MF v NF & Ors (Striking Out Claims against Third Parties)

This appeal concerns the scope of the power to strike out a statement of case under r.4.4(1) of the Family Procedure Rules 2010 (hereafter “the FPR”) and of the court’s wider case management powers under the FPR r.4.1. The appeal also raises the question of the role of pleadings in a dispute between a spouse and a third party in financial remedy proceedings as to the ownership of property. Counsel confirmed during the course of the hearing that they had been unable to identify a reported case in which the court has struck out pleadings in such a claim under FPR r.4.4(1).

The appeal is brought by MF (hereafter, by convention, “the wife”), represented by Mr Morgan Sirikanda of King’s Counsel and Mr Harry Campbell of counsel. The First Respondent is NF (hereafter, by convention, “the husband”), represented by Miss Sassa-Ann Amaouche of King’s Counsel. The Second Respondent, AF, is the husband’s mother. AF lacks litigation capacity and is represented through her litigation friend, JL, by Mr Gwydion Hughes of counsel. The Third Respondent is KN, represented by Mr Richard Bates and Mr Charles Collins of counsel.

The appeal is bought against the decision of District Judge Ashworth (hereafter “the Judge”) sitting at the Central Family Court on 31 March 2026 (a) to strike out the wife’s Points of Claim in respect of the beneficial ownership of the proceeds of sale of a company called Y Limited, the receipt by the N Family Trust (hereafter “the Trust”) of those proceeds of sale and loans thereafter made by the Trust to the husband, (b) to strike out the wife’s Points of Claim in respect of the beneficial ownership of a property in Spain called VLO and (c) to remove KN as party to the proceedings.

Permission to appeal was granted on all grounds by HHJ Hess on 6 May 2026. The appeal was allocated to be heard by a judge of High Court level pursuant to FPR 2010 PD30A on the grounds that the appeal raises an important point of principle or practice.

The wife is 43 years of age. She is of Uzbekistani origin and was, during the marriage, a homemaker. The husband is 66 years of age. He is a director and entrepreneur in the leisure sector. The parties were married in 2015. There are two children of the family, aged 9 and 7, both live with the wife and spend time with the husband.

The parties dispute the date of their separation. The wife contends that they separated in 2023. The husband asserts that the separation occurred in 2021. The wife issued her application for divorce on 23 July 2023. The wife’s Form A was issued on 2 November 2023.

The husband’s Form E was filed and served on 1 December 2023. The husband deposed in his Form E to the following matters relevant to the determination of this appeal:

It does not appear to be in dispute between the parties that the loans from the Trust to the husband and to his business coincided broadly with the receipt by the Trust of the proceeds of sale from Y Ltd in 2017. It likewise does not appear to be disputed that, in circumstances I shall come to, the husband held the shares in Y Ltd between its incorporation and June 2009 and that, by 10 June 2009, the husband had transferred those shares to KN for no consideration.

The First Directions Appointment (FDA) took place on 21 January 2024 and a Financial Dispute Resolution hearing (FDR) took place on 25 September 2025. The order from that hearing reflects the disputes at the centre of this appeal, namely that the wife did not accept the account provided by the husband as to:

The court has not seen a Form ES2. However, as at the date of the hearing before the Judge the wife contended that the matrimonial assets were some £7.23M. By contrast, the husband contended that the matrimonial assets were in deficit by some £2.16M. The stark difference between these two figures arises primarily from the matters set out in the foregoing paragraph.

On 13 March 2025, the Judge directed the wife to file and serve two sets of Points of Claim, the first dealing with her case with respect to VLO and the second dealing with the proceeds of sale of Y Ltd, the Trust and the loans. The husband was directed to file and serve two sets of Points of Defence, with the wife given permission to file Points in Reply. On 18 July 2025, the wife made an application to join AF and KN as parties to the proceedings. The Judge acceded to that application on 4 August 2025.

The wife’s Points of Claim with respect to the husband and AF, pleaded by Mr Campbell, claim (a) that the Declaration of Trust dated 2 July 2018 is a sham and the husband is and always has been the legal beneficial owner of VLO; (b) alternatively, the husband disposed of VLO with the intention of defeating the wife’s claims in a future divorce and (c) VLO constitutes a resource available to the husband pursuant to s.25(2)(a) of the Matrimonial Causes Act 1973 (hereafter “the 1973 Act”). The wife’s Points of Claim against AF plead the following facts:

With respect to the wife’s claim against the husband and AF, by his Points of Defence the husband admits that VLO was purchased in his sole name and that he remains the legal owner of that property. He further admits that he provided the entirety of the purchase funds, averring that those monies were from a loan. The husband further admits that he is responsible for meeting annual tax costs, day-to-day running costs and maintenance costs on the property and is free to use the property as and when he chooses, but denies those facts are relevant to the allegation of sham. The husband denies that the gift was made for no consideration, averring that it was made in consideration of “his mother’s care, love and attention over his lifetime.” By his Points of Defence the husband denies sham, and fraud and dishonesty, and denies that the Declaration of Trust constitutes a disposition made to defeat the wife’s claim for financial remedy. Further, the husband avers that the wife has failed to plead the requirements of those causes of action or to particularise the facts on which she relies and puts the wife to strict proof.

By her Points of Defence, AF, through her litigation friend, avers that in early 2017 the husband told AF and his sister that he was intending to buy a house in Spain that he would give to AF during her life and then to his sister, he having mentioned that possibility previously. Following a search for a property that could meet AF’ needs, AF avers that the purchase of the property completed on 2 July 2018 and a Declaration of Trust was settled and signed by the husband on the same day. By her Points of Defence, AF further avers that the effect of the Declaration of Trust is that the property belongs beneficially to AF during her lifetime and to the husband’s sister absolutely thereafter. AF denies that the Declaration of Trust contains any internal inconsistency. AF denies sham, and fraud and dishonesty, and denies that the Declaration of Trust constitutes a disposition made to defeat the wife’s claim for financial remedy. Further, AF avers that the wife has failed to plead the requirements of sham, and fraud and dishonesty, or to particularise the facts on which she relies.

The wife’s Points of Claim with respect to the husband and KN, again pleaded by Mr Campbell, claim (a) that the husband was beneficially entitled to the proceeds of sale of Y Ltd as received by KN and the Trust upon the sale of Y Ltd and that the shares allegedly held by KN at the point of sale were beneficially owned by KN and the trustees of the Trust as bare trustee or nominee for the husband; (b) any funds that flowed to KN and the Trust on the sale of Y Ltd were funds to which the husband was beneficially entitled, over which he exercises control over within the Trust via KN acting as his agent at his direction and that are a resource available to the husband pursuant to s.25(2)(a) of the 1973 Act; and (c) the alleged loans made by the Trust personally and to M Ltd are not loans but in fact a mechanism for the husband to extract funds from the Trust for which payment will never be required or, if genuine, loans are soft loans for which repayment will never be required. The wife’s Points of Claim against the husband and KN plead the following facts:

By his Points of Defence the husband admits that Y Ltd was incorporated on 10 May 2008 but denies he was the driving force behind that company. The husband avers that Y Ltd was set up by KN and that the husband was employed as a salaried director until the sale of Y Ltd in 2017. The Points of Defence further aver that the husband held nil paid shares for administrative purposes, which were transferred to KN for no consideration, reflecting KN’s ownership of the company. The husband admits that as at 19 November 2008, he held 87 of the 92 issued ordinary shares in Y Ltd but denies that he legally or beneficially owned those at all material times prior to the sale in 2017. The husband likewise denies he presented himself as the owner and managing director of Y Ltd, averring that the magazine article was a media error, that as the husband was the day-to-day face of the company it was incorrectly assumed he had an equity share and that he was listed as a Person with Significant Control because he was a director of the company at that time. The husband avers that the Share Purchase Agreement dated 13 September 2017 reflected both the legal and beneficial ownership at the time of sale. The husband further avers that the wife has failed to plead the primary facts on which she relied to prove that the husband was the legal and beneficial owner of the shares in Y Ltd and puts the wife to strict proof. The husband further asserts that as a result of his hard work at Y Ltd he persuaded KN to loan him monies. The husband admits that unsecured loans were made to him as pleaded in the wife’s Points of Claim, and that loans were made to M Ltd, but avers that the wife has failed to plead the primary and material facts on which she relies and puts the wife to strict proof.

The wife filed her two sets of Points of Reply on 2 June 2025. Those Points of Reply do not plead any additional facts, including in respect of the matters on which the wife was put to proof in the husband’s Points of Defence. The wife contends that the Points of Reply were limited in circumstances where it remained her case the proceeds of Y Ltd belonged in whole or in part to the husband and that the Declaration of Trust for VLO was a sham or, in the alternative, should be set aside. The wife’s Points of Reply record that they were prepared on the basis of the wife’s current knowledge and access to documentation.

