In divorce proceedings, those who make overly ambitious financial claims or fail to enter into reasonable negotiations are highly likely to end up worse off. The point was powerfully made...Continue reading
A gender-neutral and non-discriminatory approach to divorce generally requires an equal division of marital assets – but it is not always that simple. In one big-money case, complexities arose in respect of the husband’s inherited assets and his wish to preserve a thriving family business.
During the lengthy marriage, the husband, a self-confessed workaholic, graduated from being an HGV driver to becoming the majority shareholder in a highly successful plant hire company. The wife performed an administrative role in the business and devoted herself to the care of the three children of the family.
Many of the husband’s shares were, however, inherited from his parents. He wished to carry on running the company but raised the spectre that financial liabilities arising from his divorce might force it into liquidation, with the loss of 130 jobs. A further difficulty arose because the couple’s marital home had been in the husband’s family for generations and remained an asset of his deceased father’s estate. He and his two sisters were each entitled to inherit a one-third share in the property, in which the wife had no interest.
Ruling on the matter, a judge valued the husband’s business interests at about £7.2 million and the total marital assets at over £9.5 million. In order to provide for the wife’s housing needs and an income of £100,000 a year, she would require a capital sum of about £3 million. Having made an equal contribution to the marital wealth, however, the sharing principle applied, and she was entitled to more than that.
The judge awarded the wife a £4.3 million lump sum after finding that 45 per cent of the marital assets should go to her and 55 per cent to the husband. Given the part that the husband’s inheritance played in the case, his retention of assets worth £5.2 million represented a fair outcome which reflected the length of the marriage.
The judge acknowledged that the husband would have to borrow in order to satisfy the wife’s award, but was confident that he would use his considerable abilities to raise the money whilst maintaining the fortunes of his business. The husband was directed to pay the wife’s award by instalments over a period of two years and three months. Payment of the final instalment would result in a clean break between them.