Hutchings-Whelan v Hutchings

In ancillary relief proceedings, the court’s task is to identify one fair lump sum, not to achieve spurious mathematical precision. Where non-disclosure and unreliable evidence make exact calculation impossible, the judge may use estimates and assumptions within the generous ambit of discretion. An appellate court should not interfere unless the decision is plainly wrong. A party whose conduct created the evidential uncertainty cannot reverse the award by isolating minor arithmetic or evidential points, particularly where the items were unproved or lacked direct relevance to the award. A costs order may be made for conduct in the proceedings, and failure to give notice of the costs hearing may be cured where the party later has a full opportunity to make submissions.

The former spouses separated in 2000 and obtained a clean-break consent order in 2004. The order was set aside in 2009 after the county court found material non-disclosure concerning a property ostensibly bought for their son. Following a detailed rehearing, the court awarded the wife an additional lump sum of £384,000 and ordered the husband and his son to pay her costs jointly and severally.

The husband appealed on limited grounds concerning interest and development costs in calculating the profit from the property, the valuation of a bracelet, and the costs order made without notice. The central questions were whether the financial assessment was plainly wrong and whether the procedural failure concerning notice required the costs order to be set aside.

Lord Justice McFarlane gave the judgment of the court, with Lord Justices Hughes and Maurice Kay agreeing. The appeal was dismissed in its entirety.

1. Financial assessment. The court’s task in ancillary relief proceedings is to fix a single fair and just lump sum, applying the relevant factors under the structure of the Matrimonial Causes Act 1973. In a case involving substantial non-disclosure, incomplete records and adverse credibility findings, the assessment could not be reduced to pure arithmetic. The judge was entitled to make assumptions and estimates when doing the best possible with the available evidence.
2. Appellate review. The husband had to show that the judge was plainly wrong or had exceeded the generous ambit of discretion. That threshold was not met. The judge had already allowed for the final secured loan and associated interest when assessing the property profit. He was entitled to ignore the separate interest paid to Mrs C because its connection with the acquisition or development of the property was not established. Unsupported claims for planning and development costs likewise failed.
3. Other assets. The refurbishment costs for two other properties were not specifically claimed, were not established in evidence, and had no direct arithmetical relevance to the lump sum. The judge was also entitled to reject, by implication, the lower valuation of the bracelet. These matters formed only modest elements in an overall assessment of wealth.
4. Costs. Under the Family Proceedings Rules 1991, r 2.71(4), the general rule was that each party should bear its own costs, subject to an order justified by a party’s conduct. Although the husband had not received notice of the costs hearing, he later had a full opportunity to make submissions and made no substantive or particular objection. In light of the findings about his conduct, the costs order was justified and was upheld.

• Court of Appeal (Civil Division): [2012] EWCA Civ 38. The husband’s appeal against the substantive lump-sum and costs orders was dismissed.
• Cardiff County Court: HHJ Masterman set aside the 2004 consent order after finding material non-disclosure, then awarded the wife an additional lump sum of £384,000 and made a joint and several costs order on 21 December 2010.