By his extensive Points of Defence, pleaded by Mr Bates and dated 29 October 2025, KN avers he is resident and domiciled in Gibraltar and has not been resident or domiciled in the United Kingdom for tax purposes for some years. KN denies that the husband was ever a beneficial owner of Y Ltd, the proceeds of sale of Y Ltd or the Trust and that, at all material times, KN and / or the Trust were the beneficial owners. KN avers that the Trust is a genuine and properly constituted offshore trust with professional third-party trustees and that the Trust is a creditor of the husband and a creditor of the husband’s business. By his Points of Defence, KN further contends that the wife’s Points of Claim are deficient in that they failed to plead sham clearly and explicitly, fail to plead allegations of fraud and dishonesty that are a required element of an allegation of sham and fail to plead fraud against HMRC as a necessary consequence of the findings sought. KN’s Points of Defence further assert that the wife has failed to particularise the primary facts on which she relies. KN avers that the entirety of the wife’s claim “has no real prospect of success on the facts” and should be struck out.

On 25 October 2025, KN made an application to strike out the wife’s Points of Claim or, in the alternative, for security for costs. On 30 October 2025, the Judge gave permission to the husband and AF to make applications to strike out the wife’s Points of Claim and, in the alternative, for security for costs, by 27 November 2025. The wife was directed to file and serve any reply to those applications by 8 January 2026. The husband issued his application on 26 November 2025 and AF issued her application a day later on 27 November 2025.

The wife filed her reply to the applications to strike out on 8 January 2026. It followed the voluntary disclosure by KN of a further 348 pages of material served with his Points of Defence on 29 October 2025. The reply asserted that the wife would seek findings of fact at trial following oral evidence tested in cross-examination and would invite the court to draw adverse inferences. The reply listed the findings that the wife would seek in respect of her claims against the husband and AF and KN. In so far as the reply revised the wife’s position as against her Points of Claim and Points in Reply, Mr Sirikanda and Mr Campbell submit that it did so only to make clear her revised legal case in respect of the loans from the Trust, to make clear that the wife was not pleading that the Trust was itself a sham and to make clear that she was expressly alleging the husband wished to shield the proceeds of sale from Y Ltd from future creditors, including any financial claim on divorce.

The applications to strike out were heard by the Judge on 26 February 2026. Having reserved judgment for a short period, the Judge handed down her reserved judgment on 31 March 2026.

Having recounted the background facts and the procedural history of the matter, the Judge set out the issues to be determined. Thereafter, the Judge set out a summary of the legal principles that she considered governed the determination of the applications before her, beginning with the Overriding Objective in FPR r.1.1. The Judge noted the requirements of r.1.4 (b) and (c) to identify at an early stage the issues and who should be a party to the case, to decide promptly which issues need full investigation and which to do not and the procedure to be followed in the case. The Judge then addressed the court’s general powers of case management as articulated in FPR r.4.1. The Judge set out in terms the court’s power to exclude an issue from consideration under FPR r.4.1(l), to dismiss or give a decision on an application after a decision on a preliminary issue under FPR r.4.1(m) and the power to take any other step or make any other order for the purposes of managing the case and furthering the overriding objective under FPR r.4.1(o).

With respect to striking out, the Judge set out the terms of FPR r.4.4(1). The Judge also referred to FPR PD4A and the examples given in that Practice Direction of applications that may be held to disclose no reasonable grounds for bringing or defending a claim. The Judge also made reference to paragraph 2.2 of PD4A which provides that an application may be an abuse of process if it cannot be justified, for example because it is frivolous, scurrilous or obviously ill founded. The Judge acknowledged that in light of the decision of the Supreme Court in Wyatt v Vince [2015] UKSC 14, [2015] 1 WLR 1228 all parties accepted the wife’s substantive claim for financial remedies could not be struck out under FPR r.4.4(1). The Judge however rejected Mr Campbell’s submission on behalf of the wife that the principle articulated in Wyatt v Vince applied to individual issues in a case, including a dispute between a spouse and a third party in financial remedy proceedings as to the ownership of property. The Judge likewise rejected the wife’s broader submission that there is no jurisdiction in a financial remedies case generally to summarily determine a substantive issue of law or fact.

I will deal in detail with the Judge’s conclusions as to the proper application of FPR r.4.4(1) and the wider case management provisions of FPR r.4.1 in this case below when I come to set out the reasons for my decision.

Having set out her conclusions on the law, the Judge stated at [26] that “This is a summary application dealt with on the basis of submissions. I heard no evidence and make no findings of fact”. The Judge then proceeded to outline her reasoning for granting the applications to strike out. In determining that the wife’s Points of Claim in respect of the proceeds of sale of Y Ltd, the Trust and the loans to the husband should be struck out, the Judge set out her conclusions at [39] to [51] of the judgment.

The Judge began by observing that the wife’s Form E made no reference to the wife’s claim, which was not raised until the FDA on 31 January 2024, with her case that the husband is beneficially entitled to the proceeds of sale of Y Ltd not being raised until 11 October 2024. The judge recorded that, based on her recollection of the contents of certain Immerman documents and the matters pleaded in her Points of Claim, the wife relied on the fact that at one stage in 2008 the husband was the legal owner of 87 or 92 issued shares in Y Ltd that were transferred by the husband to KN by 10 June 2010. The judge further recorded at later points in her judgment that the wife relied on a magazine article that stated the husband was the owner of Y Ltd, that the proceeds of sale of Y Ltd had been paid into the Trust which had in turn paid them to the husband “by loan or otherwise”, that the husband had in his possession a document detailing the workings for the monies KN and the Trust received on the sale of Y Ltd that had not been explained, that KN, a man of considerable commercial acumen, had agreed to lend £6.95M to the husband without security after he had defaulted on previously agreed repayment dates and that the amount paid to the husband by the Trust represented “most of the Y Ltd consideration”. Notwithstanding these matters set out in the judgment, the judge concluded that the wife’s Points of Claim did not “provide any factual basis for the wife’s assertions in respect of Y Ltd or the Trust” (emphasis added). Against the wife’s pleaded case, with respect to Y Ltd the Judge accepted the evidence filed and served by KN setting out the reasons “why and how Y Ltd was established and how it was funded” and confirming that “the husband did not own any part of Y Ltd and [providing] an explanation of why the shareholding was in the husband’s name”.

The Judge rejected the wife’s assertion that she was unable to further particularise her claim absent further disclosure where in a civil claim it is “standard practice for pleadings to be filed before standard disclosure is directed...” By reference to Three Rivers District Council v Bank of England [2001] UKHL 16, [2003] 2 AC 1, the Judge also rejected the submission that the wife could rely on adverse inferences in a preliminary trial in financial remedy proceedings with respect to the ownership of property to prove her case. The Judge also expressed herself satisfied that the wife’s pleaded case with respect to fraud and dishonesty was deficient and that that case had changed. In the foregoing circumstances the Judge held that, whilst some of the actions of KN and the husband “might be viewed sceptically by third parties”, the wife had not demonstrated reasonable grounds for bringing the claim and is likely to obstruct the just disposal of the proceedings. The judge also held that, in the alternative, the claim should be struck out pursuant to “my case management powers under R1.4 and R4.1 in accordance with the overriding objective”.

In determining that the wife’s Points of Claim against the husband and AF in respect VLO should be struck out, the Judge set out her reasoning at [56] to [68] of the judgment.

Again, the Judge began by observing that the wife had not referred to VLO in her Form E or the husband’s acquisition and alleged disposition of that property. The Judge recorded that there was no dispute that the husband was the sole legal purchaser of the property, that most if not all of the funds for the purchase came from loans from the Trust and that the husband has been responsible for the running costs on a day to day basis since acquisition and uses the property whenever he chooses. However, having reviewed the decisions in Snook v London and West Riding Investments Ltd [1967] 2 QB 786, Bhura v Bhura [2014] EWHC 727 (Fam), Minwalla v Minwalla [2005] 1 FLR 771 and A v A & St George’s Trustees [2007] 2 FLR 467, the Judge concluded that the wife had provided no facts to support her claim that the gift was a sham, or was entered into with the intention to defeat the wife’s claim in the event of a future divorce.

