Key Facts
- •Variation Application to extend the payment date of a £1.1 million lump sum from June 2023 to June 2025.
- •Lump sum secured by a mortgage on the Husband's flat.
- •Wife obtained a possession order for the flat due to non-payment.
- •Wife issued a Strike Out Application arguing lack of jurisdiction and collateral attack.
- •Rolled-up hearing considered both applications.
- •Husband's funds were held in Lloyd's of London Special Reserve Fund due to unresolved COVID-related claims.
Legal Principles
Court's power to strike out a statement of case under FPR 4.4(1).
Family Procedure Rules 2010, FPR 4.4(1)
Court's power to vary lump sum orders under section 31 of the Matrimonial Causes Act 1973.
Matrimonial Causes Act 1973, sections 23(1)(c), 31
Court's inherent jurisdiction to extend time for payment of a lump sum; limitations on the extent of this jurisdiction.
Masefield v Alexander [1995] 1 FLR 100 (CA), Hamilton v Hamilton [2013] EWCA Civ 12, Birch v Birch [2017] UKSC 53, BT v CU [2021] EWFC 81
Collateral attack on court orders; test for abuse of process.
Veluppillai v The Chief Land Registrar [2017] EWHC 1693 (Fam), JSC BTA Bank v Ablyazov (No. 6) [2011] EWHC 1136 (Comm)
Test for costs orders in family proceedings; relevance of guideline hourly rates.
FPR 28.1, 28.2, 28.3, Samsung Electronics Co Ltd v LG Display Ltd (Costs) [2022] EWCA Civ 466, Athena Capital Fund SICAV-FIS S.C.A. v Secretariat of State for the Holy See [2022] EWCA Civ 1061
Outcomes
Variation Application struck out due to lack of jurisdiction.
A two-year extension to pay the lump sum was deemed beyond the court's inherent jurisdiction, as it significantly undermined the principle of finality established by Parliament's decision not to allow variation of such lump sum orders under section 31 of the 1973 Act.
Strike Out Application not successful on the collateral attack ground.
The Husband's attempt to extend the payment date to support an argument in the County Court proceedings was not considered an illegitimate collateral attack.
If jurisdiction existed, the Variation Application would have been dismissed on the merits.
The Husband's inability to pay was attributed to his own commercial risk-taking, and the Wife was not deemed to be prejudiced by the delay.
Husband ordered to pay costs on the standard basis.
Based on FPR 28.2, considering guideline hourly rates as an indicator of proportionality despite their strict non-applicability to family proceedings.