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Woman fails to get a share of former husband’s business windfall

A woman has failed to get a share of her husband’s business earnings which increased dramatically just after their divorce settlement was completed.

The reason was because of the long delay between the couple’s separation and their final divorce settlement, and because the woman had not contributed to the success of the business.

The couple had been married for 20 years before they separated in 1996. A decree nisi and absolute were granted in 2003 on the basis of five years separation. The wife then began ancillary relief proceedings.

During the couple’s separation but before their divorce, the husband had become a substantial shareholder in a company.

At the time of the finally hearing in April 2006, the wife’s experts valued those shares at £30m. However, the husband’s experts submitted that they had no appreciable value.

The judge handed down his judgment in September 2006. He held that as far as the husband’s company was concerned, the relevant point was that it had been created after the separation and so the wife had not contributed to it in any way.

He ordered that the matrimonial home should be transferred to her and that she should receive a lump sum of £1.1m.

It later emerged that during the period between the final hearing and the handing down of the judgment, the husband’s company achieved a refinancing deal that substantially increased its value.

The wife then applied for the court order to be set aside so the settlement could be increased to reflect the increased value of the husband’s company.

The judge refused her application. He agreed that the husband had been wrong not to disclose the increased value but said it would have made no difference to the judgment if he had.

This was because the fact remained that the wife had made no contribution to the setting up or success of the company, which took place after the couple had separated.

That decision has now been upheld by the Court of Appeal.

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