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M v M (Short Marriage: Clean Break) [2005] EWHC 528 (Fam)

Clean-break award in short but wealthy marriage

Family Division: Singer J (5 April 2005)

Summary
Clean-break award in short but wealthy marriage.

Background
The husband and wife had met in the summer of 1995, were engaged in July 1999 and married in July 2000. They never lived together continuously in the same household prior to their marriage, which was childless and ended when they separated in April 2003. The wife obtained a decree absolute in February 2004, and applied for ancillary relief: she sought the transfer of their London home, and of a villa in the south of France which was in joint names. In addition, she sought a lump sum to bring her award up to a total of £7.2 million. The husband's position at the hearing had been that his offer of a lump sum of £1.3 million (on the basis that he retained the French property) was more than generous in the circumstances.

This was manifestly a case for a clean break. The judge investigated at length the business dealings of the husband who, it was agreed, had a basic salary in excess of £180,000 and was worth approximately £17.5 million; by comparison, the wife had had an annual salary of £85,000 before the marriage, her contributions to their family life had been essentially non-financial, and she had approximately £50,000 worth of assets from which to meet her liabilities. The judge also weighed in the balance the length of the parties' relationship, and reviewed the authorities concerning the approach to be applied in short but wealthy marriage cases.

Findings
The judge considered that the award should recognise that the husband had by this marriage, notwithstanding its short duration, given the wife a reasonable expectation that her life as a single woman once again did not need to revert to what it had been before her marriage, and that she should be able to live at a significantly better standard in terms of accommodation and spendable income, even if at one which did not approach the level that the husband could afford for himself and his new family.
Also, he did not feel the slightest difficulty in departing from the principle of equality, were that a valid exercise; nor had counsel for the wife, who had discounted to 37.5% by reference, first, because of the undoubted fact that the husband had brought very valuable acquired expertise and acumen to this marriage, so that he was already fully 'fledged' in the sense expressed in GW v RW (Financial Provision: Departure from Equality) [2003] EWHC 611 (Fam); and, second, because of the brevity of the marriage.

Accordingly, the wife should retain the London property, worth approximately £2.3 million, which would be transferred to her free of mortgage; and the husband should pay a lump sum of a further £2.7 million which, if invested in accordance with usual principles and calculated using the computer programme Capitalise, would generate an initial annual income of about £98,000.

Comment by Tacey Cronin, Albion Chambers

This first instance decision is bound to be appealed, but it contributes very interestingly to the post White debate! The marriage lasted less than three years: H was worth about £17.5 million, W had only debts: evidence as to conduct was heard, but did not specifically affect the decision, the judge being unpersuaded that the circumstances of the breakdown of the marriage could really affect his decision: evidence as to the length of the relationship before marriage was unhelpful, since the Judge found the parties had had different views about it: W had given up well paid work: there were no children.

Reviewing all the authorities briefly, the Judge found that the key element was that H had given W an expectation of living on a higher matrimonial plane that justified an award of £5million. He rejected an argument for equal division of assets acquired during the marriage since there had been no real joint enterprise involved.

The Judge was extremely critical of the time and money spent on instructing expert valuers in relation to shares which H could not yet realise.

Read the full text of the judgment here