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Tuesday, 9th February 2010

Divorce ruling that means the winners could almost take it all

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Published Date: 25 May 2006
Now wealthy people may think twice about getting married after landmark decision favours ex-wives

Kate O'Hara
MILLIONAIRES and movie stars must be quaking in their Gucci loafers.
Yesterday's ruling by the Law Lords in favour of two ex-wives of wealthy men has implications for them all.
No matter that a marriage does not bear children – or lasts less than three years – the Lords yesterday agreed if a woman marries a rich man,
she has "reasonable expectations" to be wealthy for the rest of her days.
They upheld a £5m award to Melissa Miller, 36, married to her asset manager husband for just over two-and-a-half years, agreeing that she was entitled to a sum equating to over £151,500 for each of the 33 months they were married.
Not for Mrs Miller a return to the rented flat she lived in when she met her husband-to-be, the life he introduced her to in up-market Chelsea is now hers forever.
Divorce lawyers were last night pessimistically predicting that divorcing a wealthy partner could be the fastest way to a small fortune – with one likening it to winning the Lottery.
Family lawyer Vanessa Fox, at Leeds law firm Keeble Hawson, said she thought wealthy people would now think twice before getting married.
"Until now, the law on financial settlements between divorcing couples where the marriage is short with no children involved has lacked clarity," she said.
"Now this landmark ruling in favour of Mrs Miller, whereby she received a £5m payout from her husband, will have a huge impact on many other divorce cases.
"With the Miller ruling in particular, many divorce lawyers feel the pendulum has swung too far in favour of wives. Effectively someone can win the Lottery by entering into a brief marriage with a wealthy person."
Mrs Miller was not the only winner at the Lords yesterday.
In another landmark divorce case, the Lords ruled Kenneth McFarlane must pay his ex-wife £250,000 every year for the rest of her life, not only for the five years previously stated by the Court of Appeal.
Julia McFarlane, 46, won her appeal against the ruling that payments from her lawyer ex-husband should be time limited.
Like many women, Mrs McFarlane gave up a career to support her husband and bring up their children, and in her case she was giving up more money than most.
Her high-flying city job earned her as much, if not more than her husband.
When the marriage broke down in 2001, Mrs McFarlane was awarded the £1.5m London home and £250,000 a year for life, but after an appeal it was reduced to £180,000 for life. Another appeal set a figure of £250,000, but with a five-year limit.
Mrs McFarlane argued that the time and effort she put into the marriage meant she deserved more.
The Law Lords agreed.
Divorce specialists yesterday said the rulings could lead to wealthy partners hiding their assets in offshore accounts.
Sir Paul McCartney has spent the two weeks since his separation from Heather Mills defending her from "money-grabber" jibes.
Should things turn nasty and the pair end up in the divorce courts, Sir Paul may well end up wishing he had stashed at least some of his £820m in an off-shore account of his own.
kate.o'hara@ypn.co.uk

MAIN POINTS

Melissa Miller is entitled to £5m of her former husband's assets after just two years and nine months of marriage.
Julia McFarlane has been awarded £250,000 a year from her former husband's earnings and told she can keep her maintenance payments for life.
Judges say to achieve fairness, courts should look to financial needs, compensation and equal sharing.
The Ruling "closes the lid" on the argument that adultery or other behaviour should impact on money matters.
It is "manifestly unfair" to confine a wife to an award for her financial needs.
Divorce specialists say the ruling means a brief marriage to a rich man is "like winning the lottery".
The decision could lead to a wealthy partner in marriage hiding assets from their spouse in offshore accounts.

MARRIAGE BREAKDOWNS THAT LED TO LAW LORDS' RULING

McFarlane v McFarlane

Mrs McFarlane had been married to Kenneth, a senior tax partner at Deloittes earning in excess of £750,000 a year.
She had a long marriage and gave up a high-flying career to raise three children.
She received the £1.5m family home in London as one half of the family's capital assets.
A judge awarded her maintenance of £250,000 a year for life, but Mr McFarlane appealed and it was reduced to £180,000 for life.
Mrs McFarlane went to the Court of Appeal, which reinstated the £250,000 figure but imposed a five-year time limit, during which she was expected to save money to provide a lump sum for a clean break.
But the Lords ruled yesterday that Mrs McFarlane is entitled to £250,000 a year from her husband for life.

Miller v Miller

The Court of Appeal upheld a decision that multi-million-aire fund manager Alan Miller should pay a £5m settlement to his former wife Melissa after a union that lasted a little under three years.
The judges were told that she had been living in a cramped, rented flat in Cambridge when she married Mr Miller in July 2000.
He complained at the hearing he would have been better off if he had knocked her down in his car.
He also described his ex as a "waste of space" and "spendthrift".
But the Court of Appeal said that, by marrying her, Mr Miller had given his wife an expectation of a significantly better standard of living.
And the House of Lords ruled yesterday Melissa Miller can keep the £5m awarded from her husband's £17.5m fortune.



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