by Zahra Deera
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Should the wealth of a spouse’s birth family have impact on a divorce settlement?

by Zahra Deera

Divorce settlements are always tricky but they can get even trickier when you have received or are due to receive a large inheritance. The recent case between ex-investment banker Hossam Radwan and his former wife, heiress Hayat Alireza, has raised some interesting queries as to whether a former spouse may rely on their birth family for financial support post-divorce. In anticipation of the decision in this case, this week we explore how the outcome could have an impact on the current English law.

Facts of the case –

In 2015, a High Court ruling awarded Saudi heiress Ms Alireza a lump sum of £2 million and the right to stay in the former marital home in Central London. The court refused to grant a larger settlement on the basis that she was set to inherit an estimated fifth of her Saudi multimillionaire father’s estate. However, Ms Alireza recently lodged an appeal for a further £5.5 million on the basis that her father’s wealth should not be considered when determining the division of the matrimonial pot. Under English law, courts consider the standard of living enjoyed by family during marriage when granting a settlement. Ms Alireza argues that this may well mean that the £2 million sum will be insufficient as her father – whose fortune derives from one of Saudi’s oldest businesses – ‘may live for decades’.

Mr Radwan argues that Ms Alireza should be able to rely on her father’s financial support during his life and upon his death. Ms Alireza’s barrister argues that there is no principle of law supporting Mr Radwan’s argument, particularly as he is a millionaire in his own right.

Legal standpoint –

Under English Law, the starting presumption is that assets be divided in a way that facilitates equality between the parties there are valid reasons to depart from equality.This principle means that many who have a choice of jurisdiction for their divorce will select England and Wales: their status as the financially weaker party can be redressed by the court.   There is no clear precedent in England stating that a husband or wife should become the financial responsibility of their birth family following divorce, the main argument in Ms Alireza’s appeal.

On other hand, Ms Alireza’s reliance on her father for her legal fees and residence in his Kensington home is argued by Mr Radwan’s legal counsel to mean that his funds, now and in the future,are an ‘existing resource’ to Ms Alireza. How much weight the Court of Appeal choses to give these arguments remains to be seen.

The Grayford’s approach –

The advantage of Grayfords in such a case is the experience we have in dealing with complex international cases. With this case hinging upon the inheritance of property situated in Saudi Arabia, Grayfords are able to provide specialist advice in deciding which jurisdiction will provide the best advantage for our clients.

While we still await the judgement of this case, it is expected to be one of particular significance for divorcing parties. While each individual case is different, a decision in favour of Mr Radwan will no doubt play a role in the extent to which one is expected to financially provide for their former partner after divorce.

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