With respect to the wife’s case that the purported Declaration of Trust was internally inconsistent the Judge made a finding that internal inconsistencies are not capable of being evidence of sham, accepting the submission made on behalf of AF. Once again, the Judge rejected the proposition that the wife could rely on adverse inferences in a preliminary trial in financial remedy proceedings with respect to the ownership of property to prove her case. She held that what she considered to be the wife’s failure to plead a full and particularised claim as to fraud was an abuse of process. As to the wife’s pleaded case in the alternative, that the husband had disposed of VLO to avoid a claim in any future financial remedy proceedings the Judge recorded, erroneously, that the wife had not made an application under s.37 of the 1973 Act and again held that the wife had provided no factual basis for her claim in circumstances where “it is for her to satisfy the court on the balance of probabilities that the disposition was made with a view to defeating her claim.” As such, the Judge concluded that there were no reasonable grounds for bringing the claim and that it was likely to obstruct the just disposal of the proceedings. The judge also again held that, in the alternative, the claim should be struck out pursuant to “my case management powers under R1.4 and R4.1 in accordance with the overriding objective”.

The wife made her application for permission to appeal on 9 April 2026. In her Grounds of Appeal the wife relies on ten grounds as follows:

On 31 March 2026 HHJ Hess granted permission to appeal on all grounds. As I have noted, following consultation with Peel J, HHJ Hess further directed that the appeal be heard by a judge of High Court level pursuant to FPR 2010 PD30A as the appeal raised an important point of principle and practice.

Rule 4.4 of the FPR 2010 provides as follows with respect to the power of the court to strike out a statement of case:

“Power to strike out a statement of case

4.4.—(1) Except in proceedings to which Parts 12 to 14 apply, the court may strike out (GL) a statement of case if it appears to the court—

(a)

that the statement of case discloses no reasonable grounds for bringing or defending the application;

(b)

that the statement of case is an abuse of the court's process or is otherwise likely to obstruct the just disposal of the proceedings;

(c)

that there has been a failure to comply with a rule, practice direction or court order; or

(d)

in relation to applications for matrimonial and civil partnership orders and answers to such applications, that the parties to the proceedings consent.

(1A)

When the court is considering whether to exercise the power to strike out a statement of case, it must take into account any written evidence filed in relation to the application or answer.

(2)

When the court strikes out a statement of case it may make any consequential order it considers appropriate.

(3)

Where—

(a)

the court has struck out an applicant's statement of case;

(b)

the applicant has been ordered to pay costs to the respondent; and

(c)

before paying those costs, the applicant starts another application against the same respondent, arising out of facts which are the same or substantially the same as those relating to the application in which the statement of case was struck out, the court may, on the application of the respondent, stay (GL) that other application until the costs of the first application have been paid.

(4)

Paragraph (1) does not limit any other power of the court to strike out (GL) a statement of case.

(5)

If the court strikes out an applicant's statement of case and it considers that the application is totally without merit—

(a)

the court's order must record that fact; and

(b)

the court must at the same time consider whether it is appropriate to make a civil restraint order.”

The term ‘statement of case’ is defined by FPR r.4.1(1) as meaning “the whole or part of an application form or answer.” Whilst the rules provide for the use of an answer in specific contexts (see for example, FPR r.7.7(5) in the context of an application for a matrimonial or civil partnership order), the term ‘answer’ is not further defined. The FPR does not use the term ‘pleadings’. A statement of case as defined in FPR r.4.1(1) requires a statement of truth pursuant to FPR rr.17.1(1) and 17.2(1)(a). FPR r.17.2(2) contemplates amendments being made to a statement of case, and provides that where such amendments are made, those amendments must also be verified by a statement of truth. Pursuant to r.17.2(3), an applicant may not rely on the contents of an application form or application notice as evidence unless it is verified by a statement of truth. Pursuant to FPR r.17.3, a statement of case that is without a statement of truth will remain effective unless struck out, but the party may not rely on the statement of case as evidence of any of the matters set out in it.

All parties accept that it is settled law that a dispute between a spouse and a third party as to the ownership of property can be determined in financial remedy proceedings. (Footnote: ¹) In Tebbutt v Haynes [1981] 2 All ER 238, Lord Denning MR held as follows:

“It seems to me that, under s.24 of the 1973 Act, if an intervenor comes in making a claim for the property, then it is within the jurisdiction of the Judge to decide on the validity of the intervenor's claim. The Judge ought to decide what are the rights and interest of all the parties, not only of the intervenor, but of the husband and wife respectively in the property. He can only make an order for transfer to the wife, of property which is the husband's property. He cannot make an order for the transfer to the wife of someone else's interest.”

In A v A [2007] 2 FLR 467 at [20]-[21], Munby J (as he then was) held that whilst a dispute between a spouse and a third party as to the ownership of property may be determined within the substantive financial remedy proceedings, the legal principles relevant to that determination are the same across all divisions of court. Having endorsed that conclusion, in Prest v Petrodel Resources Ltd [2013] UKSC 34, [2013] 2 AC 415 Lord Sumption reiterated the point as follows at [37]:

“[37] If there is no justification as a matter of general legal principle for piercing the corporate veil, I find it impossible to say that a special and wider principle applies in matrimonial proceedings by virtue of section 24(1)(a) of the Matrimonial Causes Act 1973. The language of this provision is clear. It empowers the court to order one party to the marriage to transfer to the other property to which the first-mentioned party is entitled, either in possession or reversion. An entitlement is a legal right in respect of the property in question. The words in possession or reversion show that the right in question is a proprietary right, legal or equitable. This section is invoking concepts with an established legal meaning and recognised legal incidents under the general law. Courts exercising family jurisdiction do not occupy a desert island in which general legal concepts are suspended or mean something different. If a right of property exists, it exists in every division of the High Court and in every jurisdiction of the county courts. If it does not exist, it does not exist anywhere.”

The statement of principle set out by Munby J in A v A, and reiterated by Lord Sumption in Prest v Petrodel Resources Ltd, concerns the fundamental legal principles that apply to the determination of a dispute between a spouse and a third party as to the ownership of property. This appeal, however, is concerned with questions of procedure, which do differ as between the Divisions.

The FPR 2010 does not deal with the nature and format of ‘pleadings’ in financial remedies proceedings involving a dispute between a spouse and a third party as to the ownership of property. However, FPR r.4.1(3)(o) provides that the court can, as part of its general powers of case management, take any step or make any order for the purposes of managing the case and furthering the overriding objective. Having emphasised that a dispute between a spouse and a third party as to the ownership of property must be approached on exactly the same legal basis as if it were being determined in the Chancery Division, in TL v ML [2005] 2860 (Fam), [2006] 1 FLR 1263, Nicholas Mostyn QC sitting as a Deputy High Court Judge (as he then was) set out the following procedure with respect to the determination of such a dispute arising in the context of financial remedy proceedings:

“[35] Mr Brett makes the valid complaint that this issue has never been properly defined, pleaded or particularised. At no stage since the First Appointment has this discrete issue been the subject of any case management, notwithstanding that the parties have been before the court on numerous occasions.

[36] In my opinion, it is essential in every instance where a dispute arises about the ownership of property in ancillary relief proceedings between a spouse and a third party, that the following things should ordinarily happen:

i)

The third party should be joined to the proceedings at the earliest opportunity;

ii)

Directions should be given for the issue to be fully pleaded by points of claim and points of defence;

iii)

Separate witness statements should be directed in relation to the dispute; and

iv)

The dispute should be directed to be heard separately as a preliminary issue, before the FDR.”

The approach taken in TL v ML was endorsed by Munby J (as he then was) in A v A at [23]-[24]:

“[23] The deputy judge recorded, at para [35], the complaint of counsel in that case that the issues had never been ‘properly defined, pleaded or particularised’ and went on to suggest, at para [36], how such issues should in future be handled by way of appropriate case management. I am sympathetic to the approach being suggested by the deputy judge, though I would not wish to be quite so prescriptive as he appears to be. Vigorous judicial case management in such cases is vital, but the appropriate directions to be given in any particular case must reflect the case managing judge’s appraisal of how, given the forensic realities of the particular case, the issues can be best resolved in the most just, effective and expeditious manner.

[24] I do, however, entirely share the deputy judge’s view that directions should normally be given for such issues to be properly pleaded by points of claim and points of defence. In the present case the muddle confusion and ambiguities in the wife’s case would have been more pitilessly exposed, and at a much earlier stage in the proceedings, had the presentation of her case been exposed to the intellectual discipline which is one of the advantages of any system of pleading. Moreover, if the wife had been required to plead her case everyone would have had a much clearer idea, and at a much earlier stage, as to exactly what she was or was not asserting and as to exactly what the husband and the interveners were or were not saying by way of defence. As it was, matters were wholly unclear even as late as the first day of the final hearing.”

