W (Former Husband) v X (Former Wife)

JurisdictionJersey
CourtRoyal Court
JudgeJudy Marie O'Sullivan
Judgment Date28 September 2016
Neutral Citation[2016] JRC 171A
Date28 September 2016

[2016] JRC 171A

ROYAL COURT

(Family)

Before:

Judy Marie O'Sullivan, Registrar, Family Division.

In the Matter of W -V- X (Matrimonial)

And in the Matter of Matrimonial Causes (Jersey) Law 1949

Between
W (former husband)
Petitioner
and
X (former wife)
Respondent

Advocate M. J. Haines for the Petitioner.

Advocate M. E. Whittaker for the Respondent.

Authorities

Matrimonial Causes (Jersey) Law 1949.

L v V [2004] JRC 033 .

Civil Evidence (Jersey) Law 2003.

Matrimonial Causes Rules 2005.

L v V [2004] JLR Note 6 .

C v D [2013] JRC 056 .

C v D [2013] (1) JLR Note 11 .

E v F [2014] JRC 184 .

In the matter of L (Matrimonial) [2015] JRC 119 .

Pennington v Pennington [1985–86] JLR Note 10c .

Knight v Elwell [1977] JJ 177 .

Hamilton v Hamilton [2013] EWCA Civ 13 .

Masefield v Alexander [1995] 2 FCR 663 FLR 1 .

Matrimonial — application by respondent former wife for variation of payment time relating to consent order dated 18 August 2011.

REASONS
THE REGISTRAR:
1

This is an application by the respondent former wife for the variation of the time within which a payment is due under the terms of paragraph 3 of a consent order of 18 th August, 2011. The respondent is not seeking a variation of the amount of the order, only of the timing.

History
2

The consent order provided for the transfer of Property 1 (“the property”) from a company into the sole name of the respondent, with the respondent taking over sole responsibility for the repayment of the mortgage. The petitioner cooperated in the transfer of the property from the company in which he and the respondent both had shares.

3

Paragraph 3 of the order provided that:-

“(a) the Respondent shall pay to the Petitioner the sum of £80,000 payable on the first of the following trigger events:

(b) on 31st August 2016; or

(c) within 6 months of the death of the Respondent; or

(d) on the remarriage of the Respondent; or

(e) on the continuous cohabitation of the Respondent for a period in excess of 6 months; or

(f) at the Respondent's earlier election;”

4

Interest is to accrue upon the capital sum at the Bank of England Base Rate and is to be paid by the respondent to the petitioner at the same time as the payment of the capital sum of £80,000. The contents of the house were also transferred to the respondent, except for the petitioner's motor bike.

5

The order has a provision at Paragraph 12 stating that:-

“there shall be liberty to apply in relation to the implementation and timing of the terms of this order”.

The indebtedness to Lloyds TSB Offshore Limited (The Bank”) in 2005 was £247,000. In 2011 the property was worth £315,000 and the respondent has since spent about £25,000 on it.

6

The respondent has not paid the £80,000 and interest to the petitioner on the 31 st August, 2016. On the 7 th July, 2016, the respondent brought an application seeking an extension to the original order made by consent, asking that the date for repayment of the £80,000 and interest be extended to the 31 st August 2017 “or such other date as the Court may deem fit”. She has applied for a variation of the timing because she says she has been unable to raise the funds by way of additional mortgage, or to sell the property. She says she has no other funds to pay the money owed. Works were carried out to the neighbouring property in late 2014 which resulted in the destabilisation of a party wall to which part of the property was attached, causing structural damage to the property.

Open position of the respondent
7

The order of 18 th August, 2011, be varied to the following:-

The Court noting that the respondent gave an undertaking to the Court at the hearing on the 17 th August, 2016, which will continue in place, and

The Court further noting the undertaking of the respondent to use her best endeavours to make the payment of £80,000 due to the petitioner as soon as possible.

  • (i) That the respondent shall pay the sum of £80,000 due to the petitioner under the terms of the order on or before 31 st July, 2017;

  • (ii) That interest shall continue to accrue on the debt on a simple basis at the Bank of England Base Rate until date of payment;

  • (iii) That the respondent shall have liberty to apply for a further extension of time within which the payment shall be made in exceptional circumstances only; and

  • (iv) That the petitioner be ordered to pay the costs of and in relation to this action incurred by the respondent upon a full indemnity basis.

