Divorce – Home-Maker Wife Compensated for Sacrificing Her Career

Despite the drive towards achieving economic equality between the sexes, it remains common for women to give up their promising careers to support their husbands and devote themselves to child rearing and home-making. An important High Court ruling addressed the burning issue of how such sacrifices should be quantified in money terms in the event of divorce.

The case concerned a former couple who met when they were both working for a leading law firm. After their relationship blossomed, they decided that it would be inappropriate for them to continue working together. He remained at the firm, becoming a very highly paid equity partner, whereas she took an in-house position at a bank, which yielded earnings that were a fraction of his and from which she was later made redundant.

Following their marriage, she took on the role of a home-maker and full-time mother to their two children. Having suffered mental and physical health difficulties, she had not worked for some years before the 11-year marriage broke down. Their marital home was worth more than £5.8 million and, by the time of their divorce, their total assets were valued at over £9.7 million.

Ruling on the financial aspects of the divorce, the Court noted that both husband and wife broadly agreed that their assets should be divided equally. The principal area of controversy between them was whether the wife should in addition be compensated for the detrimental impact that the marriage had on her legal career.

The Court found that she was clearly a talented and driven lawyer and that, had she stayed at the firm, she would have stood a very good chance of becoming an equity partner, earning sums equivalent to those paid to the husband. Viewing herself as the parent with primary responsibility for the children, she treated her husband’s career as taking precedence over her own. Given her health problems, her continuing childcare responsibilities and the length of time since she had last worked, she had no residual earning capacity.

An equal division of assets would have led to the husband and wife each receiving about £4.85 million. The Court, however, awarded the wife an extra £400,000 to reflect the negative impact that the relationship had on her career and earnings. Her total award of £5,252,415 represented about 54 per cent of the overall marital assets. The Court noted that the facts of the case were exceptional and that its ruling should not be viewed as a green light for others to seek compensation for financial disadvantages arising from their marriages.