The only realistic choice for any wealthy client who wants to protect their financial position is to not get married, writes Damian Baron


Am I alone in thinking that the recent series of cases culminating with the Court of Appeal's decision in Charman has taken the law of ancillary relief too far when it comes to business and/or wealthy clients?



Pre-White, solicitors could confidently advise that the courts were reluctant to make any decision which materially affected either spouse's business so as not to kill the goose that laid the golden egg. Over recent years and since White, the courts are increasingly willing to view the value of the business as just another asset to go into the pot for division, whether the other party worked in the business or even had any part in it at all.



Not only do we have the yardstick of equality in respect of capital and pension, we now have an emerging series of cases in the higher courts where the future earning capacity of the higher earner is viewed, once again, as just another matrimonial asset to be divided. However, what does not seem to be a consideration is that only one party actually has to go out to work to generate this income. Can this be right in principle?



I firmly believe that the general perception of what is going on in these cases is one of the factors leading to an increase in a number of enquiries about pre-nuptial agreements. While we usually advise our clients that having a pre-nuptial agreement is better than nothing, we do, of course, have to further advise that the court can, and in all probability will, tear them up in any ensuing divorce proceedings.



My point is that the perception of the person in the street is that the law is becoming increasingly unfair and that he or she will be penalised if they are hard working and successful in the event that their marriage or civil partnership breaks down, even if the breakdown may be the fault of the other party.



So, just as we will usually advise some of our clients not to sign any pre-nuptial agreements, are we now at the point where we have to start advising our wealthy or potentially wealthy clients not to marry?



A couple of years ago, two clients in their late 20s sought my advice. They were about to have transferred to them their parents' business. Its value was about £7 million. They were both engaged to be married and wanted to know what the position would be if they did get married and, perhaps after a few years and a couple of children, it all went wrong. I advised accordingly as to the likely orders that maybe made by the court. Perhaps not surprisingly, both clients are still single.



I further recently advised a very wealthy individual who was considering marriage to a much younger partner. The client sought advice as to how they could, within reason, protect their financial position should the marriage fail. My advice, and that of counsel, was simple: if the individual wished to achieve any certain level of protection, don't get married.



We have now reached a point where the law is discouraging marriage in some cases, not only those involving significant wealth. Are we confident that this is a good thing? Should the law not now allow intelligent human beings with quality legal advice to agree the regulation of financial provision in the event of a break-up?



One final thought. Bearing in mind the huge discretion under section 25 of the Matrimonial Causes Act 1973 that judges have always had to make, for example, proper allowance for the indirect contributions of the economically weaker spouse or partner, was the 'reasonable needs' approach such a bad thing?



Damian Baron is head of family law at Napthens in Preston