LvL – The Fashion Designer and Spouse Maintenance

The case of LvL, decided on15 August 2011but only recently reported, is an example of Judicial promotion of women’s rights, but serves to highlight the fact that this is not universally applied.

Mrs Justice Eleanor King heard an appeal from an order of District Judge Bowman at first instance.

 The condensed facts were as follows:

 The Wife was an internationally renowned fashion designer. She lived on an inherited farm, worth £1.9m net with 370 acres. It didn’t produce an income at the time of the hearing as it had been a hobby farm.

 The husband owned his own medical services company. His home had equity of £1.3m and business premises had £70k equity after allowing for Capital Gains Tax.

 The wife’s business wasn’t making any money for her. She was paying rent of £40k a year (causing a loss last year of £18k) and out of her taxed income had to pay £18k p.a. for a flat to stay inLondonmidweek. The farm was producing an income of £23k p.a. without much effort.

The husband’s business had been valued at £144k. The premises had equity of £70k after allowing forCGT. There was a large mortgage on the premises of £2.75m, and rental income paid for much of this. However the husband had a shortfall of £50k p.a. to make up, and this had to be found somewhere. The profits from which he could draw a taxed income were £82k.

The husband was ordered to pay the wife £35k and, yearly, maintenance of £47,500 (including for the 2 children, 9 & 12) together with annual school fees of £24,000 initially, but rising soon to £48,000.

On appeal the judge reduced maintenance to £30k p.a. for the wife, to last for just over 2 years. The CSA would set the rate for the children. The husband would still pay the school fees.

The judge found that the first judge had failed to take into account the ability of the husband to pay – that he had to find £35k to pay to the wife, £50k for his costs, and £50k for the shortfall on the business mortgage. The school fees of (eventually) £48k would have to come out of the husband’s capital, and he also had to find £32k a year for his own mortgage, and pay for his other costs of living.

Particular criticism of the judge below was reserved for the (in my view rather patronising) opinion of the District Judge that the wife couldn’t be expected to provide for herself. As the D.J. put it, “how will she manage were she to get nothing from her business endeavours, if not by way of maintenance from the husband?”  King J was of a contrary view. She felt that the income from farming was far from speculative.  It was only a hobby farm because the husband liked to keep horses. She would have time to turn it into a working farm or, if she wanted, sell it. She had an earning capacity and would not have to retrain.

So well done Mrs Justice Eleanor King for not assuming that women are nothing without a man to support them, even if they have 370 acres of farm mortgage free. My only concern is this: why did it take the expense of an appeal for the judicial system to work that one out?

Andrew Lee

Andrew is a Collaborative Family Lawyer, and a Senior Associate Solicitor at Gregory AbramsDavidson.  To contact: Tel 0151 236 5000/ 0151 330 0734: [email protected]