presume, a liquor licence).
(iv) We do not believe his explanation that he
pulled out of this transaction through the stress of the Court proceedings,
which had taken much longer than expected. This transaction and his withdrawal from
it supposedly took place in August 2011, at which point the proceedings had
only just begun. The mother’s
application for financial relief was not filed until 26th September, 2011;
after he had apparently pulled out. The father’s doctor had written
about his stress but that was over a year later on the 26th November,
2012, when it could be said that the proceedings had taken a long time.
43. The Court appreciates that it has received an
affidavit from Mr L (whom the father clearly knows as he is the principal of G
whose cars he sells on his forecourt) apparently confirming this transaction
and that he is not holding money for the father, but it was untested. The Court did hear the father’s
evidence tested under cross-examination and it simply did not believe what it
was being told.
44. A further factor is relevant to note. The accounts show that at some point
after April 2011, the company increased its issued shares to 300 and the
accounts for the year ending April 2012 show the ultimate beneficial owners as
being the father, his brother and his now former girlfriend, C. Each shareholder apparently holds 100
shares each, placing the father into a minority position. This, of course, is completely at odds
with the statement in his affidavit “I
am the sole owner and beneficiary of the business. This is how it has always been and how I
plan it will always be.”
The father found this very difficult to explain. He appeared dismayed when this was
pointed out to him in the accounts (which he had signed as the sole director),
as if he had not been aware of it before, saying he needed to discuss it
urgently with his accountant. When
it was put to him that the issue of these shares could only have been done on
his instructions, he said it had been done to help him out and not to dilute
his interest in the face of the mother’s application for financial
assistance. He confirmed that they
had not paid for their shares. He
could not give us C’s address in Hungary (even though she apparently owns
a third of the company), although he said he could get there in a taxi.
45. He discussed the matter with his accountant
overnight and indicated to us the next day that his brother would sign his
shares back straight away. He
described it as a family arrangement with his brother and C helping him out at a
time of great stress and when he was under pressure, needing time out. Again we doubt “great stress”
at this stage of the proceedings and do not accept that explanation.
46. It seems obvious to us that the issuing of
these shares was undertaken as a defensive move against the potential claims of
the mother. The timing is
significant. They had separated in
2010, and relations were acrimonious.
The father had been the first to issue proceedings in relation to the
children on the 20th May, 2011, and the mother’s application for
financial provision had been issued on the 26th September, 2011. The new shares were issued during that
financial year.
47. We have regard to the summary of the principles
to be applied in cases of non-disclosure in the judgment of Mostyn J in NG-v-SG
(Appeal - Non-Disclosure) [2011] EWHC 3270 (Fam) at paragraph 16:-
“[16] Pulling the threads together it seems to me that where
the court is satisfied that the disclosure given by one party has been
materially deficient then:-
(i) The
court is duty bound to consider by the process of drawing adverse inferences
whether funds have been hidden.
(ii) But such inferences must be
properly drawn and reasonable. It
would be wrong to draw inferences that a party has assets which, on an
assessment of the evidence, the court is satisfied he has not got.
(iii) If the court concludes that funds have
been hidden then it should attempt a realistic and reasonable quantification of
those funds, even in the broadest terms.
(iv) In making its judgment as to
quantification the court will first look to direct evidence such as
documentation and observations made by the other party.
(v) The
court will then look to the scale of business activities and at lifestyle.
(vi) Vague evidence of reputation or the
opinion or beliefs of third parties is inadmissible in the exercise.
(vii) The Al-Khatib-v-Masry technique of
concluding that the non-discloser must have assets at least twice what the
claimant is seeking should not be used as the sole metric of quantification.
(viii) The court must be astute to ensure that a
non-discloser should not be able to procure a result from his non-disclosure
better than that which would be ordered if the truth were told. If the result is an order that is unfair
to the non-discloser it is better that the court should be drawn into making an
order that is unfair to the claimant.”
48. Applying these principles, there is direct
evidence that the father had received the £20,000 in cash he withdrew
from the bank for which he has not accounted, the £45,500 he withdrew
from the bank and which he says he gave to the mother in cash in a bag (with a
further £4500 making £50,000), the £118,000 he says he paid
to his girlfriend C and the £100,000 apparently paid to Mr D; a total of
£283,500. We just do not
accept the father’s explanation as to what he did with these funds. The only inference we can draw from this
is that these funds have been hidden and are still available to him.
