MG v FG (Schedule 1 – Application to strike out Estoppel Legal Costs Funding) [2016] EWHC 1964 (Fam)

28 July 2016

Consideration of a strike out application in a claim under Schedule 1 to the Children Act 1989

Facts

  • The mother (Australian) and father (British) married in Australia in 2006. They lived in England during their marriage and divorced in Australia in 2009. The parties had one child together in 2008.
  • In March 2009 the mother issued financial remedy proceedings in Australia; these were concluded by consent after mediation in August 2009. In settlement of her claims, the mother entered into three “Binding Agreements” under which she received: i) spousal maintenance at AUS$650 per week for 3.5 years; ii) child support at AUS$350 per week (CPI-linked) and; iii) a lump sum of AUS$172,500 (40% of the net matrimonial assets).
  • In 2014, the mother attempted unsuccessfully to set aside all of the Agreements in the Australian Federal Court.
  • In July 2015, the mother made an application in England under Part III of the MFPA 1984. Parker J rejected the “unjustified” application and made a costs order against the mother. The mother appealed this decision; both her paper and oral applications for permission were refused.
  • The mother then brought an application for financial provision under Sch 1, which the father applied to strike out as an abuse of process. The court also considered the mother’s application for an interim lump sum in respect of legal services.

Held

  • Cobb J rejected the father’s application to strike out the mother’s claim. The mother must, however, “downscale her potential claim – if one truly exists at all – very considerably” [29].
  • On a strict application of Vince v Wyatt [2015] UKSC 14, the judge’s consideration in an application to strike out (based on abuse of process) is confined to whether the claim is “incoherent, lacking in sense, legally unrecognisable, factually baseless or similar” [21].
  • The Australian courts had never considered the financial settlement for the parties’ child truly on its merits. Unlike the position in this jurisdiction, courts in Australia do not owe a duty to assess whether the terms of parties’ settlement agreements are appropriate.
  • Bringing a Schedule 1 claim after a failed Part III application could not be abusive per se. The mother’s Part III claim had failed at the permission stage, as opposed to following an assessment of the merits. Further, the purpose of the two items of legislation is different, with the intention behind Schedule 1 being much wider [23 (vii) and (viii)]. Cobb J did not, however, place reliance on the consideration of the welfare of the child being different under the two pieces of legislation. The concept of issue estoppel should be used sparingly in children’s cases [25], even if it might be grounds for a strike out [21].
  • Cobb J rejected the mother’s application for an interim lump sum in respect of legal services.
  • The mother had made multiple, failed applications in Australia, often filing excessive materials. The father had limited liquid income. Where there was already a Binding Agreement between the parties, and the father would be unlikely to recover under a costs order, Cobb J was not prepared to exercise his discretion so as to make an order in respect of legal services funding.