WA v Executors of the Estate of HA & Ors

A consent financial order may be set aside under the Barder jurisdiction where a supervening event fundamentally invalidates the assumption on which it was made. The event must occur shortly after the order, the application must be prompt, third-party interests must be protected, and the event must have been unforeseen and unforeseeable.

Where an award was primarily needs-based, the death of the recipient shortly afterwards may invalidate the order. In assessing the replacement award, the court must apply the sharing and needs principles. An inherited asset may nevertheless be matrimonial property where it became the family home during the marriage, although its inherited source may justify a substantial departure from equality.

The wife appealed out of time against a consent order requiring her to pay her former husband £17.34 million in two tranches. The husband died by suicide 22 days after the order was made. His estate, represented by his executors and brothers, opposed the appeal.

The wife argued that the husband’s death had invalidated the fundamental assumption that he required substantial provision for his future housing and income. The respondents argued that the award reflected a sharing entitlement and should remain in force. The court had to decide whether the death was foreseeable, whether the award was needs-based or a sharing award, and what order would have been made had the death been known when the consent order was approved.

1. Appeal allowed. The lump sum was reduced from £17.34 million to £5 million. The second tranche was set aside, and the estate was ordered to repay £3.67 million to the wife.
2. The four Barder conditions were satisfied: the husband’s death occurred within a short time of the order; the application was made promptly; no third party had acquired relevant interests for value and in good faith; and the death invalidated the fundamental assumption underlying the order. Applying the approach in Reid v Reid [2003] EWHC 2878, the suicide had been no more than a theoretical possibility and was not foreseeable.
3. The award was primarily needs-based. The assets derived from the wife’s inheritance or gifts, and the parties’ finances had remained separate. The higher of the applicant’s generously assessed needs or sharing entitlement was ordinarily applicable, subject to the respondent’s needs.
4. The Z Estate was matrimonial property because it was acquired and developed during the marriage and became the central family home. Nevertheless, the wife’s wholly inherited funding justified a significant departure from equality. One-third of the net value of the wife’s part, approximately £5 million, would have been an appropriate sharing award.
5. The pre-nuptial agreement did not prevent that award. It had been largely ignored in the negotiations, had received limited consideration, and could not be treated as effective for one aspect of the claim but ineffective for another.
6. A further award was also justified by the husband’s reasonable needs, including provision for his mother and the possibility of bequests or charitable gifts. The same £5 million figure was fair under the statutory criteria and was not excessive in the context of the marriage and the wife’s wealth.

The judgment was an appeal from a consent financial order approved in November 2014 by a Deputy District Judge. Permission to appeal and permission to appeal out of time were granted on 23 April 2015.