49. In summary, in terms of material assets, the
father has the property and garage business, which he owns mortgage free and
which are worth £1,120,000, a pension with a transfer value of some
£38,000 and cash of at least £283,500 available to him; making a
total in terms of his assets of at least £1,441,500. His income derived from the garage
business is at least £60,000 per annum.
Mother’s position
50. In order for the mother to provide a life style
for B which bears some relation to what she perceives to be that of the father,
the mother sought the following:-
(i)
Maintenance,
pursuant to the CSA guidelines
£1300 per month or £15600 per annum until the later of B’s 18th
birthday or her ceasing her tertiary education, to be increased annually by the
Jersey RPI from the date of the Court’s judgment. On looking at the CSA guidelines we note
that this takes no account of the fact that A lives with the father; the actual
maximum is £1105 per month or £13,260 per annum.
(ii) Arrears of maintenance for B in the sum of
£32,550 from the date of separation.
(iii) Additional expenditure for B of £1,000
per month or £12,000 per annum until the later of her 18th
birthday or her ceasing her tertiary education, to be increased annually by the
Jersey RPI from the date of the Court’s judgment. The additional expenditure was to cover
such things as extra tuition of £220 per month, school
uniforms/trips/books/other extra-curricular activities and a holiday fund for B
in the sum of £300 per month). The total periodical payment sought by
the mother for B is therefore £2300 per month or £27,600 per annum.
(iv) That the father pay the private school fees for
B to attend P or for any other school which the Court believes she would
benefit from attending at the end of her primary education, together with her
university fees (including reasonable billed extras), accommodation and travel
costs of her tertiary education.
(v) That the father pay the mother a lump sum of
£350,000 towards the purchase by her of a three-bedroom property with a
garden, estimated at some £450,000, with the balance being borrowed by
the mother. The lump sum would be
secured by a judicial hypothec in favour of the father on the basis that the
lump sum would be returned to him at the end of the specified term with
interest at the standard prevailing bank rate of 2% per annum
(non-compounded). The term will be
the end of the later of when B reaches 18 or ceases her tertiary
education. In addition, the father
would pay the costs of purchase and a further lump sum of £10,000 for the
cost of new furniture for the new property.
(vi) The father will pay £15,000 for the cost
of a new car for the mother, to safely and economically transport B (and A).
(vii) That the father shall pay the mother’s
legal costs defending what she described as his various vexatious and traumatic
residence applications for A, shared residence and increased contact
applications for B and for the present financial application, which she said
had been frustrated at every turn by the father by fair means and foul.
(viii) That the father shall keep in place for the
period of B’s maintenance a policy of insurance to cover her private
health costs and a capital sum to cover his future maintenance obligations in
the event of his death.
(ix) The father shall meet the costs associated with
any counselling and/or professional therapy, B is assessed as needing.
The father’s position
51. The father’s position was that maintenance
should continue at the rate of £250 per month until such time as B is 16
years or ceases full-time secondary education, whichever is the later of those
dates, subject to review on entering higher or tertiary education, or until
further order of the Court, such maintenance to be increased annually on 1st
January by mutual agreement in writing or in accordance with the increase in
the Jersey Retail Price Index.
52. In addition, the father proposes to pay half
the reasonable school expenses up to a maximum of £750 per year in
relation to B and up to half the reasonable costs of such activities as B may
undertake up to a maximum of £750 per annum.
53. He proposed that B’s maintenance should
be reviewed in the event of material changes of circumstances of either party
and that they should share equally all and any tax allowances available in
relation to her. In the event that
the father did not need to utilise the allowances in whole or in part, then
such allowances or balances remaining would accrue to the mother.
54. Finally, the father’s position was that
there should be no lump sum payments.
The law
55. Article 15 of the Children Law provides that
the Court may make orders for financial relief with respect to any child in
accordance with Schedule 1.
56. Article1 of Schedule 1 is in the following
terms:-
“1. Orders for financial relief against
parents
(1) On
an application made by a parent or guardian of a child, or by any person in
whose favour a residence order is in force with respect to the child, the court
may at any time make an order requiring one or more of the following –
(a) Either
or both parents of a child –
(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;”
57. Article 4 sets out the matters to which court
is to have regard in making orders for financial relief:-
“4. Matters to which court is to have
regard in making orders for financial relief
(1) In
deciding whether to exercise its powers under paragraph 1 or 2, and if so in
what manner, the court shall 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) [any parent of the child] 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) [any parent of the child] 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.”
