Potanina v Potanin (Rev 2)

Leave to apply for financial relief under Part III is a filter against plainly unmeritorious claims. The threshold is not high, but the applicant must show solid grounds for an order possibly being made.

Once leave has been granted, it should be set aside only for a compelling reason, such as a readily identifiable decisive authority having been overlooked or the court having been materially misled. Complex disputes about facts, motivation or foreign law should ordinarily be resolved at the substantive hearing. Under the Family Procedure Rules 2010, a complex leave application may appropriately be heard on notice, but the determination remains summary. The appeal was allowed and leave restored.

The parties married and lived in Russia. Following their Russian divorce, the wife received substantial financial provision but alleged that the Russian proceedings had not addressed assets beneficially owned by the husband or her long-term needs.

The wife obtained without-notice leave under Part III of the Matrimonial and Family Proceedings Act 1984. The High Court later set aside that leave and refused permission after a lengthy hearing concerning alleged factual, Russian-law and English-law misrepresentations. The wife appealed.

The central issues were the proper approach to an application for leave, the circumstances in which ex parte leave may be set aside, and whether disputed matters should have been determined summarily or at the substantive hearing.

1. Appeal allowed. The judge’s order setting aside leave was reversed. Leave remained in place and the Part III application was to proceed to trial under section 17. The court expressed no view on the eventual merits.
2. Leave and set aside. Applying Agbaje v Agbaje [2010] UKSC 13, the leave threshold was not high, but required solid grounds for an order possibly being made. Once leave had been granted, setting it aside required a compelling reason. Unless there was a readily identifiable decisive authority or a material instance of the court being misled amounting to a knock-out blow, the application should be adjourned to the substantive hearing.
3. Procedure. Rules 8.25(1) and (2) of the Family Procedure Rules 2010 required the application to be made and ordinarily determined without notice. Rule 8.25(3), however, permitted an on-notice hearing where appropriate. Complexity was a sufficient indication that an inter partes hearing might be appropriate. Whichever procedure was used, the leave determination remained summary and required an appropriately short listing.
4. Alleged misleading of the court. Complexity increased the disclosure required for fairness, but not every error or omission justified setting aside leave. The matter had to be objectively misleading, individually or cumulatively, and sufficiently material to the grant of leave. The judge had wrongly undertaken a wholesale examination of disputed evidence, including motivation, connections, Russian litigation and foreign law. Those issues required oral and potentially expert evidence and were not a knock-out blow.
5. Authorities and costs. The approach was consistent with Traversa v Freddi [2011] EWCA Civ 81 and the Court of Appeal’s criticism in Zimina v Zimin [2017] EWCA Civ 1429 of splitting the substantive Part III issues. The court noted, obiter, that an applicant whose ex parte leave was later set aside could face adverse costs consequences, potentially including indemnity costs.

1. Court of Appeal (Civil Division): Appeal allowed. The order setting aside leave and refusing permission was reversed. Leave remained in force and the matter was to proceed to trial.
2. High Court (Family Division): Cohen J set aside the ex parte order granting leave and, on reconsideration, refused leave to make the Part III application.