The approach articulated in TL v ML has also been endorsed by the Court of Appeal on two subsequent occasions. In Goldstone v Goldstone [2011] EWCA Civ 39, [2011] 1 FLR 1926, a case decided shortly before the FPR 2010 came into force, Thorpe LJ considered at [36] that TL v ML had identified the proper procedure for the determination of third party claims “with admirable clarity”. A year later, in Edgerton v Edgerton (Shaikh, third party) [2012] EWCA Civ 181, [2012] 1 WLR 2655, Lord Neuberger of Abbotsbury MR at [55] again endorsed the approach taken in TL v ML.

There would appear to be no decided authority on whether Points of Claim, Points of Defence and Points of Reply filed for a preliminary issue trial of a dispute between a spouse and a third party as to the ownership of property in accordance with the procedure articulated in TL v ML constitute a ‘statement of case’ for the purposes of the strike out provisions in FPR r.4.4(1)(a) and (b). However, two passages from authorities considered above are relevant.

First, in Goldstone v Goldstone at [39] Thorpe LJ said as follows with respect to the status of the preliminary issue trial of a dispute as to a third party beneficial interests in financial remedy proceedings:

“Of course the ultimate trial required the family division judge to apply the law of property and the law of sham just as his brother judge would do in the Chancery Division. Careful preparation for that trial was necessary. However these impeccable directions do not require or permit the import of the CPR. In its essence the claim remains a claim by the wife against the husband. Ultimately it is a claim for discretionary relief. In this, as in many cases, there must be a preliminary issue trial to establish the extent of the assets over which the discretion is ultimately exercised. Here, as in many cases, the preliminary issue trial determines the claims and the rights of third parties. The preliminary issue trial is pendent on the originating application. It has no independent existence.”

Second, in Wyatt v Vince [2015] UKSC, [2015] 1 WLR 1228, the Supreme Court held that in financial remedy proceedings the term ‘statement of case’ in FPR r 4.4(1)(a) and (b) should be taken to refer to the statement in support of the substantive application for a financial order as well as to the appropriate form prescribed by the FPR:

“[2] Rule 4.4(1) is modelled on rule 3.4(2) of the Civil Procedure Rules (the civil rules), which came into effect on 29 April 1999. Indeed, of the words in rule 4.4 quoted in para 19 above, only one differs from those in rule 3.4(2), which refers at (a) to bringing or defending the claim rather than the application. It would be odd if in family proceedings the words in rule 4.4(1) extended to a situation to which, if transposed to civil proceedings, the words in rule 3.4(2) would not extend.

[21] Although the principal task is to construe the words no reasonable grounds and abuse of the courts process in (a) and (b), rule 4.4(1) poses a preliminary conundrum. The power is to strike out a statement of case if that statement is an abuse or (which in particular generates the conundrum) if it discloses no reasonable grounds. Rule 4.1(1) provides that, in Part 4, statement of case means the whole or part of an application form or answer. The form to be used in applying in divorce proceedings for a financial order is Form A: see rule 5.1 and Table 2 in Practice Direction 5A supplementary to that rule.

[22] The conundrum stems from the fact that Form A in effect requires the applicant to do no more than to identify the names and addresses for service of herself and the respondent and to specify the financial order or orders for which she is applying. The form does not enable the applicant there to set out the grounds of her application. Instead she will no doubt do so in her financial statement, which, save as otherwise directed, must be in Form E and must be led and served at least five weeks prior to the first appointment: rules 9.14 and 5.1 and Table 2 in Practice Direction 5A. It would therefore make no sense to ask, as a literal construction of the rules would require, whether the Form A discloses reasonable grounds for bringing the application: for it never discloses any grounds at all. We must do our best to make the rules operate sensibly and I suggest that, pending possible reconsideration by the Family Procedure Rule Committee either of rule 4.1(1) or of rule 4.4(1)(a)(b), the phrase statement of case in (a) and (b) should be taken to refer to the statement in support of the application for a financial order as well as to the application in Form A itself.”

As to the scope of the power to strike out under FPR r.4.4(1) in the context of financial remedy proceedings, the decision of the Supreme Court in Wyatt v Vince makes clear that the scope of the power is limited and must be construed without reference to real prospects of success. In Wyatt v Vince, the Supreme Court eschewed any suggestion that the concept of abuse of process in r.4.4(1)(b) incorporates a test analogous to summary judgment:

In Wyatt v Vince the Supreme Court further emphasised the difference in any event between determining an application to strike out and determining an application for summary judgment, reiterating the approach articulated by Lord Woolf MR in Swain v Hillman [2011] 1 All ER 91:

“[24] The civil rules, however, expressly confer a further power, namely to give summary judgment. Rule 24.2 empowers the court in civil proceedings to give summary judgment if it considers that the claimant or defendant has no real prospect of successfully prosecuting or defending the claim and if there is no other compelling reason why the case should be disposed of at a trial. In the civil rules Practice Direction 3A draws a link between the powers to strike out and to give summary judgment in civil proceedings. Paragraph 1.2 explains that they are two distinct powers which may be used to achieve the summary disposal of issues which do not need full investigation at trial. Paragraph 1.7 is as follows:

A party may believe he can show without a trial that an opponents case has no real prospect of success on the facts, or that the case is bound to succeed or fail, as the case may be, because of a point of law (including the construction of a document). In such a case the party concerned may make an application under rule 3.4 or Part 24 (or both) as he thinks appropriate.

It is indeed common practice in civil proceedings to join an application to strike out under rule 3.4 with an application for summary judgment under rule 24.2. But in Swain v Hillman [2001] 1 All ER 91, 92 Lord Woolf MR observed that the power under rule 24.2 was wider than the power under rule 3.4 and that under the latter, unlike the former, the general focus of the court was only on the statement of case which was alleged to disclose no reasonable grounds for bringing the claim. Or, as my Lady, then Hale J, crisply put it three months later, the essence of a strike out is that one does not look at the evidence on the claim: Bridgeman v McAlpine-Brown (unreported), 19 January 2000; [2000] CA Transcript No39, at p4.”

In Roocroft v Ball [2016] EWCA Civ 1009, [2017] 1 WLR 1137, the Court of Appeal reiterated the absence of a summary judgment procedure in the FPR and held that the provisions of FPR r.4.4.(1) applied to an application to set aside a financial remedy order on the grounds of material non-disclosure. Delivering the leading judgment, King LJ held that:

“[43] Mr Todd reminds the court that Vince v Wyatt was concerned with a strike-out application in the context of a full ancillary relief claim. The present application is not therefore, he submits, subject to the same imperatives as are imposed by the application of section 25 of the Matrimonial Causes Act 1973 ( the MCA 1973 ) (matters to which the court is to have regard in deciding how to exercise its powers) as was the wife’s application in Vince v Wyatt. Whilst that is undoubtedly the case, in his speech, at para 27, Lord Wilson JSC said: Although the power to strike out under rule 4.4(1) extends beyond applications for financial remedies, for example to petitions for divorce, no doubt it is to such applications that the rule is most relevant.

[44] It follows that the rule, and therefore Lord Wilson JSC s observations, apply equally to an application to set aside a financial remedy order on the grounds of material misrepresentation/non-disclosure as to an application for financial remedy.”

In the foregoing circumstances (and assuming for present purposes that the wife’s Points of Claim comprised a ‘statement of claim’ for the purposes of FPR r.4.4(1), as explained below), the questions the court was required to ask and answer on the applications to strike out under FPR r.4.4(1) were (a) does the statement of case disclose no reasonable grounds for bringing or defending the application or (b) is the statement of case an abuse of the court's process or otherwise likely to obstruct the just disposal of the proceedings or (c) has there been a failure to comply with a rule, practice direction or court order.

As the Judge identified, FPR PD4A paragraph 2.1 gives a non-exhaustive list of examples that might meet these conditions, namely (a) cases which set no facts indicating what the application is about, (b) cases which are incoherent and make no sense, and (c) cases which contain a coherent set of facts but those facts, even if true, do not disclose any legally recognisable application against the respondent. Paragraph 2.2 of PD4A makes clear that an application may be an abuse of the court's process or is otherwise likely to obstruct the just disposal of the proceedings if it is frivolous, scurrilous or obviously ill founded. PD4A paragraph 2.3 states that an answer may discloses no reasonable grounds where it consists of a bare denial or otherwise sets out no coherent statement of facts. As stated by Lord Wilson in Wyatt v Vince at [27]:

“The three sets of facts set out in paragraph 2.1 of Practice Direction 4A exemplify the limited reach of rule 4.4(1)(a), valuable though no doubt it sometimes is. The touchstone is, in the words of paragraph 2.1(c) of the Practice Direction, whether the application is legally recognisable.”

