Divorce – There Can Be a High Price for Failing to Negotiate Responsibly

Divorcees who are unwilling to give ground and negotiate responsibly with a view to achieving a financial settlement with their ex-spouses are highly likely to pay a stiff price for their lack of flexibility. The High Court emphasised the point in a guideline case.

Following a hotly contested hearing of the big money case, the Court ordered that the wife should exit the marriage with assets worth £7.45 million. The legal costs of the proceedings came to £1.6 million, about 13 per cent of the overall marital assets. A further hearing ensued at which the Court was asked to decide how the burden of those costs should be distributed between the former couple.

Ruling on the matter, the Court found that neither wife nor husband had behaved flexibly in their open negotiations. She had ambitiously sought not less than £10.6 million whilst he had persisted in arguing that full effect should be given to a post-marital agreement (PMA) even though she had not signed it.

Aspects of his litigation conduct had been less than satisfactory but there were also elements of the wife’s case that were not beyond reproach. She did not succeed in persuading the Court that the PMA should be wholly ignored on the basis that he had placed her under undue pressure.

Her contention that the husband had concealed the fact that he was likely to receive vast sums of money from his father once the proceedings were concluded fell on fallow ground. She also did not satisfy the Court that her reasonable needs encompassed the purchase of a second home in Switzerland.

The most influential factor was the negotiating stances that each had taken. Whilst the husband’s open offers came close to matching the Court’s eventual award, the wife’s claim was wide of the mark by about £3 million. Overall, the Court found that the wife should contribute £150,000 towards the husband’s legal costs.

That sum, the Court noted, would eat only modestly into her needs-based award. Given that the husband had contributed £360,000 towards her legal costs whilst the case was on foot, he would still bear a significantly greater proportion of the overall legal costs incurred in the proceedings.