58. There have been two reported decisions of the
Registrar in relation to financial provision under Schedule 1, C-v-L
[2009] JLR N 41 and A-v-B [2012] JRC 165A. In both cases, the Registrar made
reference to English law and the considerations applicable under the equivalent
provisions of the Children’s Act 1989 as summarised by Bodey J in Re
P (Child: Financial Provision) [2003] 2 FLR 865 at page 877:-
“(i) 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.
(ii) Considerations as to the length
and nature of the parents’ relationship and whether or not the child was
planned are generally of little if any relevance, since the child’s needs
and dependency are the same regardless: J-v-C (Child: Financial Provision)
[1999] 1 FLR 152 at 154B.
(iii) One of the ‘…financial
needs of the child …’ (to which by para 4(1)(c) the court must pay
regard) is for him or her to be cared for by a mother who is in a position,
both financially and generally, to provide that caring. So 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 (1980) 1 FLR 62 AT 66C; and A-v-A
(A minor) (Financial Provision) [1994] 1 FLR 657 AT 665G.
(iv) By paras 4(1)(a) and (b) of Sch 1, the
respective incomes, earning capacities, property and other financial resources
of each of the parents must be taken into account, together with their respective
financial needs, obligations and responsibilities. So ‘… the child is entitled
to be brought up in circumstances which bear some sort of relationship with the
father’s current resources and the father’s present standard of
living …’ – per hale J in J-v C-(Child: Financial Provision)
[1999] 1 FLR 152.
(v) However,
as this latter concept lends itself to demands going potentially far wider than
those reasonably necessary to enable the mother properly to support the child,
‘ … one has to guard against unreasonable claims made on the
child’s behalf but with the disguised element of providing for the
mother’s benefit rather than for the child …’ – J-v-C
(Child: Financial Provision) [1999] 1 FLR 152.
(vi) In cases where 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 the home and for a car; and income provision
(with the expense of the child’s education being taken care of,
generally, by the father direct with the school).
(vii) Such income provision is reviewable from
time to time, according to the changing circumstances of the parties and of the
child.
(viii) the overall result achieved by orders under Sch 1
should be fair, just and reasonable taking into account all the
circumstances.”
59. Re P was a big
money case, in respect of which Bodey J added three further considerations:-
“[77] From the experience of this case, I would propose three
further considerations:-
(i) In
considering the mother’s budget, at least in bigger money cases, the
court should paint with a broad brush, not getting bogged down in detailed
analyses and categorisations of specific items making up opposing budgetary
presentations. Rather, the court
should do its best to achieve a fair and realistic outcome by the application
of broad common sense to the overall circumstances of the particular case.
(ii) Comparisons with the commercial
cost of providing professional care are unlikely to be of great assistance and
may only serve to distract.
(iii) when setting up a budget for the sort
of lifestyle a child should be enabled to have, the court should not generally
attach weight to the risk that the father may reduce or withdraw his support
when the child comes of age (or ceases education or training) thereby obliging
the child to adapt to a lower lifestyle at that time.”
60. Thorpe LJ in Re P disagreed with the approach
of Ward J in A-v-A (A Minor)(Financial Provision) [1994] 1 FLR 657,
where he restricted the mother’s allowance to less than what the father
would have to pay if he employed staff “…. to allow more would be
– or would be seen to be – paying maintenance to the former
mistress who has no claim in her own right to be maintained”. Quoting from paragraph 43 of the judgment
of Thorpe LJ:-
“[43] I cannot agree with that reservation. I believe that a more generous approach
to the calculation of the mother’s allowance is not only permissible but
also realistic. Nor would I have
regard to calculations in either personal injury or fatal accident claims. It seems to me that such
cross-references only risk to complicate what is an essentially broad-brush
assessment to be taken by family judges with much expertise and experience in
the specialist field of ancillary relief.”
61. As David Burles, Barrister, in his article
entitled Children Act Schedule 1 claims: latest cases”
published in Family Law Week said:-
“The mood, in keeping
with the decision in Re P and the clear prevailing trend, is to meet
genuine needs in a generous way wherever possible.”
