England: Misapplication of divorce law leading to discrimination against women

A landmark judgment by the House of Lords (now the Supreme Court) is failing to help wives during divorce who have made compromises and taken on more caring responsibilities during the marriage, the study claims.

The research shows how principles set out by the House of Lords following cases brought by Melissa Miller and Julia McFarlane two decades ago are seldom applied because they have been fundamentally misunderstood by the lower courts.

The peers introduced ‘compensation’ as an integral principle to guide fair financial divorce settlements, recognising that an equal division of property would not alleviate post-divorce earning capacity disparity to give both parties an equal start on the road to independent living.

But since their judgment compensation has hardly been applied. New research suggests this is because judges in lower courts have misunderstood compensation as a discrete claim for loss from high-flying women who had sacrificed glittering careers.

The analysis, by Lucy Crompton from the University of Exeter Law School, says this misconception is leading to courts taking insufficient account of the worse post-divorce financial outcomes that wives frequently face.

Dr Crompton warns a new UK government consultation on reforming financial remedies law reflects the same misunderstanding, and there is a risk that suggested reforms do not address issues of post-divorce disparity and could enshrine gender discrimination in legislation.

Dr Crompton calls for a return to the “holistic” understanding of compensation intended by the Law Lords who made the Miller/McFarlane judgment.

Dr Crompton said: “Fairness in financial remedies law requires recognising that interdependence often requires that spouses with children prioritise one of their careers, requiring the other spouse to make compromises that are not in their financial best interest. Financial remedies law should support spouses to make these compromises in the best interests of the family knowing that they won’t be left to bear the brunt of the consequences if the marriage breaks down.

“It is not about the wife’s individual disadvantage compared to the career she could have had if she had made different choices. Compromises have consequences for the earning capacity of both spouses, so compensation should look to alleviate the post-divorce disparity in their earning capacities in a way that is fair to both spouses in the circumstances of the case. It’s much more likely that the wife will be the one to make those compromises, so failing to recognise this means that the law discriminates against women.”

The Miller/McFarlane judgment introduced three key rationales – compensation, needs and sharing.

Dr Crompton said: “Something has obviously gone very wrong because compensation has been applied directly only twice in almost 20 years. The lower courts have embraced the intransigent notion that financial resources belong to the person who directly earned them.

“If we genuinely view going out to work and caring for the family as equal contributions to an equal partnership we must share the financial consequences of these interdependent roles more fairly. The stark fact is that wives have worse post-divorce outcomes because of the gendered economic consequences of caring roles in marriage.

“The continuing failure to address the persistent, gendered inequality on divorce demonstrates that the law sees the partnership of equals as merely a social partnership, not an economic one. Ultimately this amounts to lip service that leaves the wife to bear the brunt of the economic consequences.”