Rule of court - financial remedy
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Gary Fawcett
Date of call: 1975
garyfawcett@no18chambers.com -
John Franklin
Date of call: 2016
johnfranklin@no18chambers.com
By Gary Fawcett with input from John Franklin (pupil).
Two DJ’s have recently indicated that if a financial remedy order contains a recital whereby one party ‘agrees’ to do something, then provided the necessary elements of contract are present (certainty and consideration especially) then a separate action is needed to enforce the agreement.
In the Family Court Practice 2017 at p1447, there is a footnote to r 9.26 FPR headed ‘Preambles and drafting’ and reads:-
- ‘Where the agreed provisions contain terms beyond the jurisdiction of the statute, those terms should be set out as recitals and direct that they be made a rule of court and filed as such. This permits the terms to be enforced in the suit without the need to be bring a separate action’.
However nowhere in the Red book can I find authority for that proposition.
Rules of Court generally means rules for regulating the practice and procedure to be followed in the High Court or the Court of Appeal. Pre (codifying) Civil Procedure Act 1833 this referred to the rules that judges made for each court.
A rule of court, however is a special order made in a particular case.
But where does that derive from?
The earliest reference I have found in the time allotted to this article, is the statute known affectionately as William III, 1697-8: An Act for determining Differences by Arbitration viz ‘Merchants, &c., where Remedy only by Personal Action or Suit in Equity, may agree that Award may be made a Rule of Court, and may insert the same in their Submission’.
That Act was considered in Re Smith and Service and Nelson & Sons 16 July 1890 (25 QBD 545) in which it was said:-
- ‘The effect of making a submission a rule of court was to enable the assistance of the court to be obtained in carrying on the reference after arbitrators had been appointed, and to enable the award of the arbitrators to be enforced as if it had been a judgment of the court.’
More recently there is a Practice Direction (Decrees and Orders: Agreed Terms) Family Division 26 September 1972 , [1972] 1 W.L.R. 1313 which amongst other things states:-
- ‘Where it is desired that terms of compromise should be filed and made a rule of court in lieu of being embodied in an order, the same procedure should be followed (GF: as for filing an order with/without undertakings), and the terms, signed as above, must contain a specific provision that they are to be filed and made a rule of court’.
That practice direction replaced an earlier made on the 22 December 1966.
In Atkinson v Castan [1991] Lexis Citation 2704, the first issue was the ability of a court, (here the county court), to enforce an undoubted compromise between the parties without requiring the party wishing to rely on the compromise to commence fresh proceedings. In that case the order being enforced, contained an agreement whereby the defendants would remove a sycamore tree at their expense.
Woolf LJ said:-
- ‘That there is a long-established practice of compromising actions by making the agreement part of the decision of the court or, as it is often said, making it a rule of court is clear beyond doubt.’
Staughton LJ. cited from Jowitt's Dictionary of English Law, 1977, second edition, p 1596:
- ‘A rule of court generally means a rule of procedure. Sometimes, however, it means an order made by a court in a particular action or matter: thus a compromise of an action may, if approved by the court, be made an order of the court in which the action was brought. The making of a compromise a rule of court gives it the same effect as if the terms of the compromise were contained in an order of the court.’
The conclusion is that if an agreement is made a rule of court then it can be enforced within those proceedings.
Redundancy: Collective Consultation
Can events occurring after 20+ redundancy dismissals are proposed, provide a defence to a claim for failing to inform and consult?
No, held the EAT in Keeping Kids Company (in compulsory liquidation) v Smith & Ors, but they may affect the size of an award.
In June 2015, KKC applied for emergency government funding to avoid financial ruin with a business plan envisaging a restructure whereby half its staff might be dismissed within a few months.
On 29 July a grant was offered but revoked on 3 August when a police investigation into safeguarding issues at KKC became apparent. On 5 August KKC closed, dismissing its staff.
The tribunal heard a number of claims for protective awards for failure to inform and consult under s188 TULR(C)A. It found the business plan constituted a ‘proposal to dismiss’ and s188(1A)’s reference to consulting within ‘good time’ meant KKC should have consulted ‘promptly’ after the business plan, such that events in August did not constitute a defence of a ‘special circumstance’ for s188(7). KCC appealed.
The EAT held the Tribunal was entitled to conclude the obligation to consult arose in June not August as the business plan in June foresaw only immediate insolvency or large-scale redundancies. Whilst events in August did not excuse the obligation to consult, which crystallised beforehand, they could be relied on to reduce the size of the award.
Restrictive Covenants in Employment Contracts
Every business has information that is confidential and is vital to both their success and operation, whether that be knowledge of your business clients/customers with whom they became connected , internal processes, business strategies or technology. For any competitor in your market this information can be attractive and may help to gain a competitive edge. Certain employees may have such information and, in these situations, the most effective way to protect your business would be via a restrictive covenant.
This is usually a clause in an employee’s contract that is designed to help protect your business against the use of its confidential information by former employees. This may deter employees from joining competitor and competing against their ex-employer or competitors from poaching your staff.
