Ruth Elizabeth Gray v Duncan Keith Gray

These are financial remedy proceedings.

The applicant is Ms Gray. She is represented by Mr Barwell O’Connor. Also, with her in court over this 2 day final hearing has been her solicitor Mr Bartlett. She seeks 50% of the net equity or £140,200 from the former matrimonial home (FMH) to meet her housing needs, to pay for capitalised maintenance, to repay a loan for legal fees and to provide a sum of money in anticipation of legal fees for this hearing. With regards to the pensions, she seeks a 100% share of one of Mr. Gray’s pensions, the Fidelity SIPP.

The respondent is Mr Gray. He is a litigant in person. He does not think that the applicant should get anything in respect of the former matrimonial home. Indeed, on his view her housing needs would be met by a term of imprisonment with regards to the alleged fraud, deception, and perjury he says that she has committed. He offered a sum of £20,000 on 9^th February 2023 as a goodwill gesture. On the subject of pensions, his e-mail was silent although his position statement for the final hearing that was due to take place in February 2023 said that he had no issue with his wife having a portion of that which was built up in the course of their marriage.

Without any disrespect to the parties, I will refer hereafter to the applicant as the wife (W), and the respondent as the husband (H).

The parties met in June 2009 and very quickly (within a month) moved in together – initially into the accommodation rented by W and then into the FMH in or around April 2011. They married on 18^th June 2011 and separated on 31^st March 2020. They are of a similar age; W is now 54 and H is 56. Both have children from their respective prior marriages but no children from this relationship.

The parties separated in March 2020 when W left the marital home. She says the relationship was marred by years of psychological abuse, bullying, and controlling behaviour. She says that during the early part of the first lockdown, whilst furloughed, she took the opportunity to get away without an immediate loss of salary. She left with just some clothes, some paperwork, and a dog. She does not rely on alleged domestic abuse as a conduct issue – a realistic approach as I will come to later – and therefore seeks no findings.

H denies that he was abusive and says that as far as he was concerned, he was in a loving relationship, and he was in effect hoodwinked. He claims that W was violent on three occasions without providing any details. He describes her leaving him as her “absconding” from him. That is a very curious use of language. The word ‘absconding’ is one often used in the context of an escape from prison rather than the end of a relationship. However, as already mentioned, W seeks no findings in respect of how she characterises their relationship.

This is a case where there are few assets. The FMH is 9 Little Roke Avenue. This was purchased by H in 1993 and is in his sole name. The W contends, based on the surveyors’ report, that its effective gross value is £358,800 with a net value of £245,270. The effective gross value takes into account the value of the property in a reasonable state sold as two flats with good legal title. She argues this because she says the H has devalued the property since she left.

The husband re-mortgaged this property on 19^th April 2023 – less than a week before this final hearing. He did not notify the W’s solicitors. That is a fixed rate mortgage with a 5% early redemption fee in the first year.

The H for his part relies on the surveyors’ valuation of £295,000 which is the market valuation for the property in its current state.

In terms of monies in accounts, H has £2,573 and W has £3,794. Both parties have cars – the H’s is valued at £10,000 whilst the W’s is valued at £19,859 with an outstanding loan of £18,235 taken out for its purchase. The W has additional debts including a modest credit card balance and a loan from her mother and outstanding legal fees. The H has no debts other than the mortgage.

The H says that the Court should take into account the compensation awarded to the W in respect of her personal injury claim against the NHS. She received a total of £49,200 – the substantial payment of £47,00 being in June 2020, 3 months after separation. He says that this was a fraudulent claim on her part against the NHS and that she has hidden monies from that settlement.

The W says that the H may well have some entitlement in a claim with regards to a pension mis-selling. Such a claim would be capped at £51,850. H has provided information on this to the W’s solicitors. He says that he has made this claim but, paradoxically, says that he was in fact happy with the advice at the time. It is unclear whether he will be successful or not.

Both parties have pensions although the H’s are significantly in excess of the W’s. There is an expert report regarding the pensions that I will come to in due course.

In terms of the parties’ income, the W earns £22,114 net. She says this is likely to reduce as she requires an operation with a significant recovery time. The H earns £38,022 net. He currently pays 63% of his salary into his pension and has withdrawn two capital sums and utilised them, he says, for living expenses. Both withdrawals were in the course of these proceedings. The second withdrawal was after the Court Order from the Financial Dispute Resolution appointment (FDR) on 5^th July 2022 which provides at paragraph 24 as follows: “The respondent must not expend any part of his pension prior to the conclusion of these financial remedy proceedings but has permission to apply should be need to have recourse to those funds prior to that time.” Suffice to say that he did not make an application.

Based on this brief summary it can be seen that the issues are not complex.

Unfortunately, the H has been fixated with his determination to have issues that he says are relevant to his W’s application heard.

In the chronology that he prepared for the first hearing, an e-mail of some 7 pages, he sets out various assertions at length. He says that he is very much looking forward to going to court as there are so many points that he wishes to put across. He says he cannot proceed until W puts in a truthful Form E and he says that he will expose “every fabricated deviant tactic that she has tried to get away with.” He observes that this will be a very “timely process”. I think given the context it is more likely that he meant time consuming. H concludes his chronology by saying that he had not done one before, but he hoped that it was the kind of thing the recipient (his W’s solicitors) wanted. It seems unlikely to me that he was genuine in this sentiment. Looking at the e-mail itself it can be seen that he initially sent it to himself. It is then sent to Ms Hargreaves, a solicitor at the firm acting for W and a number of other parties who are his friends and associates. This is something that he does on a number of occasions, and it is unclear what he is trying to achieve. He says that his friend are his ‘DIY legal team’ but he may simply have wanted to embarrass of humiliate. He was specifically warned not to do this in the recitals to the FDR order but has continued to do this.

