Can A Former Spouse’s Bad Behaviour Impact Divorce Settlements?
My spouse had an affair, so they’ll get less of the assets, right?
This, along with various other examples of bad behaviour, is a question that we hear a lot.
There is often an anticipation that the answer will be ‘yes, of course’.
They’ve treated you badly so you’ll get a bigger share of the house/savings/any other asset that you might have owned during the marriage’,
In fact, the answer is not quite so simple.
This blog will look at how divorce settlements are reached and the impact that bad behaviour (perceived or otherwise) can have on final settlements.
Will Behaviour EVER Affect The Outcome Of Financial Remedy Proceedings?
A recent survey (commissioned by Birkett’s) revealed that 71% of adults in England and Wales think that financial settlements on divorce should take bad behaviour, such as infidelity, into account.
Contrary to this common belief, any ‘bad behaviour’ of one spouse rarely influences how assets will be divided.
The fact that one spouse may have been unfaithful is not the kind of behaviour that Judges will take into account.
That’s not to say that one spouse’s conduct will never impact the outcome of financial proceedings.
There are times when Judges feel that someone has behaved so badly that their behaviour cannot be disregarded when dividing the assets but, let’s be clear, those occasions are few and far between.
When Is Behaviour Relevant In Financial Proceedings?
When Judges decide how matrimonial assets should be shared, they apply a checklist that can be found at section 25 of the Matrimonial Causes Act 1973.
Section 25(2)(g) of that Act specifically states that the court will consider ‘the conduct of each of the parties if that conduct is such that it would, in the opinion of the court, be inequitable to disregard it’.
Whilst the Act makes it clear that behaviour can be taken into consideration, the question it doesn’t answer is when and what type of behaviour would be ‘inequitable to disregard’.
Although the Act provides no specific examples of such behaviour, a number of cases over the years have provided guidance and have certainly made it clear that ‘bad enough behaviour’ is a very high bar to cross.
What Is Classed As ‘Bad Behaviour’?
As mentioned above, the bar for identifying ‘bad behaviour’ is high.
In fact, in the case of S -v- S (2006), Judge Burton explained that the behaviour in question should have the ‘gasp factor’ rather than a lesser ‘mere gulp’.
Even before the introduction of the Matrimonial Causes Act in 1973, courts had made clear that for any behaviour to be taken into consideration, it must be so bad that any right-minded member of society would feel that the behaviour justified a reduction or extinction of matrimonial claims for the person responsible.
The case of Miller -v- McFarlene in 2006 saw the Court elaborate further on this, making it clear that behaviour should only affect the outcome of financial proceedings on divorce where that behaviour is ‘gross and obvious’.
So what specific types of behaviour will the court take into account?
It’s not quick, easy or cheap to convince a court that the other person’s behaviour has been such that it would be inequitable to disregard and should therefore result in a reduction of the assets that person should receive on divorce.
However, looking at previous successful cases does help to provide some examples of the type of behaviour that will be taken into consideration.
Physical Conduct
There is no doubt about it, this type of behaviour can impact the outcome of financial remedy proceedings.
In some cases, arguments of physical bad behaviour will be based upon domestic violence that occurred during the relationship and, in other cases, based on behaviour following the breakdown of the marriage.
Violent behaviour is most likely to be taken into account where, as a consequence of that behaviour, the financial position of the parties is affected, perhaps through an inability to work due to a physical injury.
Such an example can be seen in the case of H -v- H 2006, in which the wife, a serving police officer, was attacked by her husband with a knife.
As a result of the incident, the husband was sent to prison for attempted murder, and the wife’s injuries left her unable to work.
During the resulting financial proceedings, the Judge held that the husband’s behaviour was conduct at the very top of the scale and that it would be inequitable to disregard when dividing the Matrimonial assets, not least because the husband’s behaviour had detrimentally affected the wife’s financial situation.
Further examples of cases where personal conduct has affected the division of matrimonial assets have involved the following:
- A wife shooting her husband
- A wife stabbing her husband
- A husband committing incest with his children
All of these serve to highlight the severity of the behaviour that is required for the court to feel that it should affect the outcome of the financial proceedings.
Financial Misconduct
Allegations of financial misconduct are more common and will usually arise when one spouse accuses the other of recklessly or deliberately dissipating the assets prior to any financial proceedings, thereby reducing the assets that are available to be divided.
These arguments arise when one spouse has been spending excessively, gambling excessively or deliberately disposing of assets with the intention of reducing the amount in the matrimonial ‘pot’.
If a judge is satisfied that financial misconduct has taken place, they can ‘add back’ funds, thereby treating the ‘pot’ as including the funds that have been spent and sharing the remaining funds accordingly.
To succeed with an argument of financial misconduct, the Judge must be satisfied that such conduct was either ‘deliberately wanton or reckless’.
Although financial misconduct cases are more common than other behaviour cases, the bar to success remains high as is shown in the case of MAP -v- MFP (2015).
In that case, the couple had been married for 40 years.
The assets to be divided were £25.1m, largely derived from the husband’s successful business.
Although the wife sought half of the assets, she also asked for the sum of £750,000 to be ‘added back’ on the basis of the husband’s ‘wanton and reckless’ spending.
In the two years prior to the separation, the husband had struggled with a cocaine addiction and depression, and he had spent vast sums of money on prostitutes and unsuccessful therapy.
When considering this conduct, the Judge concluded that the husband’s overspending had not been with the intention of reducing his wife’s claim, and his spending was not ‘deliberate or wanton’; rather, it was the consequence of a character flaw.
As such, the Judge would not agree to add back any sums and said;
‘A spouse must take his or her partner as he or she finds them. Many successful people are flawed…. It would be wrong to allow the wife to take advantage of H’s great abilities that enabled him to make such a success of his company, while not taking the financial hit from his personality flaw that led to his cocaine addiction and inability to rid himself of the habit’.
Litigation conduct
Litigation conduct is where someone has behaved ‘badly’ during court proceedings and can include the following;
- Failing to comply with court orders
- Missing court deadlines
- Failing to comply with the ongoing duty of full and frank disclosure
- Providing incomplete or illegible documentation
- Failing to respond to correspondence in a timely manner
- Failing to attend court hearings
- Deliberately misleading the court or the other party
It is often the case that where one person behaves badly in litigation, that will lead to higher costs for the other party.
As such, if there is a finding of litigation misconduct, the most usual consequence is that the offending person will be made to pay the costs of the other party, either in full or in part. As with other types of bad behaviour, each case will be different and depend on its own facts.
Conclusion
It is understandable that when people feel wronged on the breakdown of a relationship, they feel that there should be some recognition of the wrongdoing through the way in which any assets are shared.
However, as Mr Justice Mostyn said in the case of OG -v- AG (2020):
‘the financial remedy court is no longer a court of morals. Conduct should be taken into account not only where it is inequitable to disregard but only where its impact is financially measurable. It is unprincipled for the court to stick a finger in the air and arbitrarily fine a party for what it regard as immoral conduct’.
The breakdown of a relationship is difficult and emotional at any time but can be all the more difficult when there are allegations of bad behaviour.
For help and advice in relation to divorce and/or financial settlement, please contact Sarah or Jackie on 01903 229999.
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The information contained in this article is for general guidance only and is not intended to be legal advice. Professional advice should always be taken on the application of the law in any particular situation.