Hart v Hart: a cautionary tale

The degree of recalcitrance in this case was rare but not unique, and reminds practitioners to ensure clients comply with their obligations, including full and frank disclosure, from the outset

Obstructive clients are a lamentable part of a family lawyer’s practice. The emotion and bitterness that entwines matrimonial proceedings can be difficult for clients to disentangle. Pragmatism and objectivity become lost and sensibilities vanish. Thankfully these clients are not commonplace, but when one does come your way, a sinking feeling creeps into the pit of your stomach.

Hadkinson v Hadkinson [1952] 2 All ER 567 established the long-recognised principle, that:

“It was the plain and unqualified obligation of every person against, or in respect of, whom an order was made by a court of competent jurisdiction to obey it unless and until it was discharged, and disobedience of such an order would, as a general rule, result

in the person disobeying it being in contempt and punishable by committal or attachment and in an application to the court by him not being entertained until he had purged his contempt.”

Whilst Hadkinson seemingly employs a commonsense approach, this is apparently a difficult objective for some to overcome.

The sentencing decision in the recent case of Hart v Hart [2018] EWHC 549 (Fam) demonstrates the harsh reality of the very real consequences of non-compliance with orders, and should be used as a cautionary tale to recalcitrant clients.

Mr and Mrs Hart were married for over 23 years when divorce proceedings were issued in 2012. At the time of the final hearing in 2015, Mr Hart was aged 80 and Mrs Hart aged 59.

In the decision at first instance, handed down by HHJ Wildwood in 2015, W was awarded approximately £3.5m of the total assets of £9.5m, an award HHJ Wildwood deemed sufficient to provide for her needs.

The order included an award to W for a transfer of the shares in one of H’s companies, Drakestown Properties Limited. This company owned two industrial estates in the West Midlands and formed a substantial part of the total award made to her.

From the outset of the litigation, H’s disclosure was described as “very poor indeed”; he had produced “a deluge of partial information and patent misinformation”, with his evidence being “deliberately obstructive”. At the final hearing in 2015, H was described as “an irresponsible litigant and an unsatisfactory witness”.

Within the order of 25 June 2015, H gave an undertaking “to take all steps necessary (including, for the avoidance of doubt, the provision of information and documentation and the notification of third parties of the cessation of his interest in Drakestown Properties Ltd) to ensure that the Applicant is forthwith hereafter able to conduct the efficient and effective management of Drakestown Properties Ltd and its assets”.

The order also contained a warning that, if he failed to comply with the undertaking, he would be in contempt of court and liable to be imprisoned, fined or to have his assets seized.

H delayed the effective transfer of Drakestown Properties Limited to W and she engaged the Chancery Division of the High Court for her to gain possession of the company premises. Upon ultimate transfer of the premises H left behind two bank statements and a collection of current licences and leases relating to the units that the company letted. The judge determined that, “Nobody could possibly manage the company efficiently or effectively on the basis of that information alone, as Mr Hart well knew.”

HHJ Wildwood made two further orders, in February and July 2016, requiring H to produce the required information, to allow W effective management of the company, both of which contained penal notices, and both of which were found not to have been complied with. W made an application for H’s committal in September 2016 and after a further two hearings, H was committed on 15 March 2018 to 14 months imprisonment. At the time of sentencing H was 83 years old.

The following factors demonstrated the extent of the contempt:

    • his contempt was persistent;
    • his evidence was untruthful in an attempt to conceal his contempt;
    • he showed no remorse about failing to comply with his undertaking or the enforcement orders;
    • his contempt was fueled by resentment towards W, and he deliberately attempted to obstruct the running of the company; and
    • his actions had brought significant expense and pressure on W.

