Husband loses appeal against £4.25m divorce settlement

A judge was not at fault when he exercised his discretion to award a woman a £4.25m divorce settlement based on her “needs”.

That was the decision of the Court of Appeal in a case involving a couple who had been married for two years but had a relationship stretching over nine years. The husband was 65 and the wife was 38.

The husband had assets of £37m and the couple enjoyed a very high standard of living during the marriage. However, the wife had suffered serious psychological harm because of the marriage and its breakdown.

The judge’s award of £4.25m included a term-of-years income fund of £1.34m and £2.3m to enable the wife to buy a flat in Marylebone.

The husband argued that the judge had erred in the exercise of his discretion by going beyond an assessment of the wife’s needs when making his award.

The Court of Appeal rejected this argument. It said the judge’s decision was clearly based on the application of the “needs” principle, which granted an almost unbounded discretion. The main drivers in the discretionary exercise were the scale of the payer’s wealth, the length of the marriage, the wife’s age and health, and the standard of living enjoyed during the marriage.

In a short marriage case, the discretion when assessing needs was particularly broad and fact-sensitive. The judge’s assessment of the wife’s immediate capital needs, and of her future daily needs, was well within the discretion vested in him.

It was therefore a legitimate choice to allow the wife to buy a reasonable apartment in a part of London where she felt happy and comfortable. To deal with her future income requirements by the term-of-years method was also entirely conventional and uncontroversial.

The husband’s appeal was dismissed.

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