RA v KS (Interim Order for Sale)

Factual and Procedural Background

This judgment concerns an application by the Applicant for an interim order for sale of a property known as the Barn, opposed by the Respondent. The matter was heard following a private Financial Dispute Resolution appointment and a directions appointment in the Central Family Court. The Applicant and Respondent both have legal and beneficial interests in the property. The court raised a jurisdictional question as to whether it had the power under section 33 of the Family Law Act 1996 (FLA 1996) to order vacant possession of the Barn in the context of the Applicant's applications under Family Procedure Rules (FPR) 2010 rule 20.2(1)(c)(v) and the Married Women’s Property Act 1882 (MWPA 1882) section 17.

Following the directions hearing, both parties filed skeleton arguments addressing the jurisdictional issue. The court was asked to consider the legal basis for an interim order for sale and vacant possession, particularly in light of the parties’ shared beneficial interest in the property. The judgment also addresses subsequent submissions on costs.

Legal Issues Presented

1. Whether the court has jurisdiction to order vacant possession of a property jointly owned by parties under section 33 of the Family Law Act 1996 in the context of interim applications under FPR 2010 r20.2(1)(c)(v) and MWPA 1882 s17.
2. Whether an interim order for sale can be made under the Matrimonial Causes Act 1973 (MCA 1973) s24A and the extent to which such orders are final or interim.
3. The applicability and interplay of different statutory routes for interim sale orders, including MWPA 1882 s17, Trusts of Land and Appointment of Trustees Act 1996 (TLATA 1996) ss13 and 14, and FPR 2010 r20.2(1)(c)(v).
4. The necessity of performing the evaluative exercise under FLA 1996 s33(6) before terminating home rights and ordering vacant possession.
5. The distinction between rights arising from legal and beneficial interests versus home rights under FLA 1996 s33(3)(d) and s33(3)(e) and the implications for the court's power to terminate or restrict rights of occupation.
6. Whether the Respondent is estopped from preventing the sale based on alleged prior promises and detriment.
7. The appropriate order as to costs following the court’s decision on jurisdiction.

Arguments of the Parties

Applicant's Arguments

• The Applicant contended that if MWPA 1882 s17 provides the power to order vacant possession, it is unnecessary to consider whether the powers under FLA 1996 s33(3) alter that jurisdiction.
• It was argued that the wording of s33(3) does not diminish the court’s power under MWPA 1882 s17 to order vacant possession and that the evaluative exercise under s33(6) must be performed without excluding s33(3).
• The Applicant submitted that the Respondent is estopped from preventing the sale due to prior assurances not to occupy and to market the property for sale, and that the Respondent’s refusal to sell now is unconscionable, causing financial detriment through loss of rental income.
• The Applicant further argued that an interim order for sale could be made under FPR 2010 r20.2(1)(c)(v) as a freestanding jurisdiction.

Respondent's Arguments

• The Respondent opposed the interim order for sale and argued that the court’s power to order vacant possession is limited by FLA 1996 s33(3), which distinguishes between prohibiting, suspending, or restricting rights of occupation where there is a legal and beneficial interest (s33(3)(d)) and terminating home rights (s33(3)(e)).
• It was submitted that the court cannot permanently extinguish rights of occupation where the Respondent has a proprietary interest, but only restrict or suspend them temporarily.
• The Respondent disputed the estoppel argument, noting that the alleged promise was not accepted and that the claimed detriment was inconsistent with the facts, including seasonal variations in rental income.
• It was contended that an interim order for sale under FPR 2010 r20.2(1)(c)(v) does not provide a freestanding jurisdiction inconsistent with the statutory framework.

Table of Precedents Cited

Court's Reasoning and Analysis

The court commenced by acknowledging the statutory framework governing orders for sale, particularly the Matrimonial Causes Act 1973 s24A, which restricts interim sale orders except in limited circumstances. It noted that orders for sale are generally final and cannot be made during ongoing proceedings unless under specific statutory provisions.

The court reviewed the key authorities, especially BR v VT, which identified three procedural routes for interim sale orders: MWPA 1882 s17, TLATA 1996 ss13 and 14, and FPR 2010 r20.2(1)(c)(v). It emphasized Mostyn J’s position that the evaluative exercise under FLA 1996 s33(6) must be performed before terminating home rights and ordering vacant possession.

The court contrasted this with Cobb J’s judgment in WS v HS, which held that FPR 2010 r20.2(1)(c)(v) does not confer a freestanding jurisdiction for interim sale and stressed the distinction between termination of home rights under s33(3)(e) and prohibition, suspension, or restriction of occupation rights under s33(3)(d). The court agreed with Cobb J that where the Respondent has a legal and beneficial interest, the court cannot permanently extinguish occupation rights but may only restrict them temporarily.

The court rejected the Applicant’s submission that s33(3) is irrelevant to applications under MWPA 1882 s17, reasoning that it would be illogical for the court to apply the balancing test in s33(6) without engaging s33(3), which governs the nature of orders that may be made.

On the estoppel argument, the court found the alleged promise was unaccepted and based on disputed facts, with the claimed detriment inconsistent with the evidence, thus not supporting estoppel.

Consequently, the court concluded that on the facts of this case, where both parties have a legal and beneficial interest in the property, the court lacks jurisdiction to make the interim order for sale and vacant possession sought by the Applicant under the current applications.

Regarding costs, the court considered the relevant procedural rules and the parties’ submissions. It noted the costs issue was raised by the court sua sponte and that both parties assisted in resolving the jurisdictional question. Nonetheless, as the Applicant pursued the application despite the court’s indication of potential jurisdictional limitations, the court provisionally concluded that the Applicant should pay the Respondent’s costs of the application, subject to a summary assessment and delayed enforcement due to the Applicant’s funding difficulties.

Holding and Implications

DISMISSED: The court held that it does not have jurisdiction to grant the Applicant’s interim order for sale and vacant possession of the property under the current applications, given the Respondent’s legal and beneficial interest and the statutory framework governing such orders.

The direct consequence is that the Applicant’s application for an interim sale and vacant possession order is refused. The court emphasized the necessity of applying the evaluative test under FLA 1996 s33(6) and engaging s33(3) when a respondent has a proprietary interest. The judgment clarifies the limits on interim sale orders and the distinction between terminating home rights and restricting occupation rights.

No new precedent was established beyond the court’s reasoned application of existing authorities. The decision underscores the procedural and substantive complexities in matrimonial property disputes involving jointly owned homes and interim relief.

On costs, the Applicant is ordered to pay the Respondent’s costs of the application, subject to a summary assessment and delayed enforcement to accommodate the Applicant’s financial situation.