Circumstances Have Changed – Can I Apply to Challenge the Financial Order Made After My Divorce?

If a new event occurs that renders the basis upon which a financial remedy order was made, “potentially invalid and open to challenge”, an application can be made to set aside the order. This is known as the Barder principle.

The case of Barder v Barder set out that there are 4 areas which need to be shown as follows:

1. New events happened quite soon after the order was made.
2. The application to challenge the order was made quite promptly after finding out about the new event.
3. The application must not prejudice third parties who have acquired, in good faith and for valuable consideration, interests in property affected by the order.
4. The events must be unforeseen and unforeseeable.

A number of circumstances involving new events have used the Barder principle to challenge orders. They include:

• Re-marriage or cohabitation
• Inheritance
• Death
• Change in the value of assets

The courts are generally slow to set aside an order on the Barder principle.

In the case of Cornick v Cornick [1994] 2 FLR 530, the Court identified 3 circumstances that can occur with rises in the value of assets:

a) Price fluctuation

b) Mistake about value

c) Unforeseen events

The court has ruled that rises in price, however drastic, do not generally constitute a Barder event.

Mistake about value will be regarded by the court not as a Barder event but instead a ground for challenging the order on the basis of serious mistake: de Lasala v de Lasala [1980].

Unforeseen Events

An unforeseen event may drastically change the value of assets to make a financial order seem unfair to one party.

One example of this was where COVID-19 significantly reduced the value of shares/businesses. Although the court did indicate this was a potential Barder event, they still showed a great deal of reluctance to set aside orders on this basis despite a very unbalanced financial distribution between the parties.

The courts are more likely to allow an order to be set aside under Barder where the new circumstances render one of the parties unable to re-house, as was initially provided for in the order.

The courts are also far more likely to set aside an order where one party has been fraudulent, misrepresented their finances or demonstrated other misconduct. If you are worried about disclosure issues, you may also find Melanie’s article on what to do if you suspect your spouse is hiding assets during divorce helpful.

Change in Employment Status

In Maskell v Maskell [2001], the husband lost his job. The Court of Appeal found that this did not equate to a Barder event as it was “something that hundreds and thousands of breadwinners [had] to face”.

Death

In the case of Barder, the wife had killed herself and the children of the marriage. The court found this was a new event that justified the order being challenged.

Death will not, however, be found to be a Barder event in all cases.

Re-Marriage and Cohabitation

There are no clear guidelines as to whether this will be seen by the court as a Barder event. Each case will be considered on its individual merits.

In Williams v Lindley [2005], the court found that the wife’s engagement was a Barder event in this case, as the order had been made on the basis of the wife’s urgent need to re-house, providing for her to receive a lump sum of £125,000. The Court of Appeal held the basis upon which this order was made no longer applied.

In contrast, in Dixon v Marchant [2007], an order for maintenance was made on the basis of payment from the parties’ joint lives. The husband then retired and the parties negotiated and agreed a lump sum payment to the wife – capitalisation – to pay off her future maintenance claims. The husband had argued the wife was cohabiting but the wife denied this. Seven months later the wife remarried.

The court said this was not a Barder event.

Change in Children’s Living Arrangements

In Nasim v Nasim [2015], at the time of the order the two children were presumed to continue to live with mum. The wife, on this basis, received 70% of the net profit from the sale of the family home.

Six weeks after the order was made, the wife was arrested for a criminal offence against her daughter and both children moved to live with dad and refused to see mum.

The court viewed this as a Barder event.

How Melanie Townsend can help

Melanie Townsend advises clients on complex divorce and financial settlement matters, including cases involving high-value assets, business interests, trusts, inherited wealth, property portfolios and wider financial complexity.

Where circumstances have changed after a financial order has been made, early advice is important. These cases are highly fact-specific and the court will usually look carefully at whether the new event genuinely undermines the basis on which the original order was made.

Melanie can advise on whether a change in circumstances may be significant enough to justify further steps, whether an application is likely to be proportionate, and what evidence may be needed before seeking to challenge or set aside a financial order.

If you are concerned that a financial order made after divorce may no longer reflect the circumstances on which it was based, contact Melanie Townsend in confidence.