“Big Money” Ancillary Relief

Cowan v Cowan CA TLR 17 May

The husband had made a fortune by inventing and marketing bin liners for household waste. The available family assets on the divorce totalled £11.5 million and the judge had awarded the wife the matrimonial home, a second home in Florida with £200,000 to pay off the mortgage on that home. The judge had assessed the wife’s income needs at £100,000 a year which he capitalised at £1.58 million. Encouraged by the decision in White v White (20/LL p 41) the wife applied to amend her application to amend the lump sum she was seeking to £4.6 million. Clearly the decision in White v White did not introduce the rule of equality. The object of equality was a cross-check against discrimination. Fairness was the rule and in its pursuit the reasons for departure from equality would inevitably prove to be too legion and too varied to permit of listing all classification. In so far as the yardstick of reasonable requirements was a judicially created tool to enable negotiators and judges respectively to predict and calculate conclusions, it introduced an element of predictability and accordingly curtailed the width of the judicial discretion conferred by parliament. Thus the prohibition of the judicial use of the tool extended the judicial discretion at the very moment when government policy had seemingly moved in the reverse direction in harmony with international trends, academics and specialist commentaries and such research as was available. Therein lay the heightened case for legislation. In “big money” disputes, where the assets available exceed the parties’ financial needs for housing and income, the trial judge should apply the criteria in s25 of the Matrimonial Causes Act 1973 so as to arrive at a fair conclusion. The judges should avoid any discriminatory appraisal of the traditional role of the woman as home-maker and the man as bread-winner and arbiter of the destination of the family assets among the next generation. A calculation of what would be the result of equal division was a necessary cross-check against such discrimination. The judge should also avoid any evaluation of assets solely or even largely by reference to reasonable requirements. The court came to the conclusion that the wife should have substantially more than the judge had awarded her, and increased the lump sum to £3 million resulting in her receiving 38% of the available assets together with the two houses, with the husband retaining 62% of the available assets.