How to Qualify ‘Immediate’ in Applications for Maintenance Pending Suit: Rattan v Kuwad  EWCA Civ 1
- Amita Rattan (‘W’) and Tushar Kuwad (‘H’) separated in March 2019 following a ten-year marriage. There were two children of the marriage: W’s child from a previous marriage (aged 17) and the parties’ child (aged 9). W commenced divorce and financial remedy proceedings in April 2019.
- In July 2019 W applied for Maintenance Pending Suit (‘MPS’), including for an order in respect of school fees. W’s application was supported by a statement setting out her income needs, which replicated the needs she had set out in her Form E. These totalled just under £4,900 pcm. W calculated an ongoing monthly income ‘shortfall’ of £2,830 and sought an additional £650 pcm for school fees for the younger child. W also sought sums to pay for ‘essential repairs to the house such as heating, hot water, stove fan, oven’ and other items at a total cost of £3,250.
- W set out that H worked as a software consultant and that he had set up a company in 2011 from which he received ‘a high level of salary and dividends’. W also claimed that H had transferred a total of £285,000 from his company to India between April and June/July 2018. In response, H said that his job and income had ended in August 2019, and that he had been unable to secure further employment. H put his outgoings at £4,500 pcm, and claimed he owed his brother £250,000 and had ‘director loan debts’ of £300,000.
- At a hearing in October 2019, DDJ Morris (‘the DDJ’) awarded W £2,850 pcm. In particular she:
- Ordered that the mortgage on the former matrimonial home (‘FMH’) be changed to a fixed rate product to reduce W’s monthly income needs by about £600.
- Said that H could save on rent ‘because there is a second property’ which was available for the husband to move into.
- Rejected W’s claim for essential repairs to the FMH due to lack of evidence.
- Found H’s case that he was unemployed and unable to obtain employment to be confused and noted that H had not addressed the transfer of money to India.
- H appealed the order. The appeal focused on the purported insufficiencies in the DDJ’s financial analysis. H said that the DDJ had failed to direct herself on the applicable law relating to an application for MPS. As a result, her judgement had failed to analyse W’s budget, identify what part of W’s budget was reasonable and essential expenditure, analyse H’s budget and needs, and had made unreasonable assumptions as to H’s available financial resources.
- HHJ Oliver (‘the Judge’) concluded, under the Matrimonial Causes Act 1973, section 22, that maintenance must be ‘reasonable’ and ‘should deal with immediate expenditure needs which have to be critically examined and long-term expenditure needs should be best dealt with at the final hearing’.
- H’s appeal was allowed due to ‘three fatal errors’, namely the lack of critical analysis of the wife's’ needs; the inclusion of the school fees; and the assumed reduction in the mortgage instalments of £600 per month. However, the Judge did not consider that he was in a position to decide what order should be made in place of that made by the DDJ.
- W appealed the Judge’s order.
- What needs qualify as being ‘immediate’ in an application for MPS and how should the court approach the determination of this question?
- Asplin LJ and Macur LJ agreed with Moylan LJ that the Judge’s decision that the DDJ had failed to undertake a critical analysis of W’s needs was wrong. Moylan LJ had 'no doubt that the DDJ undertook a sufficient analysis of the wife's income needs', and she 'clearly accepted, as she was entitled to do, the wife's budget as representing her reasonable income needs' .
- Moylan LJ did not consider that the Judge was right to exclude certain items from W’s budget as not being ‘immediate expenditure needs’:
‘The word "immediate", in this context, does no more than reflect the fact that the court is concerned with an order for maintenance pending the final resolution of the financial dispute between the parties. However, the use of this word does not mean that the court should embark on the type of exercise undertaken by the Judge in this case. The fact that some items of expenditure are not incurred every month does not mean they should be excluded for the purposes of determining what maintenance is reasonable.’ 
- It was held that ‘it is not necessary for an applicant for maintenance pending suit to provide a list of income needs distinct from that set out in the Form E’. 
- Moylan LJ stressed that school fees ‘can form part of an order for maintenance pending suit’ as there is ‘no reason in principle why they cannot form part of an applicant’s immediate income needs’ 
- The mortgage provision was no longer relevant, but Moylan LJ considered that, had the mortgage not been changed to the cheaper fixed rate arrangement, the DDJ could have increased the maintenance payments to reflect the increased needs of W.
- The appeal was therefore allowed and the Judge’s order (including the costs order that he had made) was set aside. The MPS order made by the DDJ was restored, save for the paragraph dealing with the mortgage.