Court of Appeal: Woman who was awarded in excess of €3.8m in divorce loses appeal

A woman who was awarded a lump sum of €3.8 million, in addition to substantial property and monthly payments of €20,000, has had her case dismissed by the Court of Appeal.

Delivering the judgment of the Court, Ms Justice Irvine held that the personal and financial misconduct of the woman’s ex-husband was not so “gross and obvious” that the High Court judge out to have provided for enhanced financial provision.

The main question for consideration by the Court was whether the High Court judge made proper provision for the parties by attaching appropriate weight to each of the attending circumstances of the case and the statutory requirements provided for in s. 16(2) of the Family Law Act 1995; and whether the husband’s conduct in this case should have resulted in a greater lump sum than that which was awarded.

High Court Order

Sitting in the High Court, Justice White made, inter alia, the following orders:

  1. that the husband pay the wife a lump sum of €3.8m
  2. that the husband pay the wife the sum of €20,000 per month
  3. that the parties would have joint custody of their children.
  4. that the wife should have the entire beneficial and equitable interest in the property in which she was then residing
  5. an order extinguishing the share that either party would otherwise have been entitled to in respect of the estate of the other
  6. a declaration that the husband had no claim on two other properties beneficially owned by the wife.
  7. that the husband discharge the costs of the proceedings

Court of Appeal

It was submitted on behalf of the wife that, pursuant to s. 16(2)(i) of the Family Law Act 1995, the High Court judge erred in law in failing to increase the lump sum payable to his client due to the gross and obvious misconduct on the part of the husband.

He submits that the concept of conduct in this section encompasses personal, financial and litigation misconduct.

He relies on individual acts of misconduct and in the alternative on the cumulative effect of the husband’s misconduct and submits that the same was so egregious that the trial judge erred in law in failing to conclude that it would be unjust to disregard such conduct, when making proper provision.

As per Wachtel v. Wachtel [1973] Fam 72, and D.T. v. C.T. [2002] 3 IR 334; it was argued that obvious and gross misconduct should be considered when making proper provision for the parties, and that a series of reprehensible actions can have a cumulative effect such as to engage the provisions of s. 16(2)(i).

Misconduct

Counsel for the wife relied on several events in support of the submission that the trial judge erred in law in ignoring the husband’s misconduct when purporting to make proper provision by way of lump sum payment

Personal misconduct:

  1. his infidelity to his wife;
  2. a false statement made by him to the media concerning the birth of a child to another woman;
  3. the property and monies paid by him to other women during the marriage.

Conduct destined to undermine the personal confidence and financial security of the wife:

  1. the commencement of nullity proceedings, which he later withdrew;
  2. the fact that he denied ever having had a meaningful or loving relationship with his wife;
  3. personal conduct which was designed to demean his wife and intended to subject her to public ridicule.

Litigation misconduct:

  1. failure to make full disclosure as to his means – omitting from his first affidavit of means several assets to the approximate value of €30m;
  2. that a nominee company had been used by the husband to purchase property, and which property only came to the attention of the wife during the hearing;
  3. that the husband owned property which could not easily be connected to him but for the discovery of updated bank statements (H v. O’N (Unreported, High Court, McMenamin J, 23rd June 2011) considered).

In any event, the misconduct, when considered cumulatively, reached the threshold at which it was unjust not to reflect that conduct when making proper provision.

Furthermore, it was argued that the trial judge erroneously took other matters, such as the husband’s financial generosity, into account and in so doing erroneously excused conduct on his part which he was not entitled to ignore having regard to the provisions of s. 16(2)(i) of the Family Law Act 1995.

Counsel for the wife argued that the effect of the High Court judgment was to award the wife 11% -12% of the total value of the husband’s assets and that she should have been awarded no less than 20% of the husband’s overall assets (H v. O’N considered).

Appeal dismissed

Ms Justice Irvine held that the word “conduct” in s. 16(2)(i) of the Family Law Act 1995 had to be construed in the same manner as the word “conduct” in s. 20(2)(i) of the Family Law (Divorce) Act 1996 – as such, only “gross and obvious” conduct should be material to the court’s consideration of proper provision.

Accordingly, Justice Irvine rejected the wife’s submission that in judicial separation proceedings a spouse may rely upon an accumulation of episodes of misconduct, which individually could not be considered “gross and obvious”, for the purposes of seeking enhanced financial provision under s. 16 of the Family Law Act 1995.

However objectionable the husbands contact had been, on the evidence in the High Court this was not so obvious and gross that it was unjust for the trial judge not to reflect it in the way he made provision for the wife under s. 16 of the Family Law Act 1995; and it “did not impact on the capacity of one spouse to make proper provision for the other”.

Having had the opportunity of assessing the husband’s credibility when giving evidence, the High Court judge was entitled to conclude that:

  1. The husband had not set out to mislead the Court or his wife as to the true extent of his assets and
  2. For the purposes of reaching his conclusions, he had a full picture of all the husband’s assets.

Therefore, there was no basis upon which the Court of Appeal could displace the High Court’s finding that such financial misconduct was not to be reflected in the amount of proper provision to be provided for the wife.

In circumstances where it had not been demonstrated that the overall provision the trial judge ordered for the wife fell short of that to which she was entitled at law, Justice Irvine was satisfied that the trial judge was entitled to reach the conclusions which he did, insofar as he declined to make additional financial provision.

  • by Seosamh Gráinséir for Irish Legal News