Schedule 1 Child Maintenance Case Update

At Hegarty, we pride ourselves on staying at the forefront of legal developments to ensure our clients receive accurate, up-to-date advice.

In this case law update, Benjamin Parker examines an important recent decision concerning Schedule 1 applications—a significant area of Family Law that often raises complex financial and practical considerations.

Understanding Schedule 1 Applications

A Schedule 1 claim or application is typically made by a parent, guardian, or special guardian seeking financial provision for a child from the other parent. While these applications are often associated with unmarried parents, married parents can also make such claims. However, it may be more appropriate for married parents to seek financial provision under the Matrimonial Causes Act 1973, which grants the court wider powers.

The Financial Remedies Court can award a range of remedies under Schedule 1, including:

• Transfer of property
• Periodical payments
• Lump sum payments
• Settlement of property for the benefit of the child

Focus of the Case: Settlement of Property

Benjamin highlights a recent case, SP v QR [2024], which focused on the remedy of settling property for the benefit of the child. This remedy typically means a property is held on trust for the child until they reach 18 or complete secondary education, after which the property reverts to the original owner or is sold.

Case Background

In SP v QR [2024], heard by His Honour Judge Hess, the parties had cohabited in a London flat owned by the father. They were together for six years and had a child born in 2017 who had additional needs. Key details:

• The flat had an interest-only mortgage (~£130,000) with estimated net sale proceeds of around £370,000.
• The father also held minority shareholdings, which were illiquid but potentially valuable.
• The mother had no assets, relied on benefits, and planned to return to work.

The central issue was whether the court could order the settlement of a mortgaged property where the father wasn’t entitled to the full value outright.

The Court’s Decision

His Honour Judge Hess ruled:

• The court can settle mortgaged property on a parent for the benefit of the child, provided no new borrowing is required. The father’s entitlement to the property could still be settled, subject to the rights of the mortgage lender.
• The court could not order the father to pay the existing mortgage instalments beyond what was covered by statutory child maintenance. Such payments would effectively act as disguised child maintenance, which falls under the jurisdiction of the Child Maintenance Service (CMS).
• The court reaffirmed that unless the paying parent earns over £156,000 per annum, the court cannot order top-up maintenance beyond the CMS calculation.

What This Means for Clients

This case clarifies several key points:

• A parent may be awarded use of a mortgaged property under Schedule 1 if it meets the child’s needs.
• Mortgage payments generally won’t be ordered unless they are capital repayments, not interest-only.
• The court cannot order payments that replicate top-up maintenance unless the paying parent’s income exceeds the CMS threshold.

Expert Legal Support When You Need It Most

Financial provision claims for children can be complex and emotionally charged. At Hegarty, our family law specialists closely track case law developments like SP v QR [2024] to provide our clients with practical, tailored advice.

If you need guidance on Schedule 1 applications, child maintenance disputes, or other family law matters, contact our experienced team today. We’re here to help you protect your child’s future.