HHJ Vincent (sitting as a Deputy High Court Judge). Final hearing in a high-value case. Court making findings on whether H’s large inheritance had been matrimonialised, W’s entitlement to a second home, and who should be awarded the family home.

Facts

H (71) and W (51) cohabited from 2003, separated briefly in 2012 and married in October 2012. W applied for divorce in May 2023 but continues to live with H and their only child, born in February 2015. Both are citizens of ‘Country A’ and relocated to England in November 2020.

The substantial wealth of H, a sculptor, stemmed exclusively from a multigenerational inheritance. This is held mostly in a property portfolio managed by an investment firm (both in Country A). H argued his inheritance, shared with his brother, was worth £12.5m due to capital gains tax liabilities and illiquidity, while W valued it at £126.7m.

In April 2024, H offered to settle for £11m, including a housing fund, capitalised income needs, and costs. In her own offer, W assessed her capitalised income needs at £18.5m and sought the family home, refurbishment costs, £3.5m for a second home, legal costs, and child maintenance. The family home, valued at £3.6m, was jointly owned.

Discussion

W accepts that her claim should be determined by reference to her needs. However, she submitted that these should reflect the scale of her sharing claim.

W claimed that H had been actively involved in managing his inherited property portfolio during the marriage, thus transforming it into a matrimonial asset. H argued that he remained a passive investor, citing Standish v Standish [2024] EWCA Civ 567, which emphasised that ‘the concept of matrimonialisation should be applied narrowly’.

W further submitted that she and her child required funds for a holiday home, notwithstanding the child’s two trust funds worth $10m each. She proposed two large properties in County M (£3.7m–£4.2m) or a property in Country C, where H owns a villa and a yacht. H’s offer, if reflected in the final award, would likely not require him to sell both, leaving him with both a home in England and somewhere for holidays with their child.

As for the family home, W argued that she should retain it to provide stability for their child, who regards it as home, whereas H would likely spend significant time abroad. Only at a late stage did H state a preference for remaining in England. Both parties agree that funds should be made for the other party to buy a nearby home of equivalent size and value.

Held

The court valued H’s inheritance at £120.8m. However, it recognised that H’s assets were largely illiquid due to significant capital gains tax liabilities, shared ownership with his brother, and their shared intention to preserve the inheritance for future generations.

HHJ Vincent held that H’s inherited business interests ‘cannot be said to have been matrimonialised’. No action taken by H during the marriage had altered their non-matrimonial character. Rather, he and his brothers’ efforts ‘have been to preserve as much as possible the inheritance, to exchange, but not to intermingle, or to be used for entrepreneurial purposes’.

W’s proposals for a second home were rejected. HHJ Vincent deemed the County M homes ‘substantial’ and ‘well in excess of the wife and the child’s needs’, noting W’s limited connection to the location. W’s additional proposal of a home in Country C, ostensibly to be near the child while spending time with H, was considered ‘unrealistic’ and unnecessary.

H was awarded the family home. The court considered its proximity to his studio, the presence of his assistant and family living on the grounds, and the tax efficiency of transferring W’s share to H. The court gave weight to H’s stated intention to retain the property and ultimately bequeath it to the child. W’s significant renovation budget, estimated at nearly £500,000, and her weaker connection to the property compared to H further influenced the decision.

W was awarded £10.5m to meet her needs. This sum included funds to purchase a suitable home, capitalised child maintenance, and living expenses. The court structured the award to ensure that W and the child could maintain a comfortable standard of living, while recognising the non-matrimonial nature of H’s assets.