An end to sharing post-divorce earnings?
A divorce and finance case has recently been reported in the media whereby multimillionaire, William Waggott (Chief Financial Officer at TUI Travel Ltd) has managed to successfully appeal an earlier decision made by the Court that awarded his ex-wife, Kim Waggott a £10million lump sum and annual lifetime maintenance of £175,000.
The lawyers for Mrs Waggott were trying to argue that the maintenance award was not “generous enough” and that it should be increased by another £23,000 per year. They also argued that she should get a 35% share of Mr Waggott’s bonuses for 5 years. Lawyers for Mr Waggott strongly argued that making a lifetime maintenance award did not give Mrs Waggott an incentive to work again (she was previously was a finance controller at UCI cinemas) and earn her own income.
The husband in this case was successful on appeal and the Judge ordered the maintenance payments to stop in 3 years’ time meaning the husband was also granted a clean break on income so that the wife could not make any more financial claims against his income after the 3 years had expired. The Judge justified this decision by saying that Mrs Waggott would not suffer “undue hardship” if maintenance were to stop in 3 years as she could either invest part of her £10million lump sum, which would create a decent amount of interest/income for her in the future and she could also go back to work should she want to top her income up.
The Judge also made the point that the Court’s priority to try and achieve a clean break (no financial ties and all financial claims are dismissed in the future) in every divorce financial settlement would be undermined if the “sharing principle” were to be extended to post-separation earnings. In short the Judge was saying that after the parties separated the husband’s earnings should not be treated the same as a matrimonial asset and so the husband should not be obliged to share it with his ex-wife.
This landmark decision could mean that for the wealthy breadwinners in a marriage, they may not necessarily have to share their post-divorce earnings with their ex-spouse. It has previously not been uncommon for a share of the paying-spouse’s income, including bonuses, to be paid to the receiving spouse.
For further advice in relation to divorce and finances, including maintenance award, please contact our Associate Solicitor, Kirsten Tomlinson on 01625 544 650 or email Kirsten.Tomlinson@family-law.co.uk.
Maguire Family Law is a highly recommended niche practise specialising in family law matters. We have a large team and can offer advice at any of our locations as follows:-
Wilmslow 01625 544650
Knutsford 01565 648228
London 0207 9474219
Manchester 0161 8048441