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Inherited assets on divorce

Divorce assets

Whether inherited assets should form part of the matrimonial “pot” is generally considered to be a grey area of family law.

Generally, if the assets of the marriage are limited, the inherited property may need to be utilised in order to meet the needs of both parties, especially if there are children of the marriage as their needs will always be prioritised by the Court.

However, when the needs of the parties can be met without taking the inherited asset into account, the Court will decide whether the inherited assets should be divided between the parties or whether they should be treated as separate property and retained by one party. Various factors will be taken into account, for example:

  • The length of the marriage – generally, the longer the marriage the less chance there is of the inherited asset being ring fenced. If the marriage is a short marriage the Courts are more inclined to start from a position of each party leaving the marriage with what they bought to it. A marriage in excess of 10 years is considered a long marriage.
  • The Court may also look at when the inheritance was received. If it was received after separation but before the divorce is finalised, the Court will be less inclined to take it into account than if it had been received at the start of a long marriage.  
  • Has the inheritance been treated as matrimonial during the course of the marriage? For example, if a couple have been married for 25 years and during the course of the marriage the husband inherited £50,000 which he used to pay off the mortgage on the jointly owned matrimonial home, it is likely that the court would treat that £50,000 as matrimonial property and therefore the husband would struggle to argue that the money should be returned to him on separation. By contrast, if the husband had deposited the £50,000 into a separate bank account in his sole name which had not been used for matrimonial benefit or if he had used the money to purchase a property in his sole name, then he would have a stronger argument to suggest that this was never intended to be matrimonial.

Having said this, each case is individual, and the Courts will ultimately look at various factors in order to establish whether the inheritance should be treated as separate property or not.

Article written and contributed by : Cheryl Haywood, Associate Solicitor, Family Group, SAS Daniels LLP

DISCLAIMER: This article should not be regarded as constituting legal advice in relation to particular circumstances. It is merely a general comment on the relevant topic. If specific advice is required in connection with any of the matters covered above, please speak to SAS Daniels LLP directly.

Published on 14th July 2021
(Last updated 14th July 2021)

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