Suffice to say that H’s approach has continued and has become deeply entrenched. There are a number of e-mails in the bundle – a small selection of those that were sent to W’s solicitors – which are in my judgement when taken as a whole vitriolic, downright offensive both in respect of W and those who represent her, and abusive. Some of those e-mails are threatening in nature, both from a professional perspective – repeated versions of the sentiment that ‘I’m having your firm shut down’ and references to ‘scumbag’ lawyers – and also of a personal nature. One of the most troubling being a reference Mr Barwell O’Connor as a sheep having its voice box removed, as well as a message to solicitors concerning the lyrics of a rapper, Uzi Lover, which make reference to the need to kill people to get respect but not so many so as there is no-one left to respect you. H did try to explain these messages away, but I am afraid that they are deeply concerning.

H has sought to make this a conduct case making allegations that W and her legal team have engaged in fraud, perjury and lies. He has been determined to be heard on this despite it being plain that his allegations are simply not relevant in the context of financial remedy proceedings. He appears to have been incensed by what he says were the comments of the FDR Judge DDJ Waschkuhn that there was no evidence of fraud, lies and perjury, and effectively doubled down even more saying in an e-mail sent two days after the FDR that he knows he has absolutely no chance and those are the sorts of odds that he likes. He now in effective retracts his negative comments about the Judge and the Court system, but lays the blame for what he sees as errors back on W and her legal team.

The FDR on 5^th July 2022 was ineffective and the Court in its Order recited that the H refused to make any offers in FDR negotiations despite the Court explaining the possible costs consequence of this and urging him to do so. His approach is further illustrated in the email already mentioned. He says that he had not opened W’s Position Statement for the FDR 2 days before.

H was ordered to send a concise narrative statement regarding his conduct allegations setting out for each allegation the conduct he is seeking to rely on, the basis for his allegations and the effect the alleged conduct should have on the financial remedy application.

His statement, collated by the W’s solicitors from 3 emails that he sent opens with the assertion “This is my statement that your client has to provide answers to.”

The W was permitted, not required to respond under the terms of the Court order. The H has made it plain that his view was this was not the order of the Court. Plainly it was. His complaint here is that the W’s legal team added words that that he says that the Judge did not use, which of course completely misses the point that Judges will get a draft order where a party is represented and only approve it if happy with the terms of it. An order is only final when it is approved by the Court, and it is for the Court to control the evidence bearing in mind the issues and the over-riding objective of the Family Procedure Rules.

Prior to responding the H sent an e-mail chaser to her solicitors:

“Any chance of answering the statement that the court order said that you had to?

And my happy meal looks rather sad as it lies on the floor like most of your testomemt.

Fries are fried like those on deaf row. The deaf can see thou. See the sea as the waves of truth flood the tears of testimony from your crocodile. Tie me kangaroo court down sport. May the pain of the unjust law you unjustly place upon the innocent with your bent judiciary come and find you undone. The day of the punishment fits the crime will once again block out what lies in your lies sunshine. 40 days and faulty knights in white armour. The problems with physics is that scum normally rises to the top. Nothing trump's the truth. The gutter lies with lies.”

H in his evidence and in his submissions seems genuine when he says that he loved his W and the time he had with her was the happiest he had ever been. However, it also seems clear me that H was incensed that she left him and had a very different view of their relationship. It appears that he is seeking to insert some control into the process of determining a fair distribution of assets following the breakdown of the parties’ marriage. He wants the W to do as he requires – to engage in his narrative – rather than engage in the actual issues that the Court needs to determine.

The W did respond in a witness statement a few days later. She did so in brief terms taking the view that it was disproportionate to respond in full and choosing to deal only with issues that she felt were relevant to the courts exercise of discretion. That was an understandable response with the benefit of legal advice.

Both parties were ordered to serve s.25 narrative statements and provisions were made for expert evidence with regard to the value of the property and a pension expert report.

This final hearing took place over two days. Participation directions were made both in respect of W’s attendance and participation as a party, and her giving evidence. Those directions were made at the FDR hearing and include screens in court, separate waiting areas, and in terms of giving evidence the provision of questions by the H so that the Court, if they are appropriate can ask them on his behalf.

The court had not received any questions from the H for the W, so I caused enquiries to be made of him on Monday. His response was that he saw no point in asking W any questions through the judge as he had taken a different stance that totally negated this. He observed that he was sure that the judge would have their own questions for both parties.

I explored this matter with the H to try and understand his expectations. I made it clear to him that in refusing to provide questions so the court could ask those that it considered to be relevant and appropriate he should not expect the court to guess what he wanted to ask and essentially enter the court arena on his behalf. I explained that I would ask any questions that I considered to be necessary so that I could determine the issues that are relevant – computation and division of assets. He said that he understood this.

I have read the bundles and the position statements. I have heard oral evidence from both parties and submissions from Mr Barwell O’Connor for the W and from the H. Because of time constraints I heard evidence until around 5pm on Tuesday, and then started early today limiting both parties in terms of the time to spend on submissions in order to ensure that I had time to consider all relevant matters, make my decisions, explain my reasons and deal with any ancillary issues that may arise. I tried to assist H in his submissions by attempting to direct him to relevant points, but his focus was very much on reading out a large quantity of messages between him and W which were on the face of it chatty and loving, and in reading them H was clearly emotionally affected by them. They are clearly precious to him although of no assistance to the Court.

As well as the usual issues of computation and division of assets I am also asked to deal with costs and enforcement. Mr Barwell O’Connor has addressed these matters in his position statement and in closing suggested that he address me on those points after I give judgement. That is plainly a sensible approach.

