The ‘second-wife impact’ and ancillary relief

1st June 2010

In 2008 in England and Wales 232,900  marriages were registered: the mean age for men marrying for the first time was 32.1 years, and for women, 29.9 years.

Andrew Commins

In the same year, 63% of all marriages were first time unions for both parties. Remarriages for both parties accounted for 17% of all marriages. The remaining 20% of marriages were of couples where only one partner had been married previously. Therefore, despite reports indicating that second marriages have fallen from favour, a significant proportion of modern marriages (37% in 2008) still involve at least one partner remarrying.

Remarriage can be a risky business, according to the statistics. In 2008, the number of divorces in England and Wales was 121,779. In the same year, 20% of men divorcing and 20% of women divorcing had a previous marriage ending in divorce. To give some comparison, this figure in 1981 was just 11% (Office for National Statistics bulletin, Divorces 2008, 05/02/10).

The issue

For those who enjoy the blessing of a happy second (third or fourth) marriage, there may be ongoing financial obligations to the first (second or third, ad infinitum) wife which, by virtue of the second marriage, are not terminated. Pressure may be brought to bear, however, by the new family and its own financial demands to bring those first-wife commitments to an end. For those applications brought under section 31 of the Matrimonial Causes Act 1973 (MCA) to vary an order for periodical payments, the spectre of the second family often has a significant impact on both the issuance of the application and its prosecution through the courts. How, if at all, should the financial commitments to the second wife impact on the judge’s assessment of the need to support the first wife? Should any such ‘second-wife impact’ influence the judge regarding either the termination of periodical payments or the substitution of capital or other orders pursuant to section 31(7B) of the MCA? If so, how?

Historical development

Generally, the law has not been blinkered to the reality that new relationships bring with them new financial responsibilities. There is, of course, a life after divorce (well, at least the first one). The courts will, when assessing the ability of the husband to meet any ongoing obligations to his first wife, have regard to the husband’s entitlement to “order his life in such a way as will hold in reasonable balance the responsibilities to his existing family, which he carries into his new life, as well as his proper aspirations for that new future” (Delaney v. Delaney [1991] 2 FLR 457, CA.

The choice of the word ‘entitlement’ is liberal and illuminating; however, achieving the balance described in the case of Delaney is a much more difficult task than articulating it. Despite there being no principle of prioritisation of one ex-wife’s claims over the other wife’s needs, the court will deprecate “any notion that a former husband and extant father may slough off the tight skin of familial responsibility and…slither into and lose himself in the greener grass on the other side…” (Delaney, at page 461E). The legitimate financial claims of the first wife cannot, of course, be ignored. However, and equally, the husband’s legitimate and reasonable financial responsibilities towards his second wife and family must also be taken into account.

In 1970, the Divisional Court of Probate, Divorce and Admiralty held that no primacy could be given to the claims of a first wife but rather that “on general principle, a spouse must on marriage….be presumed to take the other subject to all existing encumbrances, whether known or not – for example… obligation to support the wife or child of a dissolved marriage” (Roberts v. Roberts [1970] P.1).

It’s not clear what was in the water 12 years later in 1982, but something suspicious resulted in a glut of cases that year dealing with ancillary relief claims involving husbands with second wives. In Stockford v. Stockford [1982] 3 FLR 58 the Court of Appeal dismissed a first wife’s claim for an increase in her periodical payments. The husband had married for a second time and the court was right to consider his financial needs as including obligations to support both his first wife and his second family (Ormrod J, page 63A).

Slater v. Slater & Another [1982] 3 FLR 364 considered the impact of a second-wife in reverse, asking to what extent her resources were relevant to the discretionary exercise. The Court of Appeal determined that the financial position of the second wife had relevance to the extent, firstly, that her resources could ameliorate the husband’s financial obligations to his second family and, secondly, that the whole financial position of the second family should be accounted for when considering the net effect of any order on the husband. However, such an assessment would not extend to “treating the second wife’s income as a joint fund together with the husband’s income, out of which the first wife [would be] entitled to draw her entitlement…” (Sir John Arnold P at page 369F).

In Furniss v. Furniss [1982] 3 FLR 46, the Court of Appeal allowed the appeal of a husband who, by virtue of an order for periodical payments to his first wife, would be forced to sell his family home purchased with his second wife. The husband and second wife had a child together in addition to the two children the second wife had brought into the marriage. After his remarriage, the husband found a new and better job and managed to purchase a very nice home for himself, whilst his first wife lived a ‘pretty miserable life’ in a council house on the Isle of Wight.

