News and Insights

Trusts are a common feature of wealth planning in Jersey. They are often used to preserve family wealth, manage succession planning and protect assets for future generations. However, when a marriage breaks down, many people assume that assets held within a trust will automatically be protected from a financial claim on divorce. Recent developments in both England and Jersey suggest the position may not be so straightforward.

A recent English decision, TP v TF [2026] EWFC 210, provides valuable guidance on this issue and offers a useful indication of how similar arguments may be approached by the Family Court in Jersey. The case highlights the courts' increasing willingness to look beyond the legal structure of a trust and focus instead on the reality of how wealth has been used and enjoyed during a marriage.

The Changing Approach to Non-Matrimonial Wealth

Historically, assets acquired before a marriage, inherited wealth and trust interests have often been viewed differently from assets built up by the parties during the marriage. However, recent cases including the Supreme Court case of Standish v Standish have emphasised that the source of wealth is only one part of the picture. The court will also consider how that wealth has been treated throughout the marriage and whether it has become part of the parties' shared financial life.

Lawyers often refer to this process as "matrimonialisation". Put simply, an asset that began as non-matrimonial property can, in some circumstances, become subject to sharing on divorce through intermingling of the property. An example might be inheritance that has been in some way enjoyed by the parties to the marriage. In broad terms, assets that originate from outside the marriage may, through the parties’ conduct and contributions over time, become subject to the sharing principle and available for division on divorce.

What Happened in TP v TF?

The husband was the beneficiary of a substantial family wealth structure held through trusts. A key issue in the case was his interest in a Capital Allocation Plan ("CAP"), which had been established before the parties married. The husband's interest was valued at approximately £229 million. He argued that the asset should remain outside the sharing principle because it originated before the marriage and arose from family trust arrangements. The wife argued that it had become part of the parties' marital wealth.

The Court found that, although the arrangement pre-dated the marriage, much of its value had accrued during the marriage. It also recognised that the wife's contributions as spouse, homemaker and parent were equal in value to the husband's business activities.

The Court concluded that the husband's interest had become matrimonialised and awarded the wife £120.4 million.

Why Does This Matter?

The decision is an important reminder that trust assets are not automatically protected from scrutiny in divorce proceedings.

The Court was prepared to look beyond the trust structure itself and consider:

• How the wealth had grown during the marriage.

• The extent to which the parties benefited from it.

• Whether it formed part of the family's lifestyle.

• The contributions made by each spouse.

In other words, the existence of a trust was relevant, but it was not the end of the enquiry.

What Is the Position in Jersey?

Although TP v TF is not binding in Jersey, it reflects themes that are already emerging in local family law.

In U v V, two years ago, the Royal Court considered the treatment of inherited and non-matrimonial wealth and recognised the importance of examining both the origin of assets and the way they were used during the marriage.

The Jersey Court has also shown a willingness to look at the practical reality of a party's financial resources rather than focusing solely on legal ownership. Where trust benefits are likely to be available to a beneficiary spouse, that may be a relevant factor when determining a fair outcome. As a result, TP v TF is unlikely to be viewed as a dramatic departure from existing Jersey principles. Instead, it may be seen as a further indication of the English courts' willingness to examine the substance of wealth rather than simply its legal form and this will be of interest to Jersey practitioners.

Will Jersey Follow the Same Approach?

Every case will turn on its own facts, particularly where trusts are involved.

Jersey remains one of the world's leading trust jurisdictions and the Royal Court is careful to respect legitimate trust structures and the duties of trustees.

However, where trust wealth has played a significant role in the parties' financial life, the Court is likely to consider matters such as:

• How accessible the trust assets are in practice.

• Whether trust distributions have been made historically.

• How the wealth has been used throughout the marriage.

• The extent to which the parties' lifestyle depended upon it.

• Whether the asset has effectively become part of the marital partnership.

Whilst Jersey remains mindful of the importance of preserving legitimate trust structures, the direction of travel is clear. The Royal Court is increasingly concerned with the practical reality of wealth and the achievement of fairness between spouses. For families with interests in discretionary trusts, family investment structures or inherited wealth, TP v TF serves as a timely reminder that the existence of a trust will not necessarily prevent those assets from becoming relevant in divorce proceedings. The focus will remain on achieving a fair outcome.

Key Takeaway

The message from TP v TF is clear: simply placing wealth within a trust does not necessarily mean it will be ignored on divorce. Whilst trusts remain an effective tool for succession planning and asset protection, the courts are increasingly prepared to examine how trust wealth operates in practice. Where trust-derived wealth has become intertwined with family life and accumulated during the marriage, it may be vulnerable to a claim.

For Jersey families, trustees and beneficiaries, early specialist advice is essential. Understanding how trust assets may be viewed by the Family Court can be critical when planning for the future or navigating a relationship breakdown. Whilst we do not have definitive answers, it is likely that the Family Court in Jersey will consider this recent development in the law in England.

At its heart, the decision in TP v TF reinforces a principle that continues to shape modern family law: fairness will prevail over form, and the court will look at the reality of the parties' financial circumstances rather than simply the structure through which their wealth is held.