To summarise, in terms of computation I need to determine the following:

In terms of distribution, I need to determine the following:

In terms of the outcome, I have decided that H will pay W a lump sum of £117,350 or 50% of the sale value of the FMH on the basis that I consider its gross value for the purpose of computation to be £410,000. I also make a pension sharing order of 100% of the H’s Fidelity SIPP. Plainly I will come to my reasons, and set out each of the decisions to the questions set out above in due course. But first I will outline the relevant legal framework.

I will start with a few general points. Where an allegation is made the burden of proof (assuming that the allegation is relevant) falls on the person making the allegation. The standard of proof is the civil standard, that standard being the balance of probabilities – so more likely than not. That simply means that I have to be satisfied that the allegation is more likely than not to be true.

In considering the evidence I must act on the evidence that I find to be reliable. I must consider the totality of the relevant evidence. Where the burden is met the allegation is proved. If the maker of the allegation fails to discharge the burden, then the allegation is not proved. It is a binary decision.

One of the computation issues is whether the FMH is matrimonial property or not. Mr. Barwell O’Connor has helpfully set out the legal position in his position statement. It is plain from the seminal decisions in the House of Lords – Miller v Miller and MacFarlane v MacFarlane that the matrimonial home has a central place in any marriage and is normally treated as matrimonial however long or short the marriage, and whatever the source. Even fleeting use of a property can in effect turn it into a matrimonial asset and the Courts have made plain that the equal sharing principle is very likely to apply with the only departure from that being based on the parties’ respective needs.

An issue raised in this case is whether the matrimonial part of this asset can be limited to part of the property. I am not aware of any case law on this point so that seems to me to be a factual issue to determine on the evidence concerning the property and its use.

With regards to H’s assertion that W has hidden part of the proceeds of her PI claim this issue of hidden assets usually comes about through a party seeking an adverse inference based on non-disclosure. The legal position in that situation is this: if there has been materially deficient disclosure then the court must consider by a process of drawing adverse inferences, whether funds have been hidden. Such inferences are to be properly and reasonably drawn and if a court does conclude that there are such assets it should attempt a realistic and reasonable quantification of the same. Direct evidence, and evidence of lifestyle will be relevant. Vague evidence will not. The party who has failed to disclose should not benefit from this failure and will have little basis to complain if the order is unfair.

Here, the relevant disclosure has been made through the W’s bank accounts. H’s assertion is that she has made cash withdrawals and the proceeds of those are still available to her, and that some of the expenditure, such as the laser eye surgery amounts to financial conduct. The law in relation to the latter point is set out below. With regards to assertions about cash withdrawals being available to her that is a straight-forward issue of fact.

With regards to the division of assets the all important provisions of the MCA apply.

Dealing with the clean break provision first, S25A(1) provides it is the duty of the court to consider whether it would be appropriate to exercise its powers so that the financial obligations of each party towards the other will be terminated as soon after the grant of the decree as the court considers just and reasonable.”

Dealing next with s.25, this provides that the court shall have regard to all the circumstances of the case, first consideration being given to the welfare while a minor of a child of the family who has not attained the age of 18….” Plainly the first consideration does not apply here.

The s25 factors are these:

the income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future, including in the case of earning capacity any increase in that capacity which it would in the opinion of the court be reasonable to expect a party to the marriage to take steps to acquire;

the financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future;

the standard of living enjoyed by the family before the breakdown of the marriage;

the age of each party to the marriage and the duration of the marriage;

any physical or mental disability of either of the parties to the marriage;

the contributions which each of the parties has made or is likely in the foreseeable future to make to the welfare of the family, including any contribution by looking after the home or caring for the family;

the conduct of each of the parties, if that conduct is such that it would in the opinion of the court be inequitable to disregard it; [I will cover the issue of conduct more fully shortly]

in the case of proceedings for divorce or nullity of marriage, the value to each of the parties to the marriage of any benefit [...] ⁴ which, by reason of the dissolution or annulment of the marriage, that party will lose the chance of acquiring.

There is, unsurprisingly, a considerable body of case law dealing with how I should approach my decision. In summary, it seems that I need to consider all of the relevant s.25 factors being alive to the fact that some may be more relevant than others depending on the facts of a particular case. When I do this, I must be careful to do this fairly whilst bearing in mind the principles of needs, sharing and compensation in so far as they are relevant to the facts. The yardstick of equality has been described as a starting point or a check to test that the outcome is fair. Irrespective of this, I must be satisfied that if the outcome is not a 50/50 split, then I need to identify a good reason for this.

Coming back to conduct, as already mentioned s.25(2)(g) provides that the court may have regard to the conduct of the parties if it is of the opinion that it would be inequitable to disregard it.

In general, there are three types of ‘conduct’ in financial remedy proceedings: financial conduct, non-financial conduct, and litigation conduct. The reality is that there are few cases where conduct will make a difference to the final outcome, something which it is clear that DDJ Waschkuhn was seeking to communicate to the H in the hearing. Mr Justice Mostyn made this point clear in OG v AG [2020] EWFC 52 where the said this:

“Times have changed. The financial remedy court is no longer a court of morals. Conduct should be taken into account not only where it is inequitable to disregard but only where the impact is financially measurable. It is unprincipled for the court to stick a finger in the air and arbitrarily fine a party for what it regards as immoral conduct.”

