FAO Cannydc

In re pre-nuptial agreements (today's LAwtel; ignore the procedural stuff and look at the last two sentences)

SUSAN MARY CROSSLEY v STUART JAMES CROSSLEY (2007)

CA (Civ Div) (Thorpe LJ, Keene LJ, Wall LJ) 19/12/2007

FAMILY LAW - CIVIL PROCEDURE

ANCILLARY RELIEF : CASE MANAGEMENT : OVERRIDING OBJECTIVE : PREMARITAL AGREEMENTS : SEPARATION AGREEMENTS : EFFECT OF PRE-NUPTIAL AGREEMENTS : NON-DISCLOSURE OF FINANCIAL INFORMATION : FAMILY PROCEEDINGS RULES 1991 : r.2.61B FAMILY PROCEEDINGS RULES 1991 : s.25(2) MATRIMONIAL CAUSES ACT 1973

A judge had correctly used his discretionary powers to recognise the increasing importance of pre-nuptial agreements whilst ensuring that the agreement concerned did not rule the outcome of an ancillary relief claim.

The appellant wife (W) appealed against an order made in ancillary relief proceedings following the breakdown of her marriage to the respondent husband (H). W was approximately 50 years old and H was 62 years old. Both had substantial independent fortunes. They were engaged approximately three months after meeting. H had been married once before and had been in a long-term relationship and had four children. W had been married three times and had three children. A pre-nuptial agreement was signed. The trial judge stated that the critical part of the pre-nuptial agreement was the clause that effectively meant that both parties should walk away from the marriage with whatever they brought into it. Approximately 14 months after their wedding, H and W separated. W petitioned for divorce and issued a Form A. The effect of that was to trigger the date for the exchange of Form Es. H subsequently issued a summons that sought an order that W show why her claim for ancillary relief should not be dealt with in accordance with the agreement. W alleged that H had not made full disclosure of his fortune upon which the agreement had been negotiated. The judge said that W and H should complete Form Es without the accompanying documents and that W should write a letter to H setting out her position on disclosure and H could answer that in his Form E. The matter was adjourned, and it was stated at the next hearing that it could be explained why the agreement was not a "knock out blow". W submitted that the judge had erred in law in directing that H's summons be heard as a preliminary issue and in failing to apply the Family Proceedings Rules given that the rules were mandatory. She further contended that the judge had been wrong in finding that the overriding objective permitted him to ignore r.2.61B and in preventing her from filing a questionnaire, which precluded her from challenging disclosure in circumstances where it was suggested that H was responsible for substantial non-disclosure at the time of signing the agreement.

HELD: As H contended, the judge did not direct that his evidence was to be heard as a preliminary issue. H accepted that the court had to adopt the exercise under the Matrimonial Causes Act 1973 s.25(2) and the existence of the agreement could not oust the court's obligation to apply s.25. He accepted that the agreement was part of the matter but emphasised the facts. Upon the facts, he correctly added that the combination of the factors gave rise to a very strong argument that the possible result of the s.25 exercise was that W would receive no financial award. If ever there was to be a paradigm case in which the court would look at a pre-nuptial agreement as not simply one of the peripheral factors but a factor of magnetic importance, the instant case was such. The court was unpersuaded that the rules were intended to be a straightjacket precluding case management. It was easy to attach to the case a number of objectives under the overriding objective. As H pointed out, the inhibition in relation to the questionnaire did not have the effect of preventing W from raising the issue of non-disclosure but simply allowed her to state her position in a letter that would then be answered in his Form E. The judge's management of the case seemed admirable. The approach of the judge was in accordance with a developing view that pre-nuptial contracts were growing in importance. The matter demonstrated the discretionary power of a judge to require a party to show a court why a contractual agreement should not rule the outcome of an ancillary relief claim.

Appeal dismissed

Counsel:
For the appellant: Charles Howard QC, Susan Wilkins
For the respondent: James Turner QC, Deepak Nagpal

Posted By: Old Git, Dec 21, 09:57:01