JD v RMD [2023] EWFC 12514 July 2023

Published: 18/09/2023 12:31


DDJ Hodson. A financial remedy application where the debts and costs exceeded the assets. The only available asset was the equity in two properties in H’s sole name, namely the family home and an investment property. The equity in the properties were approximately £20,000. The parties had hard debts of c.£30,000. Total costs of the financial remedy proceedings were £26,000. H sought to retain the family home, whilst W wanted the proceeds from it. The issue to be determined was what should happen to the equity in the two properties, in light of the debts.

H asserted a higher level of marital debt than W, and that she indemnify him of the same. The court carefully considered what the debts were at each point including at separation and post-separation. H’s claim fell away as it was clear that the debts at the time of separation had been fully converted into a remortgage on the two properties. The only debts remaining were those that had accrued during the period of separation when the parties were living independent financial lives. As a starting point each should be responsible for their own post-separation finances unless there is financial dependency, and none could be found here. The judge was therefore satisfied that the debt was not matrimonial, and there was no good reason for this liability to be put on W.

In respect of the properties, the judge reminded himself of the non-interventionist approach of the Family Court, unless intervening was necessary in the interests of fairness and justice. The judge determined that H retain the family home given the small level of equity, costs of sale, and early redemption, as well as the precariousness of the level of the equity with the risk that it may fall into negative equity. The family home was also H’s accommodation, and W had rental accommodation which was affordable out of her income. No order for the family home was fair as H needed somewhere for the children to stay when they were in his care. The investment property had a marital element and thus W had an interest in it. However, the question of provenance could not (and indeed should not) be ignored given that the purchase was funded wholly or primarily from compensation monies received by H. W was awarded £4,000 from the equity of £17,500. If the investment property was not sold in five months, interest would run on the £4,000.

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