Dividing Financial Assets on Relationship Breakdown

kazzasingh's version from 2018-04-26 13:41


Question Answer
White v White [2000]The married couple had a joint farming business. This had to be dissolved after marriage breakdown. Wife was concerned that had she been a cohabitant, she would have received a greater share of the business. HELD: Court recognised the wife's role both in the family home and her partnership in the business. The role of court was to acheive a fair outcome - no room for discrimination between the husband and wife - check any award against the yardstick of equality. YET, the wife only received 40% of the business. However, the justification for this was that a loan from Mr W's father helped to set up the farm --> (a) departure from equality must be justified (b) no presumption of equal division (c) s25 factors to be taken into account (d) needs of the primary carer will always justify unequal division
Miller v Miller [2006]Very short marriage but in that time Mr M had managed to aquire £15m of assets. Question = whether equal division of assets is fair for a short marriage. HELD: 3 key principles underlying the discretionary jurisdiction (needs, sharing and compensation).
McFarlane v McFarlane [2006]16 year marriage with 3 children. At the start of the marriage, Ms M had been the higher earner. She left work to look after the children (at which point the husband's career took off). Couple reached an agreement to divide the assets 50:50. However, going forward, Mr M had a far superior earning capacity than Ms M. HELD: 3 key principles underlying the discretionary jurisdiction (needs, sharing and compensation).

Principles of Fairness : SHARING

Question Answer
Lord NichollsThis equal sharing principle means that when the partnership ends, each is entitled to an equal share of the assets of the partnership, unless there is a good reason to the contrary.

Principes of Fairness : NEED

Question Answer
Charman v CharmanIf needs > equal share, then needs prevail. May justify use of assets that would not be shared.
Rapp v Rapp [2016]The wife was awarded more than 50% of the assets because she had greater need. HELD: wasn't reasonable to expect the wife to go back into employment (lack of qualifications). Husband had a substantial earning capacity.

Principles of Fairness : COMPENSATION

Question Answer
McFarlane v McFarlaneCompensation is appropriate where a spouse has given up a potentially high-earning and ongoing career for the sake of the family.
H v H [2007]Compensation will not be appropriate when a career given up was not high-earning.
Hvorostovsky v Hvorostovsky [2009]Compensation will not be appropriate when a career given up was not likely to be ongoing.
S v S (Non-Matrimonial Property) [2014]Compensation will not be appropriate where the career was given up as a lifestyle choice.
SA v PA (Pre-marital agreement: Compensation) [2014]McFarlane regarded as exceptional. Exercise of calculating loss 'highly arbitrary'. Court would need to be able to say 'with almost near certainty, that the claimant gave up a high earning career which had it not been forgone would have led to earnings at least equivalent to that presently enjoyed by the respondent."
Charman v Charman (No 4) [2007]SPECIAL CONTRIBUTION ---> Reasons to depart from equality include 'an exceptional and individual quality which deserves special treatment'. HELD: Mr C satisfied the test.
Lambert v Lambert [2002]SPECIAL CONTRIBUTION ---> it is difficult to determine whether one is a stellar homemaker. HELD: it is unacceptable to place greater value on the contribution of a breadwinner then that of a homemaker as a justfication for dividing the breadwinners products unequally between them.
Robertson v Robertson [2016]While 'the scale of wealth in this case is amply large enough to admit consideration of special contribution, H did not display any special 'genius'. In any event, it is fundamental to a successful claim to special contribution that it be unmatched...'

Principles of Fairness : Non-matrimonial property

Question Answer
P v P [2004]Inherited property is something that the courts will take into consideration. If the courts can come up with a solution that does not include the property then they will do. However, if there is not enough money to go around, it will have to be sold.
McCartney v Mills-McCartney [2008]Ms M was limited to needs. HELD: no compensation as no financial loss suffered during the relationship
AC v DC (No2) [2012]"It would be unfair for none of the husband's pre-cohabitation's wealth to be excluded from the sharing principle...into the balance, however, must go to the length of the parties' relationship, the nature of the separation of the parties, and the fact that the pre-cohabitation wealth of the husband was thereafter inextricably mingled."
X v X (application for a financial remedies order) [2016]Shares acquired post separation 'were only available to the husband because of his employment and position at the Company built up during the marriage; but they were earned at a time where there was no longer any marriage partnership support.'

What forms can a financial remedy take? (when clean break is easy to achieve)

Question Answer
Ashley v Blackman [1988]No point to continuing periodic payments
Duxbury awardVery wealthy parties
White v WhiteVery wealthy parties
Burgess v Burgess [1996]Both parties have certain financial futures
Mills v Mills [2017]Mr M applies to discharge his periodic payments order but the court actually increased the amount he had to pay to his former spouse!
Roxar v Jaledoust [2017]It seemed to the judge that he had reduced his earning capacity in order to pay the wife less. HELD: no discharging of PPO.