How do divorcing couples with extraordinary wealth settle their finances on divorce?
Posted on March 25th 2021
It is no surprise that once again, Kim Kardashian-West has hit the headlines. However sadly, this time it is because she is filing for divorce from her husband, rapper Kanye West. Whilst many “Keeping up with the Kardashians” fans may not be surprised that their romance has come to an end, the big question arises as to how the parties are to separate their significant financial assets on divorce?
With Kanye estimated to be worth $1.3 billion and Kim $780 million, this article considers what law the English and Welsh courts adopt when dealing with “big money” cases such as this and what special factors are to be considered by the courts.
Principle of Fairness
In England and Wales, the court has a great deal of flexibility and discretion when deciding on the appropriate division of the matrimonial assets on divorce. In all financial remedy cases, the courts must apply the principle of fairness. Various factors of a case will affect what sort of financial settlement might be “fair” in that specific marriage breakdown.
The Needs of the Parties
When the court is considering a fair financial settlement, the court has to consider the needs of the parties, for example, their financial and housing needs following separation.
In matters such as Kimye’s divorce, when a couple and their family have enjoyed a more luxurious and above average lifestyle, the court will approach the “needs” of the parties more generously. For example, the courts may consider the “need” for a party to have regular trips to a beauty salon or regular city breaks, if the disposable income is there within the matrimonial asset “pot” to allow it.
Under the Matrimonial Causes Act 1973 (Section 25) the court has a duty to consider the contributions made by each party during the marriage. Such contributions can be financial, or to family life.
In Kimye’s case, both are high earners and in “big money” cases, the court may consider if one party has made a “special financial contribution” and if so, whether they should be awarded a greater share of the matrimonial asset “pot” on divorce.
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