MR Z AGAINST MS X [2023] ScotCS CSIH

EXTRA DIVISION, INNER HOUSE, COURT OF SESSION

[2023] CSIH 40

F66/18

Lord Malcolm

Lord Tyre

Lady Wise

OPINION OF THE COURT

delivered by LADY WISE

in the reclaiming motion

Mr Z

Defender/Reclaimer

against

Ms X

Pursuer/Respondent

Defender/Reclaimer: Smith KC, A Black; Brodies LLP

Pursuer/Respondent: Brabender KC; Turcan Connell

10 November 2023

Introduction and background

[1]

This reclaiming motion (appeal) concerns the extent to which the father of certain

children should have contributed and should contribute going forward to the school fees

incurred through their attendance at three different boarding schools. The parties to the

action have six children and these proceedings concern the youngest three.

[2]

Ms X and Mr Z were married, but separated in 2018 and divorced in 2020. Having

commenced litigation, they had ultimately agreed all of the financial matters arising from

their divorce including liability for payment of school fees, which were to be paid by Mr Z,

at least when the parties agreed on choice of school. A detailed minute of agreement

narrated what they had agreed and as a result this court dismissed the pursuer's conclusions

for payment of school fees, orders of court being unnecessary where there was an

enforceable agreement. In October 2022 the issue of payment of school fees was revisited at

proof on a Minute and Answers before the Lord Ordinary who issued an opinion ([2023] CSOH 48).

The background to the current dispute is explained therein. The Lord Ordinary

adopted fictitious names for the children to protect their anonymity and we will do the same

to provide continuity. In essence, the Lord Ordinary's decision was as follows:

(i)

that Mr Z would be ordered to meet all of James' school fees at school D until

4 July 2022 and that he would be liable for one sixth of James' school fees

from 4 July 2022 onwards;

(ii)

that in relation to Diana, Mr Z was found liable for all of her school fees at the

level at which those fees would have been incurred had she stayed at

school B until 4 July 2022, but that from 4 July 2022 onwards he was ordered

to pay one sixth of Diana's fees at school E;

(iii)

that Mr Z was found liable to pay all of Euan's school fees at school C up to

4 July 2022 and to meet one sixth of those fees from 4 July 2022 onwards.

[3]

On 6 July 2023 the Lord Ordinary made orders giving effect to her findings on the

issues of principle in relation to liability for school fees. Some of that involved

reimbursement to Ms X who had met James and Diana's fees. Having heard argument the

Lord Ordinary determined also that Mr Z should be liable in expenses to the extent of seven

eighths of Ms X's expenses of the Minute and Answers procedure. Mr Z challenges those

decisions.

Relevant legislation

[4]

Orders for aliment in respect of educational expenses are governed by the provisions

of sections 3-7 of the Family Law (Scotland) Act 1985. In so far as relevant to these

proceedings those provisions are in the following terms:

Powers of court in action for aliment.

(1)

The court may, if it thinks fit, grant decree in an action for aliment,

and in granting such decree shall have power--

(a)

to order the making of periodical payments, whether for a

definite or an indefinite period or until the happening of a

specified event;

(b)

to order the making of alimentary payments of an occasional

or special nature, including payments in respect of inlying,

funeral or educational expenses;

(c)

to backdate an award of aliment under this Act--

(i)

to the date of the bringing of the action or to such later

date as the court thinks fit; or

(ii)

on special cause shown, to a date prior to the bringing

of the action; ....

Amount of aliment

(1)

In determining the amount of aliment to award in an action for

aliment, the court shall, subject to subsection (3) below, have regard--

(a)

to the needs and resources of the parties;

(b)

to the earning capacities of the parties;

(c)

generally to all the circumstances of the case.

...

(3)

In having regard under subsection (1)(c) above generally to all the

circumstances of the case, the court--

(a)

may, if it thinks fit, take account of any support, financial or

otherwise, given by the defender to any person whom he

maintains as a dependant in his household, whether or not the

defender owes an obligation of aliment to that person; and

(b)

shall not take account of any conduct of a party unless it

would be manifestly inequitable to leave it out of account.

...

Agreements on aliment

...

