Darren Hark, Solicitor, Irwin Mitchell
Practitioners will be well-versed in hearing contentions from husbands and wives in divorce proceedings as to what contributions they have each made during the course of the marriage, and therefore why they should receive their fair
Broadly speaking, contributions fall into two categories for consideration: first, matrimonial and non-matrimonial assets; and secondly, whether one of the parties has made an unmatched special contribution. In the recently reported case of Robertson v Robertson  EWHC 613
, the husband owned shares valued at £141m which had been acquired pre-marriage but had increased in value exponentially during the course of the marriage. Holman J was hearing the matter and had to determine how and to what extent the wife should share in the value of the husband's shares.
Holman J heard Robertson
hot on the heels of Gray v Work (Phase II: Contribution and Distribution)  EWHC 834
, where he had rejected the husband's special contributions case. However, it has recently been confirmed that the husband in that case has been granted permission to appeal.
Following a brief summary as to the law on special contributions, this article will focus on the judgment in Robertson
and discuss whether the concept of special contributions is effectively dead and buried or whether it lives and, if so, does it do so in disguise. Consideration will then turn to the appeal in Gray v Work
and whether we may see the introduction of a threshold.
Under the Matrimonial Causes Act 1973 (MCA 1973), s 25(1)(f), the court must have regard to:
'the contributions which each of the parties has made or is likely in the foreseeable future to make the welfare of the family, including any contribution by looking after the home or caring for the family.'
With there being no further guidance in the statute, the concept of special contribution has been developed through the courts.White v White  2 FLR 981
established the concept of the yardstick of equality and a universal acknowledgement that the roles of the breadwinner and homemaker are to be considered as equal. However, shortly after that decision, the Court of Appeal emphasised in Cowan v Cowan  EWCA Civ 679,  2 FLR 192
that there was still a place for special contributions which would still be considered in certain circumstances. Those circumstances were, in short, where an acquisition of wealth owing to the 'genius' of one party deserved recognition.
The decision in Cowan
led to a number of cases in which one party, usually the husband, argued that the wealth generated by his entrepreneurial skill meant that it was fair to depart from equality. However, the following year in Lambert v Lambert  EWCA Civ 1685,  1 FLR 139
, the Court of Appeal limited the application of special contributions and made it clear that departures such as that seen in Cowan
were only appropriate in truly exceptional cases.
The courts were keen to avoid falling foul of discrimination by the back door by virtue of their distinguishing between the contributions made by the breadwinner and the homemaker. In Lambert
, Thorpe LJ commented that 'if all that is required is the scale of the breadwinner's success then discrimination is almost bound to follow since there is no equal opportunity for the homemaker to demonstrate the scale of her comparable success'. In that case, the Court of Appeal found that Mr Lambert was not a genius and that the wife's contribution as homemaker ought to be given equal recognition, and accordingly Mrs Lambert received 50%.
In Miller v Miller; McFarlane v McFarlane  UKHL 24,  1 FLR 1186
, the House of Lords held that contributions should only be recognised in circumstances where it would be inequitable to disregard them; thus raising the bar as to what it takes to be a 'genius'.
, there have been very few reported cases where the court made an unequal award in order to reflect a special contribution. One of those cases was Charman v Charman (No 4)  EWCA Civ 503,  1 FLR 1246
, where the wife's appeal against a departure in the husband's favour was dismissed. The Court of Appeal concluded that the case was a rare one in which Mr Charman's generation of wealth compelled a substantial departure from equality. Mr Charman received 63.5% of the assets. In Charman
, notwithstanding their decision in respect of the award, the Court of Appeal confirmed that the special contribution can be non-financial as well as financial (although the author cannot find any subsequent cases where non-financial contributions have passed the 'special' threshold), and that a finding of special contributions would generally result in a departure from equality within a range between 55/45% and the 66.6/33.3%.
In Cooper-Hohn v Hohn  EWHC 4122,  1 FLR 745
, the parties built up a wealth of $6 billion. The husband was a highly successful hedge fund manager who managed him own investment fund, and the wife was the CEO of the parties' principle charitable foundation and main carer for the children. Roberts J described the husband as a 'financial genius' and awarded him 64% of the overall assets. The judge justified a significant departure from equality by referring to the husband's genius and the truly vast wealth he had generated which could not be ignored.
One word that appears regularly in these cases is 'genius', which lends the obvious question: what is a genius? Holman J discusses this in his judgment in Gray v Work
, and notes the term to be a difficult one and rather unhelpful. He suggests that the word is generally overused. In the context of special contributions, Holman J quotes from Charman
in his judgment and defines genius (in this context) as being an 'exceptional quality which deserves special treatment'. What appears clear is that it is only in very exceptional circumstances that a court will consider a party to be a genius and that a claim for special contribution may succeed.
It is therefore perhaps no surprise that, following Cooper-Hohn v Hohn
, there have been no further reported cases in which a departure from equality owing to one party's unmatched special contribution has been reported.
The argument was raised in Gray v Work
. Mr Work had generated a wealth of $300m from scratch in just 8 years when he moved from the USA and opened an office in Japan for the private equity firm he worked for. Holman J heard the case and determined that Mr Work's efforts were 'not wholly exceptional in nature', and he ordered an equal division of the assets. In the court's opinion, Mr Work was not a genius; he was just very good at his job. Note, however, that Mr Work has recently been granted permission to appeal.
So are special contributions arguments effectively dead and buried?
Robertson v Robertson
Holman J’s judgment in Robertson
is an interesting one in which he considers and discusses special contributions as well as matrimonial and non-matrimonial property, including the wife’s formulaic approach thereto by reference to passive and active growth.
The facts of the case may be summarised as follows. Mr Robertson was 48 and Mrs Robertson was 43. They began living together in 2002 when they were aged 34 and 29 respectively. At that time, Mrs Robertson was of negligible means whereas Mr Robertson was the chief executive of the online fashion retailer ASOS and owned company shares worth £1.2m. Mr Robertson had set up a company called Entertainment Marketing (EM) in 1996 and he argued, and the Court accepted, that EM and ASOS were effectively ‘folded into one’, the effect of which was that Mr Robertson acquired his shares in the company in 1996, some 6 years before the parties met.
The parties married in 2004 and Mrs Robertson adopted the role of homemaker and was a full-time mother to their two children. Mr Robertson continued to develop his company, which began to grow substantially in 2010, considerably increasing the value of his shareholding. He sold some of his shares for £73m, which he and the wife mostly invested in property and other assets while using some for the family to enjoy a higher standard of living.
In 2013 the parties separated. Their combined assets then totalled £219.5m, of which £140.8m represented the value of Mr Robertson’s remaining shares in ASOS. It was agreed that all other assets aside from the ASOS shares would be shared equally.
Mr Robertson considered the shares were a non-matrimonial asset as he had owned them long before he met his wife, and in the alternative that the value of the shares was down to his special contribution.
Mrs Robertson submitted that, adopting the approach of Jones v Jones
 EWCA Civ 41 and the concept of passive and active growth, the current value of the husband's shares was a result of active growth made possible by him being free to develop the company while she was the homemaker, and should be shared equally as a matrimonial asset. She submitted that only £4.8m should be deemed non-matrimonial, being the value of the shares as at the time they started cohabiting, with a modest increase to reflect passive growth.