Rare Case Used to Reduce Financial Settlement


If an unforeseen event takes place that undermines the purpose of a financial settlement following a divorce, a 'Barder appeal' can be made to revise the financial settlement. This case is rarely used, but recently, Mr Justice Moor has allowed its use in reducing a settlement from £17.34 million to £5 million in what he called a divorce case with a "tragic history".

Rare Case Used to Reduce Financial Settlement

What is a Barder Appeal?

You've just had the financial order completed on your divorce, but something unexpected happens that means the money given to your ex-husband or wife is no longer needed – what do you do? The 1988 case of Barder v Barder steps in to bridge this gap in the law where tragic events alter the necessity of the financial settlement.

In Barder, a wife had been awarded the interest in the family home in final settlement from her husband. Just over a month later, she killed herself, along with their 2 children. The court decided that the husband should be allowed to appeal even though it was outside of the 21 day time limit. The judge also laid out 4 conditions for which this kind of appeal could be allowed in future.

New Barder Case with a "Tragic History"

The case, WA v Executors of the estate of HA & Others, involved a marriage whereby the wife was extremely wealthy with an estate worth around £30 million. The couple had 3 children together and had signed a pre-nuptial agreement prohibiting financial claims from one another if they were to divorce.

Their marriage came to an end and the husband was awarded £17.34 million, but 22 days after this settlement, he committed suicide. The ex-wife began an appeal on the basis of Barder, arguing that the purpose of the settlement was to meet her ex husbands need, and so this had been undermined.

Barder appeals are only allowed in limited circumstances and must satisfy the 4 conditions. These are:
  • The event since the making of the order invalidates the basis or fundamental assumption upon which the order was made so that an appeal would be certain or very likely to succeed.
  • The event took place within a relatively short time of the order having been made.
  • The application for leave to appeal out of time should be made reasonably promptly in the circumstances of the case, and
  • The grant of leave to appeal out of time should not prejudice third parties who have acquired, in good faith and for valuable consideration, interests in the property which is the subject of the order.
Moor J found that these conditions were satisfied, and that the appeal had a reasonable prospect of success.

The Decision to Reduce the Settlement

It was suggested, in defence of the husband's estate, that the suicide was foreseeable and therefore should have been taken into account initially. However, Mr Justice Moor decided that although we can see he had taken the divorce badly, his death could not have been predicted, and if anything, his mental health records were actually becoming more positive.

They also needed to find whether the initial award was based upon needs, as if it was a sharing award, the husband's estate would still be entitled to this share. Moor J was satisfied that the claim was primarily needs based, as the money was to make sure he could buy a nice house and live comfortably.

With this in mind, Ward J looked at what the court's decision would have been if they'd known from the start that the husband was to die in less than a month, and decided to reduce the settlement from £17.34 million to £5 million.

Why is This Significant?

Financial settlements after a divorce are meant to be full and final, which means that after the 21 day limit has passed to make an appeal, you can then only appeal in limited situations. Only in exceptional cases is the Barder appeal used, and many just aren't successful because of the limited circumstances it can be used in, and the conditions that you need to satisfy.

Along with Barder, you can appeal out of the time limit if a mistake was made, if there was fraud, a failure to disclose the full assets, lack of capacity, or in situations involving undue influence.

If you are going through a divorce, it's important to make sure that you get the right help and support from an experienced family law solicitor.

Our divorce solicitors at Simpson Millar LLP are on hand to make sure everything runs smoothly from the outset, and are here to help if you have any reason to look to appeal your settlement.

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