Standish v Standish: Supreme Court Delivers Landmark Judgment
The Standish v Standish case, which we discussed in our 23 June blog post, has now been decided following an appeal to the Supreme Court.
It’s worth revisiting that earlier post for the context of the case. Briefly, the case involved a very high net-worth marriage in which a significant portion of the assets had been generated by the husband prior to the marriage. The husband had transferred £77 million to his wife for tax reasons, and both the High Court and Court of Appeal held that the money remained non-matrimonial property, meaning it continued to belong primarily to the husband, despite the legal transfer.
As predicted in that earlier blog post, the Supreme Court dismissed the wife’s appeal and upheld the Court of Appeal’s decision. However, in doing so, the Court laid down five key principles that will shape how financial remedy cases are approached in the future.
Non-Matrimonial Property vs. Matrimonial Property
1. The Court confirmed a clear distinction between matrimonial and non-matrimonial property. The Supreme Court recognised that when applying the sharing principle, property acquired before the marriage is conceptually different from that acquired during the marriage.
2. The sharing principle applies only to matrimonial property.
The Court stated unequivocally that the sharing principle does not extend to non-matrimonial assets. In the past, courts had often avoided drawing this distinction explicitly, instead treating non-matrimonial property as a ‘good reason to depart from equality.’ The new judgment clarifies that these assets are not subject to the sharing principle at all.
3. The default starting point for matrimonial property is equal division.
While courts may have good reason to depart from a 50/50 split, equal division remains the standard baseline for matrimonial property.
4. Non-matrimonial property can become matrimonial through shared use.
The Court acknowledged the concept of ‘matrimonialisation’ for the first time. If a couple treats an asset in a way that it appears to be jointly owned, such as a home the couple both live in, it can become matrimonial property, regardless of its origin.
5. Transfers for tax purposes do not amount to matrimonialisation.
Relevantly for Standish, the Supreme Court clarified that transferring assets solely for tax efficiency does not demonstrate an intention to share ownership. In this case, the £77 million remained the husband’s non-matrimonial property.
Although the Supreme Court did not agree with all of the Court of Appeal’s reasoning, it agreed with the outcome: the non-matrimonial property remained with the husband, resulting in a 75/25 split in his favour.
This ruling will have a significant impact on future divorce cases. At Parsonage and Co, we are committed to advising our clients on how this decision may affect the treatment of any assets brought into a marriage.