8

Her position is that remedial works to the house, to be paid by the insurers, will be completed, barring any unforeseen matters not yet discovered, by the end of January 2017. Her own bank is not prepared to provide the additional funding until the work is completed and approved by a survey, although they are prepared to consider the increased loan on completion.

9

The Court notes that the open offer is not made on the same basis as the original application, which was that payment of the £80,000 was to be extended to the 31 st August, 2017, or such other date as decided by the Court.

10
  • (i) At para 3(b) of the Act of Court dated 18 th August, 2011, the date of 31 st August, 2016, should be replaced by 14 th January, 2017. However, having heard the evidence of Lloyds Bank International, the structural engineer and the builder, the date was amended to the 14 th February, 2017;

  • (ii) That the undertaking given by the respondent in the Act of Court dated 17 th August, 2016, should be retained until the petitioner is paid in full. It should also be permitted to vary or remove it by consent;

  • (iii) The undertaking above should also extend to the respondent confirming that she has not previously, prior to the 17 th August, 2016, signed any documents for the purpose of, or given authorisation permitting, the taking of a charge over the FMH which has not been registered at this time;

  • (iv) It is the petitioner's belief that it is the intention of the respondent to avoid paying him any of the sum due for as long as possible, and that the respondent will seek to link the sale of the house with repayment. The respondent will in this way seek to make application upon application. The Court is invited to resist such an attempt and reject any attempt to make further applications;

  • (v) That the respondent pay the costs of the application on an indemnity basis.

Evidence from Lloyd Bank
11

Elizabeth Walton, mortgage manager with Lloyds Bank International (“the Bank”), gave evidence. She was accompanied by Advocate Lawrence, legal counsel for the Bank. She stated that the respondent had come to see her. The respondent already had an existing mortgage with the Bank. She said that the respondent explained to the Bank that there had been damage to the property caused by works from the neighbouring property, and the insurers were going to pay for remedial works. The respondent discussed raising funds but Ms Walton informed her that once the building was in good order they should be able to assist her. On the 1 st September, 2016, Ms Walton sent an e-mail to the respondent stating that the Bank would not consider an equity release due to the current state of repair of the property. The property needed to be in good order. The criteria of the Bank was that it could lend up to 90% of the value of a property and five times gross income. However the Bank also looked at affordability of a loan based on net income and liabilities, such as loans, credit cards and children's education costs. The respondent had disclosed her income and on the basis of her income the Bank is potentially satisfied. As regards affordability, the Bank is aware of education costs incurred for her daughter but there is potential to assist. However the property needs to be in good order before the formal processing of an application could be done.

12

The process for obtaining an equity release loan is that an interview would be held and then a case put together within 48 hours maximum, with a decision within three to four days. The property would then be valued, within two to three days. If the survey indicated there was sufficient equity, then it would take up to a week to put forward a full written report. If there was a clean survey, the money could be paid out with one month to six weeks of a clean survey, but normally four weeks.

13

Ms Walton said there was no formal application at present as the Bank is aware of the damage but her understanding was that the security, i.e. the property, will be put in good order and then potentially the Bank can help. The paper value of the property had been £315,000 as at 2011. Ms Walton was asked that as work had been done to the property, does this mean the price of the property had gone up, and she said that potentially this was the case.

14

The Bank had lent a further £50,000 in November 2011 to the respondent and the bond entered into provided that no further charges could be secured against the property without prior consent. On 22 nd September, 2016, Advocate Lawrence wrote an e-mail on behalf of the Bank stating:-

“in ordinary circumstances a second charge may be possible but the property …has suffered damage caused by building work carried out to an adjoining property. …. The damage has had a detrimental effect on the value of the property… there is insufficient equity in the property for further borrowing to be considered.”

Advocate Haines had drafted a series of questions to ask of the Bank and wanted the questions sent in writing on a joint basis by the lawyers for the petitioner and respondent. Although Advocate Whittaker was not prepared to send the questions on a joint basis she did set out the questions in an e-mail dated the 23 rd September, 2016, to Advocate Lawrence.

15

His response was as follows in an e-mail dated the 23 rd September, 2016:-

“The bank is not willing to respond...

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