62. We accept the general proposition made by Miss
Heath that as any lump sum is to be paid to the mother “for the benefit of the child”, the purpose of the
payment must be made clear by the Court but in quantifying the amount of any
lump sum, the Court is entitled to take 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 Child) [2011] EWHC 3792 (Fam) at
paragraph 40). In making a lump sum
order for the benefit of the child, the Court must be satisfied, as Harper DJ
said in N-v-D [2008] 1 FLR 1629 at paragraph 36, that the father is able
to pay that amount.
63. As Thorpe LJ made clear in Re P at
paragraph 52, the father is entitled to proof that the whole sum has been spent
on the designated purpose and none has gone into the mother’s
pocket. However, that was a big
money case and as Mumby J held in Re N (Payments for Benefit of Child) [2009]
EWHC 11 (Fam) at paragraph 33, accounting is only appropriate where the lump
sum is substantial (in that case £20,000).
Decision
64. The mother complains that since the
parties’ separation, the father has abused his superior financial
position by giving both B and A holidays abroad, iPhones, iPads, parties, flat
screen televisions, regular enjoyable activities such as horse-riding and
jet-skiing and cash for shopping; and this in order to alienate the mother,
who, on her low earnings and the modest level of maintenance paid for B is
unable to compete. Indeed, she has
to work overtime in order to help provide for B, which means that B often has
to come to work with her. He has
succeeded in alienating A, says the mother, and she fears that without adequate
financial provision which (as per Re P) bears some sort of relationship
with the father’s current resources and standard of living he will
succeed in alienating B. B, she
said, should not have to choose between the parents for financial reasons.
65. Whilst the mother may have exaggerated the
extent of the father’s resources, we think there is truth in what she
asserts. This is supported by the
findings of the Court in the father’s recent application for a shared
residence order in respect of B, which he openly saw as a stepping-stone to B
coming to live with him when she moves to secondary school next year.
66. The Court in that case heard evidence from Dr
Briggs, the adult psychologist, of the father’s need to be in control and
the mother’s tendency to withdraw into herself and become anxious and of
a low mood. The Court in that case
commented upon what it described as the father’s desire and open campaign
to have B live with him fuelling the mother’s insecurity. In our view, the use of his superior
financial resources is part of that campaign.
67. Two matters are relevant to note here which
came to light in the course of the hearing. In cross examination the mother was
criticised for failing to respond to a phone call from A, made at the
father’s request, after her first days evidence in which she had been
visibly distressed. She explained
that she did not return the call because she did not want A to hear her in a
state of distress; what concerned her at the question however was that by this
request the father was clearly involving A in the proceedings. The father later told us that he asked A
to make this call because he was concerned for the mother. We doubt that explanation.
68. Furthermore within the bundles filed with the
Court was an email dated 6th June, 2013, from the Court Welfare
officer appointed to advise the Court in relation to the father’s
application for a shared residence order addressed to Mr English and Miss Heath
in the following terms:-
“This morning I had
messages on my voicemail from both parents requesting contact from me. I’ve just had time to call them
back now. [The mother] informed me
that B has told her [the father] said that he would see her this weekend and
next Wednesday but that after that he did not know if he would be seeing her
again, depending upon the outcome of the Court. B was understandably very upset and
tearful. [The mother] asked me to
contact [the father] to ask him not to talk to B in this manner. I agreed to do so as I was calling him
anyway. I also advised her where she
could get support for B i.e. school/Children’s Service/CAMHS. She will contact them for support.
[The father] wanted to speak to
me about some recordings he has which he felt would help me understand the
situation better. I informed him I
would take advice about whether I could listen to them and that whilst I was
happy to do so if allowed he needed to be aware that I neither could or would
do anything with the information. I
asked him repeatedly not to discuss the situation with B or tell her that he
would not see her again. He stated
he was not certain he could do that.”
69. The father admitted to talking to B about the
proceedings. She had told him, he
said, that no one was listening to her. He denied saying he did not know if he
would see her again, depending on the outcome of the Court proceedings,
although he did say to her that they could make him homeless. We do not accept his denial.
70. Very regrettably it is evident to us that the
father has involved B (as well as A) in these proceedings in a manner
calculated to alienate the mother. He
has done this against the advice of the Court Welfare Officer and of the Court;
on the 15th January, 2013, at the first directions hearing after the
matter had been transferred up to the Royal Court, the Commissioner, noting the
concern of the Court Welfare Officer over the damage being done to these
children by these proceedings, stated that he presumed neither parent would
discuss the applications with the children in any way whatsoever. More importantly the father’s
conduct in this respect constitutes a serious breach of his duties and
responsibilities to his own child.
