Inheritance & Divorce
Inherited assets and the decision as to whether or not they should be included as matrimonial assets is a contentious area which has caused much argument and debate between divorce lawyers.
It is the duty of the Court to have regard to all the circumstances of the case (please see s.25 of the Matrimonial Causes Act 1973).
Consequently, the Court’s approach to the issue of inherited assets involves a detailed review of the specific circumstances of the particular case before it.
There are certain circumstances that indicate a likely conclusion as to whether inherited assets will be included as matrimonial assets to be divided:
An inherited asset that is likely to be inherited in the near future is not usually included as matrimonial assets. The court takes the view that such an inheritance is uncertain and cannot be included. The Court, can however consider if there are any further circumstances which in the view of the Court would lead to an injustice between the parties, such assets may be included (see RE: G (financial provision: liberty to restore application for Lump Sum) [2004]).
If an inherited asset is certain to be received i.e. one party’s parents had died and their estate was in the process of being administered, then it is likely that it would be included as a matrimonial asset to be divided.
If the inherited asset was received before the parties met or married, the Court is likely to include the same as a matrimonial asset to be divided (see GW v RW (Financial Provision: Departure from Equality) [2003]).
The type of inherited asset can also be a factor that the court considers i.e. if the asset is a family home that has been in the family for a number of years, the Court may “offset” the need for sale of the property with a lump sum payment.
In conclusion, it is at the Court’s discretion under s.25 of the Matrimonial Causes Act 1973 as to what inherited assets can be included within the matrimonial assets to be distributed. The Court will look into the specific circumstances including the timing of the inheritance, the amount, the justice or injustice of including the same and the type of inheritance. Legal advice will be required to assist a party in forming an effective case for the Court to include or exclude inherited or likely to be inherited assets.
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