Ward v Akers

In matrimonial proceedings, a consent order may be set aside for material non-disclosure even where the non-disclosure was not fraudulent. The relevant question is whether full and frank disclosure might have led to an order substantially different from the order made. That possibility does not require the court to set the order aside. The court must exercise its discretion, taking account of all the circumstances, including the parties’ existing knowledge, the adequacy of professional advice, delay, and the policy supporting a clean break. Delay is assessed particularly from the time when the applicant was put on notice of possible non-disclosure. Where publicly available information could reasonably have been obtained and the applicant waited several years, the delay may be fatal.

The parties’ marriage broke down in 1989. In 1990 they negotiated a clean-break settlement and obtained a consent order under which the wife received £120,000, the balance of a building society account, a motor car and household chattels. The husband’s share options and full pension arrangements were not disclosed, and later income information was also omitted.

In 2000 the wife applied under Order 37, rule 1 of the County Court Rules 1981 to set aside the order and obtain a rehearing. The county court found technical non-disclosure but held that it was not material and that the application was defeated by delay. The central issues on appeal were whether the non-disclosure could have produced a substantially different order and, if so, whether the court should exercise its discretion to set the order aside.

1. Appeal dismissed. The application for permission to appeal was granted and treated as the substantive appeal, but the consent order was left undisturbed.
2. The duty of full and frank disclosure applies to negotiations leading to a consent order in ancillary-relief proceedings. The power to set aside is not confined to fraud or mistake and extends to material non-disclosure. The governing threshold, identified in Livesey v Jenkins [1985] AC 424, is whether the failure might have led to an order substantially different from that made.
3. Keene LJ considered that the undisclosed share options and pension arrangements made it possible that a substantially different order would have been made. That possibility established materiality, but it did not determine the application. The court retained a discretion whether to set aside the order.
4. In exercising that discretion, the court had to consider the existing disclosure, the parties’ professional representation, the wife’s knowledge that a pension existed, the failure of her solicitors to pursue obvious enquiries, the public availability of the company accounts, the absence of fraud, and the policy supporting a clean break.
5. The decisive factor was delay. The wife was put on notice in 1994 that the settlement might have been based on misleading information, yet she waited approximately five and a half years before obtaining readily available company information and nearly six years before doing so. Applying the approach in Harris v Manahan [1996] 4 All ER 454, the delay showed a lack of reasonable diligence and was fatal. Gibson LJ expressly concurred, describing the delay as fatal for the same reasons.

• Court of Appeal (Civil Division): Permission to appeal was granted and the matter was treated as the substantive appeal. The appeal from the Wolverhampton County Court was dismissed. A public funding assessment order was made concerning the appellant’s costs.
• Wolverhampton County Court: His Honour Judge Mitchell rejected the wife’s application to set aside the 5 October 1990 consent order and order a rehearing.