In terms of financial misconduct, this relates to the period in which parties are married and covers the point, set out in Martin v Martin [1976] Fam 335 where assets had been frittered away, significantly reducing the pot available to meet the parties needs. It was said that that a spouse cannot be allowed to fritter away the parties’ assets through extravagant living or reckless speculation and then expect to receive as great a share of the remaining pot as they would have done had they behaved reasonably. A further example is in Beach v Beach [1995] 2 FLR 160 where the H had dissipated his own money, his family’s money, his W’s money, his friends’ money, and the money of unsecured creditors. This led to financial ruin and bankruptcy and amounted to financial conduct that formed part of the overall evaluation of the s.25 factors.

Non-financial conduct is rarely taken into account. The Court undertook a review of the sorts of cases where conduct had been found to be inequitable to disregard in S v S [2006] EWHC 2793. The examples where conduct had been found to be relevant to the division of assets included the following:

It should be clear from these examples that conduct has to be particularly egregious and / or sufficiently serious with resulting financial consequences for it to be taken into account.

Litigation conduct has previously been held to be relevant to the exercise under s.25. Later judicial decision making moves this issue towards a costs determination rather than a s.25 determination. More recently in Rothchild v De Souza [2020] EWCA Civ 1215 the Court of Appeal decided that litigation conduct can come under s.25(g) where it meets the test of ‘inequitable to disregard’ in addition to the consideration of whether to award costs.

In this case I consider it to be appropriate to consider litigation conduct after determining what the assets are, their value and the appropriate division.

It is convenient now to consider the allegations made by the H.

The H makes a number of allegations. For the sake of brevity I will group them as best I can.

Firstly, H alleges that W has lied in her divorce petition. He disagrees with her characterisation of their relationship and maintains that it was loving and not abusive. In his submissions he read out the entirety of the messages between them over a particular period. He became quite tearful towards the end and seems genuine in his belief that this was a mutually loving and fulfilling relationship. It is clear that this was his view and I accept that W’s different view has been both a surprise and painful for him.

He takes particular issue with W’s assertion that she signed an affidavit regarding the FMH as she said that she did not dare do otherwise. He produces messages which show that she is helping in the process and says this proves that she is lying. The W maintains that the relationship was abusive but does not seek findings about this as she recognises what she alleges comes nowhere close to conduct that the court would consider taking into account. Given that there is no requirement for me to make a finding about the nature of the relationship this issue simply falls away but plainly if it did not I would need to look at her allegations as well.

I will say this - a difference of opinion about the state of a relationship is not unusual. Two parties can have completely different views of the same thing. An unfortunate characteristic of the old divorce regime is that in many scenarios’ ‘fault’ had to be asserted to establish that a marriage had irretrievably broken down – for example through unreasonable behaviour. The law has changed, and we now have no fault divorces.

The second set of allegations relates to the claim money from W’s PI settlement. H makes allegations that W has misled the court as to her position in respect of the claim money. He says that it was submitted on her behalf that she had spent the majority of the claim money on rent and day to day expenses and then points out that she had said on her Form E that she was living with her Mother. He says that these are contradictory. Her witness statement clarifies her evidence and says that she was renting for a period of time.

The core issue here is whether that money should form part of the asset pot for division. The only issues that the court is concerned with is whether W has access to hidden assets or whether there is financial conduct of the nature already described.

H’s proposition seemed to be that as it could not be right that W had spent the majority on rent and living costs given what he said was a contradictory position on this. It followed that a significant proportion of the funds – some £20K – therefore must be missing and so must still be available to her.

W has disclosed her bank accounts. H did not seek to ask any questions about expenditure. None-the-less I have obviously considered those documents. Whilst the onus is on H to prove the allegations he makes, it is part of the over-riding objective to ensure the parties are on a equal footing. If he is right this would be a relevant issue.

From the financial documentation disclosed it is clear that W received £47,200 on 9/6/2020. This was paid into her instant saver account. This account was for a time also used for payment in of her wages and payments in, presumably related to furlough, from HMRC.

The balance in her savings account drops from £44K to £17K in the remainder of 2020. She purchases a car in that time frame and has eye surgery – expenditure on these total £16K. This expenditure is set out in W’s documentation - she hasn’t sought to hide it as her bank statements have been disclosed.

W has a current account, and she regularly transfers money from her savings into this account.

H in his oral evidence appeared to refine his case and asserted that her cash withdrawals are hidden assets. It is right to say that W did make a number of cash withdrawals in 2020 amounting to circa £3,500. There are very few cash withdrawals in the following years.

However, it is impossible on the evidence to infer that circa £3,500 withdrawn over a six month period that commenced almost three years ago now is money that remains available to W. I am satisfied that this allegation is not proved.

With regards to whether W’s use of the money amounts to financial misconduct in my judgement this allegation is plainly not made out. She says that both the car and the eye surgery were necessary expenses to enable her to maximise her earning capacity and explains that she paid rent between the end of May 2020 and December 2020 when she moved back to her mothers’ address. She says that the remainder has been used to supplement her income which is modest and pay legal fees of which £47K has been paid to date - £13K of that with the assistance of a loan from her mother.

There is no evidence that this comes close to the bar required for financial misconduct. I am satisfied that this allegation is not proved and was in effect brought on the basis that H took umbridge with how this issue was presented in a position statement rather than on any coherent factual ground.

The H alleges that the compensation payment was obtained by fraud – he produces no evidence to support this and merely repeats his assertions that as far as he was concerned, she was walking around when she said she had an injured foot. Elsewhere he acknowledges a lot of time off work and her exhaustion following walking the dog. H’s own narrative is inconsistent and ignores the basic point that there is no evidence whatsoever of fraud. His views about her settlement are neither here nor there. The bottom line is that there was a civil claim; evidence, including expert evidence from doctors, would have been obtained and disclosed to the NHS and they, on legal advice decided to settle. There was a process – there was a settlement – there is absolutely no evidence of fraud save for the H’s view.

