In 2000, the House of Lords confirmed that equality requires that the work of each spouse during a marriage be given equal importance and that the name in which an asset is held is no guide to a fair outcome and risks being discriminatory.

In 2006, the House of Lords in Miller/McFarlane established the ‘sharing’ principle which has guided outcomes in financial remedy claims in England and Wales for the past 20 years.

Judgments of the High Court and Court of Appeal have since provided interpretation and guidance for how the sharing principle should be applied (and to which assets), including the leading Court of Appeal authority of XW v XH in which Stewarts partners Debbie Chism, Richard Hogwood and Jenny Duggan successfully represented the wife in obtaining fairness in respect of the division of wealth generated during the course of a marriage.

In what was only the third case to appear before the Supreme Court in over 25 years to consider the question of the principles which should underpin asset division between a divorcing couple, the Supreme Court was asked to consider:

1. when does non-matrimonial property become matrimonial property in the context of financial remedy proceedings upon divorce; and
2. how should the ‘sharing’ principle be applied to such property?

Mr Justice Moor at the first instance hearing before the High Court found that the transfer of the non-marital assets by the husband to the wife had the effect of ‘matrimonialising’ them, thus making them available for sharing. However, he determined that their pre-marital source was the magnetic feature of the case and accordingly, they should be shared unequally. The overall assets totalled £132m of which he ordered the wife should receive £45m. This represented a division of the marital property of 60/40 in the husband’s favour (some of the property having been found to be non-marital).

On 2 July 2025, the Supreme Court unanimously dismissed the wife’s appeal, confirming that the Court of Appeal’s approach in determining the wife’s entitlements under the sharing principle of £25million were correct.

The Supreme Court then gave the following legal principles in respect of the sharing principle:

The sharing principle & matrimonial property

The sharing principle applies to matrimonial property.  Matrimonial property compromises the fruits of the marriage partnership, it reflects the marriage partnership.  The ownership of an asset at the point of divorce (‘title’) is not determinative and an award based on title would run counter to the discrimination and sharing principles.

The sharing of matrimonial property should normally be on an equal basis.  Although there can be justified departures from that, equal sharing is the appropriate and principled starting position.  Once non-matrimonial property is excluded, much of the justification for not applying equality in sharing fades away.

Non-matrimonial wealth

Agreeing with the position put forward on behalf of Mr Standish, the Supreme Court determined that sharing does not apply to non-marital property.  This finding provides welcome certainty and ends speculation in earlier cases that it was theoretically possible to share non-marital property.  It is now beyond doubt that access to non-marital property is strictly limited to claims on the basis of ‘need’ and ‘compensation’.

There is no legal right to share property found to be non-matrimonial.

Matrimonialisation

Non-matrimonial property may become matrimonial property (i.e. be ‘matrimonialised’) and therefore available for sharing in certain circumstances.

The Supreme Court rejected Moylan’s suggestion in Standish (para 163) that the concept of matrimonialisation should be applied narrowly. It was found that matrimonialisation should not be applied narrowly or widely. Rather, what matters is how the parties have dealt with the non-marital assets and whether this shows that, over time, they have treated the asset as shared. This is central in determining whether it is fair to regard that property as having been matrimonialised.

The new test for ‘matrimonialisation’ can be summarised as follows:

Matrimonialisation occurs where there is intention by the contributor to share non-marital property, coupled with treatment by the parties of this non-marital property as shared over time.

The passage of time is relevant to demonstrating a settled intention that an asset be treated as shared notwithstanding its non-marital origin. Consistent with this test the Supreme Court confirmed that transfers between parties for the purpose of a tax scheme are insufficient to render an asset marital as the intention of the transferor is to mitigate tax, not to share them with their spouse.  Accordingly, absent some further compelling evidence the transfer alone in those circumstances is not ‘matrimonialisation’.

The Times – Judges cut banker’s £45m divorce payment to £25m

Bloomberg – Sheep Farming Ex-Banker Wins £20 Million Cut to Wife’s Divorce Payout

Spears – Ex-wife of former UBS banker has divorce settlement cut by £20 million in landmark ruling

New Law Journal – Sharing principle clarified in divorce

The Times – Sam Longworth on his career and winning a reduced divorce payout