High court sides with husband in divorce settlement

Divorce|February 10th 2015

The High Court has sided with the husband in an application for interim maintenance payments.

The legal circles for interim maintenance is ‘maintenance pending suit’. This is sometimes awarded to financially dependent spouses if they cannot support themselves prior to the couple’s divorce hearing and the conclusion of their financial settlement.

BD v FD concerned a wealthy couple who married in 2002 and went on have four children, now aged between three and eight years of age. The marriage came to an end during 2013 and the parties finally went their separate ways in 2014. Following the split, the husband bought a new home nearby for the wife and children, at a cost of £2.9 million, more than the estimated value of the former matrimonial home.

The husband was extremely wealthy, with assets of approximately £49 million, along with additional assets tied up in legal trusts of as much as £100 million. He also earns an income of approximately £1.7 million a year.

The wife’s wealth was more modest – approximately £4.9 million, including the £2.9 million home, along with an additional £1.4 million in “cash and investments”. These funds were also partly provided by the husband when he paid her £1 million to transfer assets held in her name to his, in order to avoid “adverse tax consequences”.

The wife applied for maintenance pending suit of not less than £270,000 per year but she argued that that it should in fact be as much as £392,000. The husband offered the lower sum of £202,000.

In the High Court, Mr Justice Moylan noted the wife’s statements that the family had enjoyed an “extremely high standard of living” but also that “her accounts were always overdrawn during the marriage and that meeting those family expenses for which she was responsible, on the sums paid to her by the husband, was a constant struggle.”

However, the Judge concluded that the wife’s maintenance requests nevertheless included “a significant element of forensic exaggeration”.

He was satisfied, he said, that the sum sought, £392,000, exceeded the standard of living she had actually enjoyed during the marriage. He added:

“That standard is not necessarily a ceiling but, in my view, there would need to be some specific, powerful, justification for that standard being exceeded on an interim basis. No such reason exists in this case.”

The wife’s precise income needs would be determined at the couple’s eventual settlement hearing. In the meantime, the sum proposed by the husband was a “reasonable sum by way of maintenance pending suit”.

Reasonableness is the only criteria specified by section 22 of the Matrimonial Causes Act 1973, governing maintenance pending suit. This states that such awards should be “just and reasonable”.

Read the judgement here.

Photo by Rafael Saffirio via Flickr

Author: Stowe Family Law

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Comments(2)

  1. Andrew says:

    How the other half lives . . .

    Yet another case where Calderbank might have led to a more realistic approach.

  2. Nordic says:

    Andrew,
    “The other half” are probably more correctly referred to as “the 1%”. It is remarkable that extreme wealth cases, such as this one, is what makes up most of the case law references on financial relief. Years ago, when going through my divorce I remember being lectured on Miller, McFarlane etc and thinking “are they raving mad, what has this got to do with me?”. When I later asked my solicitor whether anything would ever change the response was “not much, but we might get more legally binding pre-nups if a party comes along with the wealth to take the issue to the Lords”.
    .
    So that is how we make law for what undoubtedly is one of the most important policy areas of all. We wait for rich people to get the attention of our law-makers (the senior judicial) so that we can get some case law based on circumstances which bear no resemblance to how 99% of the population live. You could not make it up.

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