Swinging Away From Lifetime Duxbury scenarios

Written By: and on FAMILY LAW, FORENSIC ACCOUNTING NEWS

A Duxbury calculation need not be based on a lifetime term.

In FF v KF [2017] EWHC 1093 (Fam), a divorce after only a short marriage, the Judge only allowed a 10-year term for Duxbury calculations.

Background
The parties were married for less than two years before they separated, with no children. By the time of the appeal the husband (H) was 65 years old and the wife (W) was 38.

H had assets were approximately £37 million. At first instance, His Honour Judge Wallwork awarded W £4.25 million on a clean break basis. The husband appealed.

H’s Appeal
Mr Justice Mostyn heard and dismissed the appeal. In his judgment, Mostyn J highlighted certain evidence found by Wallwork J:-

6. In his judgments, the judge sets out the significant aspects of the evidence. I highlight the following:
i) The husband is a very rich man having assets valued in the region of £37 million, virtually all of which was liquid or capable of being easily liquidated. The great majority of this predated the marriage although the judge found that a little over £2 million had arisen during the marriage.

ii) The parties enjoyed a very high standard of living. They had three homes in Cheshire, Knightsbridge and Marbella with a combined value of over £5 million.

iii) The wife had suffered serious psychological harm as a result of the married life and its breakdown. This was diagnosed by a consultant psychiatrist instructed as a single joint expert. The wife was not raising conduct or casting blame but her medical condition was an undisputed fact. She left this marriage in a condition of great damage and vulnerability. As such the future for her, particularly in relation to any earning capacity, was very uncertain.

Mostyn J also commented the application of two principles of “sharing” and “needs”:-

18. So far as the “needs” principle is concerned there is an almost unbounded discretion. The main rule is that, save in a situation of real hardship, the “needs” must be causally related to the marriage. Like equity in the old days, the result seems to depend on the length of the judge’s foot. It is worth recalling that Heather Mills-McCartney was awarded over £25m to meet her “needs” (McCartney v McCartney [2008] EWHC 401 (Fam)). Mrs Juffali was awarded £62m to meet her “needs” (Juffali v Juffali [2016] EWHC 1684 (Fam)). In the very recent case of AAZ v BBZ [2016] EWHC 3234 (Fam) the court assessed the applicant-wife’s “needs” in the remarkable sum of £224m. Plainly “needs” does not mean needs. It is a term of art. Obviously, no-one actually needs £25m, or £62m, or £224m for accommodation and sustenance. The main drivers in the discretionary exercise are the scale of the payer’s wealth, the length of the marriage, the applicant’s age and health, and the standard of living, although the latter factor cannot be allowed to dominate the exercise.

Lastly, the Judge agreed a Duxbury calculation for W should be on a term of 10 year rather than a lifetime basis:-

20. … The multiplier of 10, while generous, was entirely legitimate having regard to the wife’s medical condition, the standard of living enjoyed during the marriage, and the scale of the husband’s fortune. Had the marriage been longer it is certain that the calculation would have been on the lifetime Duxbury basis….

The full Judgement can be downloaded here.

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