E v F (Family)

Advocate MacDonald compared the case of E-v-F (Family) [2013] JRC185A and this case. The parties in both are not married, in the E-v-F case there was a 7 year old whereas here there are 3 children, E was the primary carer and in this case the Children spend most of their time with their Mother. In the E-v-F case, F was earning £50,000 per annum and E £24,000. The Father has a much higher income than in the E-v-F cases, and the Mother has no earnings. F owned 3 properties with an equity of about £1,330,000. The Father has assets of £12,606,000 as at the 31 st July, 2017. F was ordered to pay a lump sum of £250,000 towards the cost of accommodation and cost on purchase to include stamp duty, E having some capital of her own. F was also ordered to pay a lump sum of £10,000 toward the cost of furnishing and equipping the home. In respect of maintenance F was ordered to pay £590 per month plus school fees and half of all incurred in relation to school/educational trips, extra-curricular activities, and medical costs, not covered by the mother's medical insurance and dental fees. Advocate MacDonald said that a property for the children must bear some relationship to that of the Father and the Father interjected and said " I agree."

In the decision of E-v-F , the Court's concern was maintenance of the children now as opposed to their inheritance:-

In the I-v-J case, Commissioner Clyde -Smith endorsed the proposition that the " prevailing trend is to meet genuine needs in a generous way wherever possible." He accepted at paragraph 62 in quantifying a lump sum the Court is entitled to adopt:-

In Re P (at paragraph 45) Thorpe J states:

In the decision of E-v-F , use was made of the 2000 CSA formula as a guideline for maintenance (the "CSA Guidance"), as referred to in S-v-G [2003] JRC 091A . The CSA Guidance provides that a father of three should contribute 25% of his annual net income, decreasing to 20% in respect of two children and to 15% in respect of one child. Based upon the Father's projected annual income in 2018 of £272,000, as set out in his C4 according to the CSA Guidance the Mother considers he should pay maintenance of £5,666 per month, for at least the next five years until either Child 1 becomes an adult in 2023 or later if she continues to tertiary education. The level of maintenance would then be revised on the basis that maintenance is to be paid in respect of Child 2 and Child 3. However, in considering the figures provided by the Father of £174,962 for 2017 and estimated income for 2018 of £222,890, this would equate to £3,645 per month and £4,630 per month. At present, deducting school fees and rent, the Father is paying £4,540 per month. The CSA Guidance is just that and the Court must consider the matters set out at paragraph 4 of Schedule 1 of the Law and the principles set out in the Re P (Child: Financial provision) case.

In the E-v-F appeal case, at paragraph 50, the Court considered that the Registrar had summarised the position regarding periodical payments accurately as follows:

A Court therefore has to take account of all the circumstances including " other financial resources" . In SW -v- RC [2008] EWHC 73 (Fam) Singer J said that:-

With regard to distinguishing the needs of the Children as opposed to the Mother, in the E-v-F appeal it was accepted that a Court

The case of N v D [2008] 1 FLR 1629 at paras 23 and 27 said:-

The court will not permit a maintenance claim in disguise for the mother's benefit. As against that, counsel for the mother submits she should be properly funded and supported in caring for S. It is not realistic simply to apportion items of the budget - some of which I have referred to above - as referable only to the child's needs because, in my judgement, financial provision must be made to the mother to enable her to meet S's needs. The mother needs for such purposes to eat, clothe herself, maintain car expenses and take the child for holidays. In relation to medical / dental / optician costs, the needs of the child are otherwise met through the father's medical insurance; the claim in the budget on this item is for the mother's medical costs and they are reasonable because she (the mother) must be sufficiently equipped and healthy in order to be able to care for S. The Court of Appeal indicates at para [43] re P that 'a more generous approach to the calculation of the mother's allowance is not only permissible but also realistic'."

Detailed submissions were made on behalf of the mother about the financial consequences of the Father's death. If the Father were to predecease the Children, the Mother submits that the Children would be in a precarious position financially until any inheritance from his estate was available for distribution, hence she wants a home purchased now for the Children until they are 18 or finish full time education in order to provide security for them. In the period before a grant of probate or letters of administration is obtained, the Father's estate is in effect frozen. On notification of a person's death a bank for example will freeze their relevant accounts until a grant of probate is received. Any interference with the estate of the deceased is illegal, beyond the two limited exceptions set out in Article 23(2) of Probate (Jersey) Law 1998 (the "Probate Law") which allow only for arrangements to be made to dispose of the deceased's body and for the movable estate of deceased be placed in safe custody or otherwise preserved.

