Tuesday, March 29, 2011

DE v AB: If a child is born, then the parents have obligations under law

DE v AB [2010] EWHC 3792 (Fam), just reported on Bailii, concerned a father's appeal against a Schedule 1 Children Act award. It was heard by Mrs Justice Baron.

The facts: The parties were in a relationship for a short period but never married. The mother gave birth to the child, C, on 2nd March 2008. She then applied under Schedule 1 for financial provision to be made for C.

The mother's circumstances were that she was unemployed at the time of the appeal but had been earning £60,000 gross plus commission at the date of the hearing before the district judge, and Mrs Justice Baron considered it probable that she could re-establish herself in employment at a similar income. She owned a property subject to a £600,000 mortgage, which was worth £725,000 at the date of the hearing. She also had other debts, totalling some £111,000. She wished to retain her house, but the district judge was clear that she had to sell it, a finding supported by Mrs Justice Baron.

The father was also unemployed at the date of the appeal, but Mrs Justice Baron considered his earning capacity to be in the region of £100,000. He owned a property with a net equity (as found by the district judge) of £358,000. The district judge told the father that this property had to be sold, and again Mrs Justice Baron agreed with this.

The district judge ordered that the father pay £85,000 towards the mother's overall indebtedness. In addition, he made an order that the father provide a trust fund of £250,000 to assist with C's housing, on the usual terms that the money resulted to the father upon C attaining majority and ceasing full-time education. The total of the award was therefore £335,000.

The father appealed, submitting that the award was excessive in the context of the total liquid assets of some £358,000 as found by the district judge, given that it would leave the father with a mere £23,000. On appeal, the father offered a lump sum of £40,000, but "simply eschews a housing fund because he considers it to be "unfair"", contending that the mother should rent, rather than buy.

Held: Mrs Justice Baron found (at paragraph 40) that the district judge was entitled to take a broad brush approach when assessing such sum as was fair in all the circumstances. However, she went on to say (at paragraph 41) that the district judge should have undertaken a final analysis as to the overall effect of his award on each party.

She concluded (at paragraph 42) that the district judge was "absolutely justified" in his award that the father should contribute £250,000 towards a housing fund, saying that: "Given the net equity in his property, as found by the district judge, was £358,000, prima facie that figure is completely unappealable". However, as to the additional lump sum of £85,000, she came to the conclusion (at paragraph 43): "that the district judge did not analyse this part of his award with sufficient care, particularly when assessing its impact upon the parties. The effect of the award was to leave the father with effectively little or no capital, after his very significant contribution towards housing for C. That is unfair."

Accordingly, Mrs Justice Baron reduced the lump sum to £40,000, which she considered would leave him with sufficient capital to provide him with a modest deposit for a flat for himself. The total award was therefore reduced by 13%, to £290,000.

Save for dealing with the issue of costs (she made no order as to costs), Mrs Justice Baron ended her judgment (paragraph 46) with what almost amounts to a warning:
"Neither of these parties seems sufficiently to have considered or expected that a sexual relationship would lead to the birth of a child. However, that is a known consequence. If a child arrives, then parenthood brings with it significant financial and other responsibilities. Both these parties have to make a continuing contribution in that regard for the good of their son. Both will suffer financially because the new circumstances will mean that they do not have the freedom and the financial flexibility that they once had. But that is a consequence of their own actions. As adults, they have to bear responsibility for such. Statute provides that the child must be protected and that is why my order is, as I have explained, fair. That is my judgment in this appeal."

2 comments:

  1. I do not understand how come this was in Court in the First place. I admit I am not a lawyer, but I would think that because they are not married then the CSA would have set the maintenance amount. Why didn't they in this instance please?

    ReplyDelete
  2. They did, as mentioned in the full report. However, the powers of the court under Schedule 1 go far beyond child maintenance.

    ReplyDelete

Thank you for taking the time to comment on this post. Constructive comments are always welcome, even if they do not coincide with my views! Please note, however, that comments will be removed or not published if I consider that:
* They are not relevant to the subject of this post; or
* They are (or are possibly) defamatory; or
* They breach court reporting rules; or
* They contain derogatory, abusive or threatening language; or
* They contain 'spam' advertisements (including links to any commercial websites).
Please also note that I am unable to give advice.