Does the length of a marriage affect the sharing of business assets in divorce?

BVWire–UKIssue #30-1
September 7, 2021

In the recent case of E v L [2021] EWFC 60, the court has reconsidered how the sharing principle applied to marriages that are short and/or childless.

Family courts in the UK generally follow the three principles of “needs”, “sharing,” and “compensation” when determining the distribution of marital assets. In E v L [2021] EWFC 60, the court reconsiders whether “sharing equally” should be on the same terms if the marriage was short and childless.

Prior to this case, the sharing principle was often sidestepped in favour of the needs of the two parties, but E v L rejected this precedent. The out-spouse demanded half of the marital assets (£5.5 million), while the moneyed spouse offered £600,000. Mr Justice Mostyn overlooked the short length and lack of children, finding that “discriminatory.” He wrote, “In my judgment for the court to start asking why there are no children, and whether this denotes a lesser extent of commitment to the relationship, is to make windows into people’s souls and should be avoided at all costs.”

The case confirms that business valuers need to scrutinise the increase in value of assets, or “marital acquest,” during the term of the marriage or cohabitation. In E v L, Mr Justice Mostyn said the accrual of marital assets works on the same principle no matter the length of the marriage and doesn’t simply disappear. Generally, shorter marriages will have smaller acquests than longer ones, and, here, the court awarded half of the value of the accrued value (£1,515,000) from the commencement of cohabitation to the date of the trial.

Please let us know if you have any comments about this article or enhancements you would like to see.