Article 23(1) of the Probate Law provides that:

Article 19 of the Probate Law states at paragraph (1) that:

The process for obtaining a grant of probate or letters of administration can take time to complete, because an appointment must be made with the Probate Registry by the nominated executor or the person entitled according to Jersey law to apply for letters of administration to swear the requisite oath in accordance with Article 8 of the Probate Law, and the length of time it takes to obtain an appointment varies depending on the workload of the Registry. A Grant needs to be prepared and provided to the executor of administrator. Any person being appointed as an executor is required to swear an oath at that time which requires confirmation of the value of the personal estate of the deceased, wherever situate, and court stamps of commensurate value must be brought to the appointment. The rate of stamp duty to be paid is calculated on the value of the personal estate of the deceased wherever situate at the rate of £50 per £10,000 or part thereof in respect of the first £100,000 of value; and then at the rate of £75 per £10,000 or part thereof thereafter up to £13,360,000 when the fee is capped at £100,000.

Because of the age of the Father and his health problems, the Children may be minors at the time of his death and they would not be able to receive his movable estate themselves, as per In re Fargus [1997] JLR 89 . A tuteur would need to be appointed to hold the Children's property until they reached the age of majority. Until then, the hands of the executor/administrator would effectively be tied as he/she:

The Father indicated he has made a will but provided no copy of it. If the Father were to die intestate, or if there were to be no executor of his will, then there would be additional delays associated with the appointment of an administrator. None of the Children could personally fulfil that role before becoming 18 and, because there are apparently no other heirs, there may need to be hearings to appoint a Guardian ad litem and/or a tuteur before the appointment of an administrator.

Article 14 of the Probate Law sets out who is entitled to obtain a grant of letters of administration. Paragraph (2) provides:

The person who would be entitled to be appointed as administrator according to customary law would be the deceased's principal heir; and where the deceased only had children this would be his eldest son, or if he does not have a son his eldest child.

Therefore, if the Father were to die within the next five years then his only heirs would be the Children and as none of them would be 18, they would not have capacity to be appointed as administrator or to grant a power of attorney in favour of someone else to allow that person to be appointed as administrator.

Article 14 of the Probate Law provides the Court with discretion in respect of who it may make a grant to in paragraphs (5) and (6) which state that:

Accordingly, the Judicial Greffier and the Inferior Number of the Royal Court would be required to consider whether an alternative person, other than the person entitled in accordance with customary law, should be appointed as administrator or executor. This process may take time. It is not immediately apparent who would have standing other than the Children to bring such an application, in which case a guardian ad litem or tuteur would need to be appointed to allow such an application to be brought before the Royal Court.

Once the executor or administrator is appointed, he/she could create a separate account for the estate, from which he/she could then decide to make an advancement to the Children of their inheritance by way of a payment or transfer of assets to their tuteur . This process is likely to take time to complete, and the Mother submits that in the interim the Children would suffer financial hardship unless adequate provisions are made during the Father's life. The Father has refused and/or failed to disclose any will or wills in existence at the present time but in any event the Father could destroy or amend such wills that do exist at any time.

Whilst in his Open Position of 17 th November, 2017, referred to setting up a trust in favour of the Children the Father informed the Court there is no trust set up.

Depending on the outcome of the hearing, the Mother is seeking costs of the hearing. As was said in the case of E-v-F at paragraph 85:-

In that case the Father was ordered to pay the Mother's costs on the Schedule 1 application as to the 50% legal aid rate on a standard basis. The reason costs were awarded was because the Mother largely succeeded on her application, and due to the litigation conduct of the Father. Both the Father and Mother appealed the order, including as to costs. In case of E-v-F [2014] JRC 184 at paragraph 85, the Court accepted the Mother had clearly won. In addition there had been ligation misconduct by the Father which had increased costs. The Court went on to say at paragraph 90:-

The Court therefore upheld the decision of the Registrar as to costs.

It is in the Children's best interests to be provided with a secure family home before their Father's death and as soon as reasonably possible. The Father wants to live in a five bedroomed property yet he wants the Mother and Children to remain living in Property 1, having done it up, but conceded there may be an issue about the size of the box room in classifying it as a fourth bedroom. The property is too small and indeed the Father accepted the principle that " the Children have the right to live at the same standard as their Father or Mother. A child is entitled to be brought up in circumstances that bear some relationship to the Father's current resources and present standard of living ". He accepts that a four bedroomed property like Property 1 would be between £1.5 to 2.5 million depending on its state. I consider that the Children and Mother should too live in a five bedroomed property, with a bedroom for each of the Children so Child 3 does not have to share a bedroom with his Mother. The Father accepted that the Children's Maternal family should visit them in Jersey, and this means a guest room for the Children's grandmother and other relatives to stay in as they do not have the means to stay elsewhere. The Father proposes they move to his five bedroomed property, Property 2 when he dies.

Property 1 is not suitable in terms of the actual accommodation. Furthermore because of his age and health the Father is likely to die first, and there would be problems for the Mother and children were they to remain in Property 1 at present as the Licence agreement is between the Father and the owners. I have also considered the problem if the lessors die, or want to sell. There are also difficulties even if the Father has made provision for the Children and Mother to move into Property 2 on his death. If the Children remain at Property 1, and were then evicted it is extremely unlikely they would find anywhere else to "rent."