The attached article gives a brief overview of;
- The four main types of Restrictive Covenants:
- What Are Restrictive Covenants There To Protect?
- Implied terms of confidentiality
- When Was the Covenant Entered Into?
- Varying Contracts Of Employment To Include A Restrictive Covenant
- How Long will the Covenant be valid for?
Should you have any queries or questions resulting from the notes, or just want to simply pick Ian’s brain . Please feel free to contact him either by e-mail on ianwheaton@no18chambers.com or by calling him in Chambers on 02380 736812
J (Children) EWCA Civ 115: Failure to have a fact-find hearing resulted in it being “now simply too late, and contrary to welfare interests of either of these two children, to contemplate a re-hearing”
The case concerned three children A (aged 18 at the appeal), B (aged 16) and C (aged 11). The parties were married in 1995 and separated in 2014. In December 2014, the Mother applied for an ex-parte non-molestation order. Allegations included physical violence, drunken behaviour and marital rape. A without notice order was granted. In addition to standard terms, the Father was not to “communicate with the applicant or the children whether by letter, text message, social media or other means of communication”. A return date followed with all allegations denied by the Father, stating that it was the Mother who was abusive and controlling. Children Act and Family Law Act proceedings were consolidated. The District Judge dealing with the matter was “alive to the potential difficulty of conducting a fact-finding process with the father as a litigant in person”. Given the possibility that HMCTS may fund representation, the matter was reallocated to HHJ Allweis.
However, the decision of Re K and H (Children) [2015] EWCA Civ 543 followed. As such, the court did not have power to direct HMCTS to meet the costs of a parties' legal representatives. The judge considered whether the Father's Mackenzie friend should be granted rights of audience to cross-examine the relevant witnesses. Referring to the relevant practice guidance on Mackenzie friends ([2010] 2 FLR 962), the judge declined. Instead, the judge adjourned the matter for NYAS to undertake enquiries. It is of note that the 2nd July 2015 order recorded "having considered the documents, received the representations of the parties, and the safeguarding report, the court is currently of the view that a fact-finding hearing is necessary in this case; however, the court will consider this again at the next hearing." The order of 17th July 2015 stated under the fact-finding heading, that 'the court will consider the necessity of such at the next hearing.'
The matter returned back to court in September 2015 by which time a report was provided by NYAS. That report recorded “trenchant and highly negative views” by all three children. It was agreed that indirect contact would be attempted but the Father decided not to take this forward. The order from that hearing recorded on the issues agreed that a fact-find hearing was no longer necessary due to the wishes and feelings of the children. It was highlighted that the agreement of all the parties, in particular the Father, was not recorded on the order.
The matter came before the court for a final hearing in July 2016. Evidence was heard in relation to the children’s negative views of the Father. The judge rehearsed the history of the litigation and recorded that "it has not been necessary for me to make findings of fact". It was unclear in the judgment whether the Father had agreed that decision. It was ordered that there would be no contact for the two elder children and limited direct contact to the youngest child.
The Father appealed on four grounds being:
- A without notice non-molestation injunction was allowed to run without any determination of the relevant facts.
- Father’s McKenzie Friend was wrongly denied rights of audience.
- No findings of fact were made.
- The full powers of the court were not utilised in that NYAS found them to be suffering harm, which was partly as a result of their Mother’s behaviour.
In giving the lead judgment, McFarlane LJ highlighted the development of fact-finding hearings and more recently the enactment of Practice Direction 12J. Emphasis was placed on the principles of avoidance of delay and maintaining contact between a parent and child (Re CB (International Relocation: Domestic Abuse; Child Arrangements) [2017] EWFC 39, Re D (Appeal; Failure of Case Management) [2017] EWHC 1907 (Fam) and (Re M (Children) [2017] EWCA Civ 2164).
His Lordship noted that a non-molestation order had been made against the Father for two years, preventing communication with his children. Guidance issued by the President from 2014 was highlighted. Return dates must “never be made without limited of time. There must be a fixed end date”. Orders should not normally last for more than 14 days and if a Respondent does request a hearing to dispute the order this should be heard as a matter of urgency.
The rights of audience of Mackenzie friends and paragraph 28 PD12J were also discussed.
In considering the Father’s appeal, MacFarlane LJ agreed that a fact-finding hearing was required in this case and that HHJ Allweis was wrong not to proceed on such basis given not only the parties positions but the non-molestation order. The appeal was successful on grounds A and C and that a fact-find hearing should have taken place back in 2015.
His Lordship again highlighted that “that there is a positive duty upon a family court 'to grapple with all available alternatives before abandoning hope of achieving some contact”.
In disposing of the case, whilst allowing the appeal, the Judge made no further order. Two of the children were by now over 16 years old. The Judge was struck “by the degree of negativity that was consistently expressed by each of A, B and C against their father”. Despite the successful appeal, MacFarlane LJ stated “it is now simply too late for this apparently intractable case to be re-opened”.