CH v WH

The Family Court has all the powers of the High Court. Its power to make financial remedy orders is therefore not confined to the literal terms of the Matrimonial Causes Act 1973. Where appropriate, the court may order one party to indemnify the other in relation to mortgage liabilities and may support that legal right by directing the indemnifying party to use best endeavours to maintain the mortgage payments. Such terms are within the court’s jurisdiction and should not be rejected on technical grounds.

Financial remedy proceedings had concluded by agreement, but the draft final consent order had not been approved. The order provided for the transfer of two mortgaged properties, obligations to use best endeavours to procure the other party’s release from the relevant mortgage, and corresponding indemnities.

Deputy District Judge Underhill refused approval, considering that the mortgage provisions were outside the court’s powers under the Matrimonial Causes Act 1973. District Judge Sparrow upheld that decision. The matter was referred to the High Court for determination of whether the Family Court had power to make the disputed provisions.

1. The draft consent order was approved. The disputed provisions concerning mortgage release, indemnities and best endeavours were within the court’s jurisdiction.

2. The literal terms of sections 23 and 24 of the Matrimonial Causes Act 1973 do not expressly confer a general power to make consequential or supplementary provisions concerning mortgage liabilities. However, section 30 permits the court, when making a property adjustment order, to direct settlement of an instrument by conveyancing counsel. That instrument could contain the necessary indemnities and obligations to pay mortgage instalments.

3. The wider and decisive point was that the Family Court has all the powers of the High Court. The High Court has equitable jurisdiction to order an indemnity. An indemnity creates a legal right, and the court may grant an injunction in support of that right. A direction to use best endeavours to maintain mortgage payments is properly characterised as an injunction supporting the indemnity and is therefore within the Family Court’s powers.

4. The approach taken in Livesey v Jenkins [1985] AC 424 did not require a different result. That decision established that the court could not make an order outside its statutory powers and that certain mortgage obligations should instead have been given by undertaking. The present provisions were supported by the Family Court’s wider High Court powers and were not outside the statutory parameters.

5. The technical objections had caused delay, increased costs and inconvenience. The court directed that objections of this kind to properly framed orders should cease.

Not an appeal. The matter was referred from the Family Court after approval of the draft consent order had been refused by Deputy District Judge Underhill and that refusal had been upheld by District Judge Sparrow.