While there is no specific legal definition of a high net worth (HNW) divorce, it generally refers to cases where there are substantial marital assets such as properties, land and other investments which amount to more than £1,000,000. Additionally, if one or both spouses are high earners with annual incomes over £200,000, the case may also be deemed HNW.
In this article, Adrian Silk, Head of Family Law at our Waterlooville office, provides further information on HNW divorces and answers some frequently asked questions about these cases.
How are assets divided in a high net worth divorce?
In all cases – from where there are limited financial assets to high net worth cases – the financial needs of the parties are one of the factors to be considered by the court under the checklist set out in section 25 of the Matrimonial Causes Act 1973, which provides in MCA 1973, s 25(2)(b) that the court shall have regard to the financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future. There are other factors the court must consider in all financial remedy cases, including, most importantly, the welfare whilst a minor of any child of the family.
Who handles high net worth cases?
High net worth divorce cases often involve financial assets that exceed the parties’ immediate needs. These cases are usually dealt with by family courts, including the Central Family Court.
In cases of significant wealth, such as in matters where the overall net assets amount to more than £15 million, those matters might be allocated to the High Court, London. Due to our high level of expertise and longstanding experience, we can also help in these cases and work with leading London barristers’ chambers to protect your position in these situations.
What role does a pre-nuptial or post-nuptial agreement play in high net worth divorces?
Whether people have limited or extensive assets – which they have inherited or built up – by way of insurance, they often wish to protect by ringing fence to themselves those assets should the marriage they are entering end in divorce by way of a pre-nuptial (prenup) or post-nuptial (postnup) agreement. Although they are not legally binding in the UK, these agreements are increasingly being considered by the courts, including in high-net-worth cases, if they are deemed fair and meet specific criteria.
Can non-matrimonial assets be excluded from a divorce settlement?
Yes, it is possible to exclude non-matrimonial assets – such as inherited wealth, property acquired before the marriage, or gifts – from a divorce settlement. However, each case is different, and a court will assess whether it is fair to exclude such assets, especially when these have been combined with other marital assets or if the financial needs of both parties require their inclusion.
How does the court value complex assets, such as businesses or trusts?
Valuing complex assets like businesses or trusts in high net worth divorces often involves the expert guidance of chartered and forensic accountants, pension actuaries and valuation experts where personal chattels – including cars, jewellery and artwork are involved. The court relies on these professionals to provide an accurate valuation, ensuring a fair distribution of assets. At Larcomes, our family law specialists also work with tax specialists to assess the impact of any financial settlement on your case.
Legal Precedents in High Net Worth Divorces
In the case of White v White in 2000, the House of Lords established that the parties’ financial needs should not be the determining factor in the distribution of matrimonial assets. In fact, it held that in all cases, including high net worth cases, the principles of needs, compensation and equal sharing apply. In fact, the principle of equal sharing even applies where there is great family wealth which was made clear in 2016 by the case of AAZ v BBZ, which involved assets of £1 billion.
Since the leading case of White and White, many of the big money cases deal with situations where the court has held that on the facts of the case there should be a departure from equality for various reasons including for example on the basis of it being decided that certain assets amount to non-matrimonial property.
Will I have to go to court in a high net worth divorce?
Not all divorce cases need to go to court. It is possible to resolve even complex matters, including HNW divorces, through negotiation, mediation, or collaborative law, avoiding the need for a court hearing. However, if parties cannot reach an agreement, or if disputes over asset division become more complex, the case will likely proceed to court.
Divorce Solicitors Waterlooville and Portsmouth
Regardless of the complexity of your divorce or separation, our solicitors in Portsmouth and Waterlooville have the knowledge and expertise to help. We will explain all the options available to you, ensure you are aware of the costs involved and guide and support you through every step of the process.
Larcomes’ family law department enjoys an enviable reputation and is recognised by the Law Society for the high standard of work we undertake in Family Law and Child Law matters.
Remember you can talk to us in complete confidence and gain reassurance by speaking to someone who understands your situation.
About Adrian Silk
Adrian has almost 30 years of experience in family law. He qualified in 1995 and has been practising as a solicitor for the last 28 years.
He specialises in all areas of family law, including matrimonial and child law, and throughout his career has represented many different clients on a wide range of legal issues, including divorce, grandparents’ rights, and financial remedy disputes.
Before joining Larcomes, Adrian ran his own law firm, representing people from all walks of life and giving practical advice with a supportive approach.
Get in Touch
To speak with one of our specialist family law team, please call Sandra Philips on 023 9244 8107 for our Portsmouth office or Adrian Silk on 023 9244 8106 for our Waterlooville office or make an online enquiry.
