Title:	F -v- M
Neutral Citation:	[2019] IESC 1
Supreme Court Record Number:	92 & 429/13
High Court Record Number:	2009 32 M
Date of Delivery:	01/22/2019
Court:	Supreme Court
Composition of Court:	O'Donnell Donal J., MacMenamin J., O'Malley Iseult J.
Judgment by:	MacMenamin J.
Status:	Approved
Result:	Appeal allowed

THE SUPREME COURT

BETWEEN:

Introduction
1. Before the Court are two notices of appeal against a judgment and consequent orders made by the High Court (Abbott J.) in the year 2013 in family law proceedings. The appellant is the husband. In the first order, made on the 25th January, 2013, Abbott J. granted a divorce between the parties and made a number of other provisions regulating the financial relationship between them.

2. The issue for determination in the first appeal is in relation to the appellant’s pension fund. This had been the subject matter of a number of prior orders, made both in the High Court and the Circuit Court. Abbott J. varied these orders, applying s.12 of the Family Law Act, 1995 (“the 1995 Act”), and s.17 of the Family Law (Divorce) Act, 1996 (“the 1996 Act”). The appellant appeals that order, contending it does not make proper provision for him. The respondent wife says the order made proper provision for both parties. The respondent had been legally represented in the earlier part of these proceedings, even at the earlier stages of this appeal in 2013 but, like the appellant, appeared for herself in this appeal hearing. The general factual history of the marriage was set out in a judgment by Abbott J. delivered on the 13th December, 2011 ([2011] IEHC 559). The parties separated in the year 2000. It is an unfortunate fact that the subsequent lengthy hearings in this case, go back at least to the year 2002, have absorbed hundreds of thousands of Euro, which could have been used by the parties had the issues between them been resolved. This judgment can only be based on the issues raised by the parties in their written and oral submissions.

Background
3. The appellant now works operating a small horse-breeding operation. He was born in 1953. He previously worked in finance. He held a pension from this previous employment. At para. 7 of the Order of the 25th January, 2013, Abbott J. made a Pensions Adjustment Order under s.17(2) of the 1996 Act. He awarded the respondent wife 80% of the appellant’s pension fund held in the Scotia Bank (Ireland) Defined Benefit Fund (“the Fund”), and 20% to the appellant. The “reckonable period” was to be from the 1st August, 1982 to the 22nd April, 1998. The term “reckonable period” is explained later in this judgment.

4. Abbott J. ordered that the respondent was to have carriage of the Pension Adjustment Order, and was to prepare and finalise formal orders in respect thereof within four calendar months from the date of the order, and in respect of which the matter was to be mentioned on the 15th March, 2013. In addition, the respondent’s solicitor was ordered to notify the trustees of the funds/schemes, and Mercers, the administrators of the said pension funds/schemes, of the terms of the order in respect of the said pension adjustment order, and to serve the formal pension adjustment orders upon them, and thereafter file the proof of service.

The Second Appeal
5. As well as criticising the apportionment, which he contends was over-generous to the respondent, the appellant also complains in the second appeal that the pension administrators and trustees were inefficient and needlessly incurred exorbitant costs in the process of assisting the courts as to how monies could be released from the fund for the purposes of making a pension adjustment order. In the High Court, he indicated an intention to complain to the Pensions Ombudsman. Whether he did so is unclear. Abbott J. directed that, in the event of any compensation being awarded to the parties by the Pensions Ombudsman, or through other efforts, the appellant was to have the benefit thereof, pursuant to s.17(26) of the 1996 Act. This appeal is considered later in this judgment.

The Law
6. The duty of the Court is to make “proper provision” for the defendant spouse, having regard to the circumstances. Section 17(1) of the 1996 Act defines “reckonable service” as being “service in relevant employment during membership of any scheme”. In making an order under this section, the Court can specify the period of reckonable service prior to the granting of the decree. (s.17(2)(b)(i) of the 1996 Act). Once the period of reckonable service is calculated, the Court may then decide as to the proportion of the benefit a dependent spouse should receive, and what proportion will be retained for the spouse who is a member of the scheme. (See, Crowley, Family Law (Round Hall 2013) 11-101 et seq.).

