Could your Financial Order in divorce be set aside because of the COVID 19 pandemic?
Family solicitors are now considering whether the COVID-19 pandemic could constitute a Barder event, which could set aside a recent Financial Order that has been made.
For some background I have summarised what a Barder event is and the history behind it below.
Barder events in family law unsurprisingly follow on from an adverse case of Barder v Barder. The divorcing couple filed a consent order with the court where the wife would attain the matrimonial home, as she was going to care for the children of the family. Unfortunately, five weeks after the consent order was sealed by the court – the wife murdered the children and then committed suicide.
Would it be fair for the home to now form part of her estate? Well, the Mother of the wife tried to claim that it did fall part of the estate and so the husband went back to court to appeal the Order. Rightly so the Order should be reconsidered so that the matrimonial home is transferred to the husband instead. The root of the Order was that the wife would receive the matrimonial home as she was caring for the children – but what happens now that sadly there are no children? What would be the purpose of the same Order being place?
Although it was out of time, the husband was successful in his appeal on the fact that the death of the children and the wife were a ground of invalidating the Order. It was unforeseeable at the time the Order was made, that the wife would murder the children and commit suicide, so it was reasonable to set aside the Order and reconsider the finances in the marriage.
Could this also apply to the current COVID 19 pandemic? This too would not have been a foreseeable event at the time of recent Financial Orders being made. Following this case we now question whether the pandemic is a Barder event.
For a reminder of the criteria to meet the Barder event the case set out the four main principles for a successful appeal:
1. A new event occurred which invalidated the Order made i.e. affects the main purpose of the order (for example in Barder v Barder the matrimonial home was given to the wife as she was to care for the children).
2. The new event should occur a short time after the Order was made – usually within a few months.
3. Application for leave to appeal out of time should be made reasonably promptly – in line with the case (this is subjective).
4. The grant of leave should not prejudice any third parties who may have acquired (in good faith and valuable consideration) interests in the property subject of the Order made.
There are other considerations, such as whether the matter was an unforeseeable event (Cornick v Cornick 1994) – we could argue of course that the COVID 19 pandemic has been completely unforeseeable.
We can also compare the current financial climate with the case of Myerson v Myserson. In this case the husband tried to appeal the Order by saying is was a Barder event, as the global financial crisis in 2008 caused his value in shares to drop by 90%. This meant that his shares that previously had a value of circa £25million (at the time of the Order) was then reduced to 27.5pence (at the time of appeal). However, the court did not allow the appeal as fluctuations in shares are always going to be a high-risk investment and so it did not amount to a Barder event. Therefore, fluctuations with the value of assets no matter how dramatic may not fall part of a Barder event.
In light of this, although the current fluctuation in shares/assets themselves are unlikely to form part of a Barder event, could the pandemic itself form part of it as a whole? For example, businesses have collapsed, and many people have lost their jobs/have been furloughed. The lockdown has already had some major long-term effects on people’s finances. Therefore, Financial Orders that have been made, will of course be affected. For example, lump sum orders may no longer be payable, the same with periodical payments or property adjustment orders.
Overall family lawyers have argued that COVID 19 does form part of a Barder event for the Orders made a few months prior to lockdown. We are yet to see a court determine whether the pandemic is a Barder event, and whether this may open a floodgate of appeals, however the likelihood of it being one is high.
If you are concerned about your recent financial Order and whether this could be appealed, get in contact today on 0203 887 8740 or firstname.lastname@example.org.