They thought it was all over but it wasn’t…

In the case of CB v EB [2020] EWFC 72 the husband was a property developer and the wife was a homemaker. The marital assets were broadly divided in equal shares except for two properties, which at the time, were under development.  Provision was made that the wife would receive a share from these properties at a later date.  After three years the properties were still unsold so the husband and wife reached a compromise in which the wife received a lump sum payment and the court made a final order which included a financial clean break.

When the properties eventually sold the husband did not make the profit that he had hoped for so he applied to the court to vary the order.

This is not an uncommon scenario.  When property settlement orders involve assets such as shares or a property, valuations can be unreliable as market conditions change over time.  However, the question arises as to whether or not the party who suffers loss by the reduced valuation can make a further application to the Court.

Firstly, the law states there are only extremely limited circumstances where the court can vary an order. This can include where there is fraud or mistake; a material non disclosure; a new event which invalidates the basis or the fundamental assumption on which the order was made or if the order contains undertakings and terms of the order remain executory (have not yet been complied with).

The reasoning behind these limited circumstances is because parliament intends that financial orders incorporating clean break provisions are meant to be final and bring about financial closure between a couple getting a divorce.  The clear intention of parliament is to not only sever the marital ties on divorce but also sever once and for all any financial ties.

The husband lost his case because the court refused to compensate him for the financial loss he suffered. The husband had to accept that leaving the property in his hands was his risk alone. Supposing they had sold for wildly more than he first thought, would the wife have a claim?  By this case certainly not for the same reasons.

It is always best to seek legal advice from an experienced family law practitioner. At Maxwell Hodge our family team can provide expert advice from just £150 plus vat for an initial consultation.