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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Rasool v Khushi [2002] EWCA Civ 1386 (21 August 2002) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2002/1386.html Cite as: [2002] EWCA Civ 1386

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IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE MANCHESTER COUNTY COURT
(His Honour Judge Earnshaw)

		The Royal Courts of Justice Strand London WC2 Wednesday 21st August, 2002

1. LADY JUSTICE HALE: This is an application by a former husband for permission to make a second appeal against the orders made in ancillary relief proceedings between himself and his former wife. They were legally married in 1982, with an Islamic ceremony in 1983. They have one child, a daughter, who was born in April 1991 and is now 11. They separated in 1996.
2. The initial order was made by District Judge Shannon in the Manchester County Court on 12th October 2000. He reserved judgment for a short time after six days of hearing, adjourned after three days in April until August 2000. The reason for that adjournment was the emergence, under cross-examination on behalf of the husband, of undisclosed assets in the hands of the wife.
3. The appeal was heard by His Honour Judge Earnshaw over three days in January and March 2001. He delivered a written judgment dated 16th March 2001 dismissing the appeal. His order is dated 20th March 2001.
4. The District Judge assessed the combined assets at £535,730. He decided that the capital should be divided 40 per cent to the husband and 60 per cent to the wife. He reflected that in an order that the wife should keep the £55,000-worth of assets already in her hands and be paid a lump sum of £266,438. This was to be paid effectively in three tranches. First, by the immediate release of the proceeds of sale of an investment property in Basingstoke; secondly by 30th November 2000 by the transfer of certain defined assets to her; and thirdly by 11th January 2001 by the payment of a lump sum of £153,203. The wife was to transfer her share in the former matrimonial home to the husband.
5. The District Judge assessed the husband as having a substantial earning capacity, certainly not less than his then current earnings of £50,000 a year. The wife was at that stage an undergraduate and making slow progress at the University of Manchester. It was accepted that she had no earning capacity until her graduation in 2002. The income needs of herself and her daughter were around £1,800 a month. The husband was under a liability to the Child Support Agency for the daughter. The District Judge ordered him to pay a further £300 per month periodical payments to the wife for three years, that is until 12th October 2003. He also ordered the husband to pay the daughter's school fees until she finished primary school in July 2002.
6. The District Judge made findings that neither party had been full and frank in their disclosure, but quite clearly the wife had been the worse of the two. She had deliberately concealed assets and lied to the court. He reflected that in an order that she pay £10,000 towards the husband's costs to reflect the increased length of the hearing occasioned by that concealment, and otherwise made no order as to costs.
7. The notice of appeal to the Circuit Judge did not challenge the school fees order. It contended for a lump sum of £110,000; periodical payments until 12th October 2003, which was what in fact had already been ordered and so I wondered if that was a slip for 2002; and an order that the wife pay all the husband's costs. It was argued that the District Judge had miscalculated the assets; that he had erred in the division of those assets, given that the wife's reasonable accommodation needs could be met for £110,000; that the wife should have been attributed an earning capacity from the date of her graduation in July 2002 and it was wrong to use the lump sum to generate future income; and the costs should have reflected the extent of her deception and the impossibility of settlement. It is worth pointing out in that connection the District Judge's trenchant views upon the completely unrealistic position adopted by the wife in the course of the proceedings. As an afterthought, in January 2001 the grounds of appeal added that the basis of the order had been undermined by the subsequent fall in the stock market.
8. As to errors of principle allegedly made by the District Judge, Mr Bruce says today that he concentrated upon two (on page 12 of the judgment). The first was the statement that the welfare of the daughter was the court's paramount concern. In fact section 25(1) of the Matrimonial Causes Act 1973 provides that the welfare of a minor child is the court's first consideration. So it is common ground, and was common ground before the Circuit Judge, that that was wrong. The second point was that the judge should not have taken the starting point of one-half in a case that was decided before the decision of the House of Lords in White v White [2000] 2 FLR 981, or then gone further and adjusted that to 60 per cent and 40 per cent because the wife had the care of the child for the foreseeable future.
9. The Circuit Judge was not persuaded that this District Judge, who is a highly experienced District Judge and who had heard a great deal of evidence over a long period, had miscalculated the assets. He had, after all, made findings that the husband too had not been entirely straightforward in his disclosure and had continued to move assets about, notwithstanding a freezing order made in 1999. The husband had not paid any of the periodical orders. Therefore the only certainty that the wife had was the capital division. An unequal division was justified by her having responsibility for the daughter's care and upbringing in the future, coupled with a vast discrepancy in their earning power. As to the argument that the subsequent move in the stock market amounted to a fresh event within the meaning of the case of Barder v Barder (Caluori Intervening) [1988] AC 20, in the House of Lords, he accepted the argument of counsel for the wife, as follows:

