Will COVID-19 Constitute a Barder Event in Financial Proceedings Following Divorce?

A ‘Barder Event’ describes a circumstance when an unexpected and unforeseen event invalidates the fundamental basis upon which a financial remedy order was made.  If such criteria are satisfied, the Court can revisit and alter the previous order.

In the tragic case Barder v Barder (1988), a husband had been ordered to transfer all of his interest in the family home to his ex-wife so that she could care for the two children.  Shortly after the order was made, the wife committed suicide and murdered their two children.  This was held to be a new unforeseen event which invalidated the basis of the financial order.

The Covid-19 Pandemic and its Financial Impact

The pandemic saw the economic markets plummet with businesses depreciating in value coupled with widespread furlough and redundancies.  It has therefore been considered whether the Covid-19 pandemic and the economic disruption it caused constitutes a ‘Barder Event’.  The high court has ruled, however, that it most likely will not be.

In a recent case, a financial order had been made a few months prior to the pandemic.  In which, it was ruled that of total assets worth 4.75million, the wife should receive 42% and the husband 58%.  This was on the basis that the husband was to keep an education business which pre-dated the marriage.  It was noted that the unequal division was to reflect the fact that the shares in the business to be retained by the husband bore with it an element of risk.  

Three months later, the Covid-19 pandemic hit and the shares held in the business plummeted in value and the husband sought to have the order set aside stating that it constituted a ‘barder event’.

The High Court dismissed his application.  A focus was placed on the economic impact of Coronavirus instead of its cause.  The financial impact of Coronavirus was compared to the economic impact of the stock market crash in 2008.  

It is therefore unlikely that the pandemic will be able to successfully constitute a Barder event.  Now the pandemic has been ongoing for over a year, it is likely that any such application brought now would likely fail due to it not being brought quick enough.

Questions can be raised in relation to the new Omicron variant of Coronavirus and the economic consequences that this will bring.  At this point, we do not know the full extent of what the Omicron variant or other such variants may bring, however, if the past is to go by, then the courts will likely not consider it a Barder event.  Only time will tell.  

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