#1775 - Consent Orders And The Effect Of Other Agreements - Family Law

Consent Orders and the Effect of other Agreements

Orders the Court can make

• Income Orders

  • S.23 MCA 1973: Allows for a Peridoic Payment Order to be made

    • These can be weekly, monthly or annual

    • And can be secured against property or be unsecured

  • However, these have essentially been confined to the scrap heap

    • If there are sufficient assets, a lump sum order will normally be made.

• Property Orders

  • Three main types

    • Lump sum orders

      • This requires a lump sum of money to be handed over by one spouse to the other

        • These can be made in instalments

    • Transfer of Property order

      • The most common transfer of property order is an order that one party transfers a share of the matrimonial home to the other

        • The court can also order a transfer to be made to a party to be held on trust for the child(ren)

    • Power to order sale

      • S.24A of MCA 1973 = power to order sale of property belonging to either both spouses or just one

      • The proceeds are then divided by a LSO.

• Clean Break Orders

  • What are these?

    • The making of such an order leads to finality – there can be no more applications for spousal support (this DOES NOT affect obligations under CSA 1991 for children though)

    • S.25A(1) MCA 1973: There is a duty on the court to consider whether it would be appropriate [for the court] to exercise its powers

      • that the financial obligations of each party to the other will be terminated as soon as the grant of the decree

        • as the court considers just and reasonable

  • The advantages and disadvantages of clean break orders

    • Benefits:

      • Parties free to pursue careers and lives without worrying about their actions leading to applications to vary maintenance payments

      • Parties may not feel emotionally free until financial orders end – but are encouraged to keep in contact if children, so bit of a paradox.

      • If the recipient intends to remarry, she may prefer a lump sum clean break, as this will leave her free to remarry w/o losing maintance

      • It avoids future stress of not knowing whether payments are going to be made,

    • Disadvantage:

      • It’s a break – court ties its hands hoping to avoid unforeseen circumstances

Consent Orders

• What is a consent order?

  • Negotiation between the parties

    • Parties are being encouraged to resolve their financial disputes without having to go to court

      • Either through lawyer negotiation

      • Or through mediation

  • Why might we want to encourage this?

    • Parties are encouraged to negotiate rather than fight it out

      • Reduces conflict and acrimony, which enables the parties to move forward

        • Modern family in family law, still recognise that even if status relationship ends, want people to still be bound to what they agree.

      • Also cheaper for parties as a whole for legal costs

        • And also mainly cheaper for the state – do not need lengthy court hearing or court order

  • Role of the court

    • The Family Proceedings Rules 1999 mean that all the parties and their lawyers have to attend a Financial Dispute Resolution Hearing

      • This is conducted by a judge who would not preside over the subsequent trial if there was one

      • This gives the judge a bit of leeway to bang the parties’ heads together and strongly encourage them to settle

        • While providing guidance on the likely results of trials.

    • Under s.33A MCA – Court is supposed to scrutinise the agreement and compare it to the decision they would have reached via the s.25 exercise

      • Not a way to avoid regime – part of it

        • Davis et al: Research shows that the courts give very inadequate scrutiny

          • Consent orders can differ quite significantly from what we expect might have been ordered if had gone to trial.

      • Harris v Manahan

        • Ward LJ:

          • The court is no rubber stamp, nor is it a forensic ferret

    • Herring: So while the court won’t go through the order line by line, it can make sure that the agreement seems reasonable

      • And has the power to refuse to make it if it appears not to be

• What status does the agreement have before it has been made by the court?

  • Edgar v Edgar

    • Held CoA

      • An agreement made that is then resiled on before the case reaches the court to make a consent order

        • Is not binding, but the court will take it into account when the case goes to a contested hearing

        • And will follow it unless there was duress, unforeseen circumstances, injustice or undue influence

  • Xydhias v Xydhias

    • Thorpe LJ

      • Ordinary contractual rules do not determine this issue – any agreement is only enforceable in this area if the court turns it into an order

        • an order in ancillary relief proceedings may be set aside if the product of a material breach of the duty of full and frank disclosure.