"Inevitably there will be fluctuations in the market and what goes down can also go up. The husband, he said, has provided no documentary evidence in relation to the value of the shares. We have reference to a table ... but the same difficulties apply as applied to the March, April and August 2000 schedules. Therefore, he continued, even if the January 2001 schedule was admitted in evidence it must have the same lack of credibility as the other schedules. The husband he observed, has a balanced portfolio, i.e. his investments are not all NASDAQ based. The court cannot take the view that the husband's `NASDAQ shares' are depressed permanently. He can keep them to let them rise. Further, said [counsel], the District Judge ordered the husband to pay the lump sum provision `quickly'. Therefore had he complied he would not have needed to argue that the NASDAQ had gone down. This heading should not be `respected' as a ground of appeal. I accept the thrust of this submission."

10. In making this application to this court Mr Bruce, on behalf of the husband, faces two very high hurdles. The first is that he requires a massive extension of time. The excuse in the solicitor's affidavit is difficulties with the Legal Services Commission and that the assets were still considered frozen, by implication so that he could not, from those assets, fund at least an application for permission to appeal. There is, apparently, still no public funding but the family have rallied round. That is not a good enough excuse. The order was not complied with. The trigger for this application was obviously the wife's attempts to enforce it. If there were any doubts about whether the assets were frozen, an application could have been made for the release of sufficient assets to pursue this application at the appropriate time. The notice of appeal was lodged on 15th July 2002, shortly after District Judge Shannon attached a penal notice to certain paragraphs of the original order on 4th July 2002.
11. The second hurdle is that this is a second appeal. This means that permission cannot be given unless this court considers that it raises an important point of principle or practice or there is some other compelling reason for the Court of Appeal to hear it. Those advising the husband and the Circuit Judge seem to have been under the mistaken belief that the Circuit Judge could give permission, because an application was made to him and he refused it. That is not correct; only this court can give permission and that hurdle has to be surmounted.
12. What then is the important point of principle or other compelling reason which can be urged? In the grounds of appeal and skeleton argument it was put in this way. The judges should not have made an order for a fixed sum, but for a fixed percentage. In other words, having determined that the assets should be divided 60 per cent/40 per cent, the court should have made some sort of declaration to that effect and then left the parties to sort it out themselves. This is rubbish. The court often decides first in what percentage to distribute capital or income, but then it has to make the orders for which it is given power in section 24 of the Matrimonial Causes Act, that is, either for a lump sum or for the transfer or settlement of property. This is not a settlement case. The judge therefore had to make an order either for transfer or a lump sum, and it is nonsense to suggest that he should have done anything different.
13. Secondly, it is argued -- and this is the way in which it is put today -- it is suggested that the calamitous fall in the value of some of the parties' assets is a Barder event. Mr Bruce very fairly acknowledges my analysis, which has withstood scrutiny in this court, in the case of Cornick v Cornick [1994] 2 FLR 530. It is difficult indeed to regard the foreseeable movements in the values of stocks and shares in particular as a Barder event, particularly where, as was pointed out before the Circuit Judge, there is a mixed portfolio of assets, some of which may rise and some of which may fall. There may, for example, be a sharp rise in the property market which corresponds with a sharp fall in the equities market, and particularly in a portfolio in which there have been recent movements, it may be difficult to predict the effect. The order was on the basis that the husband comply with it quickly. The figures taken were those that were current, and it has not been demonstrated were not still current, at the time when the order should have been complied with but was not. Furthermore, the order gave him a choice about how to comply with it. In those circumstances, I do not consider it arguable that this is a Barder event.
14. In those circumstances I see no important point of principle emerging from this proposed appeal. I acknowledge that the combined effect of the judge's order and the way in which the husband has chosen to react to that order is that the net effect, if matters are looked at now, is very different from that which was contemplated by the District Judge and the Circuit Judge. But that does not in itself constitute a reason for saying that the orders which they made were plainly wrong at the time when they made them.
15. For those reasons I do not believe that it is open to me to grant permission to appeal in this case.
ORDER: Application for permission to appeal refused. (Order not part of approved judgment)