The Judge in this case considered that the court’s general case management powers under the FPR r.4.1 also provided a permissible route to the orders she made were she to be mistaken in her conclusions regarding the proper ambit of FPR r.4.4(1). In Wyatt v Vince, Lord Wilson held as follows:

“[27] As a result of the fuller argument with which this court has been presented, it is clear to me that, with respect, Jackson LJ was wrong to insinuate into the concept of abuse of process in rule 4.4(1)(b) of the family rules an application for a financial order which has no real prospect of success. The Lord Justice did not (and could not) suggest that the omission from the family rules of any rule analogous to rule 24.2 of the civil rules was accidental. It was deliberate; and so it was bold for him to say that nevertheless the effect of that rule was to be discerned elsewhere in the family rules.”

In Roocroft v Ball the Court of Appeal was required to consider the probity of using the court’s case management powers to dismiss an application on the basis that allowing the application to proceed would be contrary to the courts overriding objective and the judge’s duty actively to case manage an application. In line with the decision of the Supreme Court in Wyatt v Vince, the Court of Appeal was satisfied that that approach did not remedy the fundamental error made by the judge in that case in dealing with the application in a manner properly characterised as summary judgment.

Finally with respect to the law, Mr Bates submitted on behalf of KN that it is not permissible for the court to draw adverse inferences in a dispute regarding the ownership of property. In Prest v Petrodel Resources Ltd at [44]-[45] Lord Sumption, in examining the question of drawing adverse inferences in the current context, commented as follows on the position within proceedings for a financial remedy order under the 1973 Act:

“[44] In Herrington v British Railways Board [1972]AC877, 930—931, Lord Diplock, dealing with the liability of a railway undertaking for injury suffered by trespassers on the line, said:

‘The appellants, who are a public corporation, elected to call no witnesses, thus depriving the court of any positive evidence as to whether the condition of the fence and the adjacent terrain had been noticed by any particular servant of theirs or as to what he or any other of their servants either thought or did about it. This is a legitimate tactical move under our adversarial system of litigation. But a defendant who adopts it cannot complain if the court draws from the facts which have been disclosed all reasonable inferences as to what are the facts which the defendant has chosen to withhold. A court may take judicial notice that railway lines are regularly patrolled by linesmen and Bangers. In the absence of evidence to the contrary, it is entitled to infer that one or more of them in the course of several weeks noticed what was plain for all to see. Anyone of common sense would realise the danger that the state of the fence so close to the live rail created for little children coming to the meadow to play. As the appellants elected to call none of the persons who patrolled the line there is nothing to rebut the inference that they did not lack the common sense to realise the danger. A court is accordingly entitled to infer from the inaction of the appellants that one or more of their employees decided to allow the risk to continue of some child crossing the boundary and being injured or killed by the live rail rather than to incur the trivial trouble and expense of repairing the gap in the fence.’

The courts have tended to recoil from some of the fiercer parts of this statement, which appear to convert open-ended speculation into findings of fact. There must be a reasonable basis for some hypothesis in the evidence or the inherent probabilities, before a court can draw useful inferences from a party’s failure to rebut it. For my part I would adopt, with a modification which I shall come to, the more balanced view expressed by Lord Lowry with the support of the rest of the committee in R v Inland Revenue Comrs, Ex p TC Coombs & Co [1991] 2 AC 283,300:

‘In our legal system generally, the silence of one party in face of the other party’s evidence may convert that evidence into proof in relation to matters which are, or are likely to be, within the knowledge of the silent party and about which that party could be expected to give evidence. Thus, depending on the circumstances, a prima facie case may become a strong or even an overwhelming case. But, if the silent party’s failure to give evidence (or to give the necessary evidence) can be credibly explained, even if not entirely justified, the effect of his silence in favour of the other party, may be either reduced or nullified.’

Cf Wisniewski v Central Manchester Health Authority [1998] PIQR P324, P340.

[45] The modification to which I have referred concerns the drawing of adverse inferences in claims for ancillary financial relief in matrimonial proceedings, which have some important distinctive features. There is a public interest in the proper maintenance of the wife by her former husband, especially (but not only) where the interests of the children are engaged. Partly for that reason, the proceedings although in form adversarial have a substantial inquisitorial element. The family nances will commonly have been the responsibility of the husband, so that although technically a claimant, the wife is in reality dependent on the disclosure and evidence of the husband to ascertain the extent of her proper claim. The concept of the burden of proof, which has always been one of the main factors inhibiting the drawing of adverse inferences from the absence of evidence or disclosure, cannot be applied in the same way to proceedings of this kind as it is in ordinary civil litigation. These considerations are not a licence to engage in pure speculation. But judges exercising family jurisdiction are entitled to draw on their experience and to take notice of the inherent probabilities when deciding what an uncommunicative husband is likely to be concealing. I refer to the husband because the husband is usually the economically dominant party, but of course the same applies to the economically dominant spouse whoever it is.”

Having considered carefully the written and oral submissions of leading and junior counsel (to whom I mean no discourtesy in not setting them out in full), I am satisfied that the appeal must be allowed. My reasons for so deciding are as follows.

In considering this appeal, I have borne carefully in mind that the court is dealing with case management decisions made by the Judge and that, as made clear by the Court of Appeal in Re B (A Child) [2012] EWCA Civ 1742, “a judge making case management decisions has a very wide discretion and anyone seeking to appeal against such a decision has an uphill task”. The appellate court should, accordingly, only interfere where the case management order exceeds the generous ambit of discretion with which the first instance judge is invested. With regret, I must conclude that that is the position in this case. I begin with the Judge’s conclusions with respect to the law.

The Judge’s conclusions with regard to whether, and if so how, the power under FPR r.4.4(1) to strike out a statement of case can be deployed by the court with respect to wife’s Points of Claim and Response in this case are set out in her judgment at [27] to [31]:

“STRIKE OUT

[27] Pursuant to the Supreme Court decision in Wyatt v Vince [2015] UKSC 14 at Paragraph 27 Lord Wilson suggested that R4.4(1) “has to be construed without reference to real prospects of success” and all parties accept the wife’s substantive claim for financial remedies could not be struck out under this provision. This is because as was said by Lord Wilson also at Paragraph 27 this is “ not just that its determination is discretionary but that, by virtue of Section 25(1) of the 1973 Act it is the duty of the court in determining it to have regard to all the circumstances and, in particular, to the eight matters set out in subsection 2”.

[28] Mr Campbell submits that the applications for strike out must fail as a matter of law; that there is no jurisdiction within the FPR 2010 to strike out pleadings other than by virtue of the limited provisions of R4.4 and that there is no suggestion in Wyatt v Vince that R4.4 is only engaged if it is the whole case, rather than an aspect of it, which a party is seeking to strike out. In the document filed in response to these applications prepared by counsel on the wife’s behalf (the response) it is said that there is no jurisdiction in a financial remedies case for the court to summarily determine a substantive issue of law or fact and the only procedurally permissible way in which the matters raised in the wife’s pleadings can be determined is at a trial. This is not accepted by all Counsel for the other parties who consider there is jurisdiction either under R4.4 and/or the courts wider case management powers exercised in accordance with the overriding objective.

[29] I do not accept Mr Campbell’s position is correct. Wyatt v Vince relates to proceedings between parties to a marriage which will ultimately be determined with consideration to the matters set out at S25 of the Matrimonial Causes Act 1973. Proceedings between a party to a marriage and a third party do not fall to be determined applying the same criteria and are governed by the law relating to the issue which is the subject matter of the intervenor proceedings. There is no reason why R4.4 could not or should not apply to intervener proceedings and it would be wrong to determine that it cannot apply simply because the issue is to be determined between a party and an intervenor falls to be determined within the wider remit of the financial remedy proceedings as opposed to a discrete issue between parties in the civil courts. Whilst, within the financial remedy proceedings S25(1) requires the court “in deciding whether to exercise its powers…and if so, in what manner, to have regard to all the circumstances of the case” this cannot in my view mean that any case as between a party and an intervenor, which may or may not have an impact on the outcome of financial remedy proceedings, should be allowed to proceed to hearing, whatever its merits. It cannot be correct that a third party who would have the right to apply for summary judgment in a wholly civil context is deprived of that right because the issue is to be determined within the context of financial remedy proceedings. That would be to put an intervenor in a less favourable position than a party in civil proceedings which cannot be fair.

