Cohabiting Divorcees: to bar or not to bar?

 In Comment

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Chekov v Fryer [2015] EWHC 1642 (Ch)

Any practitioners in the field of inheritance or family finance will be familiar with the standard term that forms part of a clean break in a divorce financial settlement; namely that the parties cannot claim against the estate of the other. However a recent case has challenged the widespread belief that such a bar is a binding final resolution.

Background

Mr Fryer and Mrs Chekov had consented to an order finalising their financial arrangements upon divorce. This Order was dated 17 July 1981 and varied on 23 March 1982. The Order contained the relevant bar to prevent either party claiming against the estate of the other under the Inheritance (Provision for Family and Dependants) Act 1975 (“the Act”). There was a specific provision included in the consent order that the bar would remain “unless the parties remarry”. They did not.

However after the divorce and financial matters had been finalised the parties resumed their relationship and began to cohabit once more in the same house. They continued to do so for 30 years until Mr Fryer’s death in 2013.

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Following his death Mrs Chekov sought financial assistance under the Act on the basis that they had been living as man and wife and the only reason they had ever separated was due to interference from his family, not due to the way they felt about each other. Mrs Chekov brought her claim as a cohabitee but the Deceased’s sons who had been appointed Executors argued that she was precluded from doing so. They sought to strike out the claim.

Arguments made by the defendants

  • Section 15 Orders: As a former spouse of the deceased and as a divorcee, Mrs Chekov was bound by two section 15 orders from Southampton County Court which prohibited the bringing of a claim for financial assistance pursuant to the Act. She had consented to these orders which contained the bar “on the death of the other party to the marriage, the court shall not entertain any application for an order under section 2 of the Act made by the first mentioned party….” Therefore Mrs Chekov had no reasonable grounds for bringing the claim.
  • Fairness: the matter of fairness was irrelevant. Any party should be able to rely on a bar within a consent order, particularly when other provisions within it had been enacted and carried out. It would impose unfairness on the Deceased if the claim proceeded. Furthermore the language and drafting of the Act is plain and uses unambiguous language. Certainty and consistency for all litigants must outweigh the fairness to a particular individual.
  • Section 1(1) (ba): Mrs Chekov cannot rely on the cohabitee ground as this section is limited to “and person not being included in paragraph a) or b) above”. Mrs Chekov is clearly included in section 1(1)(b) as a former spouse.

Arguments made by the Claimant

  • Section 15 Orders: At the time the consent orders were executed in 1981 and 1982 the Act did not include any provisions for cohabitees e.g. s 1(1)(ba). These amendments were only introduced by the Law Reform (Succession) Act 1995 and came into force on 1 January 1996. At the time the parties approved the consent order the parties sought to protect any future claim if they remarried. However there was therefore no need for her to seek to protect any claim she may have as a cohabitee since such a claim did not exist at the time.

It was accepted that she could not bring her claim as a divorcee but that she was not bound in relation to cohabitation as it is not possible to bind oneself to future and different claims which at the time had not come into being.

  • Section 1(1)(ba): The wording of the Act was to ensure that an applicant should make their application under the higher / highest category and to avoid double claims being made.
  • Pre-nuptial agreement analogy: it was argued that a consent order executed qua divorcee should be treated as a pre-cohabitation agreement following Radmacher v Granatino [2010] UKSC 52. As parties are not able to contract out of the legislative rights under the Act, as per Hyman v Hyman [1929] AC 601, the consent order is not binding on Mrs Chekov qua cohabitee. It was argued that the consent orders were thus merely part of the factual matrix and relevant pursuant to section 3(1)(g) of the Act.

The Judgement

  • Section 15 Orders: At the time of the divorce the parties had not contemplated that parliament might change the law in future to give the claimant the ability to make a claim as cohabitant– this was accordingly not considered by their consent order. The function of the consent order was to satisfy the condition for s.15(1) of the act.
  • Section 1(1)(ba): When in s.1(1)(ba) and (e), the Act used the phrase “not being included in [earlier provisions]” it was referring to a person who was not able to apply to the court for an order under s.2 of the Act. However where former spouse has been excluded by virtue of s.15(3) of the Act from making such an application because of an order under s.15(1), that person was not a person able to apply to the court as a former spouse under s. 1(1)(b) of the Act. Accordingly, that person (if cohabiting with the former spouse during the relevant period before the latter’s death) was capable of being a person falling within s.1(1)(ba) of the Act
  • Pre-nuptial agreement analogy; The consent order embodies an agreement of the parties, but is nevertheless an order of the court and it should not be treated as analogous to a pre-nuptial agreement.

Therefore the case did fall within s.1(1)(ba) and the claim would not be struck out for disclosing no reasonable ground for bringing it. However due to the importance and the novel arguments being put forward by both parties, permission to appeal was granted.

Whilst decided on a very specific factual matrix, it will be interesting to see how this decision impacts upon any future cases in which a party seeks to negate the effect of clean break bar.

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