Wife Retains More Than 50% of Assets
Author: Victoria Walker
The recent case of Sharp v Sharp which went to the Court of Appeal, deals with how assets should be shared for DINK’s * when the marriage has not been a long one and the contributions to the marital assets have been unequal.
Since the law changed with the case of White in 2001, family lawyers have been working on the basis that assets should be shared between couples who are married. There has, however, always been specific factors under the relevant legislation from 1973, drawing our attention to various matters, including age, earning capacity, disability and length of the marriage to which the court should have regard.
In Sharp v Sharp, the parties were in their 40’s with no children, the relationship lasted six years in total. Mrs Sharp was a trader in the fuel trade and Mr Sharp worked for an IT company. Their salaries were similar but the wife received substantial bonuses of over £10 million throughout the relationship. The assets at the time of the hearing were about £7 million. The parties agreed that approximately £1 million of that should be kept out of the pot and retained by Mrs Sharp as she brought that to the marriage. As to the balance, Mrs Sharp said it was entirely generated by her, and that they had not mingled their finances and so the wealth she had amassed should not be shared and all her husband should receive is what he ‘needed’, not an equal share.
The first Judge (Peter Singer) decided that there was no clear evidence of keeping the money entirely separate from each other, and as there was no pre-nuptial agreement, sharing was appropriate. Mrs Sharp funded a lot of expenditure on her husband’s behalf, including their two houses, holidays and three Aston Martin cars! The conclusion was that whilst the contributions did not equate to the same amount financially, they had both worked hard and contributed towards the marriage. The Judge gave Mr Sharp 50% of the agreed pot which equated to £2.75 million.
On appeal by Mrs Sharp, Mr Sharp was given a reduced sum of £2 million by Lord Justice McFarlane. This seems to be the correct application of the law and overall a fair outcome but given the guidance we had previously it’s hard to see it as ground breaking! What is important is that we now have a Court of Appeal authority to rely on for a departure from equality when it comes to a marriage that is short with dual incomes, no children and separate finances.
The judge decided to share the two properties that had been purchased and lived in as family homes and gave Mr Sharp a further £700,000 to reflect the Sharps standard of living, a capital fund over and above the property and some of Mrs Sharp’s assets. As ever there is no indication as to how this figure is arrived at which would have been useful.
What’s the real point to take from this case? Take advice on what you’re getting yourself in to before you walk down the aisle. I know it’s not romantic but when 1 in 3 marriages end in divorce it’s sensible. If Mrs Sharp had entered in to a pre or post nuptial agreement, this outcome may well have been very different.
Victoria is a Partner in our family team based in our Cobham office. Contact Victoria on 01932 588574 or firstname.lastname@example.org if you need expert, no nonsense advice on your family situation.
* Dual income no kids