The Family Court at Manchester has recently considered a financial case arising from divorce proceedings involving a wide variety of complex factors. These were (take a deep breath):

  • the interaction between divorce proceedings and insolvency law;
  • the validity of a pre-nuptial agreement made five days before the wedding;
  • allegations by the wife that the husband had hidden assets;
  • allegations by the husband that the wife had failed to disclose assets;
  • other complex international issues.

In respect of the background, the husband was aged 69 and the wife was aged 56. It was a second marriage for both parties and both had children from other relationships. However, the wife was in a far better financial position than the husband. She had assets worth £3m, a net income of more than £100,000 per annum and a pension worth around £250,000. In contrast, the husband had a very limited income of only £8500 per annum. He had also been pronounced bankrupt and had significant debts, including around £76,000 in legal fees.

Five days before the wedding in 2010, a pre-nuptial agreement was signed abroad with neither party taking legal advice before signing. However, it was always the intention of both parties that their married life would be conducted in the UK. This was where the wife had a successful business and her children were being educated.

The wife started divorce proceedings in September 2016 after six and a half years of marriage. The divorce was concluded in July 2019. The financial proceedings were first commenced in 2017, with the wife making it clear that she was relying on the pre-nuptial agreement. The financial proceedings lasted for three years, finally concluding in January 2020.

At the final hearing, the wife remained of the view that the Court should uphold the terms of the pre-nuptial agreement. The husband argued the opposite and he sought a lump sum in excess of £700,000 so as to discharge his debts and purchase a home for himself. It is fair to say that the parties were ‘poles apart’ and there was a large degree of bitterness between both of them.

In respect of the pre-nuptial agreement, the judge determined:

“There is no value in the prenuptial agreement. There was no formal process of disclosure, there was no advice given to either party, other than by the notary who prepared the document and at five days before the ceremony.”

The judge decided, based on the husband’s needs, that the wife should pay him the sum of £675,000. This would allow him to pay off his debts, it being determined that he had received no financial support from the wife during the marriage and that factor had directly caused his debts to accrue. He would also receive a property to live in until he died. That property would  revert back to the wife once he died. He also obtained 60% of the wife’s pension assets in order to give him an increased income during his retirement.

This case highlights a number of important factors and lessons:

Firstly, it serves as another warning to parties that before the Court in England and Wales will uphold a pre-nuptial agreement, the agreement must be closely scrutinised. Any failure to meet the required legal requirements will usually lead to the Court disregarding the agreement as being of any relevance. In this case, the pre-nuptial agreement was therefore doomed from the outset.

Secondly, it highlights the importance of the Court determining that the financial needs of the parties will usually be the best indicator towards achieving a fair outcome when assets are divided.

Thirdly, it emphasises that there is no gender discrimination when the Court determines financial proceedings arising from divorce. The outcome of this case would undoubtedly have been similar, had the wife been in the husband’s circumstances.

If you are unsure over where you stand when it comes to any of the above issues, do get in touch with Stuart on 01254 778148. Alternatively you can email, talk to us via live chat or complete our Contact Us form and one of our expert advisors will be in touch.

Leave a Reply

Your email address will not be published. Required fields are marked *