In sickness and health; for better or for worse. The marriage vow takes on a whole new meaning in the context of a credit crunch divorce. Lawyers representing the ex-wives of wealthy City types argue that these words should also be strictly applied to the terms of a divorce settlement. After all, they say, their former husbands made their fortune in the good times, when they were supported by their wives, and so should be prepared to lose more of it when the economic and the romantic climate turns bad.
Over the years the courts have tended to agree with the ex-wives. The legal justification for this is that the terms of a division of wealth already take account of fluctuations in the markets. If they didn't, there would be a constant stream of husbands and wives returning to the courts to complain that they are much worse off now than when they decided to split the assets. Without legal certainty, the divorce system would quickly turn to chaos.
But the credit crunch is no ordinary fluctuation in the financial markets. Lawyers representing some very wealthy ex-husbands are now arguing that no one could have foreseen this collapse. Properties and share portfolios have been so badly hit that husbands like Mr Myerson claim they are actually so badly off that they end up paying more to their wives than they keep for themselves.
This is largely because a husband has tended to give a wife a greater percentage of the copper-bottomed assets, taking for himself a larger percentage of the risk-laden assets like options, shares or futures. Such has been the ravaging effects of the recession that if they were to cash in their chips now, many ex-husbands would be technically bankrupt. What the courts have to decide is whether, for better or for worse, the recession is so exceptional an event that big-money divorce settlements are rendered meaningless.Reuse content