(2)

Where a person who owes an obligation of aliment to another person

has entered into an agreement to pay aliment to or for the benefit of

the other person, on a material change of circumstances application

may be made to the court by or on behalf of either person for variation

of the amount payable under the agreement or for termination of the

agreement.

(2ZA) On an application under subsection (2) above, the court may--

...

(b)

make an order backdating a variation of the amount payable

under the agreement to--

(i)

the date of the application or such later date as the

court thinks fit; or

(ii)

on special cause shown, a date prior to the date of the

application.

Interpretation

(1)

In this Act, unless the context otherwise requires--

...

`resources' means present and foreseeable resources; ..."

Submissions

Reclaimer

[5]

In advancing his submissions senior counsel for the reclaimer confirmed that he

would not insist in the first of his four grounds of appeal. The three matters with which he

continued to take issue related to (i) Mr Z's liability for the whole of James and Diana's

school fees (the latter at the lower rate for school B) for the period from December 2021 to

4 July 2022; (ii) the requirement that Mr Z then pay one sixth of the school fees for all three

children from 4 July 2022 onwards and (iii) the finding that Mr Z should be liable for

expenses of the Minute and Answers procedure to the extent of seven eighths of their total.

While initially the grounds of appeal had related to payment of fees for all three children for

the period prior to 4 July 2022 that was no longer insisted in for Euan as Mr Z had paid his

fees in full for the period to 4 July 2022. The argument in relation to Euan was restricted to

the Lord Ordinary's finding that Mr Z should be liable to pay one sixth of his fees from

4 July 2022 onwards.

[6]

Mr Smith submitted that the Lord Ordinary had erred in law in relying on Mr Z's

resources during the period December 2021 to 4 July 2022 in considering whether he had

sufficient resources to pay school fees. The error appeared both at the end of paragraph 87

in relation to James and at the end of paragraph 91 in relation to Diana. In both of those

passages the Lord Ordinary had relied on Mr Z's resources for that earlier period rather than

his present and foreseeable resources as required by section 4(1)(a), interpreted in

accordance with section 27 of the 1985 Act. The assessment of resources required to be those

available or foreseeable at the time of proof and prospectively. This retrospective analysis of

resources had resulted in the Lord Ordinary failing to take into account that Mr Z was

"practically bankrupt" by the time of the proof. While criticisms had been made of monies

spent by Mr Z during the first six months of 2022, the fact remained that the money had

gone and by the time of proof Mr Z had lost his employment and was in straitened

circumstances. The Lord Ordinary's error had resulted in her making a backdated award of

aliment for educational expenses that was not justified. The court should consider whether

there are resources available to meet an award of aliment at the time it is made - Semple v

Semple 1995 SCLR 569. Had the Lord Ordinary proceeded to consider Mr Z's present and

foreseeable resources in relation to his ability to pay school fees for the period prior to 4 July

2022 she would have been bound to reach the conclusion that it would be manifestly

unreasonable for him to make payment in full now of those earlier school fees.

[7]

The next challenge was to the Lord Ordinary's assessment of Mr Z's resources in

relation to the period from 4 July 2022 onwards. In assessing Mr Z's resources, the

Lord Ordinary had taken account of the potential proceeds from the sale of a reservoir he

had purchased in March 2022. Having considered that his capital resources were not easily

realisable as a generality, the Lord Ordinary then drew a distinction between Mr Z's farm as

not being a present or foreseeable resource for the purpose of paying school fees and the

reservoir, which she regarded as "in a different category in that it can be sold without the proceeds

necessarily being applied to the secured loan. It is worth around £107,000." (para 102 of the

Lord Ordinary's opinion.) Mr Smith submitted that there was no evidence before the

Lord Ordinary justifying a finding that any potential proceeds from a sale of the reservoir

could be available to fund payment of school fees. There had been evidence from a

Mr Gourlay, a director of the private bank of which Mr Z is a customer. His evidence

confirmed that there was no standard security over the reservoir. However the evidence

was that additional borrowing had been provided for the purchase of the reservoir on the

basis that there was sufficient headroom in the existing borrowing over the farm to enable

provision of the funds. Mr Gourlay had not been asked whether the bank would seek

repayment of the secured loan or any part of it in the event of the sale of the reservoir.

