Pure Genius? Divorce, Spouses and “Special Contributions” 

Published on 13 April, 2017 | Abigail Lowther

We live in a sensational age. By that, I don’t necessarily mean the scale of accomplishment but the degree of hyperbole and exaggeration applied to almost any aspect of our daily lives.

Consequently, individuals who achieve a level of profficiency in their chosen profession can rapidly be dubbed a ‘genius’.

However, there is a vast difference between how the word is interpreted by tabloid newspapers or social media and the rather more literal examination by the courts.

The issue has been given fresh currency by a ruling handed down in the case of an American financier named Randy Work.

He had sought to defend a claim by his former wife, Mandy Gray, that she should be entitled to half his £180 million fortune by suggesting that the riches amassed over the course of their marriage were due to his special financial talent.

That argument had been dismissed by Mr Justice Holman in the High Court in 2015, who felt “To my mind, the word ‘genius’ tends to be overused and is properly reserved for Leonardo Da Vinci, Mozart, Einstein and others like them.”

Nevertheless, Mr Work tried to persade three Appeal Court judges that he was indeed blessed with a touch of genius in generating huge incomes for a succession of private equity companies.

Instead, they agreed that his success owed much to “being in the right place at the right time” (http://www.telegraph.co.uk/news/2017/04/11/millionaire-not-genius-should-give-ex-wife-half-180-million/).

Mr Work is not alone in maintaining that their skill in money-making should allow them to depart from the assumption of a 50-50 split of all assets accrued while a couple is married.

Even so, this latest judgement and other recent such decisions mean that the sort of sums which might be regarded as exceptional appear to be beyond the reach of all but a fraction of the very wealthy.

That is, in part, because courts recognise the equivalent contribution of spouses (who have most frequently been female) in building a supportive household environment and raising children, allowing the family’s breadwinner to develop their careers and incomes.

Take the case of the former beauty queen Pauline Chai who, only last week, was awarded £64 million from her husband, Dr Khoo Kay Peng, the chairman of the Laura Ashley fashion business after underlining her role as a “traditional” wife (http://www.telegraph.co.uk/news/2017/04/06/homemaker-ex-wife-laura-ashley-boss-wins-third-200m-income-payout/).

Such instances illustrate how divorce law is discretionary, being decided not according to a set, rigid formula but the merits of each case.

In weighing up the evidence and dividing the marital assets, courts will consider a range of factors. They include whether one spouse has indeed made a “special contribution” along with the length of a marriage, the respective ages of the people in it.

It’s worth pointing out that the “contribution” element can be expressed in more than simple financial terms and should reflect someone’s efforts to support a family.

Even so, there is a saying that, when it comes to divorce, “needs trump all”: regardless of whether someone was demonstrably the principal provider, it is essential to meet the requirements of the less well-off spouse.

For that reason and many others, it is therefore neither suitable nor practical to establish a wealth threshold above which a contribution can be regarded as the profit of genius.

Being able to transform balance sheets with insight and skill involves a transaction of sorts.

Courts have repeatedly asserted, that a marriage (and the money earned during it) is also a sum of its parts, so it is only right that the wealth within it is split in a fair manner.