Thompson v Prater

An ancillary-relief order transferring a former matrimonial home cannot stand where its practical operation depends on mortgage finance that later evidence shows is unavailable or inadequate. The appropriate course is to allow the appeal and remit the matter for reconsideration. In reassessing the disposition, regard should be had to the housing needs of the children in both parents’ care and to whether each household can obtain suitable accommodation. The parties should cooperate in attempts to secure finance, with full and candid disclosure of income and supporting documents. If finance cannot be obtained, sale of the property and its housing consequences may have to be considered.

District Judge Chandler ordered the former matrimonial home to be sold, with the net proceeds paid to the former wife. On appeal, His Honour Judge Yelton ordered the husband to transfer his interest to her, subject to undertakings to use best endeavours to release him from the mortgage covenants and to indemnify him against mortgage claims. The husband appealed after approaches to several lenders produced no sufficient borrowing facility. The Court of Appeal considered whether the factual premise of Judge Yelton’s order remained sound and what order should follow.

1. Appeal allowed and matter remitted. The order made by His Honour Judge Yelton depended on the husband being able to obtain further mortgage finance while the existing mortgage remained in place. The evidence from the lenders showed that the finance available was either refused or materially insufficient to enable him to re-house himself. The basis on which the order had been made was therefore undermined, and the order could not be implemented as envisaged. The matter was remitted to the county court for further consideration.
2. Housing needs. In determining a fair disposition of the former matrimonial home, the housing needs of the children while in the care of each parent were relevant. Each household required accommodation sufficient for the children’s needs, including their need for separate space as they grew older. The fact that the property had been acquired before the marriage was also relevant to the fairness of the eventual disposition.
3. Cooperation and disclosure. The court stressed that the preferable solution required cooperation between the parties. The husband was expected to make joint approaches with the wife’s representatives to lenders, disclose fully his own and his partner’s income, and provide the documents ordinarily required for a mortgage application. The wife and her representatives were expected to use their best endeavours and professional knowledge to present a viable proposal.
4. Consequences if finance failed. If satisfactory borrowing could not be obtained, the county court might have to conclude that the property should be sold. That could leave the wife and her family dependent on local-authority rehousing. The transcript was to be provided at public expense and could be disclosed to the building societies concerned. Sir Martin Nourse agreed with Lord Justice Ward’s judgment and order, emphasising the need for cooperation.

• Court of Appeal (Civil Division): Lord Justice Ward allowed the appeal and remitted the matter to the county court. Sir Martin Nourse agreed.
• Southend County Court: District Judge Chandler ordered the former matrimonial home sold. On appeal, His Honour Judge Yelton ordered its transfer to the former wife subject to mortgage-related undertakings.