My Business has been impacted by Covid, can I vary the financial order relating to my marriage that was made before Covid?

In the last year Covid’s global detrimental impact on business and personal wealth has been vast. In Covid’s wake are a slew of individuals and business owners that have been faced with divorce settlements that bear no mind to financial losses from the pandemic that neither they or any court could have predicted or considered in a pre-Covid world.

In the case of FRB v DCA (No.3) 2020, a final order had been made in relation to a couples’ finances in March 2020, just as the pandemic took hold. It had been ordered that the wife was to received the matrimonial home free of mortgage and a lump sum of £49m paid in two tranches. In the absence of payment interest was payable on late payments with the whole balance of £49m being payable if the first instalment wasn’t paid on time and until the first payment was made, spousal maintenance of £720,000 per annum was to be paid.

Shortly after the Final Order the Husband applied to either vary the amount and timing of the payments he had been ordered to pay or otherwise set aside the lump sum he had been ordered to pay in two tranches on the basis that the new event, the pandemic, had invalidated the basis upon which the order was made within a relatively short period of time, known as a Barder event.

What appears central in the decision on the variation application was that in the original case the judge, Cohen J, had criticised the Husband’s financial disclosure and his honesty. As part of the variation application the Husband argued that his business interests (which included care home businesses, airlines and hotels) had been impacted by Covid, but had only made general statements about his assets and no documentation was provided of any substance that evidenced his wealth had reduced. There was no evidence that that there had been a folding of the Husband’s overall business interests which were wide ranging. The Judge was not persuaded bearing in mind his findings about the Husband’s honesty in the original matter, and refused the application entirely. He granted the Wife a legal services order meaning the Husband needed to pay for the Wife’s legal representation and increased the amount of periodical payments to reflect the lump sum that the husband had not paid.

So what can we learn from this case and the Court’s approach for those seeking to vary orders due to financial impact? First and foremost, full and frank financial disclosure and honesty in needed at all stages, and that if a variation is later sought, that further transparency is required. It further strengthens the advice that should variation of a financial order be considered that the party has to be prepared to fully disclose their position and evidence clear detriment, whilst endeavouring to comply with the original order as closely as possible. In our view such applications can be successfully argued if strongly evidenced that there has been clear financial detriment that will have an impact for a very significant period of time and that applicant’s need to be aware of the risk of a costs order against them if they make the application without what the court considers to be good cause.

Should you be considering a variation application, or indeed are considering your financial position in relation to the impact of Covid 19 in your separation, contact Tolhurst Fisher on 01702352511 or

Author: Nardia Tribe