The value of a family business or business interest is treated as an asset and therefore part of the matrimonial pot to be distributed when it comes to negotiating a financial settlement on divorce or...
(Court of Appeal, Hallett, Black LJJ, Sir Stephen Sedley, 9 July 2013)
The husband and wife were married for 10 years and had a 3-year-old child. When they separated both parties were employed and they jointly owned five properties.
In financial remedy proceedings the judge ordered the husband to pay the wife periodical payments of £1,070 per month for both herself and the child, index-linked until the child commenced secondary school. The wife was awarded 70% of the matrimonial capital on the basis that she would be caring for the child and that the husband had a higher earning capacity at least for the foreseeable future. This would enable her to purchase a property to live in and to clear some of her debts. The husband appealed.
It was not wrong for the judge to determine that the husband had the capacity to, and had done so in the past, work longer hours in order to increase his earnings and provide for the family while the wife was restricted in terms of income by her responsibility for caring for the child, at least until she started school.
She had been entitled to start with the needs of the wife and child which could not be satisfied unless the wife had access to more than half of the family resources. This was in accordance with her duty under section 25(1) Matrimonial Causes Act 1973 which required that first consideration must be given to the welfare of any minor child of the family. The husband's needs had not been ignored and she satisfied herself that he could continue to live in his current accommodation and afford to pay his mortgage and other expenses from the income would have after making periodical payments if he reverted to his former working pattern.