Accordingly the Lord Ordinary had erred in factoring in the potential proceeds from the sale

of that asset when assessing resources for the purpose of payment of school fees.

[8]

There were other curiosities in the way in which the Lord Ordinary had approached

the issue of available resources. At paragraph 97 of her opinion she had looked to calculate

whether Mr Z would have "free income" from which he could pay school fees. She assessed

his total annual income going forward as about £161,629 per annum. That figure would fall

by about £25,000 gross per annum when the A points he continued to hold through the LLP

by which had previously been employed and in which he continued to have an interest,

were realised. Overall Mr Z was likely to have a net monthly income of just over £8,000 per

calendar month going forward which would then reduce to £6,833 per calendar month. It

was submitted that aliment is primarily an income-based liability and on the figures

provided Mr Z could not meet payment of school fees from income given the level of his

outgoings. It was not accepted that his outgoings were unvouched in the way suggested by

the Lord Ordinary.

[9]

So far as other assets were concerned, the A points referred to in the Lord Ordinary's

opinion had been sold since the proof but for considerably less than their estimated value at

proof of £150,000. However, no vouching was produced to this court confirming the sum

received for that asset. Mr Z continues to hold shares in AB Ltd. Senior counsel confirmed

there was correspondence about whether or not those shares would be acquired as

previously planned but the current situation remained that their estimated value (in excess

of £1 million) remained unrealisable. Mr Z continued to have a significant liability to

HMRC. He was involved in defending an ongoing damages action at the instance of his ex-

wife, which may result in further legal fees notwithstanding the Lord Ordinary's view that

legal fees would not be ongoing. In contrast Ms X has very considerable cash resources,

over £500,000 at the time of proof and there was no reason why she could not try to get a job.

Mr Smith submitted that unless Ms Z was prepared to pay all of the school fees from cash

reserves or otherwise the children may have to leave their respective schools. The

Lord Ordinary should have contrasted the unrealisable nature of Mr Z's assets, including

the reservoir, at the time she was making the award, with the significant and realisable

assets available to Ms X. There was no evidence of a market for the reservoir. The

Lord Ordinary had failed to take into account that by the time of the proof Mr Z simply did

not have the resources to meet his ex-wife's claim for 50% of the school fees going forward.

[10]

The award of expenses made was also challenged as unjustified. The Lord Ordinary

had provided a short supplementary opinion on this issue. Senior counsel submitted that it

was a struggle to discern the reasons for the decision that Mr Z should be liable for seven

eighths of the expenses of the whole procedure. He accepted that it would be unusual for

the court to interfere with a finding on expenses which were usually primarily within the

discretion of the Lord Ordinary (Howitt v Alexander & Sons 1948 SC 154). However, in a

family case there was a different dynamic. Following the abolition of the old rule that the

husband paid both sides' expenses a practice had developed of each side paying their own

expenses. In the circumstances of this case, such an outcome would be particularly generous

to Ms X given that Mr Z had enjoyed very substantial success. As the Lord Ordinary

recorded, a significant amount of time at proof had been taken up with Ms X's decision to

remove Diana from the preparatory school she had been attending, at which the fees were

far lower, and remove her to a new school. Mr Z had succeeded in restricting his liability for

fees at the new school prior to July 2022 to the level he would have paid at the old school.

He had then succeeded also in being found liable for only one sixth of the school fees for all

three children going forward in contrast with the 50% contribution sought by his ex-wife.

He had made an offer early in the proceedings that each side would pay 50% of the school

fees pending the court's determination on the basis that the party who paid more than the

court ultimately awarded would be retrospectively reimbursed. There had been no

response to that offer. Notwithstanding the substantial success achieved by Mr Z he would

be content with a finding of no expenses due to or by for the Outer House procedure.

Respondent

[11]

Ms Brabender for Ms X drew attention to the chronology of the proceedings. A

minute varying the divorce decree, which had made no order for aliment, was raised on

3 December 2021. Mr Z was due to stand trial in connection with domestic abuse allegations

and it was ultimately agreed that proof in these proceedings should take place after that trial

concluded. Mr Z had been convicted of assault and breach of the peace in June 2022 and

had resigned his employment on 3 July that year. For that reason the proof had been further

delayed until October 2022 so that up to date financial circumstances could be considered.

