Is the Coronavirus Pandemic a Barder Event?
2020 has been a difficult year at best for everyone. In March the government told us all to work from home and for many businesses this meant they had to close their doors. For some this was temporary but for others it was a permanent closure as despite the government schemes they could not afford the impact of lockdown.
For those that had recently entered into a financial Court Order out of their divorce this raised many questions. For those that had agreed to pay spousal maintenance, pay a lump sum or transfer an asset to their spouse the question was if they still had to do this or whether the order could be changed even if it had already been approved by the Court. Especially if the value of that asset or the paying parties income had changed.
To try and change a Final Financial Remedy Order, whether made by agreement or ordered at a Final Hearing you have to be able to demonstrate that a Barder event has occurred. You must make such an application swiftly ideally within weeks or potentially months of the event taking place. Delay of longer than a year normally leads to any application to have the order set aside failing.
Barder events fall within one of the following criteria:
- material non-disclosure, or
- an unforeseen and unforeseeable event has occurred since the order was made that has fundamentally undermined the order.
The Coronavirus pandemic would not meet the first two criteria.
To meet the third criteria of an unforeseen and unforeseeable event the Court has set out a further test that must be met:
- New events have occurred since the order was made that invalidate the basis or fundamental assumption on which it was made;
- The new events occurred within a relatively short time of the order being made;
- The application for leave to appeal out of time is made reasonably promptly in the circumstances of the case; and
- The grant of leave to appeal out of time would not prejudice third parties who have acquired interests in property which is the subject matter of the order.
This basically means that the event has to have happened rapidly after the order was made and that you then apply to the Court quickly. The event must specifically affect the provisions in the order. Your application must also not affect anyone who has gained an interest in any of the assets in question since the order was made.
This has been heavily debated. The threshold for a Barder event is very high. Succeeding in these application is rare.
Redundancy or the 2008 financial crisis have already been established in case law as events that do not meet the criteria of a Barder event. This is because employment always comes with a risk of redundancy and it is an accepted fact that the economic market will fluctuate.
Whilst the general consensus appears to be that the pandemic was unforeseen and unforeseeable the changing economic landscape as a result could be argued to be a financial crisis. The overall view within professionals is that it is unlikely to meet the criteria of a Barder event except in cases where the parties needs can no longer be met as a result of the pandemic.
All are waiting to see the first case come before the Senior Courts to see how this will be interpreted.
At Watson Thomas our staff can work from home and access all systems so even if all are required to self-isolate this will not affect the day-to-day running of your case. We can also hold appointments via telephone and video link as needs be to ensure that your service is not interrupted.