71. The mother’s insecurity is further
fuelled by the very real possibility of the death of the lady she cares for,
who is 97, and of the possibility of her partner returning to live in the
United Kingdom. A lump sum payment
of £350,000 would, she said, provide her and B with financial security.
72. It will come as a disappointment to the mother
that this Court, having found that the father has failed to disclose
substantial assets that are still available to him, does not think it right to
order the payment of a lump sum of £350,000 to enable the mother to
acquire a house. It is true that
the father’s property and business is worth £1.12M 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, in our view, of the Court making an order that would place the continued
ownership of that property and the conduct of that business in jeopardy, such
as for example requiring him to borrow funds on the strength of its
security. Even taking into account
the cash of at least £283,500 we have found the father has available to
him, a lump sum of £350,000 would more than exhaust his liquid resources
and leave him indebted with no or little capital to invest in his garage
business; in particular to deal with the leak from one of the fuel tanks.
73. In A-v-B,
the father, who had a modest standard of living, had cash in his bank accounts
of over £135,000 and cash in his company of £870,000, sums in
respect of which there was no call.
The Registrar held that a lump sum payment of £150,000 to be used
towards reducing the mortgage on the mother’s house, was therefore
proportionate. In our view, having
regard to the father’s available liquid assets, a lump sum of
£350,000 would simply be disproportionate; despite the father’s
conduct, it would not be fair, just or reasonable, taking into account all the
circumstances. There are additional
reasons:-
(i)
Whilst we
deprecate the father’s campaign to get B to live with him, 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) would have been incurred in purchasing a house, only for it 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 that 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.
(ii) The mother would have to borrow about
£100,000 herself to purchase an appropriate property. She said that somewhat to her surprise,
she had found that such finance was available, but was unable when asked at the
hearing to produce any documentary evidence to support its availability or
indicate its cost; we were informed that an offer would be made when a lump sum
had been ordered in her favour.
Taking on such a liability on her earnings would do little, we feel, to
increase her financial security.
(iii) The mother does have an adequate home for
herself and B, the cost of which she shares with her partner.
74. Turning to the periodical payments, we have
considered the mother’s budget and the father’s criticisms of the
same but think it right to approach those needs in a generous way, applying a
broad-brush approach. At paragraph
49 of Thorpe LJ’s judgment in Re P, he said this:-
“[49] Thus, in my judgment, the court must recognise the
responsibility, and often the sacrifice, of the unmarried parent (generally the
mother) who is to be the primary carer for the child, perhaps the exclusive
carer if the absent parent disassociates from the child. In order to discharge this responsibility
the carer must have control of a budget that reflects her position and the
position of the father, both social and financial. On the one hand she should not be
burdened with unnecessary financial anxiety or have to resort to parsimony when
the other parent chooses to live lavishly.
On the other and whatever is provided is there to be spent at the expiration
of the year for which it is provided.
There can be no slack to enable the recipient to fund a pension or an
endowment policy or otherwise to put money away for a rainy day.”
75. We are informed by both counsel that in cases
before the Registrar reference is routinely made to the CSA guidelines, the
benefit being to bring an element of consistency to the calculation of
periodical payments. We were also
informed that in Jersey no account is taken of the time a child may have with
the paying parent by way of contact. These guidelines were compiled in 2000,
but as a party’s earning increases, so will the commensurate level of
maintenance payable under those guidelines. Thus, to some extent the effect of
inflation is taken into account.
76. We have started with a figure of £50,000,
being the approximate annual income of the father net of tax, which equates to
£961.53 per week. Applying
the CSA guidelines to that figure indicates a figure of £128 per week or
£554.66 per month. We will
round that figure up to £560 per month (over twice that which is
currently paid).
77. It is appropriate, following Re P to
take into account the mother’s needs as a carer. At the moment, she works overtime, often
requiring B to accompany her. Her
income derived from overtime is £300 per month. We have taken half of that sum, namely
£150, which we will add by way of carer’s allowance to the
periodical payment of £560 per month, increasing it to £710 per
month and this so that she can reduce her overtime when B is with her.
78. In terms of the mother’s car, we were not
persuaded that a new car was required and thought it wise, in the light of the
strained relations between the parties, not to involve the father in either the
replacement of the car or its maintenance.