That was the background to the Lord Ordinary's consideration of the two separate periods.

[12]

Many of the points made by senior counsel for Mr Z in oral argument had not been

focused in the grounds of appeal. For example, the grounds of appeal were silent about the

Lord Ordinary's finding that Mr Z had failed to provide vouching for his expenditure or the

finding that there was insufficient information to conclude how much he owed to HMRC.

There was no evidence before the Lord Ordinary that Mr Z was "practically bankrupt" and

any such evidence would have been challenged. Mr Z had net capital resources of

£2.2 million at the time of the proof. His estate (or farm) was worth £1.2 million albeit that

there were borrowings of £736,000 secured over it. The shares in AB Ltd were worth over a

million pounds. The estimate given at proof of the value of the A points was £188,591 and

the reservoir and relative land, unencumbered by any secured debt, was worth £107,000.

The court should not ignore that Mr Z also had resources from income as detailed by the

Lord Ordinary. His total income from dividends, pension, A points distribution and two

holiday lets, albeit that he diverted that income to his partner, was not inconsiderable. The

evidence simply did not support that Mr Z could not contribute anything to payment of his

children's school fees.

[13]

It was also noted that Mr Z was making no payments of ordinary aliment for the

children. There had been a child maintenance service assessment as narrated by the

Lord Ordinary but Mr Z had sought and been granted a moratorium of six months on that

in accordance with the emergency Covid legislation. Accordingly, Ms X required currently

to meet all of the children's outgoings together with the fees and extras from her capital pot

which was now much reduced from the £571,000 she had held at the time of proof.

[14]

On whether the Lord Ordinary's references to past resources when determining the

issue for the period from December 2021 to July 2022 represented an error in law, senior

counsel submitted that the attempt to use a few words within a full opinion to contend for a

particular interpretation of section 4 of the 1985 Act was not justified. The opinion had to be

read as a whole. It was clear that the Lord Ordinary had taken the relative needs of the

parties and their children into account together with their respective resources and their

earning capacities. Section 4 of the Act required the court to look at all of the circumstances.

Those circumstances included that, at a time when he had very considerable income and

assets by way of resources, Mr Z had chosen to purchase a reservoir, buy a digger and

renovate properties in preference to paying for his children's school fees. Those were

relevant circumstances for the Lord Ordinary to consider. The sums for which Mr Z was

ultimately found liable on 6 July 2023 took into account that he had ceased making any

contribution at all. He had met Euan's school fees during the period to July 2022, which

supported the Lord Ordinary's finding that he had resources from which to pay school fees

during that period.

[15]

So far as the position going forward was concerned, on the figures assessed by the

Lord Ordinary, Mr Z will require to pay only £22,075 for the academic year 2023/2024 as

against the £110,000 due by Ms X. James will leave school in the summer of 2024 and the

annual fees will then reduce such that Mr Z's contribution for one sixth of the two remaining

children's school fees will amount to £15,500. Euan will then leave school in 2025 after

which only Diana will continue to attend school. Mr Z's contribution for one sixth of her

school fees from that point will be about £7,500 per annum. The backdated period fairly

reflected the situation prior to Mr Z resigning his employment in early July 2022. His

resources during that period and going forward were only one of the issues that the court

had to take into account. This court should be slow to interfere with what was in essence a

discretionary decision on the part of the Lord Ordinary. Unless the court was satisfied that

she had misdirected herself in law or failed to take into account a relevant and material

factor or had reached her result which was manifestly inequitable or plainly wrong, the

decision should stand (Little v Little 1990 SLT 785 at 786-787).

