The case of Green v Adams – update – further judgment released on 4 August 2017

08 / 08 / 2017

I previously wrote about the case of Green v Adams, which concerned a financial claim by a mother, against the father, for financial provision for their son.

Part of the mother’s claim was for lump sums on behalf of the child (including a lump sum to replace her car, amongst others). Part of the hearing also mentioned the appeals from both parties against the assessment for liability of child maintenance that had been made by the Child Support Agency (as was the body dealing with the child maintenance at that time).

During the course of that previous hearing, it was explained that the appeals to the Child Support Agency were heard in November 2016. This was following an application by the mother for a variation to the assessment of child maintenance liability (of the father).

The ground upon which the mother was seeking to rely was “assets“. This is where the Child Support Agency could look beyond the income of the paying parent (here, the father) and look at assets which that parent owned with the relevant assets being taken into account and a figure attributed to those assets as producing an income (they could do this even if those assets in fact did not produce any such income).

In this case, it had previously been determined that £830,000 of the father’s assets could be taken into account for the purposes of the regulation and deemed income at a rate of 8% was applied to those assets which was said to contribute and give rise to a liability for child maintenance during the relevant periods at £44,140.

It is important to note that it was during the relevant periods that some of the father’s assets were taken into account for the purposes of calculating his liability for child maintenance (as well as any income that he had during that time), namely in this case, periods commencing on 29 April 2009, 16 November 2011 and 5 July 2013 respectively.

The case in question however was then transferred over to the newer statutory child maintenance pursuant to the Child Maintenance and Other Payments Act 2008.

Under that scheme, the ground of “assets” for the purposes of a variation for a calculation of child maintenance liability does not apply. Therefore the Child Maintenance Service (which replaces the Child Support Agency) cannot take into account “assets” as a ground for a variation to the level of liability for child maintenance.

Prior to the above Judgment being given, the Child Maintenance Service had recently assessed the father’s liability for child maintenance at a rate of £7 per week. This is despite the fact that, in the Judge’s words in this case, the father “has millions which may properly be regarded as his resources“.

The fact however now is that the Child Maintenance Service cannot take into account his assets in the way that the Child Support Agency were able to do so.

The Court in this case could not order periodical payments (maintenance) for the benefit of the child either as the father’s gross annual income is not in excess of £156,000 per annum and therefore the Court dismissed the mother’s claim in this respect – it simply did not have jurisdiction (power) to make the Order sought.

This led to the Judge in this case mentioning what he termed “an extraordinary state of affairs from recent amendments to child support legislation”. He explained that “assets”, as I have explained above, used to be a potential ground for a variation and he went onto say that “for reasons which I cannot fathom the “assets” ground of variation has been removed from this latest regime… In my opinion the government needs to urgently consider the reinstatement of the “assets” ground of variation”.

The case has recently been in Court again and the Judgment has now been released (on 3 August 2017). I will not deal with the substantive Judgment now save for to confirm that part of it dealt with/discussed the costs that had been sought by the mother for the costs of a trip to Israel, a China trip and half the costs of a laptop and the cost of a kayak (all items claimed for the benefit of the parties’ child).

The Judge (Mr Justice Mostyn) referred again, by way of comment, to his previous statements (set out above) where he said he had “bemoaned the abolition of the assets ground of variation in the most recent child support scheme and urged the government to consider its reinstatement”.

Further to this, Mr Justice Mostyn said that he foresees that there will be an increase in the claims for lump sums if the previous child maintenance provisions on the assets ground of variation are not reinstated.

My brief comments on this are as follows:

I share the view of Mr Justice Mostyn that there is likely to be an increase of applications to the Court with applicants seeking lump sums for the benefit of children if the previous child maintenance provisions of the asset ground of variation is not reinstated. The current position means that a paying parent may have millions of pounds in resources but may, under the current child maintenance provisions, only be liable to pay a very minimal amount of child maintenance per week/month. I would suggest, as Mr Justice Mostyn has done, that parents are more likely to therefore consider an application to the Court for lump sum financial provision for the benefit of their child in those circumstances.
Mr Justice Mostyn has said that he anticipates that the family Court will take an “ever more expansive view of what does constitute singular expenditure”. What is meant by this is that there is no specific list within the Schedule 1 of the Children Act 1989 legislation that says what is included within this. For example, it does not say a claim can be made for a “car”, “laptop”, etc. What is required is that the lump sum claimed must be for the benefit of the child/directly referable to the child.
In light of the current situation, provided it is for the benefit of the child, the Court has discretion. What Mr Justice Mostyn has said is that he foresees that the Courts may start taking a wider view as to what may be deemed to be allowed as a lump sum payment for a single expenditure item (e.g. such items as a kayak or a trip to China as claimed in this particular case, amongst other items claimed for), e.g. what may be classed as falling within this.

There is no set mathematical formula binding on a Judge as to how they calculate what a mother or father should receive as a lump sum for the benefit of the child. For example, it isn’t calculated that say the father (in this case) has X worth of assets and therefore he must pay X % of that to the mother for a car (although the financial resources of each party are taken into account, together with the other relevant circumstances in the case). I anticipate that where a Judge may be thinking in a particular case a lump sum payment for a car should be say between £10,000 and £20,000 (just by way of an example) – they may, and I would suggest, are likely to use their discretion to be more generous and make a capital Order at the higher end of the bracket as they are likely to be sympathetic to a mother or father who is receiving very minimal maintenance in circumstances where the paying parent has a great deal of assets that are not being taken into account in child maintenance calculations.

The Court will in any event always strive to do a balancing act and do what is fair in the circumstances and each case will be determined on its own facts.

Part of my comments appeared in The Telegraph on Saturday 5 August 2017 which can be accessed here.