Dart v Dart

English courts must apply domestic statutory law to ancillary relief once jurisdiction is assumed, even where a foreign jurisdiction is also available. Under the Matrimonial Causes Act 1973, a big-money case requires an assessment of all the circumstances and statutory factors, not a percentage division of wealth. The one-third or one-half approach is only a guideline. Needs means the applicant’s objectively assessed reasonable requirements and is not automatically paramount. In very large estates, the award may level off, and the statute does not authorise pure redistribution or provision for independent adult children. Extravagant litigation and rejection of a substantially better offer may justify adverse costs consequences and reduce the practical benefit of an award.

The husband and wife, both originally from Michigan, established competing divorce and financial proceedings in England and Michigan after moving to England. The wife challenged the English jurisdiction and sought a stay under paragraph 9 of Schedule 1 of the Domicile and Matrimonial Proceedings Act 1973. Johnson J dismissed that challenge.

Johnson J later ordered the husband to transfer the Michigan home and pay the wife a lump sum of £9 million. He also ordered her to pay the husband’s costs. The wife appealed, contending that Michigan law or a more equal division should have been considered, that the husband could not apply for an order against himself, that disclosure and costs had been wrongly addressed, and that the award was too low.

1. Appeal dismissed unanimously. The stay was refused, leave to appeal to the House of Lords was refused, and the wife was ordered to pay the costs of the appeal.
2. Thorpe LJ held that once the Family Division assumed jurisdiction under the principles in De Dampierre v De Dampierre [1988] AC 92, it had to perform its statutory function under the Matrimonial Causes Act 1973. The parties’ foreign origins and Michigan’s concurrent jurisdiction did not require application of Michigan law. The anticipated scale of a foreign divorce award was not a necessary benchmark for the English award. The court rejected harmonisation as a basis for departing from the statutory scheme.
3. In a big-money case, section 25 required consideration of all the circumstances and the listed criteria. A purely arithmetical division was impermissible. The fractions mentioned in Wachtel v Wachtel [1973] Fam 72 were no more than guidelines. The approach in O’D v O’D [1976] Fam 83 and Preston v Preston [1982] Fam 17 remained binding.
4. Needs meant the applicant’s reasonable requirements, assessed objectively in light of the other statutory factors. Needs were neither paramount nor determinative. The judge’s task was to identify the boundary between reasonable and unreasonable requirements. Section 25 did not authorise pure redistribution of capital or provision for independent adult children once the amount required to fulfil the statutory purposes had levelled off. O’Neill v O’Neill [1993] 2 FCR 297 was preferred to the broader approach suggested by Besterman.
5. The court confirmed that a respondent could apply for determination of the extent of his own financial liability, following Jagger v Jagger. The availability of the Thyssen disclosure defence was also treated as settled, although the husband had abandoned it and supplied extensive disclosure.
6. The costs order fell within the judge’s wide discretion. The wife had rejected an open offer exceeding the eventual award and had conducted the litigation extravagantly. The resulting costs liabilities could substantially erode the fund allowed for exceptional expenditure. Any deficiency in the expression of the judgment was immaterial because the judge’s intention was clear and an increased award would have duplicated the wasted expenditure.

Peter Gibson LJ expressed reservations about the restrictive approach to wealth and requirements but considered the court bound by authority. Butler-Sloss LJ agreed with Thorpe LJ and added that any fundamental change to the section 25 approach was a matter for Parliament.

• Court of Appeal (Civil Division): Appeal dismissed on 2 July 1996. The order for a £9 million lump sum, transfer of the Michigan home, and adverse costs consequences was upheld. [1996] EWCA Civ 1343
• High Court of Justice, Family Division: Johnson J dismissed the wife’s jurisdictional application and later ordered the husband to pay £9 million in addition to the Michigan home. The judgment also ordered the wife to pay the husband’s costs. No separate citation is stated in the judgment.