IR v OR [2022] EWFC 2029 March 2022
Published: 24/06/2022 09:00
https://www.bailii.org/ew/cases/EWFC/HCJ/2022/20.html
Mr Justice Moor.
High net worth case, judge found total net assets to be £184.6m. H had spent c.12 years as CEO, and then became Executive Chairman, of his father’s retail company which had been set up in the 1950s. Prior to marriage, H had worked in the finance department and the business had less than 20 shops. During H’s time as CEO throughout the marriage, the business grew to over 100 shops and was later sold for over $1 billion. The parties had signed a pre-nuptial agreement prior to their marriage in 1997 which excluded H’s, then quite modest, interest in the family business.
H argued that all the funds received from the sale of the family business were non-matrimonial, that it was not due to him that the business grew so rapidly between 1993 when he became CEO and sale approximately 25 years later but down to his Father coming up with the ‘joint venture partnership’ model. Judge found that the huge growth was achieved under the H’s stewardship which inevitably led to a finding that the huge increase in value was matrimonial property. But allowance must still be made for significant non-matrimonial element, i.e. the 30 years of the business before the H’s involvement. Pre-nuptial agreement ignored entirely as it failed the Radmacher v Granatino [2010] UKSC 42 test in that it would have left the W in a real predicament of need, but it raised the issue that, from the beginning, the assets from the family business should be treated as non-matrimonial.
Judge considers Hart v Hart [2017] EWCA Civ 1306; Jones v Jones [2011] EWCA Civ 41 and Martin v Martin [2018] EWCA Civ 2866 in determining how to calculate the non-matrimonial element. The judge uses multiple calculations (excluding the use of straight line calculation as a result of exponential growth) and averages the results to find the proportion that is ‘non-matrimonial’, relying on a broader brush Hart calculation, resulting in W receiving c.38% of the assets. Consideration of W’s needs, ‘generously assessed’.
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