[30] However, even if I am wrong about this and the applications for strike out do not fall to be considered under the provisions of R4.4 I am satisfied the court still has the power to limit the issues to be determined providing that in doing so it is in furtherance of the overriding objective which is, as is said in the notes to the Red Book, “fundamental and the bedrock of the 2010 Rules”. It cannot be right in my view, that there is no jurisdiction to limit a party’s ability to pursue a particular argument, under any circumstances, simply because it does not come within the provisions of R4.4 and I do not accept the premise that the Supreme Court decision informs the implementation of the FPR 2010, as argued by Mr Campbell, rather that the FPR 2010 the overriding objective and the court’s case management powers inform the Supreme Court decision. In Tsvetkov v Khayrova [2023] EWFC 130 when considering how to deal with allegations of conduct in financial remedy proceedings Mr Justice Peel considered at paragraph 46 (iii) “that the court is duty bound by FPR 2010 1.1 to have regard to the overriding objective…” and at paragraph 46(v) “in furtherance of the overriding objective it is required to identify the issue and empowered to determine which issues should be investigated. At FPR 2010 1.4…”. At paragraph 46 (vi) he said “The court should determine at the First Appointment how to case manage the alleged misconduct. In my judgment, in furtherance of the overriding objective and PFR 2010 1.4 the court is entitled at that stage to make an order preventing the party who pleads conduct from relying upon it, if the court is satisfied that the exceptionality threshold required to bring it within S25(2)(g) would not be met.”. In an article for the Financial Remedies Journal headed “The Financial Remedies Court: A Year in Review” dated 21st November 2023 Mr Justice Peel said in respect of his judgment in Tsvetkov v Khayrova that “Nor do I regard robust case management of this sort as akin to a strike out of a financial remedy claim of the sort regarded as impermissible by the Supreme Court in Wyatt v Vince [2015] UKSC 14; it is a robust identification of relevant issues so as to enable the court to exercise its S25 discretion in a focussed and proportionate way”.

[31] The fact that the issues which are the subject matter of the intervenor claims may form part of the court’s S25 analysis in terms of resources which may be available to the parties does not mean they are not capable of being struck out, either under the provisions of R4.4 and/or the court’s general case management powers.

CONSIDERATION OF R4.4

[32] Under R4.4 (1) the court may strike out a statement of case if it appears either that it discloses no reasonable grounds for bringing or defending the application or it is an abuse of the court’s process. The examples given at PD4A of cases where the court may conclude that a statement of case discloses no reasonable grounds for bringing or defending are not exhaustive. Mr Campbell refers to paragraph 27 of the judgment in Wyatt v Vince where Lord Wilson said “the touchstone is, in the words of paragraph 2.1( c) of the Practice Direction, whether the application is legally recognisable. Applications made after the applicant had remarried of after an identical application had been dismissed or otherwise finally determined would be examples of applications not legally recognisable”. In other words, the fact that the points of claim identify legally recognisable claims against AF and KN mean they cannot be said to disclose no reasonable grounds for bringing or defending the claims. On his case, whilst the other parties may try and pick holes in the wife’s pleaded case, given that this is not a form of summary judgment, any substantive arguments of fact and law are for the trial. However, again, this refers to the position as between parties to the substantive proceedings and not the position between a party or parties and the intervenors.

[33] As against the husband, the wife’s pleaded claims amount at the very least to allegations of financial misconduct. In Tsvekov v Khayrova Peel J said at paragraph 46(ii) “a party who seeks to rely upon the other’s iniquitous behaviour must say so at the earliest opportunity, and in so doing should; (a) state with particularised specificity the allegations, (b) state how the allegations meet the threshold criteria for a conduct claim, and (c) identify the financial impact caused by the alleged conduct. The author of the alleged misconduct is entitled to know with precision what case he/she must meet”.

[34] As against the husband, AF and KN the wife’s case is a direct challenge as to the beneficial ownership of assets between them and include allegations of sham and fraud. In TL v ML And Others (Ancillary Relief: Claim Against Assets of Extended Family) [2006] 1 FLR 1263 Nicholas Mostyn QC (sitting as a Deputy High Court Judge) as he was then, observed “[34] it is to be emphasised however, that the task of the judge determining a dispute as to ownership between a spouse and a third party is, of course, completely different in nature from the familiar discretionary exercise between spouses. A dispute with a third party must be approached on exactly the same legal basis as it if were being determined in the Chancery Division”. In civil proceedings CPR 16.2 requires a claim form to contain a concise statement of the nature of the claim and specify the remedy which the claimant seeks. Although CPR 16.2 does not apply in this case there is still a need for points of claim to set out with sufficient certainty the case which the other party is required to answer. Its purpose is to serve as the foundation of a case, providing the court with a clear understanding of the claim and the evidence supporting it. In particular there is a clear need to plead an allegation of dishonesty and properly particularise it. The law is settled. In Three Rivers District Council v Bank of England [2001] UKHL 16 the House of Lords restated the principles on when fraud can be pleaded.”

I acknowledge that the husband was not seeking summary judgment and that the Note lodged for the hearing before the Judge on the husband’s behalf made that clear. Further, in evaluating the respective applications to strike out, the Judge does refer on occasion to the question of reasonable grounds and obstruction of the just disposal of the proceedings and frames her ultimate conclusions in those terms. I further acknowledge that the Judge was highly experienced in financial remedy proceedings and had had long involvement in this particular case. However, it is clear reading the foregoing paragraphs of her judgment as a whole, and her subsequent analysis, that the Judge proceeded to deal with the matter by considering prospects of success. I am satisfied that this was a clear error of law.

During the course of their written and oral submissions, Mr Sirikanda and Mr Campbell submitted on behalf of the wife that Points of Claim, Points of Defence and Points of Reply are convenient but not mandatory mechanisms to allow each party to plead concisely their essential case in respect of alleged matrimonial assets that may engage third party rights. They contend, however, that such good practice does not extend to importing into such a dispute the architecture of the CPR with respect to pleading. Mr Sirikanda and Mr Campbell accordingly urge the court to hold in mind the inquisitorial role of the judge under s.25 of the 1973 Act and eschew any notion that a dispute between a spouse and a third party in financial remedy proceeding requires formal pleadings settled and analysed in accordance with the principles set out in the CPR and associated authorities.

On behalf of the husband Miss Amaouche submits that, once pleadings are ordered in a dispute between a spouse and a third party as to the ownership of property, the pleadings must comply with the principles and discipline of civil pleading as set out in the authorities under the CPR. In short, Miss Amaouche submits that there must be “no lower standard for pleadings in the Family Court”, particularly where third party rights are engaged. On behalf of the Second Respondent, Mr Hughes likewise submits that the Second Respondent should not be at greater risk of unparticularised claims of fraud in the Family Court of allegations seeking to deprive her of her home than in the civil courts. Mr Hughes further points out that the Judge had directed the wife to particularise her claim by way of pleadings. On behalf of the Third Respondent, overall Mr Bates urges the court to conclude that there should be the same practical outcome in the Family Court as in the civil courts, it mattering “not whether the practical outcome is called ‘summary judgment’ in the civil jurisdiction and ‘active case management’ or ‘strike out’ in the family court’” (emphasis in the original).

I am satisfied that the principle governing the pleading of a dispute in financial remedy proceedings between a spouse and a third party as to the ownership of property are tolerably clear on the current authorities. Namely, that it is essential in every instance where such a dispute arises that directions are given, inter alia, for the issue to be fully pleaded by Points of Claim and Points of Defence (TL v ML, A v A, Goldstone v Goldstone and Edgerton v Edgerton (Shaikh, third party)).

The FPR 2010 does not deal with the nature and format of those ‘pleadings’. As made clear in Goldstone v Goldstone, it would not be appropriate to import into these proceedings the architecture of the CPR with respect to pleadings. However, in circumstances where the approach in TL v ML has twice been endorsed by the Court of Appeal, full pleading is a requirement that goes beyond merely good practice. In such circumstances, there would be little utility in insisting, as the authorities do, that a dispute between a spouse and a third party as to the ownership of property be fully pleaded by Points of Claim and Points of Defence if the fundamental tenets of pleading were thereafter deemed not to apply. Fairness requires that a party knows the case they must meet. Accordingly, the Points of Claim should plead the material facts to enable the Points of Defence to admit or deny those material facts so as to define the decisions required of the court (see Boake Allen Limited & Others v HMRC [2006] EWCA Civ 25, [2006] STC 606 at [131]). Overarching these conclusions is the self-evident proposition that if the court directs a party to fully plead their case, the party is required to comply with that direction.

The foregoing principles in relation to pleading a dispute between a spouse and a third party as to the ownership of property in financial remedy proceedings are well settled. However, at the heart of this appeal is whether, and if so how, the power under FPR r.4.4(1) to strike out a statement of case can be applied to such pleadings. I am satisfied that the conclusion that the pleading exercise mandated in TL v ML should be undertaken with appropriate rigor does not lead automatically to the conclusion that the power to strike out under FPR r.4.4(1) can, or should, be engaged.

