In a recent ruling at the Family Court, Royal Courts of Justice, His Honour Judge Edward Hess emphasised the legal weight of a voluntarily negotiated financial settlement between a divorcing couple — even when a formal order had not yet been sealed.

The case of THR and WAT illustrates the importance of clarity and finality in divorce financial agreements, especially when parties claim to be Xydhias-bound — a legal principle confirming that an agreement reached through solicitors is binding, even if not formally endorsed by the court.

Background: Xydhias Principle in Divorce Cases

On 11 March 2025, both parties confirmed they had reached a financial agreement through negotiation between their legal teams. The agreement was considered Xydhias-binding, meaning the court could enforce it despite the absence of a signed consent order.

However, by 17 March, the couple returned to court, still disputing five specific issues:

1. Valuation of the wife’s company

2. Liability for legal costs

3. Whether interest should apply to future payments

4. Security over lump sum payments

5. The amount of child maintenance

Court’s Approach to the Disputed Terms

1. Valuation and Omissions

The husband tried to argue that key items, such as the company’s value, had been left out of the deal by mutual mistake.
Judge Hess rejected this claim, holding the husband to the terms of his own offer letter. He stated that the written agreement should stand as drafted.

“There was time to raise this if it was important.”

2. No Interest on Delayed Lump Sums

The court declined to impose interest on outstanding sums, as the wife did not raise the issue during negotiations. This underscored the importance of addressing all financial concerns up front during settlement discussions.

3. Security for Payments

Judge Hess accepted the husband’s voluntary offer of financial security, praising it as “reasonable in all of the circumstances.” He noted the husband had already made an early goodwill payment of £5 million.

Child Maintenance: An Independent Assessment

Child maintenance was the only issue that remained open for determination.
Judge Hess referred to guidance from James v Seymour [2023] EWHC 844, noting that:

“The needs of children must be finite whatever the payer’s income.”

He ordered £25,000 per child per year for each of the couple’s three children — a total of £75,000 annually in maintenance.