Posted on May 13, 2019 in Family Law by Lynne Sturrock
As Amazon’s founding couple announce their separation, family law associate, Lynne Sturrock, takes a look at financial settlement on divorce in Scotland.
High-profile, high-net divorces of famous couples are reported with increasing regularity in the media. This time it is the world’s richest man, Amazon founder, Jeff Bezos and his wife, MacKenzie, who have agreed a record-breaking divorce settlement of an estimated £27bn. Ms Bezos is due to keep a 4% share of the Amazon empire.
The former couple announced their separation on social media platform, Twitter, a increasingly popular method amongst couples in the public eye. Husband and wife both ‘tweeted’ their separation in a very amicable public display of gratitude and respect for one another. The use of social media is a good reminder of the potential risks of using social media as a platform to air grievances surrounding separations and divorces.
The Matrimonial Pot
Jeff Bezos founded the now multi-billion pound Amazon, in 1994, one year after the couple married. Currently, Mr Bezos owns around 16% of the online retail giant. As this was acquired during the course of their marriage, in many US states, this shareholding is considered to be community property and therefore owned jointly by Mr and Mrs Bezos.
Scotland employs a similar matrimonial regime, whereby assets, either individually or jointly acquired during the course of the marriage up until the final date of separation (the ‘relevant date’) constitute ‘matrimonial property’. This does not include anything acquired before the date of marriage with the exception of the family home and furnishings therein. Similarly, any debts or liabilities incurred between the date of marriage and the relevant date either individually or jointly are treated as being matrimonial property.
All the assets and debts are put into one figurative matrimonial pot which must then be divided between the parties.
Dividing the Pot
In Scotland, legislation sets out guiding principles that a court’s division of the matrimonial pot must be based on. The rules are designed to ensure fair sharing of the matrimonial pot. The default position is that fair sharing is achieved by dividing the matrimonial pot equally in half but there may be special circumstances which will justify an unequal split. Amongst other, these include the existence of prenuptial agreements and the source of funds used to acquire matrimonial property.
In dividing the matrimonial pot, a court must also take fair account of any economic advantage gained or disadvantage suffered by either party. The most common example is where one party has taken time out of work to stay at home and look after children. Furthermore, the economic burden of caring for children must also be shared fairly between the parties going forward. The court may order one party to pay a period allowance if child maintenance is not deemed to sufficiently share the costs of caring for any children.
In additional, a periodic allowance may also be ordered to help a financially dependant spouse adjust and get into work. Where financial provision is required to prevent someone suffering serious financial hardship, the court must make such an order.
In the majority of cases, financial settlement on divorce can be reached without the need for a court’s involvement. Our team of family solicitors are here to guide you through the process and represent your best interests to secure an outcome that is right for you.
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