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VV v VV [2022] EWFC 41

Peel J considers the law on the effect of pre-marital cohabitation and engagement on the sharing principle, conduct and the needs principle in a short marriage. He reserved the question of costs.

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The marriage was short (no more than 5 months) and childless and both parties were in their 50s. They met in 2018. W said they began to cohabit in November 2018. H said it was December 2019.

In July 2018 H began working for AB, a technology start up company.  Part of the remuneration were share options on shares at a value of $0.42 per share, if he remained in the employment for 1 year. The judge rejected W's suggestion that she had any significant role in H securing that job. The parties became engaged in March 2019. H completed the year with AB in August 2019. He left AB in September 2019 with a negotiated severance package which included 700,000 share options. In December 2019 H moved to London where W lived. H worked for another start-up company but that did not succeed and he moved employment again in August 2020 and remains with that company. The parties married in January 2020 and separated in June 2020.

H originally asserted that the share options in AB had no value. He then became aware that he could sell some of them to a 3rd party in a pre-listing sale. He did so. He did not want X the managing director of AB to know because he feared that he would try to make the sale and he did not want W to know as she may tell X. In fact W was in discussions with X who encouraged her to try and prevent the sale of shares. The effect of W's interference including threatening injunctions on the basis that she had a share in the ownership but not actually applying for them, was that H was unable to realise the maximum value of his shares on the initial listing. When he was able to do so the value of the shares had dropped substantially, and his lost opportunity was valued at tens of millions of dollars.

The judge considered the law on what makes up relevant cohabitation at paras 40-43 GW v RW [2003] EWHC 611; IX v IY [2018] EWHC 3053; McCartney v Mills McCartney [2008] EWHC 401, E v L [2021] EWFC 60 adding that  "the court should also look at the parties' respective intentions when inquiring into cohabitation. Where one or both parties do not think they are in a quasi-marital arrangement, or are equivocal about it, that may weaken the cohabitation case. Where, by contrast, they both consider themselves to be in a quasi-marital arrangement, that is likely to strengthen the cohabitation case…. The essential inquiry is whether the pre-marital relationship is of such a nature as to be treated as akin to marriage." [45-46]

The judge found that the fact that parties became engaged did not of itself affect whether the property was a matrimonial asset: Miller v MacFarlane [2006] UKHL 24 and McCartney v Mills-McCartney (discussed). [47-48]

The judge then concluded that that until December 2019 "they had been in a committed relationship where they spent time together, were supportive and affectionate, and shared dreams and ideas, but which fell short of cohabitation equating to marital norms. "[64]
Nor do he regard the fact of engagement, although a relevant factor when considering the extent of the mutual commitment and shared life in the circumstances of this case, as by itself giving rise to a sharing claim. [65]  He therefore rejected the sharing claim as the relevant assets were all acquired before December 2019.

He concluded that the conduct of the husband (non-disclosure) was "litigation conduct" which could be reflected in costs. [71].  However, W's conduct in colluding with the owner of AB was "gross and obvious conduct" which the court was entitled to take into account when assessing the award[72].

He then considered W's case based on need. The judge concluded that she should have a sum which cleared the mortgage on her flat, funds to clear the balance of her debts which were in fact her costs (£237000 in addition to £400000 paid to her by H for costs). He added 3 years of maintenance as a lump sum). Her conduct was taken into account by the judge saying that her award would have been higher if H had been wealthier as he would have been if she had not interfered in the share sales. The total was £750000.

He dealt with costs as a separate issue [77]. When he did so he ordered W to pay £100000 of H's costs. In effect he reduced the payment to her on the basis that she could choose how to meet her needs – see VV v VV [2022] EWFC 46 by contesting the cohabitation and the share option issues – which changed the case from a relatively straightforward "needs" to one which could not settle.


Case summary by Nicholas O'Brien, Barrister, Coram Chambers

For full case, please see BAILII