Recent developments in financial procedure: an overview

‘Where are we and what is the law that we have got?’ Hodson asked the viewers.

The starting point is the Matrimonial Causes Act 1973, from where the law has evolved in a rather complex and sophisticated legal framework. In these cases, an important central question has been, historically; what does fairness mean? It is vital for any matrimonial proceedings.

Fairness has evolved over the years. The standard was initially ‘reasonable needs’, meaning that, for example, a very wealthy husband only needs to provide his divorcee wife her ‘reasonable needs.’

One case they discussed was XW v XH [2018] Fam Law 1317, which also dealt with special contribution with the following guidance from Work v Gray [2017] EWCA 270. A few elements stood out here, such as a wholly exceptional characteristics or circumstances which would obviously be inconsistent with the objective of achieving fairness in favour of equality.

Also, exceptional earnings are to be regarded as a factor only when it would be inequitable to proceed with equality of division, Hodson explained, adding that only if such a disparity in the respective contributions to the welfare of the family that it will be inequitable to disregard should this be taken into account determining division.

Furthermore, it is important to avoid discrimination against the home-maker, this case decided, as the court must look at the nature of the contribution, and to determine whether it derives from an exception and individual quality to independently establish such a quality.

Allum also touched on Chai v Peng [2017] EWHC 792 (Fam), as well as the recent ruling in Martin v Martin [2018] EWCA 2866. On the question of special contribution, Mr Justice Mostyn said in that particular case that making £145 million did not meet the standard of rarity needed to justify an unequal division of the product of the matrimonial partnership.

Often, the problem in valuation cases is working out what was the value of the commencement of the relationship. It may be decades earlier and there may have been no valuation in existence at the time.

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