News and Insights
27 June 2017
How the court in Jersey decides how best to divide the marital assets in a divorce
Ever since the House of Lords decided the English case of White & White (2001) the Jersey court has followed three basic principles of distributing assets in a divorce. Those principles are: needs, sharing and compensation. In White, the court referred to the “yardstick of equality” and to achieving a fair result between the husband and wife. This means that the starting point is the equal division of property, unless there is a good reason for that division to be unequal.
In many cases where there are limited assets, the court will look at how to cover the needs (which can be generously interpreted) of the divorcing couple and their children. This may well lead to an unequal division because needs will trump sharing in these cases. The more difficult cases are those involving sharing. This is where the fact that some assets existed prior to the marriage or may have been inherited, for example, may shift the division away from an equal division. There has been much case law as to what constitutes non-matrimonial property. For example, the matrimonial home will always be matrimonial, even if one party owned it prior to the marriage.
The English Court of Appeal gives new guidance in sharing cases in Sharp v Sharp (2017). This case involved a husband and wife in their early 40’s who had been married for six years and did not have children. Although there was no deliberate intention to separate their finances during their marriage, several significant aspects were kept separate such as splitting restaurant bills and utility bills between them. The husband also had no idea about the extent of his wife’s bonuses. In a departure from previous cases, the court decided that in this case the assets would not be divided equally even though it was a sharing case. Sharp v Sharp is, of course, fact specific but goes to show that in a case where there are no children and the marriage has been relatively short, sharing may not necessarily mean equality anymore.
Couples contemplating divorce will, therefore, need to consider the following factors before agreeing how to divide the finances on divorce or separation:
- Was a pre-nuptial agreement signed?
- Are the assets greater than the reasonable needs of the couple after divorce (and any children)?
- If the assets more than meet needs, were any of them acquired prior to the marriage or by inheritance, for example?
- Were certain assets held separately during the marriage?
- Did the couple behave in such a way with some elements of their finances that they should not be shared?
- How long was the marriage and how old are the husband and wife?
Remember, no two cases are the same and it is essential to obtain advice from a lawyer specialising in family law to help you get a fair result. Call us today on +44 (0)1534 888666