There are a number of points that might be thought to suggest that the use of the power to strike out under FPR r.4.4(1) is not apt in a dispute between a spouse and a third party as to the ownership of property within financial remedy proceedings or, at the very least, that it should be deployed strictly within the confines of its express terms:

If, notwithstanding these matters, the use of FPR r.4.4(1) is appropriate in a dispute between a spouse and a third party as to the ownership of property within financial remedy proceedings, they suggest, at the very least, that it should be deployed strictly within the confines of the express terms of FPR r.4.4(1), with care being taken to distinguish properly between the permissible task of identifying whether the claim subject to the application to strike out is legally recognisable and the impermissible task of evaluating that claim on its merits.

The Judge proceeded in this case on the basis that FPR r.4.4(1) was engaged by the applications before her. I was not addressed in detail on whether Points of Claim filed for a preliminary issue trial of a dispute between a spouse and a third party in accordance with the procedure articulated in TL v ML constitute a ‘statement of case’ for the purposes of the strike out provisions in FPR r.4.4(1)(a) and (b). However, in circumstances where this appeal does not ultimately turn on that point, and without deciding the point, I proceed for the purposes of the appeal on the basis that the wife’s Points of Claim fell within the scope of the term ‘statement of claim’ in FPR r.4.4(1) and I turn next to the Judge’s application of that provision in this case.

All parties accept that FPR r.4.4(1), unlike the equivalent provision in the CPR, does not refer to a power to strike out a statement of case or claim on the grounds that it has no real prospect of success (i.e. a power to grant summary judgment) and that this was a deliberate omission. The Supreme Court in Wyatt v Vince made clear that FPR r.4.4(1) “has to be construed without reference to real prospects of success”.

On behalf of the husband Miss Amaouche submits that the decision of the Supreme Court in Wyatt v Vince, can be distinguished from the present case as it concerned the substantive claim for financial remedy and not a dispute in financial remedy proceedings between a spouse and a third party as to the ownership of property. Ms Amaouche further submits that the decision of the Court of Appeal in Roocroft v Ball can likewise be distinguished on its facts. However, whilst evaluated in the context of financial remedy proceedings, Lord Wilson’s conclusion in Wyatt v Vince at [27] that “Rule 4.4(1) of the family rules has to be construed without reference to real prospects of success” was not stated to be confined only to substantive claims for financial remedy. Nor could it have been having regard to the wording of FPR r.4.4(1), which applies to all proceedings except those to which Parts 12 to 14 apply (proceedings relating to children). The significance of the decision in Roocroft v Ball in this appeal lies in the fact that the Court of Appeal was satisfied, in line with this approach, that it was appropriate to apply the approach in Wyatt v Vince to an application made within substantive financial remedy proceedings (an application to set aside a financial remedy order) rather than limiting the principle to the substantive claim for financial remedy itself.

In any event, and more fundamentally, even if Wyatt v Vince and Roocroft v Ball are distinguishable in the manner contended for by Miss Amaouche, I am satisfied that as a matter of simple construction the plain terms of FPR r.4.4(1) provide no basis for construing a power to grant summary judgment. FPR r.4.4(1) contains no express power to that effect when compared to the equivalent provision in the CPR. In circumstances where it is accepted that the omission of such a power from FPR r.4.4(1) was deliberate, there is likewise no warrant for implying a power of summary judgment in FPR r.4.4(1).

Having determined that the power to strike out contained in FPR r.4.4(1) was available to her, I am satisfied that the Judge was obliged to deploy that power within the confines of the express terms of FPR r.4.4(1) in accordance with the interpretation articulated in Wyatt v Vince. This required the Judge to take care to distinguish properly between the permissible task of identifying whether the wife’s claims were legally recognisable and the impermissible task of evaluating those claims on their merits.

In the passages from the judgment set out above, the Judge uses the terms ‘striking out’ and ‘summary judgment’ interchangeably. Whilst the Judge recounted at [32] Mr Campbell’s submission on behalf of the wife referring the court to Lord Wilson’s judgment in Wyatt v Vince in which he said that the touchstone of an application under FPR r.4.4(1) is whether the wife’s claims against the husband and the Second and Third Respondents are legally recognisable, that phrase appears nowhere in the Judge’s subsequent analysis. Rather, and impermissibly, I am satisfied that the Judge substituted her own approach in concluding that the need for parity between the legal (as opposed to procedural approach) across the jurisdictions entitled her to pronounce judgment summarily on the wife’s Points of Claim. The Judge elevated her own conception of fairness above the language of FPR r.4.4(1) as interpreted by the Supreme Court in Wyatt v Vince by importing a power of summary judgment into FPR r.4.4(1), concluding at [29] that:

“It cannot be correct that a third party who would have the right to apply for summary judgment in a wholly civil context is deprived of that right because the issue is to be determined within the context of financial remedy proceedings”

The Judge’s stated alternative to FPR r.4.4(1), that if the case did not come within the scope of that provision the court still has the power to strike out a case under its wider case management powers in FPR r.4.1, providing that doing so is in furtherance of the overriding objective, was also an error of law.

Each of the respondents sought to demonstrate that the orders made by the Judge were, in any event, permissible under the wider case management powers of the court in FPR r.4.1.

On behalf of the husband, Miss Amaouche submits that in refusing to allow the claims the Judge did no more than she was enjoined to do by FPR r.1.4(1). Miss Amaouche submits that there is no rule that the wife can point to that prohibits the Judge from making the orders that she did in pursuant of her “broad and wide ranging powers of case management” in furtherance of the Overriding Objective in FPR r.1.1. On behalf of AF, Mr Hughes also emphasised the Overriding Objective and, closely connected to and fundamental to achieving the Overriding Objective, the duty to “actively manage cases” under r.1.4(1), including “deciding promptly which issues need full investigation and hearing and which do not” pursuant to FPR r.1.4(2)(c)(i). On behalf of KN, Mr Bates submitted that, notwithstanding that FPR r.4.4(1) does not contain a power of summary judgment, the case management provisions of the FPR r.4.1 can be deployed in a manner that achieves the same practical outcome, submitting in his Skeleton Argument that:

“It cannot be right that the use of different procedures must necessarily result in a Third Party being refused access to a particular practical outcome in the Family Court, where access to the same practical outcome would be readily available on the same facts and issues in the Civil Court” (emphasis in the original).

The power of summary judgment having been deliberately omitted from the strike out provisions contained in the FPR r.4.4(1), I am satisfied that it would be improper to construct such a power using the wider case management provisions contained in FPR r.4.1. To do so would be to circumvent the intention of Parliament to omit a power of summary judgment from the FPR. In Wyatt v Vince Lord Wilson was clear that, in circumstances where the omission from FPR of any rule analogous to CPR r. 24.2 was deliberate, it was too bold to assert that nevertheless a power of summary judgment was to be discerned elsewhere in the FPR. The terms of the Overriding Objective do not change this conclusion. There is a clear distinction between using robust case management to exclude an irrelevant issue from consideration and using robust case management to summarily determine relevant issues. The former is permissible, the latter is not. This is the basis for Peel J’s observation in the article for the Financial Remedies Journal, cited by the Judge, that the robust case management described in Tsvetkov v Khayrova [2023] EWFC 130 is not akin to a strike out of a financial remedy claim. I am satisfied that the Judge misunderstood the import of Tsvetkov v Khayrova.

I pause to note that, in determining to summarily determine the wife’s claims as an exercise of robust case management, it is also unclear what test the Judge was purporting to apply. At [44], the Judge observed that “The wife must make out her primary case and I cannot see that she has done so.” If this was the basis on which the Judge determined the wife’s claim by way of summary judgment under the FPR r.4.1, it represents a test that is stricter than that applying to summary judgment under FPR r.4.4(1). Later, in relying at paragraph 46 (vi) on Peel J’s decision in Tsvetkov v Khayrova, the Judge then appears to seek to turn the threshold in s.25(g) of the 1973 Act into the test for using her powers of case management to summarily prevent the wife’s claims from proceeding, on the basis that the wife’s claims with respect to the husband’s beneficial interests constitute an allegation of misconduct for the purposes of s.25(g). The wife does not plead misconduct under that statutory provision. More fundamentally, as the Judge herself made clear, the dispute regarding third party interests does not fall to be decided on a discretionary basis under s.25 of the 1973 Act, but rather as a preliminary issue in accordance with the legal provisions applying to disputes as to property interests applicable across all Divisions. In the circumstances, it is very difficult to see how the threshold under s.25(g) of the 1973 Act could inform or be the test for deciding, as a matter of case management, whether such claims should be struck out.

I am further satisfied that the errors of law identified above irretrievably undermined the Judge’s analysis in this case.

