BY v GC (No 2) [2025] EWFC 397

Judgment date: 21 November 2025

https://caselaw.nationalarchives.gov.uk/ewfc/2025/397

Mr Nicholas Allen KC (sitting as a Deputy High Court Judge). In this seven-day final hearing of a long marriage with adult children, the computation and distribution of a variety of assets were determined by a robust analysis and application of the case law by Mr Nicholas Allen KC. The assets as found (of £89.5m) were divided in H’s favour as to 55/45 to reflect illiquidity and risk. H was allowed to retain his £14m home in Spain as long as he could raise W’s lump sum against this house by the court-ordered date.

Background

• H is an investor and financier, living in Spain.
• W is a homemaker, living in Manchester.
• The couple cohabited from 1995 until 2021 (26 years). They were married for 25 years (long marriage).
• They have two adult children together.
• At the First Appointment, both parties agreed this had been a marriage of equal contribution.

Law relied upon

• MCA 1973: ss 23–25.
• White v White [2000] 2 FLR 981: fairness is the overriding principle.
• Miller/McFarlane [2006] 1 FLR 1186: three principles to achieve fairness: needs, sharing, compensation.

The parties’ respective positions

• W (BY) sought an equal division of assets of c.£105m (including pensions, excluding chattels): i.e. £52.5m each.
• W also sought sale of Spanish property as H was ‘overhoused’.
• H (GC) sought 60:40 division in his favour on assets of c.£72m (including pensions, excluding chattels): i.e. £29m to W and £43m to H.
• H wished to retain the Spanish property.

Computation

Property

• The court accepted the SJE value for the Spanish property and 12% as being the appropriate notional costs of sale as this figure was supported by evidence.

Business interests

• Pre-trial review (BY v GC [2025] EWFC 226): the judge had refused H’s Daniels v Walker application for permission to rely on his own expert’s report.
• At the final hearing the court followed HO v TL [2024] 2 FLR 175, Peel J – ‘it is for the court and not the expert to determine the value’ – and Neil v Neil [2020] 1 FLR 1095, Moor J: ‘[t]he expert advises but the judge decides.’
  - The judge accepted the expert’s opinion evidence as to the valuation of the businesses including her ‘accountancy discounts’.
• The judge rejected an argument that veered close to suggesting that an earnings-based valuation was inconsistent with the principle as set out in Waggott v Waggott [2018] 2 FLR 406 by Moylan LJ that the future sharing of post-separation income is impermissible.
• Company A: the judge decided on an earnings-based multiple approach as the net asset valuation did not capture future expectation of generating profits.
• Company B: the judge asked the SJE to recalculate her valuation as she had used incorrect assumptions, and accepted her revised figure.

Other

• ET loan note: the judge used H’s figure which was based on the actual annual receipt, and rejected W’s calculation which was based on a value of the loan note and added five years of interest.
• II loan note: the judge used the SJE figure and rejected H’s approach which was to take a percentage of the total value which H contended was the value of Company A and then pro-rated it between loan notes.
• BO4 loan notes: the judge rejected the approach of W (equal division based on the SJE’s original figures) and H (deduct the full value of the dividend as it was no longer surplus cash and then pro-rata it between the two loan notes) and accepted the SJE’s revised calculations.
• AN shares: the judge rejected H’s approach which was to add-back a gift made by W to one of the parties’ children.
• Repayment of loan made by third party: the judge accepted that H’s payment of this sum to a third party was justified and therefore refused for it to be added-back.
• Interest on the loan: the judge added back the interest already paid and did not take account of any further obligation to pay interest.
• Loss on value of shares sold: the judge decided not to add-back this as H sold the shares in good faith, the share price continued to fall after sale, and W also suffered a similar loss (Evans v Evans [2013] 2 FLR 999 Moylan J: context is important; it is not sufficient simply to point out certain aspects of one party’s expenditure). Also, given that W’s claim for the add-back was characteristic of her allegation of ‘conduct’ pursuant to MCA 1973 s 25(2)(g), ‘conduct’ is only to be taken in to account if it is of a ‘highly exceptional nature’ (N v J [2025] 1 FLR 571, Peel J at [2]) which this was not.
• Outstanding legal costs owed to third parties: the judge capped the liability at £1.18m as to update this figure to £2.06m as H sought risked unfairness if only one figure and not all figures were updated.
• Insurance payment: not included as it is an annual expenditure and not a one-off capital liability.
• Chattels: jewellery, artwork, cars. Incomplete figures and little or no evidence was given. Their value was not de minimis but was excluded given the overall asset base (B v B [2013] EWHC 1232 (Fam)). Each party will retain their own personal possessions and effects. Any chattels in dispute will be placed in a schedule of items and alternate choices of items they wish to retain/receive will be made. Chattels that neither party wants will be sold and proceeds divided equally (K v K (Financial Relief: Management of Difficult Cases) [2005] 2 FLR 1137 per Baron J at [32]–[34]).

Distribution

• Judge determined that the value of assets was £89.5m.
• A ‘court discount’ was justified given the assets H was to retain were risky and uncertain whereas W was retaining more liquid and copper-bottomed assets.
• However the discount should be limited to 5% (and not 10% as sought by H) for reasons which included H retaining the benefit of £158m of loan notes and that one of H’s future liabilities might be met by a sale or restructure of a debt.
• The overall division was therefore 55% (£49.2m) to H, 45% to W (£40.3m).
• If H was unable to raise W’s lump sum against the Spanish property by the ordered date, the house would be sold by way of deferred order for sale. Otherwise, H could retain it as his home.