Sunday, 5 November 2017

Non-Matrimonial assets. Keep Out: 'It was mine before I met you!'

If you are not going through matrimonial financial proceedings or have no plans to do so for the foreseeable future then don't waste your time in reading any more of this and instead catch up on the latest MP to have wished they kept their hands to themselves. 

'I inherited that money so it should be ignored.'
'I won the lottery after we had separated. That's my cash.'

These are the sort of pleas that are often to be uttered - sometimes screamed - out of the Family Court which deals with the division of assets and income on the break up of a relationship. 

But what does the law say? It talks of non-matrimonial assets which means property and cash which are NOT the product of or generated by the parties' endeavours during the marriage or civil partnership, such as an asset which has been inherited or gifted or which was owned by one party before the marriage or partnership or has been obtained by them as a result of their efforts after separation. 

Assets such as these may often be ignored when it comes to deciding who gets what. But they may sometimes be taken into account so that they are shared by both parties where that is fair: especially, where  they have been mingled with the family assets and the relationship has been a long one. The family home, although brought into the relationship by one of the parties, will usually come up for sharing unless the relationship has been a very short. The other situation in which one party will be able to gain some benefit from assets of the other which are clearly of a non-matrimonial kind is where that is fair because of the needs of that party (where, for example, that party is the sole or main carer of children of the relationship and reasonably requires some money out of the assets to buy another home once the family home is sold). 

The Court of Appeal has just been considering non-matrimonial assets in a case called Hart v Hart [2017] EWCA Civ 1308. What the case demonstrates is that there is no judicial appetite for a lot of time and money being spent on hearing evidence and argument on whether certain assets are matrimonial or non-matrimonial property. There needs to be a decision made at one of the preliminary hearings where there is a contested application as to whether the court should hear evidence and argument of this kind. If the facts clearly demonstrate a sharp dividing line between matrimonial and non-matrimonial property then the court should use that line for the purpose of deciding what award to make. If, on the other hand, an investigation would require an account to be undertaken of the relationship  or some other expensive investigation and/or it would be of doubtful utility then the court could be expected to say that it was neither proportionate nor required to achieve a fair outcome. Should an investigation be justified then the court would have to direct how particular or general it should be.

The distinction between matrimonial and non-matrimonial assets may continue to be of practical importance. However, if what looks like a disproportionate or pointless investigation into the distinction is being sought by your opponent to which you are opposed, then ask the judge - with the greatest of respect - to have a butchers at Hart v Hart.