Joanne Major, Principal of Major Family Law, the North East’s leading Divorce and Children Specialists Family Lawyers, Newcastle upon Tyne comments in the Luxe Magazine Divorce Lawyer Newcastle when it comes to divorce, fairness is probably not the first term to spring to mind. Recrimination so often goes hand in hand with the ending of a marriage, and what’s “fair” can be heavily influenced by how wronged either party feels.

When it comes to financial settlement, however, fairness is the key to determining what provision will be made. Generally, the accepted starting point is to consider whether an equal division (50:50) of the marital assets would provide a fair settlement.

Of course, even in this context, “fair” is bestowed with a certain amount of subjectivity as a result of the wide discretion afforded to divorce Judges in determining what financial orders should be made.

In broad terms, however, “fair” to a Judge means ensuring that both parties’ needs (for housing, capital and income) are adequately met out of the available assets.

Although there are many cases where an equal division would not result in fair provision and would disadvantage one of the parties to the marriage, in high net worth cases (those cases where the available assets exceed the reasonable needs of both parties), matrimonial property is likely to be divided equally.

That does not necessarily mean, however, that everything each party owns will be split down the middle: here, the Court makes a clear distinction between matrimonial assets, non-matrimonial assets, and post separation accruals.

Examples of non-matrimonial assets include: gifts (of value) to one party, inherited assets, business assets acquired before marriage and, in some cases, assets acquired post separation. Pre-marital assets are common in second marriages as well as in cases where one party’s family has significant financial interests in which that spouse is involved.

Whether an asset is deemed to be a non-matrimonial asset is a matter of fact according to the circumstances surrounding ownership and enjoyment of the asset. In many cases, the longer the marriage, the more likely the presumption that the asset will have become intermingled with other marital assets and therefore will become a matrimonial asset. In other words, the Court will consider whether the wealth went into the matrimonial pot during the marriage or whether it was kept specifically outside of the parties’ other assets as a distinct and untouchable asset.

The Judge in one case stated “if a party is going to assert the existence of pre-marital assets then it is incumbent upon him to prove the same by clear documentary evidence”.  It is therefore of upmost importance that if you are seeking to set aside an asset not to be included within the matrimonial pot then you must have evidence of the existence of this asset prior to the marriage and also, evidence that this was not intermingled as an asset during the marriage.

If the argument is sustained that a particular asset is a non-matrimonial asset, then in high net worth cases, it may well be excluded from any financial settlement.

The situation is similar when it involves assets accrued after the parties have separated: to be considered a non-matrimonial asset, the benefiting party needs to show that the assets were acquired entirely independently of existing matrimonial assets, for example when a new business venture is established using independent financing. Where an existing matrimonial asset gains value between separation and the determination of financial claims, the Court may well treat the increase in value as a non-matrimonial asset.

It’s a complex area, and it can be costly to argue. As always, to be sure of your position, you should seek expert advice, and ideally, enter into a pre-nuptial agreement, or a post-nuptial agreement, and at the very least ensure you have adequate documentary evidence in relation to any assets you claim fall outside of the marriage.

Joanne Major is the Principal at Major Family Law, the Divorce and Family Law Specialists, 12 West Road, Ponteland, Newcastle Upon Tyne.   T: 01661  82 45 82 Twitter: @majorfamilylaw

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