The spring board and passive appreciation
As a reminder, the Divorce Courts operate on the need principle and the sharing principle. In the vast majority of cases the need principle is dominant: it is only if all reasonable needs of the parties are met that the sharing principle is then applicable to the surplus assets. In this case the assets were some £38m to £39m. Clearly even well gilded needs could be met and there was a surplus to be divided under the sharing principle.
The normal approach to the sharing principle in respect of a business interest introduced into a marriage includes the following steps:
In this case the husband argued that his shares in a company called Zebra should be excluded from the sharing principle altogether. He argued that the “heavy lifting” in respect of the company had been done before cohabitation started. This then meant that virtually the full value was present in the acquest as the business then grew of its own momentum thereafter. (It may be of relevance that this was a hi-tech company.) Per the husband, the further accretion in value should be considered to be equivalent to the indexation of that initial value during the period of the cohabitation.