A former wife’s attempt to vary upwards an order for periodical payments being made to her by her former husband has been refused, overturning the decision made in the Court of Appeal.
In 2002 an order was made giving Mrs Mills a lump sum of £230,000 and periodical payments of £13,200 per annum. The lump sum was sufficient to enable her to rehouse herself and the parties’ child, mortgage free. Mrs Mills chose to purchase a larger property at £345,000 using her new mortgage capacity. She then chose to sell that property, purchasing a further property and continued in that vein, on each occasion utilising less and less of the capital lump sum and raising an ever increasing sum by way of mortgage.
In 2009 Mrs Mills sold the final property receiving £120,000 capital from the sale. She then chose to rent. By 2015, she had no capital and significant liabilities and found she could not pay her rent. Mrs Mills asked the Court to increase the periodical payments being received from her former husband and this was refused. She appealed and the Court of Appeal increased the periodical payments to £17,292. Mr Mills appealed against that decision and was successful.
The reason given by the court was that the award made to Mrs Mills in 2002 would have enabled her to buy a home free of mortgage…………….she had not managed her finances wisely thereafter and her needs had been augmented by the choices she had made.
In circumstances in which at the time of a divorce, a spouse was awarded capital which enabled her to purchase a home but she later exhausted that capital by entering into a series of unwise transactions and so developed a need to pay rent, the Court was entitled to decline to increase an order for the other spouse to make periodical payments to her so as to fund payment of all, or any, of her rent even if he could afford to do so.
This case should serve as a warning to spouses who seek to rely upon a variable periodical payments order as a way of funding an irresponsible lifestyle.