Financial Settlements in Short Marriages
In a short marriage case with no children, similar incomes and careers and a history of the parties keeping their finances separate it was held recently in the case of Sharp –v- Sharp that there was no reason to adhere to the usual strategy of equality. Normally, irrespective of proportions that the parties have contributed to the marriage, the starting point would be to share assets between the parties equally. In this case however, when all the circumstances were looked at, inequality wasn’t reasonable. In particular the outstanding feature of this case is that although the wages were similar the Wife had enjoyed massive bonuses of 10.5 million pounds. That could not be ignored. The Court said that Parliament had always expected legislation to look into and consider all the facts of the case. If they hadn’t then Section 25 wouldn’t have included the words “consider all the circumstances of the case”.
It was interesting that the case did comment upon (and was probably surprised by) the lack of a Prenuptial Agreement. That shows how much Prenuptials, or their absence, are now featuring in the Court’s mind when considering such matters.
Be that as it may, and in the absence of a Prenuptial Agreement, this case presented a grey area to the Court. It was quite obvious that it should be treated differently to the normal equality sharing principles.
An absolutely vital point in this case was that the Wife who had earned the bonuses sheltered her capital. That and the fact that these bonuses didn’t seem to have the joint/family asset flavour to them impressed the Court. The Court quite interestingly said that this was a “non family asset case” was not generated by joint efforts and was not handled with the assumption that they would be shared equally or enjoyed equally.
Whilst this case seems to be common sense and to link into an older line of preceding cases that had always said that short marriages should be treated differently, the wording is somewhat strange. To introduce aspects such as “non business partnership” and “non family asset case” seems likely to only confuse the issues. Perhaps it would have been more logical and clear to have simply expressed that the brevity of the marriage and the self contained manner in which the parties handled their assets was inconsistent with the usual sharing principles. Accordingly the result seems right and consistent with old law. Even if many people won’t have anything like these capital assets the principle seems a good one to be applied across the board. The only strange thing is the choice of words. It remains to be seen if this Court of Appeal case will go to the Supreme Court (formerly House of Lords).
To summarise to say that the equal/sharing principle can sometimes be departed from appears to be completely obvious in the circumstances of a short marriage and thus a pretty sensible and straightforward decision to understand.