I should add that as well as being completely unsupported by evidence this allegation is also completely irrelevant to the issues that this court needs to deal with.

The third area of allegation is that W has stolen from him. His evidence in this regard is that he gave her his bank card and she overspent on it. In support of this allegation, he produces a WhatsApp message.

That message is sent on 26 December 2018. It’s about their finances. It is clear from the message that he views these as joint finances. He says that ‘we had 5 years of no money and he had a big debt with Barclaycard because she spent money they didn’t have’. The message goes on to say that she then “got them into another £2K of debt – so over 5k you took and have never been responsible for. I paid all that off – I just bought you a 6k car. Im not worried about any of this – last year we had 50 a week shopping, now we have 100.”

That message does not tell me what H thinks it tells me. It tells me that he is concerned about her perceived lack of respect. The tone and content of that message is concerning – he is clearly telling her off – making it clear that he dislikes disrespect – drawing a line – pulling her back into line. I am rightly not asked by W to make a finding of coercive and controlling behaviour but if I were, I am sure I would be pointed in the direction of this message as corroborative evidence to consider.

In any event, this is plainly not theft – theft requires dishonesty and using a card that was given to her, perhaps unwisely, is at its very highest poor decision making about spending and finances rather than theft.

Fourthly, H alleges that W has misrepresented his position on his income. That is not a conduct allegation. The court has to determine what the parties’ respective financial positions are so that it can divide resources fairly. She plainly had one understanding – one that he did not share. It is part of the process to understand each other’s respective positions – that is the purpose of disclosure and the questionnaires. H is seeking to elevate his perception of a point into something that it is not. He also asserts that she is contradictory in her account about their standard of living during marriage – again this is a non-point in terms of the issues for me to determine.

To summarise then in respect of H’s allegations: the vast majority are simply irrelevant to the issues that I need to determine. The only relevant issue is hidden assets and / or wanton expenditure, and he has not come close to establishing any conduct point here.

Suffice to say H’s approach has been wholly misconceived and that has had a very significant impact on this litigation.

Turning now to the issues that I need to determine – computation and division.

The extent to which H’s allegations including fraud, perjury and lies are relevant to these issues and if relevant, my findings in respect of those allegations.

As I have just made clear, the allegations made by H are not remotely relevant to the issue of computation save for the assertion about hidden assets which is not made out.

The extent of the FMH to include in the assets for distribution – whether a whole or a part of it can be said to be non-matrimonial.

I have already made the legal position clear with regards to the matrimonial home. It holds a special place in a marriage and is matrimonial whatever its source.

With regards to the use of the home it is not disputed that parts of it were rented out at varying points in time. The H agreed that parts of the property were used to accommodate the children and he even said that part of the motivation with regard to the garden room was to accommodate W’s son who was allergic to their dog.

The property has one legal title. The H acknowledges that he would not be able to get a mortgage on this property with another lender as they might ask questions (I surmised both about the state that it is in as well as its use which may or may not have been authorised by them).

The property does not have separate council tax bills applied to it. The work being done whilst W lived there included removal of a central staircase to create a second entrance. H did not dispute this. H confirmed in his evidence that he had only more recently put in one tax return and that was because he has previously rented out space under the rent a room scheme. The Governments guidance on this scheme is clear – it is not available on separate dwellings. It is aimed at people essentially renting out a room or a part of their main home – in other words, taking in a lodger.

For all these reasons it is clear to me that the whole property is matrimonial.

The value of the FMH.

The evidence in terms of value comes from the report of the single joint expert, Mr. Summers, a surveyor.

He was instructed to value the property on 3 bases:

His opinion, which is not disputed, is that the current value in its current state as is £295,000. The H relies on this value. The value as regards a single dwelling in a reasonable condition was £410K with gross costs of refurbishment being £87,600. That gives an effective gross value of £322,400. This disputed by the H in the sense that he disputes that the court should value the property it as if it were something that it currently is not. The value of the property as two separate flats in reasonable condition and with good legal title is £450,000 with the refurbishment cost being the same as for a single dwelling and the legal costs to create two long leases estimated at £3,600. That gives an effective gross value of £358,800. This is the value that the W says that the court should take into account. H disputes this on the same basis as the previous valuation.

The court is being asked to attribute a higher valuation than the amount that the property would sell for today on the basis that the H has commenced works that have devalued the property and has deliberately delayed finishing his work in order to keep the value low for these proceedings.

W’s evidence is that the property was habitable when she left in March 2020. H accepts that the state of it now is worse that it was then. He says that work was necessary, and has produced photographic evidence showing rat droppings in insulation material and rotting wood which he says are joists.

Mr Barwell O’Connor says that it is open to question whether the work was reasonable. Whilst I accept H’s evidence that some remedial work was required, and his point that in the course of such work things tend to get worse before they get better, I am not able to say whether then extent of the work undertaken by H is reasonable. The work is extensive – it effectively renders the un-refurbished parts of the property completely uninhabitable.

Whilst I can be satisfied that at least some work was necessary, I am also satisfied that on the evidence H is deliberately failing to complete this work knowing full well the impact this will have on its current valuation and the potential knock-on impact on these proceedings.

I have reached this conclusion for a number of reasons. H is a multi-skilled engineer. Whilst he can’t as I understand it certify electrical work or gas work, he is clearly proficient in property improvements having renovated to a standard the surveyor considers reasonable the parts of the property that he does live in.

H has done work for others when he could have done his own. On his own evidence the amount of this work is substantial. He has produced messages from people who said he has done this for free and praise his skill and his ability to instil confidence in them to do DIY. It is obviously commendable that he choses to spend his time and skill in this way. It has clearly given confidence to one of those helped.