[16]

Ultimately, consideration of Mr Z's resources at a point when he refused to pay but

could pay was a relevant circumstance of the case for the Lord Ordinary to take into

account. Similarly, his demeanour in evidence and his comment in re-examination that he

could have used the proceeds of the sale of his Land Rover for school fees if the children's

attitude to him had been different were all factors that the Lord Ordinary had been entitled

to take into account. So far as the reservoir was concerned, this had been purchased six

months prior to proof which itself provided clear evidence of a market. As it was not

burdened by any standard security and Mr Gourlay had not been asked whether its sale

would involve any payments having to be repaid to the bank, the Lord Ordinary had been

entitled not to discount that asset as a present and foreseeable resource. It would have been

for Mr Z to lead evidence of a lack of marketability and/or consequences of the reservoir

being sold and he had not done so. The suggestion that it was somehow incumbent on Ms X

to explore whether the reservoir was realisable was without foundation. It was an asset over

which Mr Z had full control.

[17]

So far as expenses were concerned, a decision on those was entirely discretionary.

The Lord Ordinary had case managed the proceedings and heard three days of proof and

submissions. She was uniquely well placed to decide on the question of expenses. The most

authoritative decision on how to approach questions of expenses in family actions that

include financial claims was Sweeney v Sweeney No. 3 2007 SC 396. The First Division there

confirmed that it is not inconsistent with fairness that a party who is put to expense in

vindicating their rights should be able to recover some or all of that expense. There was a

particularly important relationship between the judicial award ultimately made and any

offer that had been put forward by the obligant. In the present case there had been no offer

made that would have avoided the litigation. Ms X required to litigate to proof. She

succeeded in relation to the pre-July 2022 period and has secured an order for one sixth of

payment of the school fees for all three children going forward. Without having litigated

she would not have received any contribution from Mr Z. The issue of conduct of the

proceedings is relevant to expenses. Mr Z had also sought an order from the court in his

Answers to Ms X's Minute. He had tried to vary the minute of agreement by reducing his

contribution to Euan's school fees to nil. He had been unsuccessful in that. There was

simply no basis for this court to interfere with the Lord Ordinary's decision on expenses.

Decision

[18]

A party's ability to pay aliment in the form of school fees is not restricted to an

income based analysis. In the circumstances of the present case, the Lord Ordinary required

to consider the needs of the parties and their children and both income and capital resources

before concluding how the liability for school fees could reasonably be met. Dealing first

with the argument that she erred in her conclusion that Mr Z is able to pay one sixth of each

of the three children's school fees going forward, the analysis of that is contained in

paragraphs 92-104 of the Lord Ordinary's Opinion. In brief summary, Ms X has no income

other than some rental income derived from letting out part of her home. That home

represents a significant capital asset (about £2.5 million in value) and is unencumbered by

borrowing. It can and is likely to be sold, but will no doubt require to be replaced by a

smaller family home. Ms X also had capital of over £500,000 at the time of proof, which was

what remained of the capital settlement she had received on divorce. Mr Z's income from a

number of sources had reduced to £161,629 gross per annum. He had produced a schedule

indicating a monthly deficit after meeting all of his expenses, but it was largely unvouched.

He had capital assets worth about £2.2 million but most were unrealisable, particularly his

farm, over which there are significant borrowings, and his shares in AB Limited, which were

of uncertain realisability. It was clear that neither party could currently meet payment of

school fees from income and that Ms X's available capital was more accessible. Both parties,

however, held significant capital assets that required to be taken into account, the conclusion

having been reached that it would be desirable for all three children to remain at their

current schools.

[19]

In assessing what contribution Mr Z could make to school fees, attention turned to

the reservoir that he had purchased during the course of the proceedings. Indisputably, that

item of heritable property is unencumbered by secured borrowing. Mr Z holds sole title to

the adjacent property where he lives and which includes properties that are let out. At proof

he had called his banker Mr Gourlay to give evidence about the circumstances in which an

additional loan had been made to him to enable the purchase to conclude. As the bare facts

of the purchase and the absence of a formal security over the reservoir were known, the

responsibility for leading evidence that the reservoir was not truly unencumbered because

the bank might look for repayment of some of the loan secured over the farm were it to be

sold rested squarely on Mr Z.

