Law Articles

How does the Family Court deal with non-matrimonial assets on divorce 17/10/2024

In the Family Court, the term “non-matrimonial property” refers to assets and resources that are considered to fall outside the scope of what was accumulated through joint efforts during the marriage. These types of assets may include property, financial resources, or valuables that one spouse acquired either before the marriage, through inheritance, or as personal gifts. The classification of assets as matrimonial or non-matrimonial becomes particularly significant in higher-value divorce cases. In such situations, there is often a focus on distinguishing between assets that are part of the marital pot to be divided and those that should be excluded because they were not accumulated through joint contributions during the marriage.

However, in most divorce cases, especially those where the parties’ needs are the primary consideration, the court's approach to this distinction between matrimonial and non-matrimonial property is more flexible. The court’s central concern is usually to ensure that the financial needs of both parties are met after the divorce, particularly if children are involved. This means that even if an asset is deemed to be non-matrimonial, it may still be considered by the court if it is needed to provide for the reasonable financial needs of either spouse. The court retains broad discretion in these matters, and the outcome will depend heavily on the specific facts of each case. Above all, the court strives for fairness in deciding how assets, including non-matrimonial property, are treated.

Inherited Assets

Inherited assets are one of the most common forms of non-matrimonial property. These are assets passed down to one party, often by family members, and are generally treated as belonging solely to the spouse who received the inheritance. However, the family court does not entirely exclude inherited assets from its consideration during divorce proceedings. Whether or not an inheritance should be shared between the spouses, and if so in what proportion, depends on a range of factors, including the length of the marriage and how the inheritance was treated during the relationship.

For example, in short marriages, where the couple’s financial lives have not become deeply intertwined, an inheritance is more likely to be treated as belonging solely to the spouse who received it. In contrast, in longer marriages, where the spouses’ finances have become more entangled over time, it may be harder to draw a clear line between matrimonial and non-matrimonial assets. In such cases, the court might view the inheritance as having been integrated into the couple’s joint financial affairs and may be more inclined to include it as part of the assets to be divided.

Pensions

The treatment of pensions as either matrimonial or non-matrimonial property is a complex area of law, and there are conflicting judicial approaches. Some courts have taken the view that pensions should not be treated differently from other types of assets, while others have been more inclined to view certain aspects of pension contributions as non-matrimonial, particularly if they were made before the marriage or after the separation.

In needs-based cases, those where the primary concern is ensuring that both parties can meet their financial needs after the divorce, the court rarely differentiates between pre-marital and post-marital pension contributions. In these situations, pensions are often treated as part of the general pool of assets to be divided, regardless of when the contributions were made. On the other hand, in sharing cases, typically those where the assets exceed the parties' needs, the court may be more willing to apportion pensions between the parties based on when the contributions were made. Even in such cases, however, the court generally cautions against giving pensions undue weight in the analysis of matrimonial versus non-matrimonial property.

Mingling of Assets

The principle of mingling plays a crucial role in the court's treatment of non-matrimonial property. Mingling occurs when non-matrimonial property, such as pre-marital assets or inherited wealth, is used in a way that integrates it into the couple’s joint financial life. For instance, if an inheritance is used to buy the family home or fund joint investments, the court may consider those assets to have lost their non-matrimonial status because they were used for the benefit of both parties. The more intertwined non-matrimonial assets become with the couple’s joint financial affairs, the more likely it is that they will be treated as part of the matrimonial pot for division upon divorce.

The duration of the marriage is also a key factor when determining whether mingling has occurred. In shorter marriages, it is easier for the court to maintain a distinction between non-matrimonial and matrimonial property. However, in longer marriages, where the couple has shared financial responsibilities and built a life together, it becomes more difficult to maintain this distinction. The court may take the view that the spouse who owned the non-matrimonial assets effectively agreed to share them by mingling them with the couple’s other resources.

When deciding how to treat non-matrimonial property, the court first considers whether it is fair and just to reflect the existence of these assets. If it is deemed appropriate to account for the fact that one party brought non-matrimonial assets into the marriage, the court then assesses how much of these assets should be excluded from division. The longer the marriage, and the more the non-matrimonial property has become intertwined with the couple’s joint financial life, the less likely it is that the court will exclude it entirely.

In summary, the family court’s approach to non-matrimonial property is nuanced and highly fact specific. While there is a general principle that non-matrimonial assets, such as inherited wealth or pre-marital property, may not be shared between the parties, the court’s overriding concern is fairness. The court will carefully consider the parties' financial needs, the length of the marriage, and the degree to which the non-matrimonial property has been mingled with matrimonial assets. In doing so, the court ensures that the outcome is just, recognising the contributions each party made to the marriage while also ensuring that both parties have the resources they need for the future.

For further information and advice on this issue, and other family law issues, please contact us for a free initial consultation on 01992 306 616 or 0207 956 2740 or email us.