Ask the Expert: Part 3: The legal landscape

In the third instalment of our Ask the Expert: Valuing a business for divorce series, we take a look at the legal principles that shape financial settlements and how business assets are treated by the courts.

Q: How does UK law treat business assets in divorce? 

In England and Wales, the starting point for a long-term marriage is usually a 50:50 division of marital assets, regardless of who earned or built them. This principle was established in the landmark case White v White (2001), which made it clear that the contributions of both the breadwinner and the homemaker are equally valuable.

Q: What about assets one spouse brought into the marriage? 

That’s a common concern. While pre-marital assets can sometimes be treated differently, in practice they often end up in the pot – especially in longer marriages. A pre-nuptial agreement might help, but it’s not legally binding in the UK. Courts will often uphold it, but it doesn’t guarantee protection.

Q: Is the legal system predictable when it comes to dividing business interests?

Not really. The current system gives judges a lot of discretion, which can lead to uncertainty – especially around business valuations. The Law Commission has been reviewing the system, and there’s talk of introducing a more structured approach, but for now, outcomes can vary widely.

Q: Why is business valuation particularly tricky under this system?

Because it’s not just about numbers – it’s about fairness, context, and interpretation. Judges may weigh expert opinions differently, and there’s no fixed formula. That’s why having a robust, well-reasoned valuation is so important.

Q: What’s your advice to clients navigating this legal uncertainty?

Be prepared, be transparent, and get expert advice early. The more clarity you can bring to the process — especially around business value – the better your chances of achieving a fair and efficient outcome with the minimum stress and cost.