Bulletin
Winter 2015
Dating + Divorce = Danger
Valentine's Day. 50 Shades of Grey. Love and bondage are in the air. But divorcing couples
need to beware romantic involvement. So warns Mr Justice Mostyn in a judgment handed
down at the end of last year.
In the case of AB v CB, the wife began a new relationship during the course of divorce
proceedings. Whilst she was neither cohabiting with her boyfriend nor intending to do so,
the Judge found that "it is perfectly clear that the relationship is strong, she likes him and his
children very much, she hopes it continues, they have a lot in common and are happy
together".
Significantly, Mr Justice Mostyn went on to say that a new relationship could be what he
termed a "significant fly in the ointment" in determining financial awards on divorce.
Contact the authors:
Alan Kaufman
Consultant: Private Client & Family
T: +44 (0) 20 3755 5538
E: [email protected]
The ruling caused surprise amongst the Family Law community. Nonetheless, a High Court
Judge's comments, particularly those of Mr Justice Mostyn, who is known for his landmark
decisions, cannot be ignored. Time will tell if this marks a new approach by the Courts but,
for now, the advice to clients who are contemplating divorce or who are in the midst of
divorce is to proceed with caution when it comes to new relationships.
Lois Langton
How stellar does a stellar contribution have to be?
Last November, the High Court handed down one of the largest awards in English family
courts in the long running Cooper-Hohn divorce.
The facts
Jamie Cooper-Hohn and Sir Chris Hohn had been married for 15 years and had four children
together. During the marriage, Sir Hohn amassed a huge fortune. The wife sought 50%; the
husband’s position was that she should receive 25%.
Handing down her judgment last November, Mrs Justice Roberts awarded Mrs Cooper-Hohn
£337million. The award amounted to 36% of Sir Hohn's £1billion fortune, falling far short of
the equal division sought by the wife, but going further than the figure proposed by the
husband. In her criticism of the award, Mrs Cooper-Hohn expressed her disappointment at
the use of a doctrine that she viewed as "outdated and unjust in disproportionately valuing
the generation of the wealth", feeling that it dismissed "the important contributions that
those who take on the responsibility to raise children and work in less lucrative sectors make
to our society." Whilst lamenting the decision, she has stated that she does not intend to
appeal.
Partner: Private Client & Family
T: +44 (0) 20 3755 5559
E: [email protected]
The doctrine that she is referring to is that of "special" or "stellar" contributions. Whilst Mrs
Cooper-Hohn sought to argue that the wealth had been created as a result of their
partnership during the marriage, Mrs Justice Roberts concluded that the husband qualified as
“a financial genius in his particular field of investment". His business acumen was considered
exceptional and accordingly, Mrs Justice Roberts saw reason to move away from the principle
of equality and the 50/50 division that the wife was seeking. Despite Mrs Cooper-Hohn's
criticisms, Mrs Justice Roberts acknowledged that Sir Hohn's proposal that his wife should
receive 25% of the assets was too low, as it did not properly acknowledge the extent of the
contributions she made in her own right to the marriage, namely her role as the wife and
primary carer of the children and her charitable activities. Her contributions however did not
usurp the presence of the husband’s stellar contribution.
Summary
Providing needs are met, the stellar contribution argument can provide the wealthy spouse
with a powerful shield against the argument of equal sharing. Such arguments, however, are
not easy to make successfully and the presence of wealth generated by one party’s
outstanding contribution during the marriage, although a factor to consider, does not
guarantee that the "stellar contribution” argument will succeed.
It is important that divorcing spouses take specialist Family Law advice to consider a stellar
contribution argument. However, clients should be aware that the reality is that such
arguments will apply only to a handful of cases and care is needed to make sure that client’s
expectations are managed so that they understand that the courts are looking for a
contribution that is of a “wholly exceptional nature" such that it would be unfair to disregard.
Case law states that establishing a case of special contributions will be difficult in the absence
of some “exceptional and individual quality" in the person that generated the fortune. In
short, a stellar contribution must be one which “arises in circumstances in which a spouses’
contribution, direct or indirect, to the creation of matrimonial property has been so
extraordinary as to dictate a departure within the sharing principle from the ordinary
consequence of its equal division”.
howardkennedy.com