Investments  

Can I stop my spouse sharing my inheritance on divorce?

Julia Cluley

A party to a marriage or civil partnership may understandably be concerned to know whether their spouse might be awarded a share of assets they have inherited if they ever divorce and would like to know what, if anything, they could do to reduce the chance of this happening.  

Firstly, there is a general principle, even where short marriages or civil partnerships are concerned, that property that has been acquired during the marriage through the joint efforts of the parties should normally be shared equally on divorce. 

This includes the family home regardless of how, when or by which party it was acquired. Such property is known as matrimonial property.

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In some cases, the courts have to decide how to deal with property – other than the family home – that has been acquired by one of the parties while they were together. This might be money or assets inherited or gifted to a party during the marriage and is referred to as non-matrimonial property. 

It is fair to say that generally, and especially in the case of a short marriage, the court starts with the view that a party should be allowed to keep their own non-matrimonial property.

Needs must be met

It is really important to stress that needs are always an extremely important factor. 

For example, if a half share of the matrimonial property would not be enough to meet one party’s reasonable needs, including their housing needs, then this might result in that party retaining more than half of the matrimonial property because the other party has recourse to their inheritance, which is a financial resource available to them.

Needs will always take priority as the court considers that each party will need sufficient resources to meet their reasonable financial needs.

The issue as to what happens to non-matrimonial property is not clear cut and will depend on the facts of the case. 

For example, a small amount of money inherited at the start of a long marriage, which has either been spent by the parties or has been mixed with matrimonial assets – such as using an inheritance to pay off or reduce the mortgage on the family home – may not be ring-fenced or treated differently from matrimonial assets.  

Relevant factors can include when it was received during the relationship, how substantial it is compared to the value of the overall matrimonial property and how it has been used. 

For example, if the parties generally kept their finances separate and inherited money has always been kept by one party and not shared, it may be more likely to be retained by that party on divorce. 

If on the other hand an inheritance was used to buy an investment property and both parties worked on that property and the rental income from it was enjoyed by both of them for their joint benefit during the marriage, then a party might seek to argue that it had become matrimonial property and that it should therefore be shared.