However, I do infer that failing to work on this property is a deliberate tactic on his part to minimise any money W might recover in these proceedings. This is in part because he has said as much himself in his evidence.

He was clear in his oral evidence that he would not do any work that would increase the value if that benefitted W in any way. He was clear that he understood that in doing the work he would benefit himself too. He was not prepared to do that. He was essentially taking a scorched earth approach to the FMH.

H relies on the surveyors’ valuation of £295,000 (value if sold as is) although says this should be reduced to take account of current market conditions.

However, in my judgement his approach necessitates a valuation that is higher than this.

W says my starting point should be £450,000 - the value of the property as 2 flats in a reasonable condition with good legal title to each, and deduct the estimated building costs and legal costs arriving at a notional gross value of £358,800.

This is on the basis that H himself is wedded to the idea that they should be two properties.

I don’t agree with either party. In my judgement the correct starting point is £410,000 - the value of the property in a reasonable condition as one dwelling.

I have come to this conclusion because the surveyor says that this is the most likely approach of anyone buying the property. He refers to the dearth of evidence locally for the purpose of trying to value the property as two flats and I infer that this is because this arrangement is relatively unusual in the locality. As this is the more likely approach on the surveyors’ evidence of any potential buyer, this is in my judgement is the fair valuation to attach to it.

Whether to include the value of the compensation payment W received in personal injury proceedings and if so, how much. In essence, whether any of the proceeds have been hidden.

Mr Barwell O’Connor says that this should be excluded as non-matrimonial given the purpose of compensation in a personal injury claim, and in any event, there is nothing left. The latter point is the better one in my judgement as compensation can be taken into account in a needs case. I have already given my reasons why there is no hidden assets findings or financial conduct finding so I do not need to say more here.

Whether to include the value of a claim that H may have in respect of a potential pension mis-selling claim.

H has sent the W’s legal team information about enquiries he has made into making a claim for compensation with regards to a pension mis-selling issue. This shows that if he pursues this claim he might be entitled to a sum of £51,850. H’s oral evidence on this was that he had made a claim although did not think he had been mis sold as he was perfectly happy to have the extra money. At the relevant as his focus was on the mortgage.

Whilst he has made this claim, there is no evidence that he will be successful and if successful that he would get the full capped amount of £51,850, or indeed any sum of money at all. Seeking to include this is speculative and I decline to add this to the ‘pot’.

I will deal with the s.25 factors in turn.

Both parties work. The H earns £39,318 net per annum whilst the W earns significantly less - £22,114. She is working training towards qualifying as a Health Assessment Specialist. She does not expect to increase her salary and indeed in her oral evidence said that it might decrease as an operation with a significant recovery time could lead to her having to work from home rather than travel resulting in a lower income. I do not have any figures for this, so I am unable to do anything other than rely on her position as set out on her behalf in the ES2.

A point of contention has been H’s ability to earn overtime. He says that any overtime is minimal and in any event, he prefers time off in lieu.

He has plainly done work for friends and associates – he says for no payment – and I accept his evidence on this point. Mr. Barwell O’Connor says that he could seek remuneration but accepts that he works full time and doesn’t press this point.

In my judgement the parties both earn what they earn and are broadly speaking unlikely to earn more in the foreseeable future.

Both parties have some savings – the W slightly more than the H.

With regards to the assets, plainly the FMH is in H’s sole name as are the pensions.

Both parties need to be housed. W says that she needs a two bedroom property and is essentially cutting her cloth to fit by choosing to live in Lincolnshire near her Mother rather than in the South nearer to her children.

She says that she needs 2 bedrooms so that she can host her children when they visit and there needs to be a garden for the dog.

W has produced property particulars for in the region of £150K – 160 and says that she needs an additional £8K for costs of purchase, moving and furnishing. In sum her property need is £168K and her mortgage capacity is £53K. As such she needs a minimum of £115,000 to meet her property needs.

With regards to H’s needs she says this is for a 1 bedroom flat as he is estranged from his daughter. Her property budget for him is £200 - £230,000 with a mortgage capacity given his larger income of £165,189.

Aside from his position that W should be in prison, H says that W should expect to rent rather than buy. However, he has produced no evidence as ordered as to whether this is affordable for W. As such the position that H has put the court in is that I have no evidence of an alternative budget for W.

He says that he has no mortgage capacity because no one would lend him any more money on his home. That of courses misses the point that it is about his income and any deposit, not about the FMH.

In the absence of evidence from H as to his mortgage capacity I accept W’s evidence on this. In the absence of any evidence from H of W’s needs and an alternative budget in respect of these for W I accept her evidence on this.

Both parties will need to have an income on retirement. It seems that H accepts this and agrees that W should have a share of his pension. I think his position is that this should be based on matrimonial accrual only, but I am afraid this wasn’t entirely clear. W’s position is that accrual should be full and that this should lead to a 100% share of H’s Fidelity SIPP. This would in fact lead to a slight disparity in income in H’s favour, but she accepts that the costs involved in an order in respect of two pensions is disproportionate.

H has been paying the maximum allowed into his Canary Wharf pension and then taking lump sums back out – two in the course of these proceedings – to in effect supplement his income. It seems that he has not done this with regard to the pension that W seeks a share of.

Plainly there is an expert report on pensions which neither party challenges.

This was a point of contention for H but in this case is a factor with little weight. W accepts that there should be a clean break within a year and accepts that going forward she will need to cut her cloth accordingly.

Both parties are of a similar age with a similar time to go until retirement. H with the higher earnings can plainly put more into his pension than W will be able to. Their marriage was of a medium length.

Neither party raise issues that are going to impact on how the assets are divided.

