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The Family Court considers the treatment of an inherited family estate

In Y v Y, [2012] EWHC 2063 (Fam) the key issue was the treatment by the Court of a valuable family estate, which was previously held in trust and was subsequently inherited by the husband prior to the marriage.

Both of the parties acknowledged that, as established in Charman v Charman, the sharing principle can apply to inherited assets as well as the marital acquest. Of the total net assets of £26.88m available for the division, the inherited estate comprised some £22.9m.

The wife sought some £11.2m; the husband at the start of the trial offered £6.2m. The Judge found that the husband's desire to retain the estate had to a degree blinded him to the contributions of his former spouse, and more importantly to her future needs. His overriding strategy had been to reduce her claim so that it was affordable to him. Having analyzed the figures herself, the Judge expressed the view that even borrowings at the level posited by the husband's final offer were unlikely to be sustainable in the long term and that a sale of the entire estate in time was more likely than not.

The Judge awarded the wife a lump sum of approximately £8.7m (representing a 32.5% share of the net assets); leaving the husband with £67.5% of the net assets (over £18m). The Judge held that although her calculation was needs based, it involved sharing inherited assets which would be invaded to cover the award. In this case needs and the right to sharing were essentially the same.

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