The husband and AF submit that in striking out the wife’s applications the Judge did not undertake an exercise of summary judgment and remained within the terms of FPR r.4.4(1). KN submits that the Judge “did no more than carry out a case management exercise that was consistent with the overriding objective and / or FPR 4.4.” However, whilst Miss Amaouche submits that there “is no reading of the judgment” that could support the proposition that the judge undertook a process of summary judgment, the Judge’s analysis of the applications that followed her exposition of the law reinforces firmly the conclusion that the Judge proceeded to decide the matter on the basis of prospects of success. This is particularly so in relation to KN’s application to strike out.

In giving her reasons for striking out the wife’s claim against the husband and KN with respect to the beneficial interest in the proceeds of sale of Y Ltd, rather than asking whether the wife has a legally recognisable claim, the Judge engaged directly in an examination of the relative merits of the parties’ cases.

The Judge began by noting that the wife had not dealt with the matters with which her claim was concerned in her Form E. Rather than being relevant to the identification of a legally recognisable claim, this appears to be an evaluation of the wife’s credibility. At [39] the Judge accepts, without further comment, that the evidence of KN “confirms that the husband did not own any part of Y Ltd and provides an explanation as to why the shareholding was in the husband’s name.” At [44] the Judge further observes that the wife’s Points of Claim “ignore the evidence provided by the husband and KN in response as well as the undisputed facts within the wife’s knowledge” (which, again, the Judge appears simply to accept) before concluding that “The wife must make out her primary case and I cannot see that she has done so.” Whilst the Judge accepted at [46] that “some of the actions of KN and the husband might be viewed sceptically by third parties”, the Judge then again referred to the evidence filed by both of those parties explaining their reasons for doing so and once again noted that “the burden of proof lies with the wife”. Each of these instances further reinforces the impression that, consistent with her erroneous conclusions on the law, the Judge was engaged in evaluating the prospects of success of the wife’s claim rather than concentrating on the question of whether the wife had a legally recognisable claim.

The Judge’s conclusion regarding the absence of facts to support the wife’s claim against the husband and KN was also in error. The following matters of fact were clear on the face of the Judge’s judgment, and apparently undisputed on the face of the pleadings, in the context of the wife’s case that, as the husband was entitled to the proceeds of sale of Y Ltd, he is the true beneficial owner of the funds paid to the Trust on sale of Y Ltd:

Each of these matters was a fact relevant to the wife’s claim with respect to the husband and KN. The Judge’s conclusion that the wife’s Points of Claim comprised bare assertions unsupported by facts was simply not correct. Even where the Judge did acknowledge the existence of one of these facts, she did not acknowledge its role in the wife’s pleaded case, observing at [41] “Again, she provides no factual evidence other than a document which the husband had in his possession detailing the workings for the monies KN and HFT received upon the sale of Y Ltd.” Whilst it is the case that the wife’s allegations with respect to the Share Agreement were unparticularised and, in the circumstances the wife indicated that she would seek to rely at the preliminary hearing on adverse inferences, this position fell to be evaluated in the context of the wife being dependent on the disclosure and evidence of the husband to ascertain the proper extent of her pleaded claim. In such circumstances, and as recognised in Prest v Petrodel Resources Ltd, adverse inferences may take on a greater role than is ordinarily the case in disputes as to the ownership of property outside of financial remedy proceedings.

With respect to the wife’s claim against AF, it is the case that the wife’s pleaded case of sham and, in the alternative, disposition designed to defeat her claim was unparticularised. However, notwithstanding Mr Hughes’ eloquent and clear submissions, it remains the case that the Judge’s evaluation of AF’ application to strike out the wife’s Points of Claim was founded on her erroneous conclusions on the law, as dealt with above.

Whilst the Judge did, at points, address the question of whether the wife could demonstrate reasonable grounds for bringing her claim against AF, the judge’s conclusions were in part based on her evaluation of the merits of competing evidence. Again, the Judge started with the finding that the wife had not dealt with the matters with which her claim was concerned in her Form E. This again appears to be an evaluation of the wife’s credibility rather than being relevant to the identification of a legally recognisable claim. Once again, in considering AF’s application, the Judge appears to have proceeded on the basis that “It is for the wife to make out her primary case...” The Judge also compared the parties’ competing cases on the weight that could be attached to alleged internal inconsistencies in a document when deciding the question of sham and preferred the case advanced by AF based on her acceptance of the proposition that “if a party is going to go to the lengths of creating a sham document it might be expected that steps would be taken to ensure it would not be open to close examination or criticism.” After erroneously stating that the wife had not issued an application under s.37 of the 1973 Act, the Judge’s emphasis was again on the prospects of success, evaluating and coming to a conclusion on the merits of the case rather than asking whether the wife had a legally recognisable claim:

“The wife has not to date made any application under S37 of the Matrimonial Causes Act 1973. Her points of claim provide no factual basis for the assertion that the disposition was made with the intention of defeating her claim for financial remedies other than it was made for no consideration. The disposition took place in July 2018 some five years before the date of separation relied on by the wife. The wife’s Form A was issued in November 2023, more than three years after the disposition and so the presumption at S37(5) that it was done with the intention of defeating the wife’s claim unless the contrary is shown does not apply and the burden of proof rests with the wife. It is for her to satisfy the court on a balance of probabilities that the disposition was made with a view to defeating her claims. This is accepted by the wife at paragraph 20 of her points of claim.”

With respect to the wife’s Points of Claim regarding disposition designed to defeat her claim, contrary to the Judge’s assessment, the claim was not one entirely unsupported by facts. As recorded in the judgment, it appeared to be accepted that (a) the husband was the sole legal purchaser of the property, (b) most, if not all, of the purchase funds came from the Trust, (c) the husband has been responsible for the running costs since acquisition, (d) the husband uses the property as and when he chooses, (e) the transfer was made for no consideration and (f) the purported Declaration of Trust was signed only by the husband.

Whilst it is the case that the wife’s allegations of sham and reviewable disposition are unparticularised and, in the circumstances the wife indicated that she would seek to rely at the preliminary hearing on adverse inferences, this position also fell to be evaluated in the context of the wife being dependent on the disclosure and evidence of the husband to ascertain the proper extent of her pleaded claim for the reasons set out above.

Within the context of the foregoing conclusions, I turn to consider the grounds of appeal. These can be taken shortly in light of the analysis set out above.

I am satisfied that Grounds 1 and 2 of the Grounds of Appeal are made out. Unfortunately, the Judge lost sight of the fact that the applications to strike out fell to be decided under the express terms of FPR r.4.4(1). In an attempt to address what the Judge erroneously perceived to be an unfair distinction between the procedural position of the respondents in these proceedings and their procedural position were these civil proceedings, the Judge wrongly imported into FPR r.4.4(1) a power of summary judgment. She thereby misunderstood the ambit of FPR r.4.4(1). Instead of considering whether the wife had articulated legally recognisable claims against the husband, AF and KN, on repeated occasions the Judge slipped into evaluating the merits of the wife’s claims notwithstanding the deliberate omission from FPR r.4.4(1) of prospects of success. Whilst the Judge set out at [27] that she did not have the power to exercise summary judgment, I am satisfied that that is the approach she proceeded to take, disregarding the limited reach of FPR 4.4(1). In the circumstances, I am likewise satisfied that Grounds 3 and 4 of the Grounds of Appeal are made out. For the reasons I have set out, pursuant to Ground 5 of the Grounds of Appeal, I am satisfied that the Judge was indeed wrong to conclude, in the alternative, that the court’s wider case management powers under the FPR r.4.1 enabled her to strike out the wife’s claims if she was mistaken regarding the ambit of FPR r.4.4(1).

The satisfaction of Grounds 1 to 5 is sufficient to dispose of the appeal. It is not necessary for the court to deal with Ground 6. I am further satisfied, however, that pursuant to Ground 7 that it was not appropriate for the Judge to determine at the hearing that the purported Declaration of Trust with respect to VLO was not a sham, which was plainly an issue for the preliminary trial. Likewise, as a matter of fact, pursuant to Ground 8 the Judge was wrong to state in her judgment that the wife had not applied to set aside the Declaration of Trust under s.37 of the 1973 Act. The wife had made an application and the effect of the Judge’s decision to strike out the wife’s claim against AF was to summarily determine that application to set aside. Ground 9 does not add anything to these conclusion and I do not need to deal with it. I am, however, satisfied that, in light of the matters set out above, the Judge was wrong, pursuant to Ground 10, to remove KN as a party pursuant to FPR rule 9.26B(2).

For the reasons set out above, I allow the appeal. The orders striking out the wife’s claim against AF shall be set aside. With respect to the claim against KN, the order striking out that claim shall also be set as will the order discharging him as a party. The matter will be listed before me at the beginning of term to consider the further directions consequent on this judgment. I will ask leading and junior counsel to draw an order accordingly.