Yesterday judgment was handed down on one of the largest awards on divorce in the history of the English Courts. Mr Justice Moor in his judgment ordered payment of staggering sums including a £251.5 million lump sum to be paid by Sheikh Al Maktoum to Princess Haya as well as £11.2 million per year for periodical payments for the children. The case encompassed claims under Schedule 1 of the Children Act 1989 and Part III of the Matrimonial and Family Proceedings Act 1984 which are to be distinguished from financial remedy proceedings, as the latter usually take place in parallel to English divorce proceedings. Whilst this might seem a somewhat pedantic distinction, it is an important one, as it has implications in respect of the orders the Court can make and the factors it considers in reaching its decision.
What is a Schedule 1 Children Act 1989 claim?
An application under Schedule 1 of the Children Act 1989 involves applying for financial provision for a child, whether that be in the form of maintenance provision (e.g. income) or capital provision (e.g housing). The most common orders under this type of application are for periodical payments for the benefit of the child (either to the parent or directly to the child) or for lump sum payments relating to maintaining a child, such as to enable the purchase of a house for the child to live in with the parent.
This type of claim is usually used by parents who have never married and therefore do not have recourse to the usual statutes for financial provision on divorce. However, it may also be used in other circumstances. Importantly, this claim is for the child only and not for the parent, although it is possible for a parent to be awarded what is called a 'carers allowance'. Further, there are indirect benefits which the caring/receiving parent might enjoy. For example, there might be provision made for the home in which the children live; in this case, £2,476,800 was included as part of the annual child maintenance calculation in respect of the costs of the family home, covering items such as utility bills, maintenance and wear and tear. Although it should perhaps be caveated that this is an extraordinary case, and such high provision should be considered as part of the context of the exceptional wealth the children would have enjoyed had the parents remained married.
What is a Part III Matrimonial and Family Proceedings Act 1984 claim?
In this case, Sheikh Al Maktoum divorced Princess Haya by talaq under Sharia law and that divorce was then registered with a Dubai Court in May 2019. As the divorce therefore already happened overseas, there was not the opportunity to apply for divorce (and therefore financial remedy proceedings) in England and Wales.
It is, however, still possible to apply for financial relief in England and Wales after an overseas divorce has taken place. Although permission of the Court is first required, once granted, the possible provision is almost identical to what an applicant might expect to have received as part of financial remedy proceedings had the couple had divorced in England and Wales. Interestingly however, in this case, Princess Haya did not make a substantive claim to the extent that she could have and instead limited her application to provision for security costs and compensation for some of her belongings which she was unable to retrieve from her home in Dubai. As a result, there was no claim for items of expenditure such as her other expenses which would ordinarily vary from anything from rent to purchasing designer handbags! Given the extraordinarily high standard of living enjoyed during the marriage, the provision granted is therefore only a one part of a broader picture of what the financial settlement following an overseas divorce could have fetched.
Whilst this case involves eye-watering figures, the context of the marriage must not be forgotten. Therefore these sums must be compared to the standard of living Princess Haya, Sheikh Al Maktoum and the children would have enjoyed during the marriage. The impression from the judgment, as can be expected, is that money would certainly have been no object.
Further, it is also worth bearing in mind that this could well have been an even higher award had Princess Haya applied for more substantive provision for herself in respect of her needs i.e. for costs other than security and compensation for lost belongings. We can but only speculate on what numbers such a claim might have involved.