In respect of contributions H would no doubt want me to take into account the fact that he brought the FMH into the marriage having purchased it in 1993, many years before they met. I have already set out the legal position on this and as this is a needs case and in judgement this renders his points here untenable.

This is a matter that I have already dealt with – there is no conduct to take into account.

This is not a relevant matter on these facts.

W seeks a lump sum payment of £140,200 comprising £115K for a deposit, £7,200 in capitalised maintenance, £13K to repay a loan for legal fees and £5K for anticipated enforcement costs. In the alternative she seeks 50% of the net equity from the sale of the FMH, whichever is the greater figure.

She seeks a pension share of 100% of H’s Fidelity SIPP.

The value of the FMH in these proceedings is £410,000. An equal division of the net equity of the same – not accounting for the redemption charge on the re-mortgage H entered into a few days before this final hearing. If the property has to be sold and he gets less as a result of this then I am afraid he really has no-one else to blame.

The net equity based on this valuation is £234,700 and 50% of this is £117,350. This in my judgement is the appropriate amount for the lump sum (with 50% of the net equity on sale if this is the greater sum).

This sum together with W’s mortgage capacity gives her a pot of £170,350 – sufficient for her housing needs with some headroom. I have not added an extra amount for capitalised maintenance for two reasons: firstly there is not the money; secondly there has in reality been a clean break already.

For H, this leaves him with £117,350 (assuming the work is done and the property is a single dwelling) which together with his mortgage capacity leaves him with a pot of £262,435; more than sufficient to re-house according to his needs. If he does not have the work done, or do it himself and the property is sold in its current state then that will leave H short on his housing fund. However, that is a matter of his own making the resolution of which is entirely in his gift. This is something which should not be in his hands to cause detriment to W. In any event I am satisfied that there are alternatives for H to explore. He may be able to take money out of the pension that is not to be the subject of the pension share. He has already done this twice in proceedings. He may be successful in his claim in respect of pension mis-selling. He may choose to do the work on the property that he is plainly eminently capable of.

As an aside, he indicated to me whilst I was still giving oral judgement that he would pay the lump sum.

Having divided the equity equally I make no additional order for W – there is simply insufficient money. I am satisfied that W will in reality continue to live with her mother until she gets her money and this of itself will enable her to keep her costs manageable.

In terms of the pensions, I have considered the expert report and the parties’ positions, or apparent position in respect of H. Plainly the objective is to achieve equality of income in retirement there being no evidence that they have different needs in this regards for that stage of their lives.

HHJ Hess has set out the position in a needs case of how to treat the pre-matrimonial portion of a pension in W v H [2020] EWFC B10 as follows:

“In a sharing case the exclusion of the pre-marital portion of a pension might well be a legitimate exercise in principle… In a needs case this approach needs to be treated with caution. Where the pensions concerned represent the sole or main mechanism for meeting the post-retirement income needs of both parties, and where income produced by the pension funds after division falls short of producing a surplus over needs, then it is difficult to see that excluding any portion of the pension has any justification… the proper and fair approach is for me to seek to equalise incomes on an equal basis taking into account all the pensions.”

The expert report is clear in that the only way to achieve this objective is to make the order that W seeks, namely 100% of the Fidelity SIPP.

Given the withdrawals from H’s Canary Wharf pension, I agree with Mr Barwell O’Connors’ submission that the order will need to require H to indemnify from his share of the proceeds of the sale of the FMH, should it come to that, on a pound for pound basis.

That is my judgement in respect of the substantive matters. I have heard submissions concerning costs and enforcement.

The usual starting point in financial remedy proceedings is that each party will bear its own legal costs. However, under FPR 28.3(6) the court may make an order requiring one party to pay the costs of another at any stage where it considers it appropriate to do so because of conduct in relation to proceedings.

The factors that the Court must have regard to are set out in FPR 28.3(7):

PD 28A says that the court will take a broad view of conduct and will generally conclude that a refusal to negotiate openly, reasonably and responsibly, will amount to conduct in respect of which the court will consider making an order for costs. This, the Practice Direction goes on, will include a needs case where the party litigates unreasonably resulting in costs becoming disproportionate to the award made by the court.

Mr Barwell O’Connor has set out the relevant case law that establishes the principle that a costs order can be made even if the consequence of such an order is that the party is unable to meet their needs. That plainly makes sense otherwise a party taking a scorched earth approach to the litigation could essentially be shielded from the consequences of their poor behaviour to the cost and detriment of the other party.

Mr Barwell O’Connor has in particular highlighted the case of A v A [2023] EWFC 4 where the Court said that it was quite satisfied that the length and costs of the proceedings had been increased by the Respondent’s intransigent and unreasonable position in seeking 100% of the liquid assets and the manner of his conduct – ignoring court orders and refusing to co-operate sensibly and reasonably with Applicant’s solicitor.

Mr Barwell O’Connor has also provided the Court and H with a copy of Mr Justice Mostyn’s judgement in James v Seymour [2023] EWHC 844 (Fam) – a judgement dated 19^th April 2023. In this judgement he approved the first instance judge’s formulation of the issues set out below and said they should be well known and handed out to litigants at the beginning of every case:

Mr Gray, I’m afraid to say that your litigation conduct is that you have behaved in a way that has frustrated and unnecessarily prolonged these proceedings and not only has that led to unnecessary costs but there has also been a more personal cost to Mrs Gray and to her legal representatives who have to read some of the really quite offensive and vitriolic correspondence that you made a choice to send to them. I don’t intend to repeat what I have already said in my main judgement, but that correspondence includes veiled threats of violence essentially set against a context where you say in your first appointment chronology…

Mr Gray interjected at this point as he required a comfort break. I asked whether he could wait as it was already late in the day and there was going to be a costs order. Mr Gray indicated that he could wait.

