G v G

In a short marriage, financial provision should promote independent and self-sufficient living, while fairly recognising needs, compensation, sharing and the continuing care of children. A spouse’s earning capacity is a relevant financial resource and should ordinarily be assessed and taken into account when fixing periodical payments. Trust interests are assessed in two stages: whether they are resources likely to be received immediately or in the foreseeable future, and how they should affect the overall award. The court must respect the legal structure and duties of trustees while applying a realistic assessment of what trustees are likely to do. Inherited or gifted assets may fund the recipient’s independent lifestyle, but the paying spouse remains primarily responsible for relationship-generated needs and disadvantages.

The wife sought financial remedies after a short marriage to a high-earning husband. They had one child and shared care of him. The principal issues concerned the wife’s housing needs, periodical payments, the duration and reduction of spousal payments, and the relevance of her interests in eleven family trusts and continuing family support.

The wife sought a substantial lump sum and joint-lives periodical payments. The husband sought an equal division of liquid capital and payments reducing over time. The central questions were how the wife’s trust resources and earning capacity should be treated, and how the parties’ marital choices and continuing care of their child affected the award.

1. Overall outcome. The court made financial remedy orders involving an equal division of available liquid capital, a charge securing repayment of £170,487 by the wife, periodical payments for the wife reducing from £95,500 per annum to £35,000 after six years, and child periodical payments of £18,000 per annum with school fees and related expenses.
2. The statutory exercise under the Matrimonial Causes Act 1973 is flexible but principled. The objectives are fairness, independence and self-sufficiency, assessed through need, sharing and compensation. A short marriage supports a transition towards a lower independent standard of living, subject to relationship-generated needs and disadvantages. The marital standard of living remains a relevant benchmark, but does not ordinarily justify lifelong economic dependence.
3. A spouse’s earning capacity is a resource under section 25(2)(a). The court should make an evidence-based assessment of likely future earnings and may build predicted reductions into the original periodical payments order. The wife’s failure to quantify her proposed earnings did not prevent the court from making a reasonable estimate.
4. Trust interests require a two-stage assessment. The court must first decide whether the interests are financial resources likely to produce income or capital immediately or in the foreseeable future. It must then decide how they should affect the award. The court should apply a judicious mixture of worldly realism and respect for the legal effect of trusts and trustees’ duties. A hypothetical disaster is not the correct test.
5. The wife’s trusts were not marital assets and did not affect the equal sharing of liquid matrimonial capital. They were nevertheless relevant to the funding of her independent lifestyle and housing needs. The husband remained primarily responsible for the continuing needs, contributions and disadvantages generated by the marriage and the care of the child.
6. The parties’ understanding that the wife would return to remunerated part-time work while caring for the child constituted a relevant marital choice. It supported a continuing award for relationship-generated disadvantage, but did not justify allowing the wife to elect not to work or to defer all adjustment to a later variation application.