7. The appellant, being dissatisfied with the High Court order, filed a Notice of Appeal to this Court. He brought an application to this Court for a stay on the High Court order pending the full hearing of the appeal. The application for a stay was heard on the 19th April, 2013, and on subsequent occasions by various panels of this Court.

8. Ultimately, in an order dated the 19th April, 2013, this Court refused to grant a stay on the High Court pension adjustment order, but instead directed that, pending the outcome of the full appeal, the order of the 25th January, 2013 should be varied, and the respondent’s solicitor was immediately to pay into court half the amount received by the respondent. By way of an interim pension adjustment order, the respondent wife was to immediately receive half, i.e. 40% of the total value of the fund awarded in the High Court. The appellant was also to make available to the respondent a valuation of the pension funds. The court also made an order pursuant to s.17(20) of the 1996 Act, to the effect that the trustees of the Fund were not to disperse any of the remaining entitlements of the appellant (60%) in the Fund, pending further order of this Court. The appellant himself undertook not to interfere with the 60% balance held in the Fund pending the determination of this appeal.

9. The matter then returned to the High Court to give effect to the orders of this Court. On the 27th September, 2013, Abbott J. made orders pursuant to s.17(22)(a) of the 1996 Act to give effect to the interim order of this Court. He directed that the sum of €40,000 in respect of costs incurred by the administrators/trustees of the Fund be borne proportionately by the parties herein. The effect of this was that the appellant was to pay 50% of this full amount of €40.000, that is, €20,000, and the respondent was to pay the remaining 50%, that is also €20,000, to the trustees. These amounts were to be paid within a period of five days from the date of the order. In default of such payments, the sum of €40,000 was to be deducted by the trustees from the portion of the Fund payable to the respondent, subject to any necessary tax adjustments. The right of the respondent to claim a refund or set-off as against the appellant of €20,000 of such deduction was reserved. As stated, the appellant contends that these sums, by way of costs, are excessive.

10. The full appeal was subsequently remitted to the Court of Appeal, on foot of the 33rd Amendment to the Constitution, and the Court of Appeal Act, 2014. Matters rested there until the 4th July, 2018. The appellant then brought a Notice of Motion to the Court of Appeal. He sought an order setting aside the interim order of this Court dated the 16th May, 2013, and seeking that, instead, he should have access to 20% of his total entitlement in the Fund, which now equated to 33.33% of the remaining entitlements, following the respondent’s interim permitted encashment of her 40% of the Fund, which took place towards the end of 2014. He informed the Court of Appeal that at the time of the application the remaining entitlements had a value of €584,750. Thus, the 20% obtained by him had a value of €194,917, which, when added to the AVC fund of €90,526, gave a value of €285,443, out of which €20,000 had to be blocked to cover trustees’ costs, leaving a balance of €265,443. In early 2017, he availed of the draw-down of 30%.

11. On the 27th July, 2018, the Court of Appeal (Irvine J.) granted the appellant’s application. She directed that the interim order of this Court made on the 16th May, 2013, be amended, and that the husband be permitted to access 33.33% of the remaining fund, subject to the retention of €20,000 which might be required to meet the trustees’ fees. Irvine J. granted liberty to the applicant to notify the trustees and the administrators of the pension scheme of the making of that order. The costs were directed to be the costs of this appeal. The effect of this order was that the appellant had received all of his entitlement on foot of Abbott J.’s order.

12. Subsequently, the matter was transferred back to this Court on foot of an Article 64 order. The parties made their oral submissions succinctly. But it must be said that substantial parts of the material put before the Court was simply assertion, and was not backed up by evidence, or by reference to findings of fact by the High Court.

13. The parties’ circumstances have, in any case, changed since the year 2013. The written submissions cover many historic issues which are not material to this appeal. Those issues are no doubt still important to the parties, but were addressed in many past judgments of the courts in this litigation which goes back at least sixteen years. It can be said issues of child custody, maintenance, property, discovery, attachment and committal have been considered by courts at every level of the State. In this appeal, the parties have been permitted to present all or any material they wished to this Court. The Court has sought to adopt a flexible approach in the circumstances.

14. It should be said that, despite the unhappy differences between the parties, the couple’s children, M who was born in 1992, and E who was born in 1995, are now adults and are successfully making their way in the world. This fact is to the credit of both parties.