[20]

We have considered the evidence of Mr Gourlay, who had provided an affidavit and

was examined and cross-examined. Neither side enquired of him whether the bank

considered that it would be able to call on Mr Z to reduce his secured borrowings in the

event of a sale of the reservoir. The court was left without any evidence that the bank would

do so, or what the basis for such a request would be. There was no evidence that the bank

had even mooted the idea of additional security when it advanced funds for the reservoir

purchase. The documentation put to Mr Gourlay in evidence confirmed little more than that

there were errors in some of the detail about Mr Z's situation, as the recorded information

was out of date. It seems that the communications about the additional advance were

relatively informal. Mr Z was regarded as a high net worth client and the loan to value ratio

of the secured property was apparently not of concern. We conclude that the Lord Ordinary

was entirely justified in identifying the reservoir as a realisable resource. It had been

purchased only a few months previously, which indicated that it was a marketable asset.

More importantly, its purchase represented one of the many examples of Mr Z electing to

prioritise acquisition of assets for his own use over meeting his alimentary obligations to his

children. That tendency was a circumstance of the case that the Lord Ordinary was fully

entitled to take into account.

[21]

We can identify no error in the Lord Ordinary's approach to the respective

contributions for school fees to be made by each of the parties going forward. A decision

that Mr Z be liable for only one sixth of each child's fees took ample account of his presently

reduced circumstances. The burden will be far greater on Ms X, whose capital settlement

has already been depleted by meeting James and Diana's school fees during the period that

Mr Z refused to pay. The decision reached was well within the discretion available to the

Lord Ordinary.

[22]

On the issue of whether the Lord Ordinary erred in law by failing to rely only on

present and foreseeable resources in ordering Mr Z to meet all of James and Diana's school

fees for the period December 2021 to 4 July 2022, the context is important. As a result of

being convicted of assault of his ex-wife and related breach of the peace charges, Mr Z

resigned from his employment. We were told that he knew he would be asked to leave in

consequence of the convictions and so left voluntarily. His departure from the business

resulted in a very significant drop in income for Mr Z, from well over £500,000 per annum

gross to £161,629 gross. The Lord Ordinary divided her analysis of what should be paid for

school fees into two separate periods, one relating to the period when Mr Z could have paid

and did not and then the period post resignation looking prospectively. There was a

marked difference in the level at which the Lord Ordinary determined that Mr Z should

meet his obligation to aliment the children by paying school fees as between those distinct

periods. In relation to the earlier period, so far as James and Diana were concerned, the

Lord Ordinary stated in terms that she was satisfied that his being made liable for the whole

amount was reasonable having regard to his resources prior to 4 July 2022, which was stated

to be the "material time" paragraphs 87 and 91 of the Lord Ordinary's opinion.

[23]

The context of these awards of aliment was that they were new orders and not a

variation of an existing order or agreement. While they were two distinct awards relating to

different periods, one a backdated award and the other to apply from decree onwards, they

represented different components of a global alimentary decision. Section 4(1)(a) of the

1985 Act requires the court to have regard to the needs and resources of the parties and

section 27(1) defines resources as being present and foreseeable resources. It would

undoubtedly be an error to rely solely on resources from a historic period in making an

award that would require to be met from current and foreseeable resources. It would not,

however, be erroneous to take into account various other circumstances of the case, such as a

past refusal to pay when able to do so, in making such an award.

[24]

At the time when Mr Z refused to pay James's and Diana's school fees, the dispute

was unrelated to economic resources but was about choice of school. The Lord Ordinary

was entitled to treat this as a relevant consideration. However, we accept the submission

made on Mr Z's behalf that her decision to find him liable for those school fees appears to

have been based primarily upon the resources which had been available to him during that

period of time. It is not clear that the requirement to consider present and foreseeable

resources at the time of proof as one of the factors listed in section 4 was applied rigorously

in relation to Mr Z's ability to pay now for the period from December 2021 to 4 July 2022. To

that extent the Lord Ordinary erred in law and it is necessary for us consider the matter of

new.