However, an allowance should be made for the cost to the mother of
running a car to the extent that that benefits B. Working from our own experience, we
considered that with insurance, servicing and petrol, a car will cost
approximately £2,000 a year to run and we assessed a quarter of that sum
as being applicable to the benefit of B, namely £500 per annum or
£41.67 per month. We will
round that up to £42 per month, increasing the periodical payment to
£752 per month or £9024 per annum to be increased annually from the
date of the Court’s judgement in accordance with the increase in the
Jersey RPI.
79. In addition to the periodical payments, the
father will be responsible for all reasonable educational costs in respect of B
and the cost of extra-curricular activities.
80. We accept the mother’s claim for a one
off lump sum payment for a holiday or holidays for B, which we will set in the
sum of £5,000. The mother
must accompany B and therefore that sum can be used to meet the cost of her
doing so. This sum is not substantial
enough to warrant directing the mother to account to the father for the use of
that sum for that purpose.
81. The mother sought an order that the periodical
payments commence on the date of the parties’ separation, and continue
until B is 18 or completes her tertiary education. The father resisted any backdating of
the order, and submitted that it should continue until B was 16 or completed
her secondary education. Article 3
of Schedule 1 is in the following terms:-
“3. Duration of orders for financial
relief
(1) The
terms to be specified in an order for periodical payment made under paragraph
1(1)(a)(i) or (ii) in favour of a child may begin with the date of the making
of an application for the order in question or any later date but –
(a) Shall
not in the first instance extend beyond the child’s 17th birthday unless
the court thinks it right in the circumstances of the case to specify a later
date; and
(b) Shall
not in any event extend beyond the child’s 18th birthday.
(2) Sub-paragraph
(1)(b) shall not apply in the case of a child if it appears to the court that
–
(a) The
child is, or will be or (if an order were made without complying with that
paragraph) would be receiving instruction at an educational establishment or
undergoing training for a trade, profession or vocation, whether or not while
in gainful employment; or
(b) There
are special circumstances which justify the making of an order without
complying with that paragraph.”
82. As a consequence of our findings, it follows
that the father has been paying too little by way of periodical payments for
the benefit of B and we cannot see why he should benefit from the delay in this
matter being determined, particularly when that delay has been caused, at least
in part, by his failure to make proper disclosure. Furthermore, the delay has worked to his
advantage in another way, in that if the mother’s application had been
heard timeously, any order would have been based on the earlier and stronger
financial performance of the company and would certainly have resulted in a
larger award than that which we have given, when taking into account the later
deterioration in the financial performance of the company.
83. The Court has no power under Schedule 1 to
backdate the periodical payments to the date of separation, but it is empowered
to order that it may begin with the date of the making of the mother’s
application, namely 26th September, 2011, and that is the order we
make save in respect of the carer’s allowance. The father will be credited with the
periodical payments he has made to the mother in the interim.
84. As to the duration of the order, having regard
to the provisions of Article 3(1)(a) and (b), we think it right, in the
circumstances of this case, for the order to extend to B’s 18th
birthday, but with reference to Article 3(2)(a) and (b), it is too early to say
whether she will be receiving instruction at an educational establishment or
undergoing training for a trade, profession or vocation when she gets to her 18th
birthday and we are not aware of any special circumstances which would justify
the making of an order today that extends beyond her 18th
birthday. The matter can be
reviewed nearer the time, but at this stage, we are going to order that the
periodical payments will continue until B’s 18th birthday.
85. We are not prepared to accede to any of the
other financial claims of the mother and we are satisfied that the father can
meet the cost of the financial provision we have decided to order in her favour
for the benefit of B.
86. We can understand the mother feeling that the
accommodation provided by her for B is insecure in that her contribution to the
rental is dependent upon her employment, which could end at any time, and upon
her partner remaining living with her.
We have considered whether we should order a further lump sum by way of
security to cover the rent whilst the mother finds alternative employment or
finds alternative accommodation should such eventualities arise, even though no
such lump sum was sought by the mother. We have decided that this would not be
reasonable for the following reasons:-
(i)
We think
that if the lady whom the mother cares for dies, the mother will be able to
find other work. She is clearly a
very competent and good carer.
(ii) She told us that she had a good stable relationship
with her partner and notwithstanding what we had been told of his intentions we
felt it was a matter of pure speculation whether he might leave her.