The Appellant’s Submissions
15. The appellant submits he now is in poorer health than at the time the High Court order was made. He is suffering from viral arthritis and has been diagnosed with a prostate problem. These are obviously serious complaints. He says his physical mobility is now significantly impeded. He has type 2 diabetes. He states he is being pursued by creditors through the courts in relation to debts that have arisen since the family law proceedings. He told the Court that he is hopelessly insolvent.

Blocking the Balance of Entitlements
16. The appellant referred the Court to part of the interim order made by this Court, which provided that the trustees were not to disperse any of the remainder of his entitlement in the defined pension scheme. He says that at the time of the making of these orders, he was aware that the balance of 40% of the award to the respondent would have to be blocked. In an act of good faith, he proposed that the entire remaining balance of entitlements could be blocked pending the determination of the appeal. But he submits he had not anticipated it would take a number of years to have the appeal finalised. He did not believe that his health would deteriorate as it has. Had he anticipated these events, he would not have offered to have his remaining benefits blocked.

17. The appellant says that, on foot of the interim orders made by this Court and then the High Court, the distribution to the respondent took place in late 2013. He says that the respondent received disbursements to a total value of €229,000, of which €63,500 remains blocked until the recipient attains the age of 75 years; €47,250 was in a tax-free payment and made available immediately to the respondent, and €109,750 was held in a bond to the order of the respondent.

18. The Scheme, he estimates, originally had a net value of approximately €800,000. With regard to the remainder of the Fund, he submits that justice would best be served by awarding him the balance of the Defined Benefit Scheme, and that the respondent should receive the full extent of her inheritance from her mother. The value of that inheritance, it should be said, is unclear. But the appellant says the respondent is due to inherit property to the value of €1 million. The appellant contends that, when the marriage began, he “brought to the table” a desirable home which together equals 47% of the total Fund value, amounting to €442,000. Whether this is a fair or accurate assessment of the situation cannot be determined as a matter of certainty.

19. The appellant submits that thus far the respondent has benefited from approximately €500,000 from the lump sums, and other sources. In 2003, she received a lump sum from previous court orders which amounted to €250,000. Of this, €168,000 went to discharge solicitors’ fees. He says there remained a balance of €82,000. It is said that the total value of the monies she received in 2013 from the Pension Fund is €222,000. He contends that the total value of maintenance paid to her over the years is €300,000. He is no longer obliged to pay maintenance. He submits that, by virtue of the High Court order under appeal, the respondent would be due to receive a further €380,000 from the appellant’s Defined Benefit Pension Fund. He submits that she has received an additional €70,000 from various sources, and benefited from the social services. By contrast, he submits that, on foot of Abbott J.’s order, he would be entitled only to €276,000, being €188,000 from the Defined Benefit Fund, and a further €88,000 from the AVC element. He contends that he has debts in the region of €600,000. It would appear from the High Court judgment of the 13th December, 2011, Abbott J., that this includes sums outstanding on the mortgage on the family home.

20. He contends that the disbursements already made to the respondent have apparently been expended with no tangible benefit to her, and with no indication that it was used to obtain or seek accommodation. He also complains that, when the funds were released, the respondent travelled to Italy for cosmetic surgery, costing €15,000, and bought a new car. He contends that the respondent has a history of non-disclosure in the proceedings. He says that her delays in dealing and selling the former home in Dublin has cost them both significant sums of money.

Mediation and Open Offer
21. The appellant submits that he has offered mediation to the respondent, but the respondent would not agree to share the costs of this. He says that earlier, in an open offer in 2018, he proposed that the respondent accept €120,000 from the pension fund, together with preserving the conditions in Abbott J.’s order, which provided that either party should be entitled to direct the other party to pay a lump sum amounting to 20% of the value of any inheritance net of any enforceable debts, taxes and expenses to which they might be entitled, on a death within ten years of the order. He contended the total value of this offer amounted to a potential after-tax amount of €288,000. He says this offer was refused.