The judge at first instance made an order for periodical payments that would force a sale of the husband’s home but justified this by assessing his first charge as being to his first wife; that it had been the husband’s choice to remarry and, “if the husband could not afford it, so much the worse for him” (page 48G). The appellate court disagreed. Rather curiously, Templeman LJ said that “if [the husband] had decided to ruin his future life by not remarrying, he would still have had to buy accommodation for himself – and accommodation is expensive the world over” (page 49B). Nevertheless, the husband’s saving grace was that the home he had purchased with his second wife was within his reasonable needs. An assessment of the net effect of the judge’s order – taking into account both the husband’s income and that of his second wife – resulted in a reduction to the trial judge’s order for periodical payments to the tune of £200 per month.

Modern application

The majority of reported cases are historical (see above) but the recent decision of Vaughan v. Vaughan [2010] EWCA Civ 349 has re-assessed the ‘second-wife impact’ within the modern ancillary relief context.

In Vaughan the Court of Appeal was faced with a first wife’s appeal against a decision discharging a periodical payments order for £15,175 made in 1989 in her favour (in addition to an annual payment of £12,000 pursuant to a deed of separation dating back to 1981).

At the time of the appeal, the wife was 66 and the husband 71 years old. In 1985 the husband had remarried. His second wife was some 15 years his junior. He was a successful barrister but suffering from ill health. Upon appeal, the first wife had a home with a net value of just over £1m, a valuable antique desk worth £300,000 and a pension income of £5,000 gross p.a. The first wife’s pleaded needs were £62,000 annually, a sum which was reduced by the trial judge to circa £50,000. Conversely, the husband had a home in North Kensington with a net value of £3,628,000, a property in Wales and various other smaller investments. The husband also had a private pension fund with a value of £2,388,000 before commutation. Given the husband’s ailing health and his second wife’s relative youth, he was electing to exercise his right under the scheme to have an annuity paid to himself and his second wife during their joint lives and, upon death, at the same rate to the survivor (approximately £100,000 gross p.a.).

The judge at first instance ascribed half of the husband’s gross annual pension income (approx £50,000) to the second wife, thereby taking 50 % of this income out of the husband’s income schedule. The judge was keen to highlight the second wife’s positive and contributory influence on the husband’s financial position at trial, and assessed the value of her contribution within the parameters of the heel-worn ancillary relief factors and considerations:

“I consider that the second wife has an entitlement to a substantial proportion of [the assets built up during the second marriage]. In view of the length of the [second] marriage and her contribution to the welfare of the family, particularly, being a mother of two children, I consider that she must be entitled to at least 50% of those assets.”

The Court of Appeal criticised the judge’s reasoning for the appraisal of the second wife’s entirely theoretical ancillary relief claim against the husband. The judge had elevated her potential ‘claim’ to the realms of an existing proprietary entitlement, to the extent that he treated such an anticipatory claim as eliminating the concrete claims of the first wife. This was particularly true in relation to the husband’s pension, as it was illogical and inconsistent to attribute one half of the pension income to the second wife, despite her contributions to the marriage. It was akin to attributing half of the husband’s earnings during the marriage to her.

The trial judge had fallen into error in a number of respects. Firstly, he assessed the first wife’s claim as if it competed with that of the second wife, despite the second marriage persisting happily. Secondly, he trespassed beyond the actual into the hypothetical, and, in so doing, gave priority to the second wife’s supposed claims, contravening the standard that the second wife took the husband in 1985 with all his ‘encumbrances’ attached, including the ongoing financial obligations to his first wife. Instead, “all the judge should have done was to take into account the husband’s obligation to maintain the second wife to the extent to which she could not maintain herself out of the income already judicially attributed to her” (Vaughan, per Wilson LJ, at para 39). To this extent, the Court of Appeal in 2010 affirmed the reasoning in the Slater case in 1982.

Vaughan, therefore, re-assesses time-worn notions which, although expressed in language one would rarely see in modern court reports, remain as applicable today as they did in the 1970s and 1980s. Remarriage remains popular, and will take place later in life the longer that the average age for first time marriages and divorces increase. Remarriage can significantly (and positively or negatively) alter an individual’s financial position: it may not have the same impact on existing first-wife obligations.

Vaughan, therefore, is good guidance that the court must strike a balance between the shackles of obligations and the freedom and anticipation of new relationships. The ‘second-wife impact’ is important, therefore, only when considering:

(a) the extent to which the second wife’s own financial position assists or allows the husband to meet all his financial obligations (past and present), and

(b) the ultimate net effect of any order for periodical payments on the husband, taking account of the reality of his circumstances and obligations within a second family unit.

The influence of any ‘second-wife impact’ cannot extend to give priority to one claim over another, albeit that in certain cases, it may be that the husband’s reasonable and fair obligations to his second wife are ordered in such a way that, in effect, his decision to remarry does give primacy to his new family.