Matrimonial assets (or marital assets) refers to any property and possessions that you and/or your spouse have acquired during your marriage or civil partnership. Non-matrimonial assets (or non-marital assets) typically refers to property and possessions that were acquired before getting married, after separation, or through inheritance.
Matrimonial assets may include:
- The family home
- Other property
- Cash savings
- Furniture and household items
- Jewellery
- Cars
- Businesses
- Investments (e.g. stocks and shares)
- Collectibles (e.g. art and antiques)
- Pensions
Non-matrimonial assets may include:
- An inheritance received by one spouse while married
- Gifts received by one spouse
- Property owned by one spouse before the marriage (with the exception of the family home)
- A business owned by one spouse before the marriage
- Property or other possessions purchased after the separation
It is important to understand the family home is an exception to the non-marital asset rule. This is because even if your partner owned the family home before you got married, as a result of your matrimonial home rights, you have a right to an equal share of the property, regardless of the legal ownership.
Division of non-matrimonial and matrimonial assets in a divorce
If you are currently going through the process of reaching a financial settlement following a divorce, it is most likely that your marital assets will be split fairly between you and your ex-spouse. This is the starting point that the family courts take. That said, the division of your matrimonial assets in a divorce may not necessarily be a 50/50 split. This will depend on your and your ex-partner’s financial situation, taking into account how much you both earn, how much you may earn in the future and your individual financial needs.
Any non-marital assets owned by your or your ex-spouse will not normally be divided between you and your ex-partner unless the family court judge considers that it is necessary to meet both of your needs. Dealing with the division of non-matrimonial assets is often made more complicated because they may be mingled with your marital assets. If you have been married for many years and any non-matrimonial property is mixed with marital funds, this may be viewed as an indication that there was an intention for these to be shared.
If, during your marriage, your ex-partner used part of their inheritance to put down a deposit on a jointly owned property, a judge is more likely to conclude that the whole value of that property should be shared. Likewise, if you owned a pre-marital property and sold this to place a deposit on your family home, this would be classed as mingled with your marital assets.
Unless you have protected your non-matrimonial assets through ring-fencing, there is always the possibility that the courts may exercise their discretion and divide them as part of a divorce settlement.
Ring-fencing non-matrimonial assets
Ring-fencing means that certain non-matrimonial assets, such as an inheritance or pre-marital property, may be protected from being included in a divorce financial settlement by the family court. Courts are normally less willing to ring-fence non-marital assets following a short marriage, where assets have been shared (i.e. mingled), or where it is not necessary to meet the needs of both spouses.
It is important to bear in mind that the courts often have discretion on such matters. Inherited property, for example, cannot be quarantined, ring-fenced or excluded from the court’s discretion.
Where possible, it is always advisable to include any non-matrimonial assets that you want to keep outside of a divorce settlement in a pre-nuptial agreement. If you did not include your non-matrimonial assets in your pre-nuptial agreement, you can still do so by entering into a post-nuptial agreement with your spouse. While nuptial agreements are not legally binding, the courts will take their contents into consideration when reaching a divorce financial settlement.
Another method is to set up a trust into which you can place the assets that you want to protect from a future claim following divorce. If you are unsure how to ring-fence your pre-marital assets, it is always advisable to speak to a family law solicitor who can explain how best to do so based on your individual circumstances as soon as possible.
