Hutchings -Whelan v Hutchings

On an application for permission to appeal against an ancillary-relief award, primary factual findings will generally be treated as the starting point where there is no realistic challenge to the evidence. Permission may nevertheless be granted where identified accounting or valuation errors could affect the lump sum. Equality is not necessarily the objective where an award is intended to redress financial non-disclosure and concealed profits. A party denied a proper opportunity to make costs submissions may receive permission limited to costs. A hand-down hearing does not reopen the merits or invite further submissions on the order itself.

Following a 20-year marriage, the parties entered into a consent order in 2004 under which the husband paid £176,000 and obtained the former matrimonial home. The wife later discovered that the husband had failed to disclose an investment property and had realised substantial profits.

On 3 March 2009, the Cardiff Civil Justice Centre set aside the consent order for non-disclosure and directed a rehearing. After a five-day retrial in July 2010, His Honour Judge C M Masterman ordered the husband to pay a further lump sum of £384,000. The husband sought permission to challenge the factual findings, the calculation of the award, and the costs order. The central issues were whether any proposed ground had a realistic prospect of success and whether the husband had been denied a proper opportunity to address costs.

Application granted in limited terms. Permission to appeal was confined to specified accounting, valuation and costs issues. Enforcement remained stayed only for sums exceeding £200,000.

1. The court approached the application on the basis of the trial judge’s primary findings. The conclusions that family members had acted as nominees, that the husband had concealed transactions, and that his financial evidence was unreliable were supported by the evidence and offered no realistic ground of appeal.
2. The judge’s basic approach to ancillary relief was not arguably wrong. He was entitled to award a suitable proportion of profits made and concealed after separation. He was not required to pursue equality where his purpose was to redress non-disclosure and unexplained expenditure.
3. Two minor factual errors concerning the sale of the Bentley and the Skenfrith property had no effect on the overall findings. The court noted that an injunction under section 37 of the 1960 Act had prevented their sale.
4. Permission was nevertheless justified for potentially material omissions from the calculation. These included interest paid on informal loans used to finance the Risca transaction, development and refurbishment costs, and the asserted overvaluation of a bracelet. Such points could affect the overall lump sum even though they did not undermine the judge’s basic method.
5. The challenge to the valuation of the properties was refused. The order permitted the husband to sell them with the wife’s consent, and unreasonable refusal could be addressed by application to the court.
6. The husband had not had a proper opportunity to make submissions on costs because notice of the hand-down hearing had not reached him. Permission was therefore granted on costs alone. The hand-down hearing concerned delivery of a judgment already reached and was not an opportunity for further submissions on the merits or the substantive order.

Permission was limited to the Risca starting figure, approximately £19,600 of refurbishment costs, the bracelet valuation, the resulting lump sum, and costs. The formal order was: application granted.

• Court of Appeal (Civil Division): On 15 August 2011, Lord Justice Hughes granted permission to appeal on specified accounting, valuation and costs grounds only, and continued the stay of enforcement for sums above £200,000.
• Cardiff Civil Justice Centre: His Honour Judge C M Masterman set aside the 2004 consent order on 3 March 2009 for non-disclosure and ordered a rehearing. Following the July 2010 retrial, judgment dated 18 October 2010 required a further lump sum of £384,000.
• Earlier Court of Appeal stage: Wall LJ refused permission on 30 July 2009 to challenge the setting-aside and rehearing decisions.