- AuthorSandra Hickson
In the absence of any children from a marriage, divorcing couples are generally awarded roughly equal shares of the matrimonial assets, subject to their needs. However, the courts have recently ruled in a case where the wife argued that "because this was a short marriage he (i.e. her husband) should not get half of the matrimonial pot".
After a judge initially ruled that the husband was entitled to half the matrimonial assets, having subtracted, in the wife’s favour, pre-acquired assets of £1.45m, the Court of Appeal ruled that the original £2,725,000 award should be reduced to £2 million.
This change to a previously “sacred” principle of divorce law will almost certainly cause greater argument and dispute between some divorcing couples and therefore increase their legal costs. Mr and Mrs Sharp’s marriage had lasted four years, together with 18 months of cohabitation, during which time they had no children and kept their finances separate, except for the properties which were held in joint names and valued at £2.6m. They each earned approximately £100,000 a year when they met in 2007, but Mrs Sharp subsequently received bonuses of £10.5 million.
They separated when Mrs Sharp became aware of her husband’s affair. At the initial hearing a family judge ruled that the 43 year old Mr Sharp should receive half their total assets save for those conceded to be pre-acquired assets, as no sufficient reason had been given not to apply the established principle of equal shares.
The Court of Appeal ruled that the principle of equal shares is not inviolate, especially in a short, dual career marriage, where the parties kept their finances separate. In fact the Court of Appeal, ruled that abandoning the principle in the case of Mr and Mrs Sharp was "justified". Mr Sharp's award was reduced to £2 million, and included a house valued at £1.3 million, plus a £700,000 lump sum.
Lord Justice McFarlane said: “The husband made no contribution to the source of the wife's bonuses and this is not a case where, save in the final year, the husband is said to have contributed more to the home life or welfare of the family than the wife”. The judge stressed that nothing in the judgment was "intended in any manner to unsettle the clear understanding that has been reached ... on the approach that is to be taken in the vast majority of cases".
While some lawyers have suggested the effect of the decision is a "retrograde step" that will "lead to uncertainty in the law" and that the likely impact of the ruling is "considerable", it will, in my view, only affect relatively few couples. I consider that those couples that will be affected are those that the Court of Appeal described as having considerable wealth in a “non-business partnership, non-family asset case' where the bulk, indeed effectively all, of the property has been generated by the wife”, or of course husband.
It is easy to see matters from Mrs Sharp’s perspective, but Family Law solicitors will need to consider how long a marriage has to be for it to be defined as ‘short’ and after how many years of marriage individuals can make a claim on the wealth generated by their spouse?