A practical solution is for the Children and mother to be given exclusive occupation now of Property 2, rather than wait until he dies. The Father submits that this means his home is taken away from him. This would not render the Father homeless as he already has the licence/ lease of Property 1 in his own name, and it appears he can do Property 1 up, and according to his evidence, the owners would reduce the rent if he moved back there.

Schedule 1 of the Law states that the court may make an order that a parent pays a lump sum to the applicant for the benefit of a child or transfer such property to which the parent is entitled.

Schedule 1 also state that a settlement be made for the benefit of a child of property to which either parent is entitled. Property 2 however is owned by the company Company 1 Limited. The Father is the owner of the shares, the sole shareholder of the company and is a director, and accordingly has control of the company. The Father could require the directors to pass a resolution to provide the Children and Mother with exclusive possession to them of Property 2 until the Children are all 18 or have completed any (including tertiary education), whichever is the later and without the occupation of the Father. On the face of it the Father is not " entitled " to Property 2, so that solution is not possible unless the Father agrees to it and at Court made clear he did not do so.

The Mother has indicated that as an alternative the Father gives her sufficient so she can purchase a registered property that she and the children can live in until the Children are all 18 or have completed any (including tertiary education), whichever is the later with a judicial hypothec in the Father's favour. In the appeal case of E v F at paragraph 106 stated:

The Father, a property investor, lives in Property 2, a newly renovated five bedroomed home which is " palatial ." He has spent about £1,500,000, on it but aims to make money on it. Mr Trower valued it a £1,500,000 without seeing the interior. The Father said that Property 1 is worth about £1.5 to £2.5 million, the property having a small fourth bedroomed/box room. On that basis the five bedroomed property, Property 2, which he has done up to a very high standard, may be worth around £2.5 million. The Father has the capital to be able to afford a property of £2.5 million for the Children and Mother. The balance on 2 accounts to support his investment portfolio was £1,994,820 at July 2017, but he has not provided an up to date figure so it is not clear what investments he currently has and how much is tied up in property. The Father did say in Court that if the Mother sees a property he will buy it - the property as stated in the E-v-F case needs to be in her name - but this may take some time. He has experience in the property market so I was informed that the Mother would welcome his experience when it comes to choosing a property. The difficulty as Mr Trower explained is the lack of registered properties on the market, so it could take time to find a suitable home to purchase and it seems from the evidence of Mr Trower , such a property would be at least £2.5 million. There is the five bedroom property on at £925,000 but Mr Trower said that monies need to be spent on doing it up. The Mother does not have the money or skill or language to employ builders to do it up, and a solution would be to purchase this property and the Father to organise the work to do it up to a " palatial " standard. However the likelihood is that because of the price, it is already under offer or sold. I am awarding the Mother the sum of up to £2,500,000 together with the cost of purchase which includes the stamp duty of £97,000 to purchase a five bedroomed property in her name which would be comparable to Property 2 until the Children are all 18 and have completed any tertiary education. The Father will be a creditor of the Mother and the sum will be secured by judicial hypothec. The sum is to be held in escrow by the Mother's lawyers, the father having no lawyer, so there will be the cash to purchase available as soon as a property comes on the market. Until such time as a property is purchased for the Children and Mother, the Father is to continue to pay the rental on Property 1 and to continue the licence/lease for the children and Mother so they are not rendered homeless. An application may be made to the court as to the timing and implementation of the order.

This is not a case where the Father has refused to make provision for his children. His schedule of payments for the family makes this clear. However, in accordance with the Children Law the Mother should receive periodical payments for the benefit of the children, for a set amount. This sum should also include a carer's allowance as the Mother presently has no income and very limited, if any, earning capacity given the time which is occupied caring for the Children and her limited ability to speak English.

Until the Mother purchases a property, the Father is to continue paying the "rent" on Property 1, which is £2,489.42, and he will pay direct to the Mother for the Children the sum of £2,311 per month.

The Father's income is comparatively low at present taking into account his capital but he states it will be " like a waterfall " in 2 or 3 years' time, and on the return of 4.5% he is seeking on present figures, his income may increase from about £250,000 to over double that sum per annum. Bearing in mind his income is going to increase significantly, and to avoid having to come back to Court each year, I am ordering that once the Mother purchases a property, he pays a figure equating to the greater of 25% of his net monthly income or £4,800 for so long as each of the three Children remain minors or are undertaking any full-time education to include tertiary education. So long as two of the Children remain minors or are undertaking any full-time education to include tertiary education I am ordering he pays a figure equating to 20% of his net monthly income. So long as one of the Children remains a minor or is undertaking any full-time education to include tertiary education I am ordering he pays a figure equating to 15% of his net monthly income. This sum includes provision for holidays for the children and the Mother to include providing financial assistance to the Children's Maternal family to visit Jersey, until the Children are all 18 and have completed any tertiary education. In other words, the Mother will have to meet all the expenses of running the property in her name and all the other bills that the Father is currently meeting. The Father is to provide the Mother with an annual statement of his earnings to be provided by not later than the 1 st February of each year. If there is a material change in circumstances of either party, there may be a review of maintenance.

