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Appeal court confirms assets remain non-matrimonial after long marriage

Monday, 4 September, 2017

The England and Wales Court of Appeal has upheld a financial remedy order in which a wife received less than half of the couple's combined assets, on the grounds that most of the property was owned by her husband before the marriage began.

The important legal point of the case (Hart v Hart) is that the 23-year duration of the marriage was held not to have erased the non-matrimonial status of Mr Hart's pre-marital assets.
Karen and John Hart separated in 2006 and have been fighting their legal battle over the settlement for years, with Mrs Hart alleging that her ex-husband has not been entirely transparent about his wealth.

However, in June 2015, the England and Wales High Court assessed their combined assets at GBP9.4 million, and accepted Mr Hart's representations that he had brought a substantial part of this into the marriage at its outset in 1987. Accordingly, Wildblood J judged it fair to depart from the equal sharing principle and awarded Mrs Hart only GBP3.5 million of the total, on the basis of her needs.

John Hart objected even to this settlement, and last year brought an action to have it reduced on the grounds that his ex-wife was cohabiting with and being supported by another man. His claim was dismissed by Munby J, who accepted Karen Hart's argument that she wished to remain financially independent and that the presence of her cohabitant did not diminish her needs.

For her part, Mrs Hart believed she had been unfairly treated by not receiving an equal share of what she claimed were the matrimonial assets. She instructed Irwin Mitchell Private Wealth to challenge the settlement in the appeal court. John Hart contested the claim, arguing that the couple had not increased their assets together, and that the needs-based financial remedy order had left Mrs Hart with a home, a holiday home, a lifetime income 'at a very considerable figure and clear of liabilities'.

Judgment was handed down on 31 August 2017, and it went against Karen Hart. Moylan J said the High Court 'was plainly entitled to find that the husband had substantial wealth at the commencement of the relationship, because this was agreed'. Mr Hart, who was already in his 50s when the couple married back in 1987, had already amassed GBP2.6 million and considerable property assets. He concluded that, despite the length of the marriage, an equal division would be unfair to the husband.

Nicola Walker of Irwin Mitchell, who represented Mrs Hart, called the decision 'unfair and discriminatory' and said Mr Hart's contribution had not been properly evidenced.

'Given that the couple were married for 23 years, the settlement should have been based on an equal sharing of the assets they created between them during this time', she said. 'Any difficulty in separating the matrimonial assets from the non-matrimonial in this case is entirely the result of Mr Hart's refusal to provide relevant information which was available to him.'

The appeal court's decision 'leaves the law in a state of flux', said Walker. 'It allows a trial judge to find that even where it is not properly evidenced, the financial contribution of one spouse outweighs the family and domestic contribution of the other. More such results are likely to follow, with the potential to set the law back more than 20 years.'

  • The full EWCA judgement was not available at the time of writing.

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