A recent court decision may have an important impact on personal injury compensation and divorce
In the recent case of Mr and Mrs Mansfield, that has all been thrown to the wind. Mr Mansfield had been awarded personal injury compensation of £500,000. He used some of that money to buy a specially adapted house to help with the consequences of his injuries. He then married and he and his wife had two children, with the house becoming their family home. In effect, his £500,000 had provided most of the family assets.
When the couple later divorced, the judge ordered that the house should be sold and the proceeds split, with Mr Mansfield to get one-third. The rest was to go to his former wife. The only leeway was that the sale was to be postponed until the youngest child reached 18 or ended full-time education. Such an order is common where the parties have essentially only one main asset between them – the matrimonial home – and the needs of the children for that home take precedence over the husband or wife being paid out their share of its value.
However, this case is the first time that I’m aware of where the court has effectively ordered one divorcing party to hand over a very large chunk of their injury compensation to the other, even though it was done through the medium of the sale of the property which that compensation had bought.
This could mean that any injured claimant who is about to receive a significant amount of money and intends to invest it in a home; or who is about to get married and use that money on his family; or both… needs to be very carefully advised about how to ensure that if the relationship founders, the money does not go the same way. The most likely answer is to ensure a suitable agreement is entered into between the parties to the effect that if they separate, there will be no claim on the compensation money or on the assets bought with it.
For guidance on personal injury compensation and divorce call us on 0333 888 0408.
