How the ruling changes settlements


Who will be affected by yesterday's ruling?

Those involved in marriages where there is a large amount of wealth at stake. This wealth must be excess wealth, including property, which is left over from any money used to pay for the maintenance of children and the non-earning spouse, usually the wife. Divorcing couples who have incomes totalling less than £100,000 will remain unaffected.

So why is the ruling important?

The House of Lords has used the judgment to lay down principles for the fair division of assets. It has introduced a new concept of compensation which can be used by the courts to financially remedy the situation where a wife (or husband) has given up a successful career in the interests of the marriage. This could mean ex-wives who feel they have missed out on high-flying careers, which the law has failed to address by ordering periodic payments under a maintenance scheme, will go back to court to vary the terms of the settlement.

How are rich husbands expected to react?

Shrewd husbands who wish to hold on to their wealth will try to get wives to sign pre-nuptial agreements which stipulate exactly what they are entitled to if the marriage breaks down. But since pre-nuptials are only persuasive, and not binding, on a court, some will try to hide the truth about their assets.

What about Sir Paul McCartney and Heather Mills McCartney and other short marriages?

The ruling will confirm any expectation Lady McCartney may have that she will be entitled to millions of pounds upon her divorce. Like Lady McCartney, Mellisa Miller was married only for a short time and had very little significant wealth of her own. But the judges said yesterday that she was still entitled to a fair share of her husband's assets. Because the McCartneys have a child the courts will also interpret her "financial needs" very generously. However, recent estimations that she can expect £200m are wildly exaggerated. A more accurate figure is between £25m and £50m.

What about wealth acquired before the marriage?

This is where the ruling becomes confusing. Lord Nicholls said that anything acquired before the marriage should remain outside the "pot" of marriage wealth but everything else is up for grabs. Lady Hale offers a more conservative approach, suggesting investments and business enterprises not part of any joint enterprise, should be excluded from the division even if acquired during the marriage.

What do the lawyers think?

Disappointment all round. Family lawyers say the principle of certainty has lost out to the need for flexibility in deciding settlements.

Suggested Topics
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
Nadine Gordimer died peacefully at home yesterday
people
Arts and Entertainment
Neil Young performs on stage at Hyde Park
musicAnd his Hyde Park set has rhyme and reason, writes Nick Hasted
News
Women have been desperate to possess dimples like Cheryl Cole's
people Cole has secretly married French boyfriend Jean-Bernard Fernandez-Versini after just three months.
Arts and Entertainment
AKB48 perform during one of their daily concerts at Tokyo’s Akihabara theatre
musicJapan's AKB48 are one of the world’s most-successful pop acts
News
Ian Thorpe has thanked his supporters after the athlete said in an interview that he is gay
people
News
The headstone of jazz great Miles Davis at Woodlawn Cemetery in New York
news
Arts and Entertainment
Brendan O'Carroll has brought out his female alter-ego Agnes Brown for Mrs Brown's Boys D'Movie
filmComedy holds its place at top of the UK box office
News
newsBear sweltering in zoo that reaches temperatures of 40 degrees
Arts and Entertainment
Professor Kathy Willis will showcase plants from the Royal Botanic Gardens at Kew
radioPlants: From Roots to Riches has been two years in the making
Extras
indybestThe tastiest creations for children’s parties this summer
Arts and Entertainment
TV The follow-up documentary that has got locals worried
Arts and Entertainment
Paolo Nutini performs at T in the Park
music
Have you tried new the Independent Digital Edition apps?

Day In a Page

Super Mario crushes the Messi dream as Germany win the 2014 World Cup in Brazil

Super Mario crushes the Messi dream

Germany win the 2014 World Cup in Brazil
Saharan remains may be evidence of the first race war, 13,000 years ago

The first race war, 13,000 years ago?

Saharan remains may be evidence of oldest large-scale armed conflict
Scientists find early warning system for Alzheimer’s

Scientists find early warning system for Alzheimer’s

Researchers hope eye tests can spot ‘biomarkers’ of the disease
Sex, controversy and schoolgirl schtick

Meet Japan's AKB48

Pop, sex and schoolgirl schtick make for controversial success
In pictures: Breathtaking results of this weekend's 'supermoon'

Weekend's 'supermoon' in pictures

The moon appeared bigger and brighter at the weekend
Iraq crisis: How Saudi Arabia helped Isis take over the north of the country

How Saudi Arabia helped Isis take over northern Iraq

A speech by an ex-MI6 boss hints at a plan going back over a decade. In some areas, being Shia is akin to being a Jew in Nazi Germany, says Patrick Cockburn
The evolution of Andy Serkis: First Gollum, then King Kong - now the actor is swinging through the trees in Dawn of the Planet of the Apes

The evolution of Andy Serkis

First Gollum, then King Kong - now the actor is swinging through the trees in Dawn of the Planet of the Apes
You thought 'Benefits Street' was controversial: Follow-up documentary 'Immigrant Street' has got locals worried

You thought 'Benefits Street' was controversial...

Follow-up documentary 'Immigrant Street' has got locals worried
Refugee children from Central America let down by Washington's high ideals

Refugee children let down by Washington's high ideals

Democrats and Republicans refuse to set aside their differences to cope with the influx of desperate Central Americas, says Rupert Cornwell
Children's books are too white, says Laureate

Children's books are too white, says Laureate

Malorie Blackman appeals for a better ethnic mix of authors and characters and the illustrator Quentin Blake comes to the rescue
Blackest is the new black: Scientists have developed a material so dark that you can't see it...

Blackest is the new black

Scientists have developed a material so dark that you can't see it...
Matthew Barzun: America's diplomatic dude

Matthew Barzun: America's diplomatic dude

The US Ambassador to London holds 'jeans and beer' gigs at his official residence – it's all part of the job, he tells Chris Green
Meet the Quantified Selfers: From heart rates to happiness, there is little this fast-growing, self-tracking community won't monitor

Meet the 'Quantified Selfers'

From heart rates to happiness, there is little this fast-growing, self-tracking community won't monitor
Madani Younis: Five-star reviews are just the opening act for British theatre's first non-white artistic director

Five-star reviews are just the opening act for British theatre's first non-white artistic director

Madani Younis wants the neighbourhood to follow his work as closely as his audiences do
Mrs Brown and her boys: are they having a laugh?

Mrs Brown and her boys: are they having a laugh?

When it comes to national stereotyping, the Irish – among others – know it can pay to play up to outsiders' expectations, says DJ Taylor