Senior Associate Solicitor Stuart Barton shares some insight into the above matters…

Domestic abuse remains an issue that is frequently raised by parties in divorce cases. Such allegations are usually raised by the alleged victim who believes that the impact/effect of such abuse should justify them receiving a greater share of the assets in comparison to the alleged perpetrator. This is a so called ‘conduct’ argument. Under the current law, the Financial Remedies Court can take the conduct of either party into account when considering the division of assets between divorcing parties. However, the law also makes it clear that conduct must be ‘exceptional’ if it is to be taken into account by the Court and the conduct in question must also have a financial consequence.

How the Court has dealt with domestic abuse historically in such cases remains a contentious issue for both lawyers and alleged victims. As domestic abuse has become so prevalent within society, there is an emerging view that it is longer appropriate for it to be viewed by the Court in divorce cases in such narrow terms.  Resolution (an organisation consisting of family law professionals) has set up a working party to consider domestic abuse in financial remedy proceedings. Their report is due to be published in October 2024. It is hoped that it will provide insight into lawyers’ experience of how domestic abuse is currently being dealt with by the Court and what changes for the better might be introduced.

For now though, it all really boils down to a single question: does domestic abuse amount to ‘conduct’ or not? With almost perfect timing, in the recent case of N v J, Mr. Justice Peel (the National Lead Judge of the Financial Remedies Court) considered this very issue. The facts of the case are important. The parties were a same-sex couple who started living together in either 2006 or 2009, entered into a civil partnership in 2012 and separated in July 2023. They were therefore in a relationship for at least 14 years.

N alleged he was the victim of domestic abuse with J being the alleged perpetrator. N had mental health issues, including a diagnosis of bipolar affective disorder before the relationship started. His mental health deteriorated from mid-2012 and got worse from 2016, allegedly because of J’s conduct. N was hospitalised, spent time in rehabilitation and attempted suicide on two occasions. The assets in the case were about £32 million. N wanted the court to take J’s alleged conduct into account when dividing the assets.

The specific ‘conduct’ allegations made by N were that J had lied about his cheating and infidelity. J admitted in August 2021 that he had paid men for sex from 2011 onwards. N claimed that J’s behaviour (by denying he was cheating on N and making N think it was all in his head) resulted in his increasing need to obtain treatment for his mental health. This treatment included hospitalisation, rehabilitation, medication and electroconvulsive treatment. These treatments were allegedly based on false assumptions that N was paranoid, delusional and psychotic when J was in fact cheating on N and N’s fears were therefore justified. On a very simplistic level, N was alleging that he was the victim of prolonged ‘gaslighting’ from J.

Mr. Justice Peel concluded that N’s allegations should not be considered by the court as amounting to ‘conduct’ within the case.  He gave several reasons in reaching this decision but the most important were:

• N’s allegations were not ‘exceptional enough’;

• He was not satisfied that the behaviour N complained of caused the decline in his mental health;

• The conduct alleged by N did not ‘leap off the page’ as a factor to be considered by the court;

• The only direct financial consequence was N’s increased medical costs, which the court was automatically required to take into account when considering N’s financial needs in the case;

• The conduct alleged by N did not add anything to his case and would not increase the assets the court would award him;

• Allowing N to argue conduct at a final hearing would be disproportionate. It would increase the length of final hearing and the parties’ legal costs for no purpose.

In terms of the implications of this decision, an immediate conclusion might be to say that in any divorce case, domestic abuse in the form of gaslighting does not amount to ‘conduct’ and is therefore inconsequential. However, a closer look at the decision suggests that this is not correct. Any case must be considered in its own factual matrix and there are two key features of N v J that stand out.

Firstly, N was unable to prove or show that J’s behaviour had a meaningful financial consequence. Mr Justice Peel was clear when considering previous cases raising ‘conduct’ that it was essential in his view that the conduct complained of must have a financial consequence.

Secondly, the assets in the case were £32m. However these considerable assets were ultimately divided between the parties, it was clear that each of them would have more than enough to meet their reasonable financial needs. In the circumstances, the suggestion by Mr Justice Peel that arguing conduct at a final hearing would be disproportionate has some weight to it.

There is perhaps room for debate over Mr Justice Peel’s fundamental premise that it was essential in his view that the conduct complained of must have a financial consequence. This premise is not actually written into the relevant statute that the Court must follow in divorce cases – the Matrimonial Causes Act 1973. Rather, this premise has arisen as a common feature in the limited number of previous cases where the court has considered that conduct should be taken into account as it was clearly exceptional. Examples here are behaviours such as attempted murder or sexual assault.

One possible exception to the above may possibly be found in the 2022 case of Goddard-Watts v Goddard-Watts. In that case, the husband and wife had settled financial issues arising from their divorce back in 2010 through a consent order. The wife subsequently established that the husband had lied over the extent of his assets and sought to set aside the consent order because of the husband’s deception.  The wife managed to get the consent order set aside in 2016 and obtained an additional lump sum in her favour. The wife then established that the husband had lied yet again about the extent of his assets and financial dealings and sought to set aside the order made in 2016.

The wife was partly successful with her application to set aside the order made in 2016 but did not agree with the Court’s decision. She contended that the Court had failed to attribute the necessary weight to the husband’s fraud as ultimately, the husband had benefitted from that fraud whilst she had suffered detriment. She appealed and the Court ultimately agreed that the husband’s deception/fraud was the primary cause for the current and most unsatisfactory state of affairs. The court determined that her case should be re-heard again on a fresh basis.

Could Goddard-Watts therefore be relied upon as a case where the husband’s conduct did not have a financial consequence but was still taken into account by the Court?  Could a victim of gaslighting behaviour who has not suffered any meaningful financial impact as a result of that behaviour potentially seek to rely on that abuse as conduct within a financial remedy case?  Mr Justice Peel clearly thought the answer to these questions remained a ‘no’ and the writer is inclined to agree.

In the view of the writer, Goddard-Watts falls outside the usual sphere of so-called ‘conduct’ cases and belongs more properly in a category of cases concerning ‘fraudulent non-disclosure.’ These are considered differently to ‘conduct’ cases, even if one can easily argue that fraudulent non-disclosure is deplorable behaviour. Moreover, the view of the writer is that even if Goddard-Watts is purely considered as a ‘conduct’ case, there is an argument on the part of the wife that the husband’s conduct has created a meaningful financial impact through her significant legal costs arising from repeated court applications, perhaps coupled with her own inability to plan her own financial future because of ongoing uncertainty.

Ultimately, evaluating the impact of N v J possibly hinges upon whether you are of the ‘glass half-full’ or ‘glass half-empty’ persuasion. Objectively, it is difficult to argue against the reasoning of Mr Justice Peel given the facts in the case and one could simply say that all N v J does is to reaffirm existing law (which it does). On the other hand, the case does not say that gaslighting (or any form of domestic abuse for that matter) cannot or will not meet the criteria of being ‘exceptional’ and therefore conduct that the Court should consider in a financial remedies case.

So…what if the assets in the case were only £750,000? What if the Court was also satisfied that J’s behaviour did lead to a decline in N’s mental health? What if N lost his job as a result of that decline or in attempting suicide was left with long-term injuries or illness? Surely these would be clear financial consequences for N caused by J’s conduct. In this scenario, an argument on N’s part for him to receive a greater share of the assets appears considerably stronger. The view of the writer is that it may only be a matter of time before the Court is confronted with a case which includes some or all of the above features. If and when that occurs, the decision that any Judge would have to make in those circumstances would appear far more finely balanced than the one faced by Mr Justice Peel.