A city trader has successfully challenged a divorce judgement awarding her ex-husband of four years £2.7m – in a decision that family lawyers warn raises more questions than it answers.
In Julie Therese Sharp v Robin Duncan Sharp, the Court of Appeal ruled today that the combination of potentially relevant factors – a short marriage, no children, dual incomes and separate finances – was sufficient to justify departing from an equal sharing principle to achieve overall fairness between the two parties.
The High Court, in November 2015, awarded Robin Sharp £2.7m, which represented half of the total matrimonial assets. Julie Sharp argued that her ex-husband should receive only £1.3m.
Today, the Court of Appeal ruled that Robin Sharp should be awarded £2m. It dismissed Julie Sharp’s appeal against a December 2015 order requiring her to pay Robin Sharp £80,000 in costs as a contribution to his overall £200,000 costs bill.
Commenting on today’s ruling, divorce lawyer Alex Carruthers, partner at London firm Hughes Fowler Carruthers, said: ‘This groundbreaking ruling ultimately dictates that marriage is no longer a financial partnership in some circumstances. This raises far more questions than it answers.
‘It opens the way for countless legal and philosophical arguments. There was previously no legal distinction between a “short” and a “long” marriage, and therefore no defined point after which wealth generated should be shared.
‘The only clarity provided by this judgment is that there is now a further issue for divorcing couples to bicker about, and for lawyers to profit from.’
In the judgment Lord Justice McFarlane said that Mrs Sharp received bonuses ‘way beyond the level of her previous earnings purely as a result of her employment and…without any contribution, either domestic or business, from her husband’.
The manner in which the couple arranged their finances ‘was more than sufficient to establish that Mrs Sharp maintained her capital separately in a manner which is compatible with that described by Baroness Hale in Miller‘, he added.
Jo Edwards, head of family at London firm Forsters, echoed Carruthers’ comments, saying today’s judgment ‘poses almost as many questions as it answers’. These include how long a marriage has to be to be defined as ‘short’, and at what stage is someone entitled to share the wealth generated by their spouse.
Andrew Newbury, a senior family lawyer at Manchester firm Hall Brown Family Law, said: ‘What we have seen on an increasingly frequent basis in recent years is something of a move towards ensuring that meeting the needs of spouses after they divorce should be the principal factor in determining a settlement.
‘This case reinforces that concept and emphasises that needs take precedence, even in the case of couples possessing significant joint wealth.’
Neil Russell, family partner at London commercial firm Seddons, said couples should be encouraged to enter into prenuptial agreements, ‘which may avoid the huge costs of uncertain litigation’.
However, Edwards warned: ‘It may be that in light of this decision, couples take a more relaxed attitude towards pre-nuptial agreements if they know that if their marriage is short and childless and they are both in work, one of them can point to this decision as a reason not to share assets built up during the marriage.’