        • Similarly, the court conducts an independent assessment to enable it to discharge its statutory function

          • to make such orders as reflect the criteria listed in section 25 of the MCA

      • In consequence, it is clear that the award to an applicant for ancillary relief is always fixed by the court.

        • The payer’s liability cannot be ultimately fixed by compromise as can be done in the settlement of claims in other divisions

        • However, in view of the fact that settling keeps down costs,

          • there are sound policy reasons for giving judges a broad discretion to determine if the parties have settled or not.

  • Soulsbury v Soulsbury: Mr and Mrs S got divorced. However they remained friendly. Mr S suggested that he stop paying maintenance to Mrs S, and she would not enforce the payments, if he paid her 100,000 in his will. Mrs S agreed, and later Mr S died. Mrs S sought the 100,000 which had been bequeathed to her

    • Ward LJ

      • An agreement to oust the court’s jurisdiction is void, but this agreement contained no terms saying that Mrs S would not go to court

        • She could have gone back to court at any time without being in breach of any promise that she would not do so.

        • There was no promise not to apply to the court – it just had the effect that going to court would have made the fulfilment of the condition subsequent impossible

          • She would have forfeited her right to the payment of 100,000 by seeking to enforce the arrears or seeking some alternative form of relief

      • An agreement on financial matters by former or current spouses is not unenforceable by the court so long as there are intentions to create legal relations

        • In my judgment the cardinal conclusions expressed by Thorpe L.J. are stated in terms which are too wide.

        • I accept that if there are negotiations to compromise a claim for ancillary relief, then there is a duty to seek the court's approval as is stated in Smallman.

          • But as Smallman states, and I do not see how that authority of this court can be ignored

            • even an agreement subject to the approval of the court is binding on the parties to the extent that neither can resile from it.

• Variation of, appeals against, and setting aside consent orders

  • Variation

    • Herring: This is highly controversial – if the parties have divorced and an appropriate order made by the court

      • Then why should the order be varied if H wins the national lottery and justify W getting more money?

      • However, often there aren’t enough assets to divide at divorce – why should the timing of sufficient assets appearing matter?

    • When can order be varied?

      • An application can be made to vary a periodical payment order

        • Either by increasing, decreasing or terminating the payment

        • Increasing or decreasing the length and period it is made for

        • Or to terminate it in favour of a lump sum order

  • Setting aside a consent order

    • For non disclosure

      • Here, the court decides whether the non-disclosure was such to justify setting the order aside

      • Livesey v Jenkins

        • HoL:

          • Fact W about to remarry is of sufficient importance that order should be set aside

          • The test is whether the court had been aware of the information that had not been disclosed, it would have made a substantially different order.

    • For bad legal advice?

      • Harris v Manahan

        • CoA:

          • Restricted to cases where “the cruellest injustice”

          • Preferable to sue solicitors for negligence.

      • Dinch v Dinch

        • Lord Oliver

          • It is the imperative professional duty of lawyers to consider with due care any impact any terms they agree for their clients will have on anicallry relief applications

          • s.31 of the Act only enables variation in very limited circumstances

            • If none apply, once the court has either exercised or declined to exercise its power to make such an order

              • no further application for an order in respect of that property can be obtained

          • The burden to establish that the order was final is on the party who seeks to show that it was final

  • Appeal

    • Can an appeal be made out of time, especially where a clean break is ordered?

    • Barder v Calouri [1988]:

      • Five things need to be shown

        • Basis or fundamental assumption underlining the order has been falsified by some change of circumstances

          • E.g. Williams v Lindley: order made to meet W’s housing needs, she then married a very wealthy man six weeks later

          • BUT not Maskell v Maskell – husband’s redundancy not a supervening event – one of life’s normal difficulties.

        • Such change is within a relatively short time of the order

        • Application made promptly after event

        • Granting of relief does not unfairly prejudice third parties who have acquired interest for value of property affected

        • Very rare to overrule

Other agreements and Cohabitation Contracts

What are they?

• Separation agreement:

  • Parties negotiate, but don’t get consent order, but have reached agreement – this is valid under s.34(2)(b)

    • Fact they have done this and not got the consent order does...