The Mother did not specify what furniture and effects are required for the sum of £10,000, and it may be that this depends on the property. I presume she will need to purchase a bed for Child 3 and other furniture for his room and also for the spare room so I will allow a sum of £2,000 but it is open to her to apply for a further lump sum if necessary.

The Mother currently has an old car but is now looking for a lump sum of £10,000 to purchase a car for the transportation of the Children, and occasionally their friends, to school and extracurricular activities. Because there are three children it needs to be of a sufficient size and capacity in order that three children (occasionally more) and any sporting equipment or other belongings can be safely transported. The Father can afford £10,000 and has now indicated he would be so that she has a newer and more reliable car. I am therefore ordering he pay a lump sum of £10,000 for a car.

The Father has been paying these fees for the children, so he is ordered to pay medical insurance for them and any bills not covered by that medical insurance.

The Father is meeting the school fees and incidental costs and has agreed to continue doing so. Indeed he wants to send them to H School, which will cost significantly more, whereas I School will cost less than G School. If the parents cannot agree what school the Children should attend, and mediation is unsuccessful then an application may need to be made to Court. The Father wants to fund them going on to tertiary education. I will order he pays any school fees for the Children to complete their education, so far as possible at G School, Jersey and thereafter for the Children to remain in private education following G School, until each of the Children complete their secondary education. The Father shall pay the costs of any tertiary education for the Children.

The Father congratulated himself at the hearing on the amount of money he has saved in not instructing lawyers, and at the Case Review Hearing said he had saved £30,000 and had saved a further sum of about £60,000 to include the cost of the hearing. He said that whilst he wanted to go to mediation he did not want to pay £5,000 to £7,000 for a day plus the lawyers' fees, this from a man with assets of over £12,500,000. At the Case Review Hearings, I had reminded the parties of The Overriding objective as set out in rule 4 of the Children Rules 2005 including at (6)

Time had been spent trying to arrange a mediation with the Father, but this did not take place as he did not want to spend the money on it. He made enquiries of the FMJ as the last moment but was told he had left it too late.

It was submitted on behalf of the Mother that as early as July 2017 the Father had been advised to get legal advice, and the Court had also adjourned the case on four occasions for him to get legal advice, leading to additional costs incurred by the Mother, including the cost of an interpreter. The Father has " strung along " this case, and the Mother's lawyers submit it was a way of wearing her down without regard to the interests of the Children. He has sacked lawyers on several occasions immediately prior to hearings which delayed matters.

The Father throughout has refused to provide a copy of the terms on which the Children and Mother were residing at Property 1, and only provided this when I insisted he do so at the hearing. He has not provided a copy of his will nor detailed information as to the Trust he said he was going to set up. He did not consider the legal authorities, which had been provided some months ago to his then advocate, Advocate Godden. The Mother submitted that his approach was adversarial and his approach made settlement impossible.

At the hearing he gave contradictory submissions and evidence, for example as to the state of Property 1. The Mother's lawyers provided a detailed analysis of the time lines in support of their submissions about the conduct of the Father in these proceedings, for example on the 28 th September, 2017, the mother was told that the Father had written a will, found trustees and a suitable protector. On the 17 th November 2017 he stated he was setting up the F Trust and was making provision for the Mother as well in the trust. He was provided with a bundle of the authorities on the 7 th December, 2017, a hearing was adjourned and Advocate Godden reinstructed on about the 7 th December, 2017. On the 4 th January, 2018, he said he would have the children DNA tested and results were received which confirmed all three children were his. On the 8 th February, 2018 Advocate Godden was no longer instructed and Steensons were appointed who requested an extension which was granted. His advocate said on the 12 th February that the trust did not exist, despite the earlier information given, and it was accepted that the case was crying out for mediation. By the 2 nd February, 2018, he was a litigant in person again. Efforts were made to agree a court bundle. The Father refused access to Property 2 and Property 1 prior to the hearing, so an application had to be made for access, which was refused because of the concessions made by the Father on day 1, which he then tried to row back from on day 2.

Often there are limited resources so a cost order will impact on the ability for the Father to pay costs, but this is not so here. The cost I am told will be £45,000 at a minimum, but will need to be taxed on a standard basis if not agreed. In the circumstance I am ordering the father pay the costs of this case, on a standard basis, to be taxed if not agreed.