Business assets and divorce : balancing the competing interests

Matrimonial property law is an important but complex area of law and as a result has been the subject of much debate in many jurisdictions. The highly discretionary nature of Irish divorce legislation has made the development of a coherent and consistent body of case law particularly problematic in this jurisdiction. The constitutional and legislative requirement of “proper provision” represents the only judicial guidance but what is “proper” tends to vary on a case-by-case basis leading to an absence of predictability. A further complication, upon which this thesis focuses, is the absence of legislative guidance to the courts, in dealing with a spouse’s business or company assets on divorce. Whether the business assets of a spouse could or should be used to make proper provision for the dependent spouse is unclear, despite the constitutional importance attached to such provision. Central to the debate regarding company assets is whether the doctrine of separate legal personality applies in the divorce context. It is uncertain whether the family courts are acting sui generis and thus able to disregard this important doctrine or whether the judiciary in the family courts must also abide by this company law rule. In addition, the complicated nature of the valuation process for businesses and companies in the divorce context and the lack of legislative guidance in this regard, have led to unnecessarily costly divorce proceedings, and an inordinate amount of time spent by the judiciary in deliberating issues of valuation. This thesis examines the current caselaw governing these issues in Ireland and England. It also considers the treatment of business assets on divorce in British Columbia and concludes with recommendations for the introduction of legislative guidance in this area.