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A situation which all experienced family lawyers encounter in a divorce is where one party embarks on reckless spending. I am often asked whether that person can get away with it and my advice is not always what someone wants to hear.

What Conduct is Considered?

In a divorce situation, a court can take into account ‘the conduct of each party if it is such that it would be inequitable to disregard it’.

Financial misconduct such as emptying bank accounts can often lead to the argument that the wasted money should be ‘added back’ into the pot of assets. However, courts are very cautious about doing this which often leaves the aggrieved party feeling it is unfair.

The case of MAP v MFP (2015) has made it very difficult to persuade a court to ‘add back’ the wasted money. In that case it was said that, to add back the money dissipated, it must be shown that:

  • The behaviour that led to the reduction in assets was reckless and wanton; and

  • The motivation for the spending was to reduce a financial claim. 

In MAP v MFP the husband spent a large sum of money after the separation. The money was used to pay for drugs, female escorts and stints in rehab. The wife asked the court to ‘add back’ the sum she felt had been wasted which exceeded a hundred thousand pounds, but this request was refused as the court found that the husband did not overspend with the intention of reducing the wife’s claim. The judge referred to the spending being down to the husband’s ‘flawed character’ and the wife should ‘take her husband as she found him’. 

The Risk Involved

In some cases, it may be worth trying to ‘add back’ wasted money but there is always the risk that you will spend more in legal costs than the amount in dispute. Add to this that the prospects of success are slim, and the experienced lawyer will often advise that a person is very unlikely to be able to claw back squandered cash.

The Court’s Objective

The objective any case must be fairness and it is not always easy for a person to be objective when going through a traumatic time in their life. 

Specialist Advice

The law in this area is again very discretionary and there is no one right answer.  The experience of a specialist family lawyer is therefore vital where there appears to have been large sums wasted.  Vingoe Family Law has solicitors who specialise in the financial implications of divorce and are happy to advise on any questions.

 

Anthony Vingoe

Specialist Financial Remedy Solicitor

30th June 2023

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