High net worth divorce cases: LMZ v AMZ

Request a call from a family law solicitor

Consent

High net worth divorce cases

High net worth divorce cases involve unique complexities and challenges that set them apart from standard divorce proceedings.

These cases typically involve significant assets from high net worth individuals. Assets may include businesses, multiple properties, pensions, international investments, and other high-value interests.

The legal framework in England and Wales provides a structured approach to dealing with these assets. It also considers the welfare of any children involved and the lifestyle maintained during the marriage.

Key considerations in high net worth divorces

Asset Identification and Valuation:

One of the primary steps in high net worth divorces is identifying and valuing all matrimonial assets. This can be complicated, especially with hidden assets or assets spread across different countries.

Financial Disclosure:

Both parties are required to provide full and frank financial disclosure. Non-disclosure or hiding of assets can lead to severe legal penalties.

Asset Division:

The court aims for a fair division of matrimonial property and assets, which does not always mean a 50/50 split. Factors such as the length of the marriage, the needs of each party, and the contributions made by each party are considered.

Maintenance:

One party may be required to support the other financially through spousal maintenance. This is particularly common where there is a significant disparity in the earning capacities of the parties involved. Child maintenance may also be a factor in high net worth divorce cases.

Legal Jurisdiction:

England and Wales are known for favouring the financially weaker spouse. This can sometimes result in ‘forum shopping’ where one party tries to file for divorce in this jurisdiction to achieve a more favourable outcome.

Tax Considerations:

Divorce can have significant tax implications, particularly regarding the transfer of assets and properties. It’s essential for parties to get specialised tax advice.

Legal process and outcomes

The process generally follows these steps:

  • Filing for Divorce: One party files a divorce petition, stating the ground for the divorce.
  • Financial Proceedings: If financial matters cannot be resolved through mediation or negotiation, they may need to be decided by a court.
  • Court Hearings: The court can order interim measures to protect assets and decide on urgent matters ahead of a final settlement.
  • Final Settlement: A court can issue a ‘Financial Order’ that decides how assets should be divided, whether any maintenance should be paid, and how pension rights are managed.

High net worth divorce cases: trends and statistics

  • Divorces among the affluent tend to involve lengthy legal battles due to the complexities of the assets involved.
  • London is often dubbed the “divorce capital of the world” due to its perceived favourability towards the financially weaker spouse.
  • Recent reforms and updates to family law emphasise the importance of prenuptial agreements and mediation to avoid protracted disputes.

 

High net worth divorce recent caselaw

A high net worth divorce was considered in the recent case of LMZ v AMZ [2024] EWFC 28 (12 February 2024).

The judgment by Mr Justice Moor concerned a financial remedy application in a divorce case involving a significant age difference between the spouses and complex financial arrangements, including international business assets.

Background and parties involved:

The applicant, LMZ (aged 45), and the respondent, AMZ (aged 93), had been married for over two decades. The marriage produced two children, who are now both adults.

The husband was a successful businessman prior to the marriage, having established a considerable fortune including assets in Iraq and the UK, as well as trusts and companies.

Marriage and financial contributions:

The marriage was described as initially happy despite the age gap. The wife took on significant roles in managing the husband’s business interests after moving from a happy career trajectory in accounting to marriage.

Breakdown of marriage:

The marriage deteriorated around 2021 or 2022, although the couple continued to live together. The wife performed caregiving duties for the husband despite the marital breakdown.

Financial claims and legal considerations:

The wife initially pursued a sharing claim of the assets but switched to a needs-based claim recognising the significant pre-marital accumulation of the husband’s wealth.

The court dismissed the sharing claim and focused on the wife’s needs. This included housing and income, given the length of the marriage and contributions to the family and the husband’s businesses.

Assets and valuations:

The husband had generated significant wealth and had assets included properties in London and Morocco, business interests in Iraq, and offshore trusts. There were significant complexities related to the value and liquidity of overseas assets, especially those in Iraq.

Observations from Mr Justice Moor:

“The legal proceedings have been a considerable ordeal for him, as they have been for the Wife.”

“It is, of course, sad and regrettable that this marriage has broken down at such a late stage of the Husband’s life.”

“I must approach the financial remedy claim dispassionately, whilst having proper regard to the needs, both emotional and financial, of both parties in these unusual circumstances.”

Decision:

The judge awarded the wife a needs-based settlement that included housing and an income fund. This acknowledged her significant role in the marriage and the husband’s ability to fund this settlement from his substantial assets.

The judgment reflects the complexity of high net worth divorce cases involving individuals and cross-jurisdictional assets. There is evidently a need to balance respect for the contributions of both parties against the legal and practical realities of their financial entanglement.

How can Expert Family Law assist?

High net worth divorce cases can be complex. Obtaining legal advice and assistance from a divorce lawyer can ensure you get the best outcome on your financial settlement.

At Expert Family Law, we deal with high net worth divorce solicitors with the skills and experience tp assist on your case.

Our panel of divorce solicitors and experienced family law firms will help you to navigate a range of issues and disputes, such as financial matters and will assist you in reaching an agreement on such issues.

Whether you are going through a divorce or dissolution of a civil partnership, our panel of family law solicitors will provide expert legal advice and assistance, guiding you through every step of the process.

Please note we are not a firm of solicitors. We maintain a panel of trusted and regulated legal experts. If you contact us in relation to a case, we may pass your case on to a panel firm in return for a fee from our panel firms. We will never charge you for passing on your case to a panel firm.

 

Services

Divorce Proceedings

Ancillary Relief

Domestic Abuse

Child arrangements

Expert Family Law

Keep up to date with the latest family law news

Newsletter