Inherited Assets on Divorce – Can they be ring-fenced?July 15, 2013
This question is one which regularly crops up in cases where family wealth within a marriage has been increased by monies received from an inheritance.
The English legal system is discretionary in determining how financial property on divorce should be divided. Whilst this flexibility enables each case to be looked at on its individual facts, it is very difficult to accurately predict how inherited assets will be treated on divorce.
It is my role as a family lawyer, to interpret guidance given by Judges from decided cases and to advise as to how the Court would be likely to treat those assets on divorce.
The factors the Court would take into consideration are as follows:-
• The type of asset i.e. cash / property. Cash is more likely to form part of the matrimonial assets rather than property which has passed through generations of the same family.
• At what time during the marriage was the inheritance received? Eg. an inheritance received shortly before or after separation may be less likely to form part of the matrimonial ‘pot’ than one received mid-way through a marriage.
• Whether the inherited assets have been kept separate from other matrimonial assets or whether they have been ‘intermingled’. Assets that have been kept separate are more likely to be ring-fenced and therefore not converted into matrimonial property.
However, in all cases, the needs of both spouses will be carefully considered to ensure that fairness is achieved. It is clear that if the matrimonial assets are not sufficient to meet the needs of the parties, it is unlikely that inherited assets will be excluded. However, in bigger money cases, it is more difficult to predict an outcome.
If you are in an unhappy marriage, contemplating divorce and are likely to receive an inheritance in the foreseeable future, I would recommend taking advice at this stage. For more details, contact Liz Hebden 01756 700200 or email: [email protected].
Liz specialises in all aspects of relationship breakdown. She has over 20 years experience in dealing with divorce, financial resolution and children matters, including contact and residence. She also has significant experience of co-habitation disputes and prepares pre-nuptial agreements, post-nuptial agreements and separation agreements.
If you are a parent anticipating problems within the marriage of your child, you may wish to consider amending your Will or entering into a Trust to ensure that assets are kept within the family. For more details contact Maxine Worrall on 01943 609969.