The recent judgment in HAT v LAT [2023] EWFC 162 regarding a wife’s claim for further financial remedy 25 years after the divorce is incredibly interesting. It will no doubt spark much debate around this issue.
It is very often the case that we see clients who have dealt with their divorce but have not obtained a financial order for various reasons. Sometimes, there was nothing to divide at that time or because financial assets were divided amicably, they felt there was no need to get a formal court order. Further, it could be that a couple has separated and is living separate lives but has not yet gotten around to finalising a divorce and dealing with the financial assets.
The critical point to take away from cases such as HAT v LAT [2023] is that until there is a financial order dismissing future claims, there is still a risk that one party may make a claim further down the line (up until the point that the other party remarries).
Circumstances of the Case
The circumstances of the case in HAT v LAT [2023] are interesting in that the Husband and Wife separated in 1993 after a marriage of just nine years. A formal separation agreement was drawn up and signed in 1994, which provided for the Wife to receive a lump sum of £702,000 on a clean break basis.
Both parties were legally represented. Notably, nothing would seem to invalidate the terms of the separation agreement.
However, this was not converted into a court order. The parties divorced in 1998, but the terms of the separation agreement were not incorporated into a consent order at that time- if they had been, there would be no cause for any litigation now.
Because of the lack of any formal court order, the Wife is not entitled in principle to proceed with her application for financial relief.
This situation is fascinating and can be differentiated from similar cases because the Husband continued to provide substantial financial support to the Wife over the years despite the terms of the separation agreement. This generosity is arguably the downfall.
The Husband asserts that he had no obligation to pay these sums, which is correct, but the judge in this case determined that the ongoing financial support to the Wife for over 20 years has created a dependency. It is her case that it was inferred this would be for life.
Outcome
This particular judgment related to an application for interim maintenance and an LSPO order for costs- these were both successful at this stage, and the Husband was ordered to pay £200,000 by way of a legal costs order to an FDR hearing. The outcome of the Wife’s application is yet to be determined at a final hearing if the case proceeds that far, but the implications and reasoning within the judgement are so important.
Key points from judgment:
- Delay is not a bar to a financial claim and does not in itself disentitle someone from bringing a claim, but it will be a factor in weighing up the s.25 factors- in this case, the delay was over 25 years.
- Delay also does not prevent interim orders, although the judge was notably cautious about this. If the Wife’s case does not succeed, she may have to repay the sums ordered.
- Ongoing voluntary financial support from the Husband created a dependency and need for the Wife.
- An LSPO order was made to level the playing field at an FDR hearing.
- Despite no grounds to invalidate the separation agreement, the case was allowed to proceed.
The above case highlights the importance of a final financial order on divorce- without this, there is a risk of future claims. Even if those claims are unsuccessful, the cost and stress associated with that future litigation are not worth the risk.
Link to the full case here: High Court Judgment Template (bailii.org)
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