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Landmark ruling on finances on the dissolution of civil partnerships

In March this year, the Court of Appeal handed down its’ first reported decision relating to financial claims arising from the dissolution of a civil partnership and in doing so sent out the message that where finances on the breakdown of a relationship are concerned, civil partnerships are to be considered no different to marriages.

The case involved a couple living an enchanting lifestyle, with one of the partners, Peter Lawrence working as a successful city analyst earning approximately £200,000 net per year and the other, David Gallagher working as an actor, who at the time of the decision had reached the dizzy heights of the West End by landing the leading role in Priscilla Queen of the Desert.

Prior to the civil partnership, which lasted short of 8 months, the couple had lived happily together for 11 years, splitting their time between a docklands apartment, owned by Peter Lawrence prior to commencement of their relationship and a Sussex cottage, described by David as his pride and joy.

Between them, the value of their assets were close to £4m to include Peter’s pension but excluding some personal chattels and deferred bonuses, which were dealt with separately. Initially, Peter had sought to settle David’s claim for approximately £600,000 to include a share in his pension, an offer which was rejected and described as somewhat “fanciful” by the judge who at first instance, adopted a sharing approach which led to her awarding David just shy of £1.7m.

On appeal by Peter, the Court of Appeal reduced David’s award quite considerably, although allowing him the Sussex cottage and his claim for a share in Peter’s deferred bonus was cancelled.  There has been commentary which has stated that the reduction in the award was more to do with the initial valuations of the assets being inaccurate as opposed to it being owed to the fact that it was the dissolution of a civil partnership rather than a marriage that was in issue.

Lord Justice Thorpe addressed this point directly by saying that "The fact that the claim arises from the dissolution of a civil partnership rather than a marriage is of little moment since it is common ground that the language of schedule 5 to the Civil Partnership Act 2004 is identical to the language of s.25 of the Matrimonial Causes Act 1973."

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