SR v HR [2018] EWHC 606 (Fam)


  • A final order was made by consent in 2012 (‘the
    Final Order’). The Final Order included property adjustment orders in respect
    of three properties.
  • The Final Order was not implemented in
    accordance with its terms due to disputes about the sale process and the
    selling agents, among other things. This led to implementation litigation.
  • In June 2016, the wife (‘W’) appealed an
    implementation order. She was granted permission to appeal that order (it was
    unclear whether she also obtained permission to appeal the Final Order out of
  • Prior to the hearing of W’s appeal, the husband
    (‘H’) was declared bankrupt. The judge hearing W’s appeal (‘the appeal judge’)
    discharged the Final Order and replaced it with a new order (‘the New Order’).
    The appeal judge explained in his judgment that he was entitled to discharge
    the Final Order and replace it with the New Order because the Final Order
    remained executory and was ‘at the very edge, if not already beyond, any
    effective period of implementation’.
  • The New Order had a significantly different
    economic impact on the parties compared to the Final Order. The effect of the
    New Order was to transfer c. £46,000 from H to W. H appealed the New Order.

Held, granting the appeal

  • Parliament was very careful to keep the powers
    of variation and discharge under section 31 Matrimonial Causes Act 1973 tightly
    confined. It is an iron rule that aside from a lump sum payable by instalments,
    and aside from a set aside on traditional grounds, a capital award cannot be
    varied or discharged by a court of first instance.
  • A “liberty to apply” clause does not entitle a
    court to rewrite non-variable capital awards and to make different ones.
    Equally, the fact that a dismissal clause does not take effect until there has
    been full compliance with certain transfers and payments plainly does not
    entitle a court to replace an executory order with a new one.
  • The decision of Thwaite v. Thwaite [1982] Fam 1 did not entitle the
    judge to make the New Order. In that case, Ormrod LJ stated “Where the
    order is still executory (…) and one of the parties applies to the court to
    enforce the order, the court may refuse, if in the circumstances prevailing at
    the time of the application, it would be inequitable to do so.” This gave no
    support to the notion that if the court refuses to enforce an order it gains
    the power to make a completely new one.
  • It would not have been appropriate to decline to
    enforce the Final Order pursuant to Thwaite and to ask W to provide an
    undertaking that she would transfer c. 46,000 to H in a form of barter as was
    envisaged by Lord Wilson in Birch v. Birch [2017] UKSC 53. This would have
    been a blatant circumvention of the statutory prohibition on variation.
  • Mere delay in implementation of the Final order
    provided no ground for setting aside the Final order on grounds of fraud,
    mistake or supervening event under rule 9.9A FPR.
  • Moreover, the New Order should be set aside
    because at the time they were made, H was bankrupt and all of his property was
    vested in his trustee in bankruptcy, so that he did not in fact have £46,500
    worth of property capable of being taken from him and given to W.