Mansfield v Mansfield

In ancillary-relief proceedings, personal-injury damages received before marriage remain resources for the statutory assessment. Their compensatory origin, purpose and the recipient’s continuing needs may substantially temper the sharing principle, although the capital is not automatically ring-fenced. Each case must be assessed on its facts. Where family capital chiefly derives from compensation and one spouse’s immediate housing needs arise from primary care of children, a delayed charge-back or Mesher order may preserve the injured spouse’s residual interest. An appellate court should respect a trial judge’s assessment of needs, particularly where it has not heard the oral evidence, while correcting a material misdirection of law.

The husband received approximately £0.5 million in personal-injury damages in 1998, before meeting the wife, and invested the compensation in an adapted home and a rental flat. The parties married in September 2003, separated in April 2008 and had twins. The district judge ordered the husband to pay the wife £285,000, with provision for sale of the adapted home if necessary. HHJ Newton dismissed the husband’s first appeal. On second appeal, the Court of Appeal considered whether the compensatory origin of the capital had been properly reflected, whether the lump sum should be reduced, and whether a charge-back or Mesher order should be made.

The Court of Appeal unanimously dismissed the appeal. It held that the district judge had materially misdirected herself by recognising that personal-injury compensation was available for the statutory assessment but failing to give proper weight to the compensatory origin of the capital and the recipient’s needs.

1. Applicable approach. Personal-injury damages were not excluded from the property or resources considered under section 25. However, the general sharing approach had to be tempered, and could in some cases be excluded, by the reasons for the award, the size and purpose of the capital, and the needs of the disabled spouse. The court applied the guidance in Wagstaff v Wagstaff [1992] 1 FLR 333, which required each case to be considered on its facts. The district judge had omitted this qualifying part of the guidance (paras [14]-[16]).
2. Second appeal and lump sum. The misdirection entitled the Court of Appeal, despite the second-appeal context, to investigate the issue and exercise its own discretion. Nevertheless, the £285,000 award was sustained. The district judge had assessed the wife’s and children’s needs carefully, and the Court of Appeal had not heard the oral evidence. Interference merely because the figure might be high would fail to respect the trial judge’s function (paras [16]-[21]).
3. Charge-back. The origin of almost all the family capital made a Mesher order particularly suitable. The wife’s immediate need for a home arose principally from her role as primary carer and would diminish when the twins reached maturity or completed tertiary education. The husband’s need for capital was likely to increase with age and disability. His residual interest was therefore fixed at one third of the equity in the property acquired by the wife, redeemable when the twins reached maturity, with adjustments if the purchase price differed (paras [22]-[26]).

The formal order was that the appeal be dismissed.

• Court of Appeal (Civil Division): On 27 July 2011, dismissed the husband’s second appeal and directed that the award be protected by a charge-back mechanism reflecting a one-third residual interest.
• Chelmsford County Court, HHJ Newton: On 23 September 2010, dismissed the husband’s appeal from the district judge’s ancillary-relief order.
• Chelmsford County Court, District Judge Silverwood-Cope: On 6 May 2010, ordered the husband to pay the wife a £285,000 lump sum, with provision for sale of The Orchards if payment was not made.