Fairness is the gold standard of asset splits in divorces in England and Wales. However a solicitor will still want to achieve the best possible outcome for their client.
When there’s significant assets at stake, you may hear of a rare legal mechanism known as ‘special contributions’.
In this guide, we discuss what special contributions are, when they’re employed and how they might impact your final divorce settlement.
What is a ‘special contribution’ in relation to divorce?
Special contributions are a high-level legal argument that effectively argues that the idea of equal division would be grossly unfair to one party. It’s a relatively rare legal argument, but when accepted, it can result in a purposely unequal split.
Firstly, there is no automatic 50/50 divorce rule. The starting point might be 50/50, but the Matrimonial Causes Act 1973 sets out the factors which must be taken into consideration when determining a settlement. That’s why so many divorces don’t result in a strict 50/50 split.
In the case of a divorce where a special contribution argument is accepted, though, one spouse must have had such vision or genius to create a truly exceptional amount of wealth that an equal split itself would be unfair.
Note that the Family Court sets an extremely high bar for special contributions, hence why it’s so rare to see one of these arguments accepted.
How the Family Court decides on ‘special contributions’ in divorce
Contrary to popular belief, special contributions are not simply about money. Qualifying as ‘special’ must meet several criteria, including:
Proof of Genius – Being the primary breadwinner or earning a high salary won’t qualify. Instead, the wealth must come from a truly exceptional form of genius, such as inventing something world-changing or displaying unmatched talent.
Unmatched Contributions – The effort of one party must be totally unmatched by their spouse. In England and Wales, the value of homemakers is exceptional, and judges are typically loath to discriminate against them on monetary grounds.
Likewise, the contributions can’t simply be because you happened to be in a booming industry or because you got a sudden windfall, like winning the lottery. Running the home carries as much weight as money, meaning that simply being a high performer usually isn’t enough to get a special contributions argument accepted.
Proving ‘special contributions’ in divorce proceedings
Proving a special contribution, also known as a ‘stellar contribution’, is exceptionally difficult. The law allows judges considerable room for interpretation, but it ultimately comes down to fairness and the avoidance of discrimination against homemakers.
So, typically, there are three aspects that you’ll have to prove to the court:
1. Wealth Scale – There’s no monetary minimum stated in the law, but it’s an argument that’s really only relevant to big money cases. In short, unless it involves millions of pounds, you’re unlikely to see a special contributions argument.
2. Generating Force – You must be the primary generating force behind the wealth creation. You cannot be just an instrument, regardless of how talented and hardworking you are, for somebody else’s vision. This is why the generating force is usually a business owner or inventor.
3. Needs Priority – Understand that even when courts do accept these arguments, the priority is to meet the needs of both parties and any children. Needs will always trump any special contribution argument.
With that in mind, we understand that it can feel like a mountain to climb to prove a special contribution. In practice, you must fully disclose your finances and trace wealth creation from the beginning. Whether that’s company reports, financial statements, or employee testimonies, you must demonstrate that your distinctive genius directly led to the wealth being created.
If you’re worried that many of these requirements sound ambiguous and less than straightforward, you’re not alone. This is by design because the prevailing priority is for judges to have as much flexibility as possible to serve the needs of both sides, rather than focusing purely on monetary aspects.
It’s a rare and difficult argument to win within the English legal system. If you intend to make this argument, it’s vital to work with an expert in family law to manage your strategy and give yourself the best possible chance of success.
How a solicitor can help with complex assets during a divorce
Complex divorces place even more stress on an already stressful situation. You deserve the best possible outcome, so that you can keep more of what you own. Working with a solicitor provides you with the expert guidance needed to achieve the best result.
So, what can a solicitor do to help you through a divorce involving complex assets?
Identifying assets to be divided.
Getting expert valuations.
Managing the tax implications of divorce.
Dealing with cross-border assets.
Negotiating with other legal professionals to get you the best possible settlement.
Finalising agreements to prevent future claims.
In an emotionally charged atmosphere, it’s hard to manage the ins and outs of finance. Rather than risking a catastrophic error that costs you further down the line, working with expert divorce solicitors at VM Family Law is the way forward.
If you’re about to file for divorce or proceedings have already been initiated, schedule your consultation with one of our family law experts now.