Potanina (Respondent) v Potanin (Appellant) - [2024] UKSC 3

Hilary Term
[2024] UKSC 3
On appeal from: [2021] EWCA Civ 702

JUDGMENT

Potanina (Respondent) vPotanin (Appellant)

before

Lord Lloyd-Jones
Lord Briggs
Lord Leggatt
Lord Stephens
Lady Rose

JUDGMENT GIVEN ON
31 January 2024

Heard on 31 October and 1 November 2023

Appellant
Lord Faulks KC
Rebecca Carew Pole KC
Rebecca Bailey-Harris
(Instructed by Payne Hicks Beach (London))

Respondent
Charles Howard KC
Deepak Nagpal KC
Jennifer Palmer
(Instructed by Hughes Fowler Carruthers Ltd)

LORD LEGGATT (with whom Lord Lloyd-Jones and Lady Rose agree):

Introduction

Rule one for any judge dealing with a case is that, before you make an order requested by one party, you must give the other party a chance to object. Sometimes a decision needs to be made before it is practicable to do this. Then you must do the next best thing, which is - if you make the order sought - to give the other party an opportunity to argue that the order should be set aside or varied. What is always unfair is to make a final order, only capable of correction on appeal, after hearing only from the party who wants you to make the order without allowing the other party to say why the order should not be made.

This fundamental principle of procedural fairness may seem so obvious and elementary that it goes without saying. On this appeal, however, we are asked to review a practice which has developed in dealing with applications under section 13 of Matrimonial and Family Proceedings Act 1984 that violates this fundamental principle. The practice has its origin in some observations made obiter in a judgment of this court in Agbaje v Agbaje [2010] UKSC 13; [2010] 1 AC 628. So far as the report of that case shows, no argument was addressed to the Supreme Court on the point, which was not an issue in the appeal. However, those obiter dicta have subsequently been treated as authoritative guidance which lower courts must follow.

The procedural history of the present case shows the mischief which this has caused. After a day of reading and hearing argument from the applicant alone without notice to the respondent, the judge made an order in the applicant’s favour under section 13 of the 1984 Act. When the respondent was notified of the order, he was told that he had the right to apply to have it set aside, which he did. After hearing argument from both sides, the judge concluded that the order sought by the applicant was not justified and should not be made. So he set aside his initial order and refused the section 13 application: [2019] EWCA Civ 2956 (Fam); [2020] Fam 189.

The Court of Appeal, however, following the practice by which they regarded the judge and themselves as bound, ruled that the judge should not have done this. No matter that after hearing what the respondent had to say the judge had come to the considered view that the application should be…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2024] UKSC 3
Decision Date

CaseChat Overview and Summary

The case of Potanina v Potanin concerned a dispute between former spouses over financial relief after divorce. The wife, Natalia Potanina, sought leave to apply for financial relief under Part III of the Matrimonial and Family Proceedings Act 1984 in the English courts. This required the leave of the court, which is granted only if there is substantial ground for making such an application. The wife applied for leave without notice to the husband, Vladimir Potanin, who was served with the order granting leave after the fact. The husband applied to set aside the leave, arguing that the order should not have been made without notice to him. The judge set aside the leave, but the Court of Appeal reinstated it, holding that the husband had no right to object to the grant of leave unless he could show that the judge had been materially misled at the initial hearing held in his absence. The Supreme Court allowed the husband's appeal, holding that the husband had an unconditional right to apply to set aside the leave, and that the rules of court did not require a "compelling reason" or "knock-out blow" to be shown. The court held that the approach taken by the Court of Appeal was inconsistent with the procedural rules and contrary to the fundamental principle of procedural fairness. The Supreme Court found that the current practice of requiring a "compelling reason" to set aside leave granted without notice was based on a series of misunderstandings and missteps and should be abandoned. The court held that the right to apply to set aside leave granted without notice was a fundamental right which could not be deprived by judicial practice.

Orders