The A.V.C.
22. The term “AVC” refers to an additional voluntary contribution. This may be used to top up a pension entitlement from a fund. The appellant has said that, were he to receive the 20% retained, together with the AVC fund of €90,526, this would give him a total of €285,443, out of which €20,000 would have to be blocked to cover trustees’ costs, thereby giving rise to a balance of €265,443. He says this could be used to pay-off his creditors and ease his financial situation. How this contention is arrived at is unclear.

Earnings
23. The appellant informed the Court of Appeal that his earnings for the years 2014, 2015 and 2016 totalled €33,000, equating to an average per annum income of €11,000. In order to provide for himself and the couple’s daughter, who is now living with him he drew down 30% of the AVC portion of his pension fund, yielding €32,000, which was used to bridge the gap of expenditure versus income. He says this draw-down occurred in early 2017, and is now fully expended. He denies the respondent’s assertions that he earns much more than the sums he has put before this Court.

Accommodation
24. The appellant fairly accepts he is living in the home which he inherited from his father, which is attached to the small stud farm he operates. But, he says, by the terms of his father’s will, he is entitled only to a life interest in the home which would thereafter go to other male members of his family, and not to his wife or daughters.

25. In oral submissions, he nuanced his position by submitting the Court should grant him 30% of the 40% of the fund which remains to be apportioned. He places reliance on the contention that he made a substantially greater contribution to the financial pool in the course of the marriage, and that he was in work or in receipt of income for this time.

The Respondent’s Submissions

Financial Circumstances
26. The respondent was born in 1957. The respondent contends that she is currently struggling to make ends meet, is in debt, and relying on borrowings to live on a day-to-day basis. She says she is living abroad in the house of a platonic friend. She accepts that this friend has helped her financially from time to time with issues like travel and airfares. While she is living abroad, she wishes to return to Ireland to be with her daughters. There are proceedings before the courts brought by family members concerning the provisions of her late mother’s will. She does not challenge the appellant’s calculations in any significant way.

Accommodation
27. The respondent states she, too, is being pursued through the courts by creditors, including family members, in relation to debts which are said to have built up as a result of the family law proceedings. Part of these borrowings came from her mother. This totalled €168,000. Part of the loans came from a brother. This amounted to €60,000. There are other debts. Neither of the children of the marriage are living with her. She is living abroad. She states that she wishes to return home. One of her reasons for wishing to do so is her desire to see more of the children, and to have a home to bring them to.

Legal Fees
28. The respondent states that most of the money she previously received from the pension fund has also been eaten up in discharging legal fees. By any standards, this was a very substantial sum, which is now of no direct benefit to either of the parties. There is apparently no dispute that this money has gone. The respondent has been represented by a number of different solicitors’ firms over the many years of the litigation between the parties which began in 2002.

Mediation
29. The respondent states she could not afford to pay the €4,000 out of the projected €8,000 cost of mediation. She took the view that it would be a complete waste of time. She too says that her health is poor. She submits the open offer by the appellant was inadequate for her needs. The respondent seeks to raise doubts in relation to the evidence which the appellant gave before Abbott J. regarding his income. But there is now no substantive evidence to support her doubts. Many of the submissions and the points made by both sides cover ground already traversed many times in many different courts.

Decision
30. This is a decision which can only be made on the basis of the material which is available to the Court. The judgment must be confined to its own facts. It is not entirely clear why Abbott J. arrived at the apportionment of 80% of the pension fund to the wife and 20% to the husband. Little would be gained at this stage by remitting the case to the High Court. What is needed at this stage is that this litigation be concluded. On the face of things, the parties are both in difficult financial circumstances. It is simply not possible to make a final pension adjustment order which can satisfy the needs of both parties. The available funds are insufficient to meet all the apparent debts. It would appear that the parties to varying degrees were certainly in a different and probably considerably better financial situation two decades ago than they are now. Other past issues reflected in various hearings and judgments, are now of little relevance to the two issues before the Court.

Proper Provision
31. The general duty of the Court in a divorce is to make proper provision for the parties, having regard to their financial circumstances. A pension adjustment order is part of this duty. The only issue between the parties in this appeal is the allocation of the remaining 40% of the Fund. Under the 1996 Act, this Court has to balance the respective rights, duties, obligations and circumstances of each of the parties.

