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Post Nuptial Agreements and Fairness

In the case of Gray v Work the Court considered whether a Post Nuptial Agreement should be upheld in subsequent divorce proceedings.

The relationship between the parties lasted 20 years.

When the parties met they were both in their early to mid-twenties and had similar modest incomes and no capital.

The parties were in their mid to late forties when they divorced.

During the marriage the Husband earned considerable wealth, with his net wealth amounting to £144,000,000.00.

The Wife cared for the parties two children.

The Wife moved with the Husband to live in Japan, to enable him to generate the wealth in the space of eight years.

The parties signed post nuptial agreements in October 2000. The purpose of the agreements was to partition the parties separate property under Texan and American Law, including future earnings of each parties, to keep them separate and distinct.

The post nuptial agreements were signed in anticipation of the Husband renouncing his American citizenship, which he did purely to avoid tax.

The Wife subsequently formed an emotional and sexual attachment with a man, Mr H, who was the parties’ physiotherapist in 2013.

As such, the Husband presented the Wife with a divorce petition in 2013.

The Wife applied to the Court for financial remedy.

The Husband offered to pay the Wife $71,000,000.00. The Wife did not accept this and felt she was entitled to half of the assets.

The matter came before the Court.

The Court confirmed that it was an established principle that effect should be given to post nuptial agreements, unless it would not be fair to hold the parties to the agreement in the circumstances.

On the facts under the agreement, the Wife was free and fully entitled to accept the post nuptial agreement to seek alternative relief. Therefore, the post nuptial agreement had not impacted the Wife’s right to seek a discretionary award.

In view of the fact the Wife had issued Form A, it was clear she sought alternative relief.

The Court needed to consider if the Husband had made a special contribution, meaning the payment to the Wife should be significantly less than it may otherwise have been.

The Court held that for a successful claim to a special contribution, there needed to be some exceptional and individual quality in the spouse concerned. It was not enough for a person to be in the right place at the right time, benefit from a period of boom or argue they worked hard for the money. It was also a risk to attach special weight to hard work, given this may undermine the hard work of running a home and caring for children.

In view of this, the Court considered that the Husband had not established an unmatched and special contribution of the kind and to the extent required.

Therefore, the Court considered the Section 25 factors to determine the appropriate outcome.

The Court held that to achieve a fair outcome, an equal division of the assets would be appropriate.

If you need assistance in respect of your matrimonial affairs, whether this is in respect of issues concerning a divorce and the related financial aspects, children, injunctions or cohabitation disputes, please contact our offices on 01323 727321 to arrange an appointment.

Please note that the family department offer a free initial 30 minute interview to provide general advice and guidance in relation to your matter.

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Guy Brown
Guy Brown
Carolyn Richards
Carolyn Richards
Greg Saunders
Greg Saunders
Tina Ripley
Tina Ripley