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Maintenance Pending Suit after Rattan v Kuwad [2021] EWCA Civ 1

Facts

Like all good cases, the essential facts of Rattan v Kuwad can be stated briefly:

  • Within her claim for financial remedies, the Wife issued a claim for interim maintenance (i.e. ‘maintenance pending suit’ or ‘MPS’), seeking £3,250 pm;
  • At a hearing on 1 October 2019, DDJ Morris awarded W £2,850 pm;
  • H appealed. He contended that the DDJ had misapplied the law, failed to critically analyse W’s budget and included items that were not required for the short-term;
  • On 6 January 2020, H’s appeal was allowed by HHJ Oliver, who concluded that the DDJ had indeed erred. An application for MPS ‘…should deal with immediate expenditure needs which have to be critically examined’, which the DDJ had failed to do. HHJ Oliver accepted W was in need of maintenance but concluded that he could not determine the figure;
  • W was granted permission to appeal HHJ Oliver’s order, thereby presenting the Court of Appeal with a rare opportunity, this being a second appeal pursuant to CPR 52.7, to review an interim order, in what has always been a difficult area of practice;
  • The Court of Appeal sat on 2 December 2020, and handed down its judgment on 11 January 2021, allowing W’s appeal (quite a feat, given that W had acted in person in the CA) and restoring the order of DDJ Morris.

Judgment of Moylan LJ

The lead judgment was handed down by Moylan LJ, with whom Macur LJ and Asplin LJ agreed. The law is reviewed from §§ 31 to 40, and the determination is between §§ 47 and 56.

It should be underlined that Rattan does not overrule earlier authority, or purport to lay down new guidance which applies to all cases. Rather, it restores a more discretionary approach to MPS applications, and dilutes the guidance contained in such cases as TL v ML [2006] 1 FLR 1263, to the effect that guidance which may apply in complex big money litigation need not be applied with equal force to more straightforward applications.

Practice Points

The following practice points can be noted:

  1. Broad assessment

This was a straightforward case (‘not unduly complex’ § 47), which ‘did not require any extensive analysis but was an application which could be determined justly with a succinct summary and consideration of the relevant factors’

2. Separate MPS budget

The guidance that in every MPS application an application must present a ‘specific MPS budget which excludes capital or long-term expenditure’ (TL v ML [124(iii)] does not apply to every application. At § 51, Moylan LJ comments: “This case also demonstrates that it is not necessary for an applicant for maintenance pending suit to provide a list of income needs distinct from that set out in the Form E. As the wife submitted, she was seeking no more than her basic needs which she had set out in her Form E”

3. Forensic analysis of budget

W’s Form E budget was described as ‘…the type of budget which will be very familiar to judges determining financial claims and which they are well placed to decide on a broad assessment’. Per Moylan LJ at § 48 ‘The court was not required to undertake any greater ‘critical’ analysis of a schedule of income needs than is required of any other aspect of the case. The court is required to undertake such analysis as is sufficient to be satisfied that the ultimate award is ‘reasonable’. In some cases this might require a detailed examination… in others, such as the present case, it will be immediately apparent whether the listed items represent a fair guid to the applicant’s income needs’. In other words, the time-honoured guidance that an MPS budget should be ‘examined critically in every case to exclude forensic exaggeration’ (see Thorpe J in F v F [1995] 2 FLR 45 and Nicholas Mostyn QC (DHCJ) in TL v ML [2006] 1 FLR 1263 at [124(iii)]) does not have to apply in every case, including more straightforward cases

4. ‘Immediate’ needs

Per Moylan LJ at § 49, when the court is dealing with ‘immediate’ needs on an MPS application, it is dealing with those needs that might arise pending the final determination of the order. “The word “immediate”, in this context, does no more than reflect the fact that the court is concerned with an order for maintenance pending the final resolution of the financial dispute between the parties. However, the use of this word does not mean that the court should embark on the type of exercise undertaken by the Judge in this case. The fact that some items of expenditure are not incurred every month does not mean they should be excluded for the purposes of determining what maintenance is reasonable

5. Proportionality and sufficiency

In words that will chime with anyone who has conducted (or responded to) an MPS application within a time estimate of 1 or 2 hours, Moylan LJ concludes that on the facts of the case, the DDJ’s approach (which did not involve a forensic analysis) was sufficient. At § 54,

“… it is clear to me that the DDJ undertook a sufficient analysis of the relevant factors to support her decision. As referred to above, she plainly accepted that the wife’s listed needs were reasonable. She was entitled to include the amount sought for school fees. She took into account the wife’s likely income. It is also clear that she analysed the husband’s budget and the parties’ respective cases as to the husband’s resources and determined that the husband had sufficient resources to meet the wife’s income needs as well as his own needs. Accordingly, considered the relevant factors and reached a fair decision as to what level of maintenance would be reasonable. In those circumstances, there was no basis on which the Judge could properly interfere with the DDJ’s decision”.

Concluding thoughts

Several years ago, I wrote an article which suggested there are two forces at play in financial remedies: the mathematical and the discretionary. I described the first school of thought as the boffins, the second as the gurus. The boffins seek to identify the relevant factors whereby the outcome of a case might ultimately be calculated according to an Excel formula. The gurus represented a more old school approach, stepping back from the detail and reaching an outcome which in all the circumstances felt right. I posed the question:

“are we meant to be gurus, ruminating on the facts and handing down our ‘gut instincts’ on the likely outcome, or boffins, preparing spreadsheets calculating apt values based on concepts of passive growth?”

While it would be a mistake to view Rattan as re-writing the law concerning MPS, it marks a shift – a decisive one in more straightforward cases – away from an adherence to the principles set out in TL v ML, towards a more broad brush and discretionary – and less rule bound – approach to applications of this nature.

Alexander Chandler

25 January 2021

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