Referring to the case of Crystal Mews Ltd v Metterick & ors

[2005] EWHC 3087 (Ch), HHJ Wildwood found that:

    • W had been seriously prejudiced by H’s actions.
    • H had not acted under pressure. He acted out of a wish to put W under pressure due to his dissatisfaction with the outcome of the substantive proceedings.
    • His breaches were deliberate and sustained.
    • The breaches lay at a high level of culpability. They were persistent, damaging, motivated, continuing in part and bore no remorse at all from him. In the language of s143 of the Criminal Justice Act 2003, his contempt had caused deliberate financial and emotional harm to W.
    •  H was solely responsible for the breaches that he had committed.
    • H had not co-operated in the enforcement proceedings and did not appear to recognise the seriousness of what he had done.

The above factors were mitigated by H’s age, his previous good character, including his contributions to society and the effect that these proceedings had had on him, the breakdown of his relationship with his children, his isolation and ill health, his agreement to pay W’s substantial costs, and the fact that he had provided information that made good some – but not all – of the deficiencies set out by W.

Rather movingly, HHJ Wildwood described H, at the outset of the proceedings, to be an “upbeat, proud and canny business man”, compared with, at the committal proceedings some three years later, “an isolated and sad man seemingly unable to enjoy for his remaining years the millions of pounds that he still owns”.

The sorry tale of Mr Hart is not a frequent occurrence, although there are a few recent authorities to be aware of. In Young v Young [2013] EWHC 34 (Fam) Moor J committed Mr Young to six months’ imprisonment, despite Mr Young’s claim to suffer from ill health. In Al Baker v Al Baker [2015] EWHC 3229 (Fam) the husband was committed to nine months for failure to comply with two disclosure orders.

So what can we, as solicitors, do to ensure clients comply with their obligations and provide full and frank disclosure from the outset, and at what point do we have to refuse to continue to represent our client? To conclude, here are some points to consider:

    •  How many of us draw our client’s attention to the cover sheet of the form E and explain the uncompromising requirement of full and frank financial disclosure and the ramifications of non-compliance.

Often clients are simply unaware of the significance of disclosure and treat the process with a casual attitude, which then pervades the litigation as a whole.

    • Therapeutic input can assist clients on the slow road to emotional recovery. Lots of clients are battling significant resentment, which makes the divorce process even more overwhelming, leaving little energy to fully engage in the process, and/or further determination to make things more difficult for the other side. Therapy can help clients achieve perspective within the proceedings.
    • Divorce consultants offer a range of practical services that can help clients make the most of their time with you.
    • Encourage non-court dispute resolution, where appropriate, from the outset.
    • Consider the use of the round table meeting, a much-neglected instrument, which can be used really effectively.

There occasionally comes a time when, despite all our efforts, a client remains uncooperative. It is at this point that we, as solicitors, must decide whether we can continue to act for a client.

In Wv W (Financial provision: Form E) [2004] 1 FLR 494 Nicholas Mostyn QC, sitting as a deputy High Court judge, asserted that solicitors must distinguish between their duty to represent their client and their duty not to mislead the court.

But the litigant bears the ultimate responsibility for signing form E, and cannot hide behind the actions of their solicitor.

Resolution’s guidance note ‘Disclosure in financial cases’ (2016) summarises the requirements as set out in the Solicitor’s Code of Conduct and sets out very clearly at what point a solicitor must cease acting for a client:

    •  If your client refuses to disclose anything at all, you must advise them of the costs, sanctions and the risk of inferences being made by the court. However, you can continue to act provided you are not privy to any information that is not disclosed or is misleadingly disclosed.
    • If your client says they have an asset, but instructs you not to disclose, you cannot continue to act. You would be in breach of your duty to the court to not mislead it, and could also commit the offence of conspiracy to defraud, which survives the Fraud Act 2006, or fraud by failing to disclose information under s3 of that Act.
    • If, after initial disclosure, the client admits to the existence of additional assets and disclosure is then given, you can continue to act. If the client refuses to disclose, you cannot continue to act.
    • You must never compromise your professional integrity or your duty as an officer of the court.

It is hoped that the cautionary tale of Hart v Hart can be used to discourage future clients from employing such tactics.