In the chronology you say that you effectively took matters into your own hands in respect of a non-molestation order that your wife had obtained in respect of another person. You said that you went along to school gates, taking a friend with you, threatened that person and said if he didn’t leave W alone you would ‘punch his effing face in.’ Including that in your chronology creates and generates a very clear impression of your physicality and essentially presents you as someone who is pretty handy from a physical point of view and is capable of making threats and willing to follow them through. This is part of the context; it shows that you are prepared to be intimidating and this added to the issues that your wife and her representatives have had to deal with. That is frankly unpleasant, difficult, and made it very difficult for them to deal with anything reasonable that you might have had to say.

In terms of the four issues that Mr Justice Mostyn approved:

has there been deliberate non-disclosure or refusal to openly negotiate? Yes, there has. You plainly on your own correspondence have said, essentially, that you will not engage in negotiations until the issues that you want are determined e.g. fraud etc.. Those issues were irrelevant and this approach completely unreasonable. It amounts to a failure to negotiate.

In terms of failure to explain the basis for a claim or comply with procedural directions. You’ve failed to comply with court orders. The most egregious one is the order in the FDR order which prohibited you from making withdrawals from your pension. [Mr Gray interjected at this point to say that this was part of his salary – and the Court reiterated that that there was an order in place about this which he ignored – and he then went on to raise again the issue of valuations at which point the Court reminded him that it was giving judgement and was not going to argue points with him].

Making a ludicrous claim: frankly your claims about the conduct of your Wife and her representatives have been ludicrous and you have had plenty of opportunity to understand what you were raising was irrelevant. You’ve made the allegations anyway and this has prolonged proceedings. Your position was that you did not want to negotiate until you had an answer that satisfied you. You have sought to control the proceedings rather than engage with them. That amounts to litigation conduct.

You’ve refused to negotiate. You say there was an order in relation to valuations and you have produced evidence which shows that you weren’t obstructive according to those agents. You referred in one of your emails to the possibility that the solicitor raised that there might have been a misunderstanding. It is possible that there was, but the way that you have behaved has made it impossible for those dealing with you to have a sensible conversation and deal with potential misunderstandings. You use words and emails like they are battering rams. There has been so much correspondence, most of which has not been claimed by your wife’s lawyers in terms of costs but they have still had to read it. The way you’ve behaved has made it impossible to have a reasonable conversation with you.

So, in my judgment this is a case where the court should stray from principle that costs are borne by the parties themselves. That leads me to decide what proportion of costs to order and make an assessment of those costs.

The order from FDR is clear, it puts the blame plainly on your conduct in the court hearing for that hearing being ineffective. I’m satisfied that the full amount of that hearing should be paid by you as a starting point.

In terms of additional costs, these are essentially set out in the Form H and amounting to £54,650.64. I don’t have a breakdown of those costs in order to do a full assessment of those and I have to think about the impact on you of making a costs order. You’ve told me you have this potential claim in respect of your pension mis-selling which you may be successful in, and Mr Barwell O’Connor has pointed to your income. I am satisfied you do have recourses to be able to pay for a costs’ order. Either as income or as a lump sum out of your pension – I am satisfied that you do have the resources. In addition you have told me that rather than selling the FMH you will be able to pay the lump sum ordered out of your existing pension so it seems you do have resources.

The W seeks 100% of her costs. I have to consider whether that is the right order to make in the circumstances. Plainly W would have had to incur some costs in any event in bringing these proceedings.

[Mr Gray interjected again at this point to say that he really needed a comfort break and was happy for the court to continue in his absence. I indicated that I was considering an order that he pay 75% of the overall costs and he replied “sure, thanks…. The rest can be sent by e-mail I don’t need to be here?” He then left].

That 75% covers the costs in total, including those from the FDR as I am satisfied regarding totality that 75% represents an amount that is reasonable in occurrence and proportionate.

I was going to ask Mr Gray if he wished to seek permission to appeal but he was obviously not there to ask. The court invited Mr Barwell O’Connor to draft the Order and agreed that provisions would be approved in terms of ensuring it was enforceable if he did not pay the lump sum.

Three separate points were then raised and addressed;

Firstly, permission was sought for Decree Absolute out of time which I approved.

Secondly, a realistic timeframe to pay the lump sum; 6 weeks from the sealing of the Order is a reasonable timeframe.

Thirdly, terms of an Order for Sale in default. Mr Barwell O’Connor sought an order which allowed for an application to be made, reserved to me, for vacant possession and sole conduct of sale and I stated that I was content for such terms to be included for my consideration.

In terms time for payment the court observed that Mr Gray would have the opportunity to comment on the draft order before it was approved by the Court. Mr Barwell O’Connor proposed the use of a specific estate agent which had been used by the parties for a valuation which I approved.

Mr Barwell O’Connor also made an oral application for the unreacted publication of this judgment. He raised concerns regarding Mr Gray’s repeated copying in of third parties to confidential emails and history of sending confidential documents to friends; and the likelihood that Mr Gray would do so again. Likewise, he raised the concern that Mrs Gray would be left unable to rebut any untruths Mr Gray may have told or go on to tell friends or family members concerning the proceedings and that Mr Gray may seek to contact her employer or other third parties to cause difficulties for her. Having the unredacted judgment published would allow both parties to use the judgment as they wished. I granted Mr Barwell O’Connor’s application on the basis that publication was in the public interest and would provide Mrs Gray some level of protection from the baseless allegations made against her throughout these proceedings but also to enable the legal representatives to refer to the judgment, if they should wish or find the need to do so, given the allegations of professional misconduct levelled by Mr Gray.