The case of Green v Adams [2017] EWFC 24 serves as a useful illustration of the application of family law in regard to capital provision for children of parents who have separated and are no longer living together.
The case was begun on 5 April 2013 when the mother of a 16-year old boy made plain her desire to seek an additional capital sum to pay for a replacement car, travel expenses for her child, and miscellaneous capital expenses, including a new laptop for the child, and for periodical payments. This claim was made under Schedule 1 of the Children Act 1989.
The father of the child was a 65–year-old man of considerable means. He had already bought a £220,000 home for his son to live in with his mother, but despite his wealth, which ran into millions of pounds, the father had, up until the hearing of the case, made little else in the way of further contributions.
The court heard that the father had a pension fund worth £1.35 million—even after he had made a tax-free lump sum withdrawal. Furthermore, the man had asked his pension advisor to invest the fund in such a way as to ensure he could not draw any income from it and could therefore also avoid paying child maintenance. The judge found that this approach was entirely unnecessary and described the arrangement as "little short of scandalous".
The lingering nature of the dispute can be attributed in part to the fact that both parties had previously appealed against Child Support Agency assessments, and this is why Mostyn J did not have the opportunity to determine the application until the spring of this year.
Mostyn J ruled that the capital expenditure being sought by the mother was both merited and justified, and expressed his satisfaction that the £20,600 being sought was a reasonable and proportionate sum. Furthermore, he described the historical level of financial support offered by the father as "mere pittance", particularly given that he estimated the father's total wealth at around £5.2 million.
This contrasted with CSA's calculation of the father's worth at £830,000. However, Mostyn J expressed his view that this sum did not truly reflect the level of capital available to the father. He also dismissed the argument made by the father's family lawyer that he had "exhausted all capital resources".
Mostyn J stated that the father's opaque and evasive financial dealings clearly demonstrated his determination to protect and hide his assets from any claim by his son's mother. As such he made an immediate and absolute order under s.3(1), Charging Orders Act 1979.
Conclusion
Cases similar to this are unfortunately not uncommon in family law. All too often, parents dispute sums for child maintenance and capital expenditure when, typically, one parent seeks to hide or ring-fence assets in such a way that they cannot be touched or even accounted for by CMS calculations.
In fact, concerns about the limitations of family law as it currently relates to such matters, prompted Mostyn J to proffer his opinion, via the judgement , that the government should consider the reinstatement of "assets" as a ground of variation. Since a regime amendment of the child maintenance scheme in 2013, wealthy parents have been able to avoid making child maintenance payments by living on their capital as, technically, this allows them to claim that they have no income.
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