Written by Siobhan Jeffels, Legal Director at Clarion
The Supreme Court’s July 2025 ruling in Standish v Standish has brought long-awaited clarity to how pre-acquired and transferred assets are treated in divorce proceedings. In a unanimous decision, the Court upheld that assets brought into a marriage and later transferred between spouses for tax or estate planning purposes do not automatically become matrimonial property. This landmark judgment has significant implications for high-net-worth individuals, placing renewed focus on the legal distinction between ownership and intention, as well as on the value of well-drafted nuptial agreements. In this article, Siobhan Jeffels of Clarion explores what the ruling means in practice for financial advisers and legal professionals supporting clients through complex relationship breakdowns.
The verdict of the Supreme Court, delivered by Lord Burrows and Lord Stephens in July 2025, in the case of Standish v Standish provides important guidance on how asset classification is determined in financial proceedings on divorce.
In a unanimous decision, the Court dismissed the wife’s appeal and upheld the decision of the Court of Appeal. The case has clarified how assets should be divided when one spouse brings wealth into a marriage and then later transfers ownership to the other spouse for tax purposes.
Facts of the case
In Standish v Standish, the husband had a highly successful career in financial services and brought substantial assets worth £57m into the marriage. Thirteen years later, he transferred several of these to his wife (with a value of around £80 million) based on estate and tax planning advice. It was intended that the wife would settle these assets on trust for the benefit of their children. However, very shortly afterwards they separated, and the assets remained in her name. The husband argued that these transfers were made to benefit their children rather than intending to share the assets with his wife, and so they were non-matrimonial and the wife should not be entitled to a 50% share. His wife contested this position.
Matrimonial or non-matrimonial?
On divorce, the Court will distinguish between matrimonial and non-matrimonial property. The ‘sharing principle’ applies to matrimonial assets i.e. the assets which are generated during the marriage by the parties’ common endeavour.
In Standish, the Supreme Court upheld the husband’s argument that whether assets are matrimonial turns on the source of the assets, not the title, confirming that the underlying nature of the assets remained unchanged despite the legal transfer of ownership.
Although there can be justified departures, for example when required to meet one party’s needs, equal sharing of matrimonial property is the appropriate and principled starting position. Non-matrimonial property may become matrimonial property for example where the parties, over a sufficiently long time, treat the assets as shared and intend to benefit the other spouse.
Outcome
The wife’s appeal for a 50% entitlement was rejected and her earlier award of £25 million was upheld.
The Standish case clarifies that tax saving schemes whereby one spouse transfers an asset to the other spouse do not normally show that the asset is being treated as shared between them, regardless of the time period involved.
The Standish judgment provides much-needed clarity on how assets owned prior to the marriage will be treated on divorce.
In fact, the impact of the ruling in Standish cannot be underestimated as the treatment of non-matrimonial property on divorce is often a driving factor for costly and litigious proceedings. Where there is a focus on non-court dispute resolution in family law cases, having clearer guidance on the treatment of non-matrimonial property will provide more certainty, helping cases to settle without the need for court intervention as parties and legal advisors alike will have a clearer understanding of the position and won’t have to take the “gamble” of proceedings.
Going forward, it’s likely this ruling will significantly influence high-net-worth divorce proceedings, and couples along with their legal and financial advisors should consider its implications moving forward. The decision reiterates that context is equally important as legal ownership when determining asset division.
Nuptial agreements in the spotlight?
The case also highlights the growing importance of pre and post-nuptial agreements. With many experts suggesting that a well-drafted nuptial agreement could have prevented this matter from reaching the Supreme Court in the first place.
When properly drafted and executed, pre-nuptial agreements can effectively demonstrate each party’s intentions regarding asset division in the event of a future divorce, helping to ensure fair outcomes for all involved.
The ruling’s most significant impact is its clarification that couples should document their intention for non-matrimonial assets to become shared marital property. Without clear documentation, the legal presumption may now favour keeping such assets as non-matrimonial property.
The decision clearly outlines the importance of putting things in writing and although the Court’s decision will always be grounded in making sure that the financial needs of both parties are met, without a doubt – the most effective way of protecting wealth remains to be a pre- or post-nuptial agreement.
Ultimately, the ruling is a landmark moment for matrimonial law. While it’s natural for questions to arise after a significant moment like this – establishing firmer boundaries between existing and shared wealth will go a long way in liberating clients, legal and financial advisors alike from the legal limbo.
