On 2 July 2025, the Supreme Court handed down a decision in the case of Standish v Standish [2025] UKSC 26. The case was an appeal from the Court of Appeal where the court had attempted to clarify the rules in respect of 'non-matrimonial property' as opposed to property that could be termed 'matrimonial property'. In what is, thankfully, a fairly succinct judgment, the Supreme Court has clarified the approach that the Family Court should take when being asked to consider separation of assets on divorce and, in doing so, provides much needed clarity for practitioners and clients.
The decision is important for three particular reasons. Firstly, it repeats and approves the court’s approach when being asked to exercise its power to divide assets (Para 39). Secondly, the judgment addresses when property is likely to be non-matrimonial (and thereby exempt from the sharing principle) or matrimonial (and thereby subject to the sharing principle) (Para 47-48). Thirdly, and helpfully, it clarifies that there is a principle where property can become matrimonial through a process called, ‘matrimonialisation’ (Para 51).
The facts of the case are complex but can be explained briefly. The husband had had a successful career, prior to marriage, and his total wealth brought to the marriage was significant. The wife, in contrast, had very modest property in comparison to the husband.
The court’s approach in attempting to achieve a fair outcome on division of assets can be distilled to three separate principles. These are, “needs”, “compensation” and “sharing”. “Needs” means that the relationship has generated needs and a it is right that the other party should meet those needs (for instance, minor children). “Compensation” is the need for a party to be compensated for any relationship-generated disadvantage (such as a high earner who surrenders earning potential so that they can care for children). “Sharing” is the sharing of the fruits of the matrimonial partnership such as property or assets that were bought during the marriage.
It is this last principle, "sharing", that most concerns the Supreme Court in Standish. The starting point is that while there can be justified departures from equal sharing that “equal sharing is the appropriate and principled starting position” and if property can be termed matrimonial / non-matrimonial the Supreme Court opines that much of the justification for departing from equality disappears.
Much like the legal definition of an elephant, i.e. you know it when you see it, the Supreme Court identifies that there is a conceptual distinction between property that is non-matrimonial and what is matrimonial and this distinction, the court says, turns on the source of the assets and not the ownership. The qualities of non-matrimonial property are typically, those assets brought into the marriage by one party or acquired by another way such as an inheritance or gift. In contrast, matrimonial property is that which arises as a result of the partnership of the marriage.
The court makes crystal clear to all that, “the time has come to make clear that non-matrimonial property should not be subject to the sharing principle” (Para 48). In other words, there is likely to be minimal to no justification for equal sharing any non-matrimonial property.
However, the court did also conclude that non-matrimonial property may be subject to review if the court considers the needs and compensation principles. If, for instance, the wife had, during a marriage, received a significant sum of inheritance but it was not possible, on divorce, to meet both parties needs then the court would likely look to that inheritance to achieve a fair outcome to meet both parties’ needs.
In Standish there were arguments about whether non-matrimonial assets had become matrimonial by virtue of them being transferred between spouses. In the particular circumstances of the case, the Supreme Court agreed with the Court of Appeal’s conclusion that the property, having been transferred to achieve a tax advantage, did not change the type of property and emphasised that the source of the property was a key consideration. Whether non-matrimonial property has become matrimonial depends on how the parties’ have treated the asset and whether it has been treated as shared. A better example of this may be a situation where one party brings to the marriage a home, subject to a mortgage, over time both parties contribute to the mortgage, it may be refinanced into both parties names for instance, and treated as shared. In that circumstance, the property, although pre-acquired, would become matrimonial. Contrast this, though, with a situation where fixed rate bonds owned by a party pre-marriage have been left to grow passively without intervention from either side, then these are likely to remain non-matrimonial and therefore excluded from the sharing principle.
Standish is an unusual case though as the sums available for distribution were, by any measure, significant and the parties needs (housing, income etc) were able to be met out of the available assets. While the courts judgment provides much-needed clarity on how the court will exercise judgment in cases where one party asserts that property is non-matrimonial, it also emphasises the need to have robust, skilled and tailored advice about the impact on assets of whatever class of decisions that are made.
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The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. The law may have changed since this article was published. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances.
