Waggott v Waggott at Court of Appeal

The Court of Appeal last week made an important and high value divorce settlement ruling in relation to the lifetime maintenance payments made to a woman who believed that an earlier decision to award her £175,000 a year was unjust and insufficiently reflected her needs.

However, in Waggott v Waggott, the court turned down her appeal and went further by deciding to scrap the spousal maintenance payments altogether after three years. This heralds a potentially significant shift in approach to such cases.

Earlier rulings in the family law case had seen a settlement of £9.76m plus £175,000 annual lifetime maintenance payments awarded to Kim Waggott, 49. However, she had felt this was not enough and instructed her divorce solicitor to argue for a £23,000 increase per year.

Mr Waggott cross appealed.

At appeal hearing, Lord Justice Moylan ruled that the original settlement terms were in fact too generous and suggested that Mrs Waggott would be well served by investing a portion of her initial £9.76m settlement and living off the interest. Furthermore, he said that Mrs Waggott “would not suffer undue hardship” and ordered the annual payments to cease in March 2021.

“How long should an order based on sharing last for? When does the meter stop ticking?” said Lord Justice Moylan. “It is unfair to expect the husband to continue working long hours in demanding employment and not expect the wife to realise her earning potential as soon as is reasonably practicable.” This position was sympathetic to that of Mr Waggott who had claimed that the original ruling left his wife with no incentive to work.

When the couple first began living together both parties were working as accountants for Coopers & Lybrand. They married and had one daughter together. The family home was a large £4.3m property near Great Missenden, Buckinghamshire. However, the relationship broke down and the couple separated in 2012 following 21 years of marriage; a situation which, reports indicate, was to some degree attributable to Mr Waggott’s two affairs.

Since her initial £9.76m award Mrs Waggott has moved to a £2m home in Cheshire – she has also invested in a second residence in the Balearics – while Mr Waggott now lives in a £1.9m farm near St Albans.

Mrs Waggott is now likely to face a considerable divorce solicitor legal bill following the case in which she has perhaps unfairly been characterised by some media outlets as seeking to obtain a “meal ticket for life”.

Divorce settlement ramifications for the future

The ruling suggests that courts are increasingly in favour of clean break divorce settlements, even when considering the sharing principle in relation to post separation earnings.

The Court of Appeal ruling in Waggott v Waggott is perhaps given extra significance in that Lord Justice Moylan has long been reputed for his generous and sympathetic approach to less financially independent parties in divorce financial settlement cases – as such, the case could well mark the beginning of a family law sea change.

The decision is likely to have a bearing on future cases as it indicates future earning capacity should not be viewed as a matrimonial asset and as such there may be no obligation to share it.