Considering pre-marital contributions on divorce

The high-profile divorce settlement decision in the case of Anna Standish v Clive Standish, primarily concerns pre-marital contributions to the asset pot. This case has garnered widespread attention, as the Court of Appeal made an unprecedented decision to reduce the award to the wife by £20m, following a financial remedy agreement made on 27 October 2022. The court found that the existing financial settlement did not adequately reflect the pre-marital contributions of the husband.

The original financial settlement

Anna and Clive Standish began their relationship in 2003 and married in 2005. Their marriage lasted until 2020. At the time of their marriage, Clive had accumulated significant pre-marital wealth through his career, including investments and properties. Anna’s assets were more modest, consisting of a property, some savings, and an inheritance.

The decision made is particularly reflective of two key financial decisions made in 2017, which took place as part of tax reduction schemes. Clive transferred investment funds worth around £77m to Anna, and the second involved Anna being issued shares in a farming business, Ardenside Angus.

The court initially determined that the couple’s total wealth was £132m, with £112m deemed matrimonial property, including the 2017 assets and the farming business. The judge ruled that these assets had become part of the matrimonial pot and were thus subject to division. Due to the timing of the assets’ inclusion, the judge decided on an unequal division, awarding Clive £87m (66%) and Anna £45m (34%).

Grounds of Appeal

Both Anna and Clive appealed the financial remedy order for different reasons, arguing that the Judge failed to apply the sharing principle correctly.

Anna contended that the judge wrongly classified the 2017 assets and shares in farming business as matrimonial property, arguing they should be deemed her separate, non-matrimonial property. Clive claimed the judge should not have applied the sharing principle to these assets, as they were his pre-matrimonial wealth.

Court’s Findings

The Court of Appeal focused on the source of the assets rather than their title. Citing Miller v Miller [2006] and Hart v Hart [2017], the court emphasised that matrimonial property includes assets generated by the couple’s joint efforts during the marriage, while non-matrimonial property generally refers to assets acquired before marriage or through inheritance or gifts.

The Court of Appeal dismissed Anna’s appeal and allowed Clive’s, ruling that the initial application of the sharing principle was incorrect and had unfairly favoured Anna. The court determined that the marital property was £50.48 million, and a fair division would award Anna approximately £25m, significantly less than the initial £45m she received.

The case highlights the complexities involved in high-net-worth divorces and the careful distinctions that must be made between matrimonial and non-matrimonial property. The COA judgement highlights the careful consideration of the source of assets.

The full case summary can be found here: Anna Catherine Standish v Clive Thomas Standish – Find case law – The National Archives

When a marriage ends, dividing assets can be a complicated process, especially when one or both spouses had significant assets before the marriage. The recent high-profile case of Anna and Clive Standish sheds light on how courts might approach this issue.

Understanding the Basics

Pre-Marital Contributions: These are assets that one spouse brought into the marriage. They can include savings, property, investments, or businesses that were owned before getting married.

Matrimonial Property: This refers to assets that were acquired or accumulated during the marriage. These are usually considered to be the result of the joint efforts of both spouses.

The Standish Case

Background: Anna and Clive Standish married in 2005 and divorced in 2020. Before they married, Clive had already accumulated a significant amount of wealth through his career. Anna had more modest assets, including a property, some savings, and an inheritance.

Financial Decisions: In 2017, Clive made two key financial decisions:

1. He transferred investment funds worth around £77 million to Anna.
2. Anna was issued shares in a farming business called Ardenside Angus.

Initially, the court considered these assets part of the matrimonial property and divided the total wealth of £132 million, giving Clive £87 million (66%) and Anna £45 million (34%).

Appeals and Court’s Decision

Appeals: Both Anna and Clive appealed the court’s decision. Anna argued that the assets transferred in 2017 should be considered her separate property. Clive contended that these assets were his pre-marital wealth and should not be shared.

Court’s Focus: The court looked at where the assets came from rather than whose name they were under. They emphasised that:

• Matrimonial property includes assets generated by the couple’s joint efforts during the marriage.
• Non-matrimonial property includes assets acquired before marriage or through inheritance or gifts.

Outcome: The court ruled that the assets transferred in 2017 were indeed Clive’s pre-marital assets. Therefore, the initial division was adjusted. Anna’s award was reduced to approximately £25 million, recognising Clive’s pre-marital contributions.

What This Means for You

If you are going through a divorce, it is essential to understand how the court might look at pre-marital assets. Here are some key takeaways:

• Source of Assets: The origin of the assets is crucial. The court will distinguish between what was acquired before the marriage and what was accumulated during the marriage.
• Documentation: Keep clear records of your pre-marital assets. This can include bank statements, property deeds, and investment records.
• Legal Advice: Consult with a family law professional to help navigate the complexities and ensure that your contributions are adequately considered.

The Standish case highlights the importance of distinguishing between pre-marital and matrimonial assets and shows that courts take these distinctions seriously when making decisions about asset division.

It is important to note that the principles in this case apply where the total assets are significant and exceed the financial needs of the parties. If the assets are insufficient to meet the needs of the parties, whether assets are considered matrimonial or non-matrimonial carries less weight.

The full case summary can be found here: Anna Catherine Standish v Clive Thomas Standish – Find case law – The National Archives