If a settlement order relating to property has been made under the Children Act 1989, what are the circumstances in which it can be varied – if at all? This was a question of interest to all good family lawyers, dealt with by the Family Court recently in a complex case involving not only property issues but the question of where the child in question should live – with his mother in England or with his father in Canada. The settlement order in this case was varied as far as property was concerned, in direct response to a change in the arrangements for the child’s residence.
Settlement Orders under the Children Act 1989
London family solicitors will recall that Schedule 1 of the Children Act 1989 makes provision for the court to make a number of different orders. These include orders to make or to secure periodical payments either for the benefit of the child, or directly to the child; likewise, the payment of a lump sum. The Schedule also includes the power to make orders for the settlement of property (settlement orders) to be made for the benefit of the child concerned. As any top family lawyer in London is aware, the court can also order the transfer of property for the benefit of the child or, again, to the child directly.
Although orders relating to periodical payments can be varied or discharged (Schedule 1, section 1(4) there is no express power to vary settlement orders, the Family Court has recently established that is it possible to vary a settlement order and has consider the circumstances in which this can take place.
The facts in Re C (A Child) (Schedule 1 Children Act Variation)
As the best family lawyers will agree, very few family law cases are straightforward, and this was no different. The child, C, was the result of a brief relationship between his mother and father. He was born in October 2014 and in early 2015, his father went to work in Canada. The international dimension to the case meant that 2 sets of proceedings were running in parallel – one dealing with where C should live, and arrangements for spending time with the other parent, under s.8 Children Act 1989, the other proceedings dealing with financial arrangements, pursuant to Schedule 1. The s. 8 proceedings resulted in a consent order which specified that C should live with his mother in England for 8 weeks at a time, but spend 4, rising to 6 weeks, at a time with his father in Canada. As C was to live with his mother, the financial arrangements were put in place for the father to make a settlement of property to the value of up to £700,000 where C could live with his mother until he reached 18 or concluded his first degree. At that point, the property would revert back to the father. The father also had to pay child maintenance on a monthly basis – initially at the rate of £5,500 and then, once the property was settled, at £4,500. The mother, who was degree educated, had argued that looking after C meant she could not work.
A change in circumstances
The section 8 proceedings relating to where C should live – and with whom were revived in 2017 before the settlement order was due to be finally implemented. A guardian appointed for C had expressed concerns about how appropriate it was for C to remain in the care of his mother. In December 2017, a judge made an order effectively reversing the original consent order – C was now to live with his father in Canada and spend time with his mother. In addition, the father was ordered to pay for the air travel between England and Canada, and to pay for hotel accommodation for the mother when she visited C in Canada. Against this background the father asked the court to discharge the settlement order on the basis that C was now to live with him.
The power to vary a settlement order
The court decided that it did have the power to vary the settlement order made under Schedule 1 of the Children Act 1989. This was even though there was no express power to vary compared with the situation for periodical payments. Section 31F(6) of the Matrimonial and Family Proceedings Act 1984, given procedural effect by the Family Procedure Rules 2010 part 4.1(6), provides that the Family Court has power to vary, suspend, rescind or revive any order made by it.
Having established the jurisdiction of the Family Court and the power to vary a settlement order, the court then went on to consider the parameters within which any variation should be exercised. Clearly, if there were no limit on the ability to vary orders of the court, there would be no certainty. As Rix LJ said in the Tibbles case “…considerations of finality, the undesirability of allowing litigants to have two bites of the cherry and the need to avoid undermining the concept of appeal all push towards a principled curtailment of an otherwise apparently open discretion.” Taking this into consideration the court considered that a settlement order should only be varied where there was
- A material change in circumstances since the order was made; or
- Where the facts were (innocently or otherwise) misstated when the original order was made.
In this case, it was agreed that there had been a significant change in circumstances – the switch from care being shared, with C living the majority of the time with his mother in England to living with his father in Canada and spending a 7/8 week period in England with his mother. The Court then had to consider 2 aspects of the orders that had previously been made – relating to periodical payments and to the settlement of property. Although the Court thought that there was now no reason for the periodical child maintenance payments to continue, it felt that it was in the best interests of the child for the father to provide a property for C to live in in England with his mother. However, the value of the settlement order was reduced to £200,000.
Obtain expert family law advice from a London family solicitor
Situations involving financial arrangements for a child and with whom a child should live are always complex and can be highly emotional. Taking practical advice from the best family solicitors available will usually result in a positive outcome.
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Posted on: Friday, 14 September, 2018