In a timely and thought-provoking article published on the FRJ website in October last year (‘Is It Time to Consign the “Gasp” Factor to the History Books?’), Olivia Piercy and Anita Mehta considered the decisions of Sir Jonathan Cohen in Traharne v Limb [2022] EWFC 27, Her Honour Judge Reardon in DP v EP (Conduct; Domestic Abuse; Needs) [2023] EWFC 6 and Master Bell in Seales v Seales (Ancillary Relief: Murder and Coercive Control as Conduct) [2023] NI Master 6, and queried whether they might conceivably herald, or at least foreshadow, a significant change in the courts’ approach to domestic abuse, including economic abuse and coercive and controlling behaviour, as ‘conduct’ that it would be ‘inequitable to disregard’.

If there is a nascent consensus that it is time for a change in approach, that view may not be universally held. In Tsvetkov v Khayrova [2023] EWFC 130, Peel J noted that the conduct threshold ‘has consistently been set at a high or exceptional level’, and reiterated the conventional view that before ‘the court will go on to consider how the misconduct, and its financial consequences, should impact upon the outcome of the financial remedies proceedings, undertaking the familiar s 25 exercise which requires balancing all the relevant factors’, an applicant must first successfully prove (i) the facts relied upon; (ii) that those facts meet the conduct threshold; and (iii) that there is an identifiable negative financial impact upon the parties which has been generated by the alleged wrongdoing. He also suggested that courts should exercise their case management powers to exclude asserted conduct claims which clearly do not meet the threshold or are unlikely to make a material difference to the outcome. Writing extra-judicially for the FRJ, Peel J subsequently stated that he did not regard such robust case management as being akin to the striking out of a financial remedies claim in the manner regarded as impermissible by the Supreme Court in Wyatt v Vince [2015] UKSC 14.

Goddard-Watts

Relatively unremarked upon, until very recently, in the ongoing conversation about conduct and financial remedy proceedings has been the Court of Appeal’s decision in Goddard-Watts v Goddard-Watts [2023] 2 FLR 735 and Macur LJ’s brief consideration, at [70] to [74] of her judgment, as to whether the frauds perpetrated by the husband in that case might constitute ‘conduct’ within the meaning of Matrimonial Causes Act 1973, s 25(2)(g), and, if so, then how, if at all, that ought to bear upon the court’s consideration of the case.

Having reviewed the relevant authorities, including OG v AG (Financial Remedies: Conduct) [2021] 1 FLR 1105, at [71] Macur LJ observed that:

‘the principle and accepted view to be derived from these authorities is that the misconduct envisaged by section 25(2)(g) must necessarily be quantifiable in monetary terms rather than seen as a penalty to be imposed against the errant partner, and that the “orthodox approach” to litigation misconduct is to be met by an award of costs.’

At [72], she cited TT v CDS [2021] FLR 996 (also reported as Rothschild v De Souza), in which, at [65], Moylan LJ acknowledged that the:

‘general approach is that litigation conduct within the financial remedy proceedings will be reflected, if appropriate, in a costs order. However, there are cases in which the court has determined that one party’s litigation conduct has been such that it should be taken into account when the court is determining its award.’

Having observed at [71] that OG v AG was not cited in TT v CDS (it had not been reported), and perhaps anchoring her views in the second sentence of those comments of Moylan LJ’s, at [74], Macur LJ concluded as follows:

‘I agree with the husband that there is no direct financial consequence to his fraudulent conduct so as to enable its monetary evaluation. However, I take the view that the husband’s fraud is "conduct" for the purpose of subsection 25(2)(g) in that it provides "the glass" through which to address the unnecessary delay in achieving finality of the wife’s overall claim, including her unanticipated contribution to the welfare of the family post 2010.’

Notwithstanding that they were almost certainly obiter, the observations made by Macur LJ, with whom Nicola Davies LJ and Carr LJ (as she then was) agreed, do appear to cast doubt over the orthodox view that conduct must have demonstrable, quantifiable financial consequences to be relevant to outcome.

TK v LK

In TK v LK [2024] EWFC 71, a case concerning an application under Children Act 1989, Schedule 1, Nicholas Allen KC (sitting as a deputy High Court judge) made exactly that point, noting, at [68], that it is:

‘arguable that by these comments Macur LJ may have called into question the “accepted view” that conduct must be identifiable or quantifiable in monetary terms in order to be relevant.’

Nicholas Allen KC noted, again at [68], the comments made by Her Honour Judge Reardon in DP v EP, at [34], [155] and [156], that ‘[r]ecent cases where it appears that conduct without a financially measurable consequence has impacted on the distribution exercise are rare, but exist’; that ‘too narrow an interpretation of s 25(2)(g) would render the provision nugatory’; and that:

‘there must be some scope for conduct which has had consequences to be reflected in the ultimate division of assets, even where those consequences are not financially measurable’.

He went on, at [69] and [70], to refer to two High Court cases in which conduct with no measurable financial consequences had been taken into consideration under s 25(2)(g): Al-Khatib v Masry [2002] 1 FLR 1053 and FRB v DCA (No 2) [2020] EWHC 754 (Fam). Interestingly, it is recorded that in the former case, it was both agreed between counsel and implicitly accepted by Munby J (as he then was) that conduct ‘does not have to have a financial consequence for it to be taken into account’.

Ultimately, there was no need for the court in TK v LK to decide whether, singly or collectively, the above-mentioned decisions sufficed to controvert the conventional wisdom articulated in Tsevtkov v Khayrova and elsewhere, since, as was explained at [71], there was ample basis, on the facts of that case, on which to conclude that the relevant conduct was not only of sufficient gravity but also had measurable financial consequences.

Nevertheless, the discussion within the judgment, whilst similarly obiter, may well be taken to call further into question the widely accepted view and the assumptions underpinning Deputy District Judge Harrop’s observation in KA v LE [2023] EWFC 266 (B), at [72], as to the current state of the law, that:

‘[h]owever one may feel about it, the case law at present is clear that personal misconduct will only be taken into account in very rare circumstances and only where it has had financial consequences.’

If nothing else, it may serve to highlight the apparent existence of a credible, alternative view of the current law, which is rather more resonant with the expansive approach for which Olivia Piercy and Anita Mehta’s article called, and hence suggest that there may be room for further argument, not only about what the law ought to be, but also about what it is at present.