Defining genius

Jamie Cooper-Hohn was handed 36 per cent of the matrimonial assets late last year, awarding her £337m in the biggest divorce settlement Britain has ever seen.
As many of the newspapers noted,
this made her wealthier than the Queen of England. The settlement concluded one of the most high-profile and longest-running divorce cases of recent years, but more importantly, it will have several significant implications for the future of family law.

The percentage awarded to Mrs Cooper-Hohn was in line with previous awards to wives, in cases where a husband had successfully argued that his spark of genius justified a departure from equality in dividing the matrimonial assets on divorce.

What was headline grabbing in this case however, was the sheer amount of wealth to be divided, and whether any clarity or guidance would be provided by the judge regarding a 'special contribution' argument.

Opposing arguments

During the settlement proceedings, Mrs Cooper-Hohn argued that she was entitled to half the couple's assets, while Sir Chris Hohn offered a quarter. He argued that he had made a special contribution to their wealth throughout their marriage.

Mrs Justice Roberts settled between the two arguments, accepting that Sir Chris was the "generating force" behind their financial success. However she recognised Jamie Cooper-Hohn's work for the couple's charitable foundation, stating in her judgment: "Her role in the foundation demanded of her the skills and qualities which would have been needed in any CEO at the top of an organisation".

Case law precedent

The divorce could become a significant turning point in the case law surrounding divorce proceedings, as it is one of the very few cases in matrimonial law to uphold the notion of a special contribution. It has the potential to provide key guidance as to what may and may not qualify for this very elusive concept.

Historically, upon divorce, the bulk of the wealth would remain with the breadwinning party (usually the husband in a traditional marriage) and the wife and children would have their reasonable needs met. This changed in 2000 in the case of White v White.

It was held that such an approach
is discriminatory to the home maker and instead, the roles of home maker and breadwinner are equally valuable
in a marriage in the eyes of the law.
It followed that the value of these two separate (but equally valuable) roles should be reflected by the division of the matrimonial assets.

It is an extremely rare case therefore, where after a long marriage of 20 years or more, where the bulk of the wealth has been generated during the marriage, the parties do not receive an equal division of the assets.

But one basis for doing so is if one spouse has made a contribution so unique and overwhelming, that it cannot be matched by the contribution (financial or otherwise) of the other spouse; a special contribution. The fact that so few cases have seen a successful plea suggests that the contribution in question must indeed be truly exceptional. This is what makes the Cooper-Hohn divorce so important.

Test of genius

In her ruling, Mrs Justice Roberts remarked that she had no wish to define or set boundaries for what may or may not constitute a special contribution. Nonetheless, she stated that she asked herself the following questions when assessing whether Chris Hohn had made a special contribution to the couple's wealth. It is inevitable that lawyers will use these to guide their clients as to the likely success, or otherwise, of running a special contribution argument. Those questions were:

• Can it properly be said that he is the generating force behind the fortune rather than the product itself?

• Does the scale of the wealth depend upon his innovative vision as well as on his ability to develop those visions?

• Has he generated truly vast wealth such that his business success can properly be viewed as exceptional?

• Does he have a special skill and effort which is special to him and which survives as a material consideration, despite the partnership or pooling aspect of the marriage?

• Would it, in all the circumstances, be inequitable for me to disregard that contribution?

Mrs Justice Roberts found that the answer to each of these questions was yes. When applying the definition of genius to him, she took the view that he qualifies as a financial genius in his particular field of financial investment. Perhaps more uniquely to this case, she also asked herself: "If he does not qualify as having made a special contribution to his marriage, who could?

Although rare, the outcome of the case is perhaps unsurprising given Chris Hohn's impact on the investment industry, and his considerable market success. Previously, judges have been reluctant to recognise a special contribution, as such a decision could be seen as undermining the supporting partner's role as home keeper and parent.

However, in this case, Sir Chris Hohn's professional and financial contribution to the marriage was seen to outweigh Jamie Cooper-Hohn's contribution as wife, mother and business woman. She has since said that she will not appeal the judge's decision that gave her less than half of the couple's joint assets. She has, however, publicly stated that she has questioned why the ruling didn't assign equal value to her efforts during the marriage.

Percentage of the award is essential, not the amount

She stated:"As a woman who, during my marriage, raised four children with little support while building one of the world's largest foundations as its CEO and board chair, how can it be that my contributions did not make me an equal partner in the eyes of the law?"

She went further, stating: "If this is the law, then the law is not just."

Mrs Cooper-Hohn has decided not to challenge the ruling as she wants to concentrate on bringing up the parties' children and focus on her charitable activities. Many will argue that with a £337m fortune, she has been awarded a very substantial sum of money. But they are completely missing the central point of importance here.

This case, one where the largest amount of money has been allocated to a wife upon divorce, was not about the amount of money awarded. It was about the percentage of the assets that the judge felt the wife was entitled to, which reflected her role and contribution during the marriage.

A new trend?

It will be interesting to see what impact this precedent-setting decision will have on similar cases in the future. One result of Sir Chris' successful plea may be an increase in the number of individuals using 'special contribution' as an argument in divorce proceedings. However, lawyers and clients must remember that the contribution must
be deemed truly exceptional, or the court will not find that it outmatches the supporting partner's contribution
to the marriage.

There are few individuals who could successfully claim to be geniuses as defined by the judge in this case. Importantly, to qualify as a genius who can rightly argue that they are worthy of having made a special contribution, an individual must not rely purely on the extent of the wealth.

According to Mrs Justice Roberts, the individual must "have some exceptional natural capacity or intellectual or creative power or other natural ability, which finds reflection in the exercise of an exceptional skill in a particular area of activity."

It will inevitably become the responsibility of the parties and their lawyers in divorce cases to demonstrate this exceptional ability, which may prove to be a very complicated process. Many high-net worth individuals claim that they are exceptional, but often due to very obvious reasons such as vast wealth or huge talent.

What is clear, however, is that the courts are willing to decide between those who are truly exceptional and those who aren't. What's more, divorce lawyers and clients now actually have a checklist which they can use to determine whether or not they have made a 'special contribution'.

Deborah Jeff is a partner and head
of the family department at Seddons

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