MCJ v MAJ: financial remedy principles in action

Divorce|July 11th 2016

I don’t think there is anything new in Mrs Justice Roberts’ clearly-written judgment in MCJ v MAJ (Financial Provision: Treatment of Non-Matrimonial Property), but nevertheless it is an interesting and useful example of several financial remedy principles in action. In particular, we see at work the principles not just relating to non-matrimonial property, but also relating to the issues of sharing, needs and fairness.

There is a lot going on in MCJ v MAJ, and I couldn’t possibly cover it all in one blog post. Briefly, it concerns a couple who were married in December 2000, the husband was aged 68 and the wife was nearly 51. It was not in dispute that the husband had assets that he acquired prior to the marriage. However, the parties were in dispute as to the value of those assets at the time of the marriage. The husband argued that they were worth some £5.6 million, whereas the wife argued that at the time the relationship began the husband was to all intents and purposes insolvent. She further argued that she rescued him from that parlous position by her hard work throughout the marriage in the husband’s care home business.

The parties were also in dispute as to exactly when the marriage broke down. Suffice to say that divorce proceedings were issued in 2014 and the husband made an application for ‘financial relief’ [i.e. a financial settlement between the parties] in September 2014.

Each party had quite different ideas as to what financial settlement the court should order. The husband contended that the wife’s award should be based upon her needs – she should not be entitled to a 50% share of all of the assets, as they had essentially been accumulated by him prior to the marriage. The wife, on the other hand, contended that this was a sharing case, and she was entitled to a full half share, because the husband’s assets were worth little or nothing at the time of the marriage, and also because she claimed that the husband had promised her a half share.

In a nutshell, Mrs Justice Roberts assessed that the total assets of the marriage were now worth some £10.3 million. She had her doubts that the husband’s assets at the time of the marriage were worth as much as £5.6 million, but didn’t accept the wife’s argument that the husband was to all intents and purposes insolvent at the time the relationship began. She also didn’t accept that the husband ever agreed to the wife having a half share of the wealth he acquired prior to the marriage. As to the value of the assets that were generated over the course of the marriage, she put that at a figure of about two and a half million pounds.

In the light of her findings regarding the value of the husband’s non-matrimonial property (i.e. the property he acquired prior to the marriage) and that there was no agreement that the wife was entitled to half of that, Mrs Justice Roberts concluded that this was not a sharing case, where the wife was entitled to a 50% share in all of the assets. Instead, the award to the wife should be based upon her needs.

Mrs Justice Roberts calculated that the wife’s’ needs were about £1 million for housing and £1.3 million for her income needs (which she could invest and which would produce an annual net income of £90,000). Thus, the wife would receive most of the matrimonial assets (i.e. the assets acquired during the marriage).

Finally, Mrs Justice Roberts ‘cross-checked’ her award by considering whether it was fair to the parties. She said:

“A global award which leaves in W’s hands assets of £2.3 million will leave H with over 75% of the wealth in this case. I am satisfied that such an award meets her needs … Despite the fact that such an award is in excess of what H was prepared to offer on an open basis, having stood back to review all of [the relevant] factors, I am satisfied that it is entirely fair to both parties. It gives proper weight to the origin of the assets as well as to the contributions made by W.”

She concluded with the following:

“All that remains at the end of a hard fought and difficult case for each of these parties is for me to wish them both well for whatever lies ahead. I hope that they will now be able to put the unhappiness and stress of these proceedings behind them and enjoy in comfort the retirement which each richly deserves.”

Let us hope that they do.

The full report of MCJ v MAJ can be read here.

The blog team at Stowe is a group of writers who share their advice on the wellbeing and emotional aspects of divorce or separation from personal experience. Guest contributors also regularly contribute to share their knowledge.

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  1. Andy says:

    Here,Here..For the common sense taken in the case…wish I had a judge like that….
    As for the closing statement..That speaks volumes…move on…

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