Iqbal v Iqbal

In financial remedy proceedings, procedural fairness requires proper notice, tested evidence and a real opportunity to challenge the case relied on. The court must address the relevant statutory factors and give findings and reasons sufficient for scrutiny. A final order based on late unserved evidence, unsworn assertions, unexamined documents and unexplained calculations is unsafe and should be set aside and reheard. In enforcement proceedings which may result in imprisonment, the applicant must prove to the criminal standard both the debtor’s means to pay and refusal or neglect to pay. Earlier civil-standard findings cannot be treated as substantive findings in that process.

These appeals arose from financial remedy and enforcement orders in divorce proceedings. An interim order required monthly payments. A final order required a lump sum of £3,220,000, arrears of £530,000 and continuing monthly payments. The husband had not attended later hearings and challenged the final order and judgment-summons orders on grounds including procedural unfairness and failure to prove means and default.

The Court of Appeal considered whether the final hearing was fair and sufficiently reasoned, and whether the committal orders complied with statutory and procedural safeguards. It also considered, but did not decide, whether an evidential burden could shift after a prima facie case had been established.

Sir Ernest Ryder, Senior President of Tribunals, gave the judgment. Lord Justice Patten and Lord Justice Simon agreed. The appeals were allowed in part.

1. Final financial remedy hearing. The hearing was procedurally unfair. The husband had not been given adequate protection concerning his absence and evidence. A late section 25 statement by the wife was not served on him. The wife was not sworn and her assertions were not properly tested. The judge did not analyse the husband’s filed documents or explain whether they complied with disclosure directions. The resulting assessment of assets and resources was inadequately founded.
2. Inquisitorial duty and reasons. Financial remedy proceedings are partly inquisitorial. The court must satisfy itself about the relevant statutory factors and cannot determine the case by relying on untested assertions while ignoring basic evidential material. A formal determination must contain sufficient findings and reasons to permit understanding and appellate scrutiny. Applying English v Emery Reimbold & Strick Ltd [2002] EWCA Civ 605, the unexplained issues concerning ownership, resources, assets, needs and ability to pay made the reasoning failure fatal.
3. Interim orders. The appeals concerning the interim order and the dismissal of the first appeal were not further determined. The interim conclusions could not be relied on at the rehearing of the final application. The stays remained in place pending the new determination.
4. Enforcement and committal. Under section 5(2) of the Debtors Act 1869, the applicant had to prove to the criminal standard that the husband had or had had since the order the means to pay, and had refused or neglected to pay. The burden remained on the applicant and the husband could not be compelled to give evidence. These requirements, considered in Prest v Prest [2015] EWCA Civ 714, were not met. Earlier civil-standard findings could not be used substantively in the later quasi-criminal process. The enforcement hearings were irregular, including because merits were determined at a directions hearing without proper notice and without adequate evidence. All enforcement orders were set aside.
5. The possible evidential-burden approach discussed in Migliaccio v Migliaccio and Bhura v Bhura did not arise because the husband had never been presented with a prima facie case. The Court declined to develop that point.

The final financial remedy application was remitted for rehearing before a new specialist family judge.

1. Court of Appeal (Civil Division) — [2017] EWCA Civ 19: allowed the appeals in part, set aside the final financial remedy order and all enforcement orders, and remitted the financial remedy application for rehearing before a new judge.
2. Central Family Court — His Honour Judge Brasse made the final financial remedy order on 25 March 2015 and enforcement orders on judgment summonses. The Court of Appeal found the final hearing procedurally unfair and the enforcement process irregular.