RegulationFeb 25 2020

How the courts will apportion assets of a divorcing couple

  • Describe some of the challenges the courts face when dividing up assets of divorcing couples
  • Explain some of the problems around maintenance payments from income
  • Describe how the courts resolve these problems
  • Describe some of the challenges the courts face when dividing up assets of divorcing couples
  • Explain some of the problems around maintenance payments from income
  • Describe how the courts resolve these problems
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Approx.30min
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How the courts will apportion assets of a divorcing couple

The parties had six children and the wife had not worked during the marriage.

The husband was a member of a successful band and it was anticipated that he would continue to earn a high income. The wife's share of the matrimonial assets was around £5m. 

In stark contrast to the flexible approach, Mr Justice Mostyn said "I struggle to conceive of any case where in the assessment of a [wife's] needs it could tenably be argued that it was reasonable for her not to have to spend her own money in meeting them.

"After all, that is what money is for".

After meeting housing and other costs, the wife would have around £2.1m in capital, and Mr Justice Mostyn's order assumed she would amortise all of this to meet her income needs.

The flexible approach can be criticised for creating uncertainty, which makes it more difficult for disputes to be settled through negotiated agreement.

However, Mr Justice Mostyn's approach in CB v KB is also problematic.

His assertion that spending "is what money is for" does not reflect the reality of the wealthy couples considered in these cases, who do not live hand-to-mouth, for whom capital represents financial security and the ability to assist future generations.

It ignores the different roles most people accord to capital and income.

It would also appear inconsistent with Court of Appeal authority.

Discrimination 

Further it is questionable whether Mr Justice Mostyn's approach avoids the discrimination described in White, between homemaker and breadwinner.

The approach in White was explained by reference to society's increasing awareness that a breadwinner's success may have been made possible, or enhanced, by the homemaker's non-financial contributions to the family, and to society's increasing recognition that the homemaker will often have made these contributions at the cost of losing the opportunity to develop her own earning capacity.

If, following divorce, a wife has to use her share of the matrimonial assets to meet her income needs, but the husband's share continues to grow as he meets his income needs through the earning capacity he developed, supported by the wife, during the marriage, then it would not seem that the discrimination with which White was concerned has been avoided.

On the other hand, it has been clearly established that a wife has no right to share in her former husband's earning capacity. 

Articulating a fair approach to the division of assets on divorce which avoids discrimination will continue to challenge the family court.

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