The law around what happens to assets during a divorce is generally complex, and often very fact-specific – the goal of the courts is to come to an agreement, if the couple divorcing cannot do so themselves, to fairly divide the assets so that each person gets a fair share. The general idea is that the assets held by both people will be shared equally and fairly.
In order to do this, assets held by the couple are generally split into matrimonial and non-matrimonial assets. Once this is done, in a simple case the matrimonial assets would be fairly divided between the couple. But how do you differentiate between matrimonial assets and non-matrimonial assets?
Generally, matrimonial assets are assets either shared by the couple, or alternatively acquired during the marriage – this could include, for example a house that was bought for the couple to live in, furniture used in that house, or paying into a pension.
By contrast, non-matrimonial assets are generally those acquired prior to the marriage, received after a separation, or separated from the marriage by a pre-nuptial agreement. Importantly, inheritance to one spouse specifically is often classed as a non-matrimonial asset and would not necessarily fall into the pot to be divided.
However, things are not quite that simple – there is generally a high threshold to show that non-matrimonial assets should not be divided equally between the couple, and they are not automatically excluded from assessment. In the case of inheritance, it would need to be clear that the inheritance was solely for one spouse, and the money from such inheritance was not in any way integrated into the marriage, for example by using the money to buy furniture for the marital home.
Let us give you an example:
Gary marries Sheila in 2007 and they move into a rented flat together. They both contribute equally to the flat, combining their furniture and splitting bills between them. Sadly, in 2010 Gary’s mother, Susan, dies and leaves a will stating that she leaves her entire estate to Gary alone, which consists of her house and £20,000 in her bank account. Sheila and Gary decide as a couple to move into the house, where they settle and have two children. Gary meanwhile places the £20,000 into a savings account in his sole name.
10 years later, Sheila and Gary decide to divorce, and as such they look at their matrimonial assets. If these could not be agreed on, a court would have to make a decision on whether any part of the inheritance from Susan could go to Sheila. As they have lived in the house together for 10 years, it is possible that this part of the inheritance could be said to form part of the matrimonial assets. However, there may be a stronger argument for the £20,000 to be seen as a non-matrimonial asset, as it was kept separate from the marriage and was gifted to Gary solely.
As this is a complex area, the calculations do not necessarily stop there – if, using the above example, Sheila was viewed by the court not to be getting a fair amount from the divorce, it’s possible that a court may consider that Gary should use some of his non-matrimonial assets (ie. the £20,000 inheritance in savings) to top this up.