[25]

There are a number of factors that require to be considered when determining

whether to make an award of aliment for the period to July 2022 and if so at what level. In

the circumstances of the present case those factors included, amongst others, the following;

(i)

that Mr Z chose not to pay the school fees necessary for James and Diana's

attendance at school at a time when he was well able to do so;

(ii)

that Mr Z's income resources at the time of proof were much reduced but that

he still had significant income in comparison with that of Ms X;

(iii)

that Mr Z had chosen to purchase a reservoir and a digger while at the same

time refusing to pay school fees;

(iv)

that Mr Z had not vouched his current income and expenditure position fully;

(v)

that Mr Z was making no payments of ordinary aliment for the children;

(vi)

that the parties had agreed in principle on expensive schooling for all three of

their children;

(vii)

that Mr Z had paid Euan's school fees after July 2022, illustrating that he was

able to find money for school fees after the drop in his income;

(viii) that Mr Z's capital resources at the time of proof included capital assets that

could or were going to be realised, particularly the reservoir and the A points;

(ix)

that a distinction could properly be drawn between reimbursing Ms X for

payments she had made while proceedings were ongoing to avoid the

children having to leave their respective schools and an assessment of the

parties' respective contributions for school fees going forward; and

(x)

that Mr Z's payment of one sixth of the children's school fees going forward

would reduce over time as each child left school.

Taking all of those factors into account, we consider that the conclusion reached by the

Lord Ordinary was easily justified by the circumstances of the case. Accordingly, even

when the focus on past resources in paragraphs 87 and 91 is regarded as erroneous, the

overall result was entirely fair.

[26]

In any event, the decision that Mr Z should pay all of the children's school fees until

the point at which he had to resign from his employment must, as we have indicated, be

regarded as one part of a holistic decision. While the court must be satisfied that any order

it makes can be met from present and foreseeable resources, the liability for all fees prior to

July 2022 is one component of a decision that requires Mr Z to pay only a small fraction of

the total school fees bill thereafter. On the information available, we are unable to fault the

Lord Ordinary's conclusion that Mr Z can, now and in the foreseeable future, realise funds

both to reimburse Ms X for the period to July 2022 and to make a one sixth contribution to

the total (albeit reducing from 2024) school fees bill thereafter.

[27]

So far as the finding on expenses is concerned, this was a matter for the

Lord Ordinary's discretion and which she was best placed to decide. Having heard the

proof and against a backdrop of the substantive decisions she had made, the Lord Ordinary

took the view that finding Mr Z liable for seven eights of the expenses occasioned by the

Minute and Answers would best reflect the competing arguments about how success had

been divided. Two issues were of particular relevance. First, Ms X required to litigate in

order to secure orders for payment of any contribution to school fees from Mr Z. Secondly,

there had been no extra judicial offer at all by Mr Z as potential obligant, to settle the matter

without a court determination. The offer he had made in December 2021 was in effect to

make conditional payments of fees that would be reimbursed to him should he succeed at

proof. No proposals were made on the basis that proof could be avoided if those proposals

were accepted. Those matters had to be set against the success both that Mr Z had achieved

in relation to Diana's change of school and limiting his future school fees contribution and

Ms X's own success in having him ordered to reimburse her for the period to July 2022 and

securing a contribution for the future.

[28]

It is well established that, although the principle that expenses follow success is not

applied in its full rigour in financial family proceedings (Little v Little 1990 SLT 785 at 790),

there is no general rule that each party should pay their own expenses where they have been

unable to resolve matters extra judicially. The clear context of the First Division's dictum in

Sweeney v Sweeney (No. 3) 2007 SC 396 to the effect that what will be of primary significance

is the relationship of the judicial award to any offer made, was a discussion about offers

made with a view to settlement of the case. The present case can be regarded as one in

which there was no meaningful offer advanced by Mr Z as potential obligant. Notably, it is

also a case where one party (Mr Z) was found to have failed to make full disclosure of

relevant material, a matter that the court in Sweeney considered relevant as militating away

from a finding of no expenses due to or by see paragraph 7. In our view, the

Lord Ordinary's decision on expenses fell within the discretion available to her and cannot

be faulted.

[29]

For the reasons given, the reclaiming motion is refused. We shall reserve meantime

all questions of the expenses arising from the appellate stage of the case.

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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> MR Z AGAINST MS X [2023] ScotCS CSIH_40 (10 November 2023) URL: http://www.bailii.org/scot/cases/ScotCS/2023/2023_CSIH_40.html Cite as: [2023] CSIH 40, [2023] ScotCS CSIH_40

Scottish Court of Session Decisions