M-M (A Child), Re

In proceedings under Schedule 1 to the Children Act 1989, financial provision is a broad discretionary assessment. The child’s circumstances should bear a relationship to the funding parent’s resources and standard of living, but finite capital and competing family obligations may require the court to prioritise needs.

Although the child support scheme did not directly apply because the parent lived abroad, its assessment could provide an informative starting point. A periodical-payments order should not double-count variable remuneration already reflected in the basic award. Any additional payment should reflect the applicable child-support percentage, including the adjustment for other dependent children.

HHJ Hughes QC made financial provision for a child under Schedule 1 to the Children Act 1989. The order required the father to clear the mother’s credit-card debt, pay monthly maintenance of £1,000, and pay 15% of any annual bonus.

The mother appealed, seeking a larger lump sum and increased monthly maintenance. The father cross-appealed against the bonus provision, contending that the monthly sum already allowed for variable remuneration and that the percentage was excessive.

The central issues were whether the lump sum and monthly maintenance were wrong in principle or amount, and how any additional remuneration should affect maintenance.

1. The mother’s appeal was dismissed and the father’s appeal was allowed to a limited extent. The judge had conducted a detailed examination of the parties’ finances. There was no bias or unfair curtailment of the mother’s case. An appeal was not a complete rehearing of the Schedule 1 application.

2. The lump sum was properly confined to discharging the mother’s high-interest credit-card debt. Schedule 1 provision required a broad discretionary assessment, informed by the child’s relationship to the father’s resources and household standard of living. It also required regard to the father’s finite capital, his wife and three other children, and the need to achieve a fair, just and reasonable result. A larger contribution towards house repairs was possible in a case with greater resources, but the judge was entitled to prioritise the debt.

3. The monthly maintenance of £1,000 was not open to challenge. The child support scheme did not directly apply because the father lived abroad. Nevertheless, the court could use its assessment as an informative comparison. The sum exceeded the relevant child-support figure and already accommodated up to £30,000 a year of additional net commission or bonus income.

4. The father’s bonus liability should therefore arise only when annual remuneration exceeded £106,800. The appropriate percentage was 11.25%, rather than 15%, because the child-support calculation took account of his responsibility for three other children. No cap was appropriate once remuneration passed that threshold, since further provision was justified to maintain some parity between the child’s household and that of the father’s other children.

• Court of Appeal (Civil Division) — In [2014] EWCA Civ 276, dismissed the mother’s appeal and varied the bonus element of the father’s maintenance liability.
• Principal Registry of the Family Division — HHJ Hughes QC made a Schedule 1 order on 2 August 2013 for a debt-payment lump sum, monthly maintenance and a percentage of the father’s bonus.