Facts
- Terry Neil (“H”) and Soraya Neil (“W”) married in 2007 and separated in 2014.
- After mediation they created a Memorandum of Understanding (“MOU”), which made no provision for spousal maintenance and which created a charge on W’s new property in H’s favour if the FMH sold for more than a certain amount.
- W’s solicitors, XYZ, drafted a consent order on the basis of the MOU. On W’s instructions, XYZ then included a nominal maintenance order of £1 pa and removed the charge back clause.
- XYZ sent the draft to H along with a letter saying it reflected the terms of the agreement reached at mediation (despite the amendments.) W and H both signed this first draft order.
- W was negotiating a mortgage with Coutts and sent them an unsigned draft order, which had included in it a clause saying that H would pay periodical payments of £66,000 pa (£5,500 pcm). On this basis W’s mortgage application was successful.
- Coutts then said that they needed to see a signed draft order and to receive written consent from H stating he was happy with the divorce settlement. W sent a copy of the draft order (with provision for periodical payments of £5,500 pcm) unsigned by her but purportedly signed by H, to Coutts.
- An email was then sent from H’s email address to Coutts confirming the spousal maintenance arrangements. H said W must have sent this from his email address.
- W signed the final order, with the substantial periodical payments clause, and there was a signature purportedly from H on the document.
- In 2017, H made an application to set aside the order on the basis of forgery and fraud.
- Separately, following chancery proceedings, H made an application to commit W to prison for contempt of court and W was duly committed to prison.
Issues
- Was the order procured by forgery and fraud and should it therefore be set aside?
- If the order was indeed set aside, did the court have to set the case down for a rehearing?
Held
- Mr Justice Moor found that:
- Without H’s knowledge, W got XYZ to amend the MOU to delete the charge back and include nominal maintenance of £1 pa.
- H signed the first consent order thinking it was in accordance with the MOU (having failed to read it through carefully, or instruct legal advisors of his own.)
- W sent Coutts a document which she accepted she falsified by changing maintenance of £1 pa to £66,000 pa to get the mortgage she wanted, and then sent them another document to which she added H’s signature from an earlier document.
- She sent fraudulent emails to Coutts purporting to be from H when they were actually sent by her, and H knew nothing about this.
- W sent back the final consent order with a signature on it from H, and although Moor J could not be sure that H did not sign it, he was sure that H was not aware of what he was signing.
- H was very naïve and W was thoroughly dishonest. Moor J had never before come across a court order obtained by fraud in the way W obtained the order dishonestly, which was conduct of the most serious nature under s 25(2)(g).
- As a result, it followed ‘as sure as night follows day, that the Husband is entitled to a set aside of the order’ [78]. However, H only sought to set aside the periodical payments order and for Moor J to determine the amount W owed to him regarding the proceeds of sale of the FMH.
- The order provided that W should receive the first £1m of the proceeds of sale of the FMH and that H should get the balance. Since W had already paid £100,000 towards the balance of £348,930, Moor J ordered that she should pay £248,930.
- Since the case was ‘crying out for a final determination now’ [81] and Kingdon v Kingdon [2010] EWCA Civ 1251 is authority for judges not having to set cases down for rehearing if they are clear as to the correct outcome, Moor J immediately imposed a clean break because there was no realistic prospect W would get a substantive maintenance order against H.
- Moor J decided not to report W to the DPP but noted he ‘undoubtedly would have done so had she not already served an eight-month sentence for contempt’ [88].
- W was ordered to pay H’s costs on the indemnity basis given the serious findings of fact made.