32. Proper provision under the Act is not a case of who contributed “more”, but rather what is now appropriate and available for the parties. The simple fact is that the appellant is fortunate in that lifetime accommodation is available to him. He has a source of income, albeit an attenuated one. He submits he faces significant debts. It is to his credit that he is taking care of one child. But since Abbott J.’s order his health and finances have deteriorated significantly.

The Respondent
33. By contrast, the respondent has no home. She has told the Court she faces new difficulties in finding accommodation, and wishes to come back to Ireland to live. She previously successfully operated a business. She made efforts to revive her own business, but with no great long-term success. There is no evidence that she has worked in the recent past, or tried to do so. She has informed the Court she effectively has no income. She does not receive maintenance by a previous order of the High Court, which is not applied. The circumstances of the parties have undoubtedly altered since the time when Abbott J. made the order. Undoubtedly, the appellant’s health has deteriorated. What happened to the first draw-down, and the respondent’s accommodation needs raise a serious and weighty issue. While the position of both parties has worsened since 2013, the respondent’s situation has deteriorated more. At the moment, it appears she has no assets or home. The monies derived from this Court’s interim order, as realised by Abbott J.’s order in 2013, has now gone.

34. In general, the duty of this Court is to seek to identify whether the High Court judge erred in principle in making the award. But one cannot ignore the realities as they appear as of now. There is one particularly telling distinction between the situation of the parties: the appellant’s accommodation position is significantly more stable than the respondent’s. Whatever about his financial position, his accommodation is secure for his lifetime. Against this, the respondent has informed the Court she has no home, no income, and faces an uncertain future. From the papers in the case, it appears she ran businesses in the past, but not recently. Her financial needs are, at present, significantly greater than the appellant’s, who may have the benefit of the remaining AVC. While seeking to be fair to both sides, the more weighty factor identified, that is living accommodation, requires the Court to lean more towards the respondent than the appellant. But the Court cannot entirely ignore either, the fact that the appellant’s financial circumstances have significantly worsened. His health situation is relevant also. These are factors which Abbott J. did not, and could not have reasonably anticipated. These factors are significant and must be weighed in the balance. But due weight must be given to the respondent’s accommodation situation. I would direct that the respondent should receive 75%, that is three quarters of the balance of the fund, and the appellant 25%, or one quarter of the balance of the fund.

The Second Appeal
35. There is also a second appeal. The appellant submits the trustees’ and administrators’ costs were exorbitant. It is unnecessary to go into detail, as the trustees and administrators were not put on notice of the date of this appeal, or that the amount of their costs was to be challenged. The appellant says that, if the trustees and administrators of the scheme had followed the advices of one official in Mercers, there would not have been any difficulty regarding the realisation of the assets in the Fund. He says the costs which accrued as a result of these efforts were unnecessary. The appellant complains that the trustees and administrators unnecessarily set about making a transfer of 50% of the entire funds on two separate occasions, but that he subsequently applied to court to prevent this. He says the matter was appealed to the Supreme Court. He complains, in particular, that one representative of the trustees attended this Court, and is said to have charged the sum of €12,350 plus VAT for one day, that is, a total of €15,790.

36. The appellant has frankly admitted that he did not serve the trustees or the administrators with notice of the date of this appeal. The issue directly, or indirectly, affects both parties. But whatever sympathy one might feel in relation to these costs which were incurred, the position is that neither this Court, nor the High Court, would have been in a position to make the pension adjustment orders in the absence of information from them. This Court has no role in making a determination in relation to whether or not the fees were exorbitant. The High Court judge proposed that the matter of these costs might be dealt with by the Pensions Ombudsman. I am unable to see he erred in this. Whether any complaint to the Pensions Ombudsman was processed or not is unclear. Unfortunately, the Court cannot play a role in this question, however much sympathy one might feel for both parties.

37. I would allow the appeal to the extent set out in this judgment, and vary the order of the High Court accordingly. There will be no order for costs. Any matter outstanding must be dealt with by the High Court. The registrar of the Court received correspondence from both parties subsequent to the hearing. This was not appropriate. The issues raised in the letters have no significant bearing on the determination of the two issues. I would hope, however, that after many days of litigation over so many years, and hundreds of thousands of Euro in legal costs, this case will now end, as all cases ultimately must end.