AB v BA
[2024] EWHC 1179 (Fam)
TK v AC
10 November 2023
[2023] EWHC 2958 (Fam)
High Court
A husband appealed a court order to pay his ex-wife a lot of money each month. He has no money and would have to borrow more to pay, which is too much debt. The judge agreed and cancelled the order, even though the ex-wife needs the money. The judge said it's unfair to make him borrow more money he can't pay back.
Key Facts
- •Appeal against paragraphs 5 and 6 of Recorder Tidbury's order (April 14, 2023), requiring husband (TK) to pay wife (AC) £1,010/month (backdated) and then £3,510/month until further order, plus a legal services order.
- •Husband has no assets, no income, and substantial debt (£1.7m). Payments would be from borrowed funds.
- •Parties married in 2008, separated two months later, divorced in 2012. Final ancillary relief order in 2013 included periodical payments.
- •Wife's application for an extension of periodical payments 15 years after separation.
- •Husband's income is lumpy and ceased in January 2023.
- •Wife left her job, is now part-time and sofa surfing, previously paid one year’s rent in advance that ended in October 2023.
- •Husband's debts include HMRC debt (£500,000), credit card debt, commercial debts, director's loan account debt, and debts to friends and family.
Legal Principles
Whether it is appropriate to order periodical payments when the payer has no assets and no income, and payments would only be made from borrowed funds.
Moor J's permission to appeal
It is not necessarily wrong in principle to order maintenance to be paid out of debt, if certain conditions are met such as the debt being unlikely to be called in, likely to be met by a third party, or if foreseeable future income exists.
Sir Jonathan Cohen's judgment
Outcomes
Appeal allowed.
The husband's dire financial situation, with no identifiable source of funds to make the payments, makes ordering payments from further debt inappropriate. There is no prospect of future income to repay the debt.
Paragraphs 5 and 6 of Recorder Tidbury's order (relating to maintenance and legal services payments) set aside.
The legal services order is discharged as there are no longer solicitors involved. The calculation of the increased maintenance payment is no longer relevant given the wife's changed circumstances.