(iii) These eventualities would be best dealt with by
a review of the periodical payments undertaken at the relevant time when the
actual circumstances will be known.
87. We will deal with costs separately. The mother is on Legal Aid and her costs
at the Legal Aid rate (for this and all the other applications) amount to some
£140,000. If costs are
awarded in her favour, then some 25% would be added to that figure. That figure includes a disbursement of
£17,115 for the forensic accountant, who we are told has written off a
substantial part of his time. The
father has incurred legal fees for this and the application for a shared
residence order at Miss Heath’s ordinary charge-out rate of some
£96,000 inclusive of disbursements.
88. A concern for the Court is to ensure that the
lump sum, periodical payments and arrears are not taken as a contribution to
the mother’s legal costs under the terms of the Legal Aid Scheme. In Re N Mumby J held that the
mother was liable to account to the father for the balance of any money not
used for the purpose stipulated in respect of a substantial lump sum, applying Barclays
Bank Limited-v-Quistclose Investments Limited [1970] AC 567, and this on
the basis that money directed to be applied for a specified purpose is, to the
extent that it is not so applied, held upon trust for the payor. Although the matter was not the subject
of argument before us, we would be inclined to agree that this principle
applies to lump sum payments made under Schedule 1 to a mother for the benefit
of the child. In our view the lump
sum we have ordered is not substantial enough to warrant directing the mother
to account but that may not prevent the principle of a Quistclose trust
applying.
89. It seems arguable that a Quistclose
trust could also apply to periodical payments and arrears as much as it applies
to a lump sum payment in that they are made for a purpose, namely for the
benefit of B. A trust ordinarily brings with it a duty to account but as
Million DJ said in Re C (Financial Provision) [2007] 2 FLR 13 at
paragraph 84 in the context of accounting for periodical payments:-
“It [is] almost always
unhelpful and counterproductive to encourage a father to ask that the mother
keep such accounts of her expenditure”
We agree that it would counterproductive in
this case for the mother to be directed to account to the father for her
expenditure of the periodical payments and arrears.
90. The issue does not arise if we can have
confirmation from Mr English that none of these sums will be taken as a
contribution to his firm’s fees before this judgement is handed down; in
the absence of such confirmation we will wish to address ways in which we can
ensure that these funds are used for their intended purpose.
91. Finally as a consequence of the father’s
conduct we are minded to secure the periodical payments against his property
pursuant to Article 1(1)(a)(ii) of Schedule 1 but we did not raise this with
counsel at the hearing and will therefore invite their submissions both on the
principle and the amount and term when this judgement is handed down.
92. In summary:-
(i)
The father
will make periodical payments to the mother for the benefit of B in the sum of
£752 per month, commencing in the sum of £602 per month (i.e. less
the carer’s allowance) on 26th September, 2011, with the full
amount of £752 per month commencing with the date of the Court’s
order and ending on her 18th birthday, to be increased annually from
the date of the Court’s judgement in accordance with the increase in the
Jersey RPI. The arrears will be
paid within 28 days of the date of the Court’s order. In addition, the father will be
responsible for the payment of all of B’s reasonable educational costs
and extra-curricular activities.
(ii) The father will pay to the mother a lump sum of
£5,000 within 28 days of the date of the Court’s order to pay for a
holiday or holidays for B, accompanied by the mother. The mother will not be directed to
account to the father for the use of that sum.
(iii) The Court will be addressed on the issue of
security when this judgement is handed down.
(iv) Costs will be left over.
Authorities
Children (Jersey) Law 2002.
Children Rules 2005.
NG-v-SG (Appeal - Non-Disclosure) [2011] EWHC 3270 (Fam).
C-v-L [2009] JLR N 41.
A-v-B [2012] JRC 165A.
Children’s Act 1989.
Re P (Child:
Financial Provision) [2003] 2 FLR 865.
A-v-A (A Minor)(Financial Provision)
[1994] 1 FLR 657.
Children Act Schedule 1 claims:
latest cases.
DE-v-AB (Financial Provision for
Child) [2011] EWHC 3792 (Fam).
N-v-D [2008] 1 FLR 1629.
Re N (Payments for Benefit of Child)
[2009] EWHC 11 (Fam).
Barclays Bank
Limited-v-Quistclose Investments Limited
[1970] AC 567.
Re C (Financial Provision) [2007] 2
FLR 13.