The Impact of the recent case of Standish v Standish in Matrimonial Proceedings

The case of Standish v Standish [2024] has marked a pivotal moment in the development of matrimonial law, particularly regarding the treatment of non-matrimonial assets in divorce proceedings.

Mr Standish argued that his inherited business interests, overseas investments and savings should be treated as "non-matrimonial property" as he obtained all of his wealth before the marriage and therefore these assets should be kept separate from the assets to be divided in the divorce. Mrs. Standish, meanwhile, argued that these assets had become intermingled with the matrimonial finances and had been used to support the family lifestyle, thus losing their separate character and should therefore be shared equally between them.

Up until 2017, all of Mr Standish's wealth aside from two joint bank accounts and the family home (purchased by Mr Standish outright) were held in his sole name. In 2017, Mr Standish transferred a large sum to Mrs Standish (£80million) for the purposes of setting up a trust for the children. Mrs Standish failed to set up the trust and following divorce argued that due to the transfer the sum of £80 million had been inter-mingled and therefore should now be classed as matrimonial in nature. Mr Standish argued that the 2017 assets were his non-matrimonial property, as the source of the funds were attributable to his pre-marital assets and should be excluded from being shared with Mrs Standish.

There was a number of hearings firstly in the High Court, then the Court of Appeal and then in the Supreme Court.

The Court took a balanced view. It said that while some assets might start off as non-matrimonial if they are used during the marriage - for example, to buy the family home or fund a certain standard of living - they can become part of the marital "pot" and should be considered for division. However, the Supreme Court confirmed that the sharing principle does not apply to non-matrimonial property unless there is a real "need" or "compensation" is required. The Supreme Court did not believe that the 2017 transfer allowed the monies to become matrimonial in nature as the money was not intended to benefit Mrs Standish or with the intention to share the funds with her. They therefore did not allow Mrs Standish to claim from the non-matrimonial assets.

This is a groundbreaking case as clear guidance has now been confirmed by the Supreme Court regarding matrimonial and non-matrimonial assets.

Key Takeaways:

1. Non-Matrimonial Assets: These remain potentially exempt from equal sharing, but only if they have not been extensively merged into the family's lifestyle and there isn't a real need of the parties.
2. Matrimonialisation: Matrimonialisation occurs where there is intention by a spouse to share their non-matrimonial property, along with evidence over time the parties have treated the asset as shared.
3. Tax: The Supreme Court confirmed that transfers between parties for the purpose of a tax scheme i.e. to mitigate tax are insufficient to render an asset matrimonial in nature.

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