Burns v Burns

An ancillary relief order, including a consent order, may be reopened where a party breached the duty of full and frank disclosure or where a qualifying new event undermined the order’s basis. A Barder application must, however, be made reasonably promptly. Finality in litigation requires the court to censure substantial and unjustified delay.

A dramatic post-order sale may justify review where it reveals a gross discrepancy between the assumed and actual value of an asset. A party who knew substantially of that discrepancy, chose to use it only when implementing the order, and then delayed for years may forfeit the right to review.

The wife sought an extension of time and permission to appeal against a consent order made by Mr Paul Coleridge QC in ancillary relief proceedings on 20 July 1999. The order transferred the jointly owned matrimonial home to the husband on the basis of a joint expert valuation of £850,000, with a compensating lump sum for the wife.

Within days, the husband marketed the property. He agreed its sale for £1.7 million approximately two and a half months after the order. The wife and her solicitors knew by December 2000 at the latest that the property had sold for substantially more than the valuation, but proceedings to reopen the order were not commenced until 2004.

The central issue was whether the wife had applied reasonably promptly, as required by the third condition governing relief based on new or supervening events.

1. The application for an extension of time and the application for permission to appeal were unanimously refused. The order plainly would have justified review had the wife applied at the end of 1999 or in the spring of 2000. Her delay and subsequent conduct nevertheless forfeited the right to review.

2. A party to ancillary relief proceedings owes a duty of full and frank disclosure. A breach may consist of actively presenting a false case or passively failing to reveal relevant facts and circumstances. The court may set aside an order and do justice following such a breach, whether or not the order was made by consent.

3. An order may also be reopened for a new or supervening event under the four conditions derived from Barder v Caluori. The event must be certain or very likely to make an appeal successful; it must arise within a relatively short time; the application must be reasonably prompt; and relief must not prejudice third parties. It was unnecessary to decide whether the case fell within breach of candour or supervening event because the legal consequences were the same.

4. The extraordinary difference between the assumed value of £850,000 and the sale price of £1.7 million was material even under the former reasonable-needs approach. The assets held, or likely to be held, by the husband remained relevant. Knowledge of the true position would have produced a more generous assessment for the wife.

5. A short-term change caused merely by natural market fluctuation does not justify reopening. The court may intervene where an unforeseen and unforeseeable event changes an asset’s value so dramatically that the balance of the parties’ assets is substantially altered. A gross discrepancy between valuation and fact may therefore justify review in a proper case.

6. By December 2000 the wife and her advisers had reasonably accurate and developed knowledge of the exceptional sale. They elected to rely on it to accelerate lump-sum payments, secure pension funding and support child-maintenance proceedings, rather than seek reassessment of the fundamental order. The ensuing three-year period of inactivity was unexplained and unjustified. Granting relief after that delay would offend the principle of finality.

1. Court of Appeal (Civil Division): The court unanimously refused both an extension of time and permission to appeal: [2004] EWCA Civ 1258.

2. High Court, Family Division: Mr Paul Coleridge QC approved the parties’ ancillary relief settlement and made a consent order on 20 July 1999. The wife later sought to appeal that order.