If you don't ask, you don't get?

A recent judgment by the Inner House, Murdoch v Murdoch [2012] CSIH 002, has turned two broadly accepted principles regarding craves on their head.

The parties had been married for a short period and had a young son. The principal item of matrimonial property was the matrimonial home, which was held in the husband’s sole name. The wife raised an action for divorce at Hamilton Sheriff Court in which she sought transfer of the home to her. The husband had obtained rented council accommodation. The husband wished to retain the matrimonial home in his name until the property was sold. The sheriff ordered transfer of the home to the wife, who still lived there with the child. The wife was ordered to make a compensating payment of £20,600, even though there was no crave for this, in order to achieve fair sharing of the matrimonial property.

High risk strategy

The husband appealed, arguing that the order was incompetent where there was no crave for a capital sum. He refused to add such a crave when invited to amend by the sheriff principal, as he wanted the property to be sold. In a somewhat disastrous, but perhaps not unexpected turn of events for the husband, Temporary Sheriff Principal McKay struck out the order for payment to the husband as incompetent, but left the property transfer order standing, resulting in an unequal division of the matrimonial property. The husband’s refusal to crave payment was regarded as a special circumstance justifying this.

The sheriff principal’s decision followed a decision of Sheriff Principal Nicholson QC in Muir v Muir 1994 SCLR 178, where it was held that it was not competent to make an order for financial provision in respect of which there is no crave. The sheriff principal saw the matter as one of fair notice, and was also influenced by the then Sheriff Court Rules governing the making by the defender of an application for financial provision. Since that decision, this principle has been generally accepted by practitioners.

The husband appealed to the Inner House. Counsel for both parties took the view, no doubt following the reasoning of Muir, that for the sheriff to make order for a capital sum in the absence of a crave was incompetent.

Through the barrier

At an early stage in submissions, following exchanges with the bench, counsel for the wife took the step of tendering a minute of amendment craving transfer and, unusually, a balancing payment in favour of the husband. It has been generally thought that it was incompetent to crave an order on behalf of another party. However, the Inner House took the view that it is competent where such an order is ancillary to the principal order sought and is expedient to give effect to the principles set out in s 9. This was “consistent with common sense”, and it was “the plain objective of the 1985 Act to give the widest possible powers to courts to enable them to effect a fair division of the matrimonial property”.

It is no doubt significant that the Inner House considered that the sheriff’s approach at first instance did not give rise to any procedural unfairness, particularly in regard to fair notice. It was noted that a transfer of title in exchange for a capital payment was commonly found in practice, and that in this case the pursuer wife sought to have the obligation to make a counterbalancing payment imposed on herself.

The court therefore allowed the appeal in part and recalled the sheriff principal’s interlocutor, reinstating the decision at first instance. Given that it did so on the basis of the pursuer’s minute of amendment, it did not need to decide whether an order for payment of a capital sum was competent without a crave. However, the court indicated that it was “inclined to the view” that such an order would be competent.

It is clear that the courts do not take kindly to being forced into a particular decision through artificial procedural barriers, particularly where these are insisted on by one or other of the parties. Murdoch illustrates that courts will endeavour to find a solution that is fair and consistent with the ethos of the 1985 Act. However, encouraging as that is, the principles of fair notice set out in Muir still apply. Clients should still be advised to give careful consideration to the various disposals that the court may consider, and their default craves if they are to avoid fettering the court potentially to their disadvantage.