Al-Khatib v Masry & Ors

Mediation remains potentially appropriate and capable of success in highly conflicted family litigation at appellate level, even where it was not attempted or failed at trial. Effective mediation requires active judicial supervision. The court should select a mediator suitable for the dispute and ensure that the supervising judge remains available to address crises. An agreed mediated settlement may justify extending limited permission to appeal and allowing the appeal by consent so that specified financial obligations are removed from the order below.

The appeal concerned financial orders made by Munby J in the High Court Family Division on 30 January 2002, reported at [2002] 1 FLR 1053. The order transferred substantial real property to the wife and required the husband to pay a £10 million lump sum, a £2.5 million litigation fund, arrears of periodical payments and interest.

Permission to appeal was initially limited to the lump sum and litigation fund. The husband later sought to widen the appeal, while the wife argued that his contempt prevented appellate review, relying on Hadkinson v Hadkinson. After an earlier mediation failed, the Court of Appeal arranged a further supervised mediation. The parties then presented an agreed order. The central issue became whether the limited permission should be extended and the appeal allowed to give effect to that settlement.

Lord Justice Thorpe gave the judgment, with Mr Justice Wall agreeing.

1. Disposition. The Court of Appeal extended the limited permission to appeal granted in June 2002 and allowed the appeal by consent. The order below was varied by deleting the husband’s obligations to pay the £10 million lump sum, the £2.5 million litigation fund, arrears of periodical payments and accrued interest. The liabilities removed totalled approximately £17 million.
2. Availability of appellate mediation. The court emphasised that even highly conflicted family litigation may remain capable of successful mediation at appellate level. This applies even where mediation was not attempted or had failed during the trial process.
3. Judicial supervision. In a difficult family case, it is insufficient merely to direct mediation and assume that the process will proceed smoothly. The selection of an appropriate mediator is crucial. The supervising judge should remain available to deal with crises arising during the process. The failed first mediation demonstrated the practical importance of both safeguards.
4. Agreed arrangements. The consent order recognised the children’s right to have their views considered on education and residence. It also allocated responsibility for living expenses, education costs and contact transport. Further terms addressed property settlements, applications concerning foreign proceedings and the husband’s undertaking to pronounce a talaq divorce within 14 days.

• Court of Appeal (Civil Division): In [2004] EWCA Civ 1353, the court extended permission to appeal and allowed the appeal by consent, varying the financial obligations in the order below.
• High Court Family Division: Munby J made the financial and property orders on 30 January 2002, reported at [2002] 1 FLR 1053.