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	Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Helkimo Or Kennett Or Robertson v Robertson [1999] ScotCS 292 (7 December 1999) URL: http://www.bailii.org/scot/cases/ScotCS/1999/292.html Cite as: [1999] ScotCS 292

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The parties to this action of divorce were married in Scotland on 11 April 1988. The pursuer comes originally from Finland but had lived in Scotland for some years prior to her marriage to the defender. She had previously been married and has a daughter - Victoria Ann Kennett, born 19 June 1984 - by that marriage. When the defender married the pursuer he accepted Victoria into family. The parties have three other children, namely Hamish Drysdale Robertson, born 10 September 1988, Lotta Ingrid Robertson, born 11 October 1991 and Ogilvie Arthur Robertson who was born on 10 March 1996. The marital cohabitation endured for almost ten years, the parties having separated on 12 March 1998 when the defender left the matrimonial home.

The defender does not oppose the granting of decree of divorce. Evidence in relation to the merits of the divorce was given by the pursuer and supporting evidence was provided, in affidavit form, by the pursuer's sister, Mrs Cobby. Within that evidence there is sufficient to enable me to hold that the marriage has broken down irretrievably.

The parties are now agreed on the arrangements respecting the children. Lotta and Ogilvie are to reside with their mother, the pursuer, whereas Hamish will stay with his father. Arrangements are in place whereby the three children are together each weekend, alternating between the homes of the pursuer and the defenders respectively. Victoria attends boarding school and will continue to do so. During school holidays she stays principally with her mother but she also has contact with the defender.

In light of the evidence given by the parties and by the defender's aunt, Mrs Innes, I consider that the arrangements for the care and upbringing of the children are satisfactory. In these circumstances I shall grant decree of divorce and make a residence order to the effect that Lotta and Ogilvie reside with the pursuer and Hamish with the defender. I shall make the order sought by the defender that he be given parental rights and responsibilities in respect of Victoria, there being no opposition to such an order. Neither party seeks any further order in relation to Victoria's residence or contact with her.

The remaining controversy between the parties concerns the financial provision to be made by the defender for the pursuer. Although agreement has been reached on the extent and value of the matrimonial property at the relevant date, the division of that property is in dispute, the principal issue being the contention on behalf of the defender that there exist special circumstances, particular special circumstances of the kind referred to in subsection (6)(b) of section 10 of the Family Law (Scotland) Act 1985 - "the Act" - which justify a sharing of the matrimonial property on a basis other than equality and the primary contention for the pursuer that the property be divided equally.

Leaving aside the furniture and furnishings in the former matrimonial home which the parties' have agreed to divide between them on an equitable basis, the total value of the matrimonial property has been agreed in the sum of £1,204,635. This agreement is contained in the Joint Minute, no. 19 of process.

The items forming the matrimonial property are inventoried in paragraph 1 of the Joint Minute as follows:

With the exception of the last item on that inventory, all of the matrimonial property is owned by the defender. It appears that the three horses forming that last item were sold by the pursuer after the separation.

It was not suggested in evidence that at the date of the marriage the pursuer had any significant capital assets. She had been employed as an assistant in a children's home in Perth and had previously done some work for a Swedish company. She was an accomplished horsewoman and was involved in show-jumping and consequently owned a horse or horses. By contrast, the defender was the owner of Lochead Farm in Fife which had been gifted to him by his father some time prior to the marriage. The defender was also in partnership with his mother in the firm of W.B. & A.D. Robertson. This was the family farming partnership. The partners at one time included the defender and both his parents but his father had retired some time prior to the date of the defender's marriage to the pursuer. In addition to carrying on farming at Lochead the partnership also farmed the holding known as Colton Farm near Dunfermline. In 1988, when the parties married, Colton House and Farm was owned by the defender's father. However, by a disposition dated 12 February 1992 Mr Robertson, Senior, donated Colton Farm to the defender (while retaining ownership of the mansion house and policies known as Colton House). In September 1993 the defender's mother died and in terms of her testamentary arrangements the defender succeeded to all of her interest in the partnership. The defender thereafter continued the farming business as a sole trader but used the name of the former family partnership as his trading style. Accordingly, by way of gift or inheritance the defender came to own both the farms of Lochead and Colton and the whole of the farming business.

In the course of 1989 the defender sold part of Lochead to Dunfermline District Council for use as a refuse coup. The consideration for the sale was some £30,000 in cash, which the defender banked initially and thereafter applied as additional capital in the farming business, and the conveyance (in part excambion) of an area of land adjacent to Colton Farm. In 1991 the defender was able to sell approximately forty acres of Lochead to a quarry company for use as a quarry. That sale attracted a price of £305,000. Colton Farm also turned out to have valuable minerals and the farm, together with the ground adjacent to it which had been obtained from the District Council, were sold in 1992 to an open cast coal mining company for a price of £751,000. The proceeds of this sale were also deposited in a bank account. The sale of Colton Farm was accompanied by an arrangement whereby the defender was given a tenancy of the farmhouse at Colton Farm and for some time after the sale the parties continued to live there.

The parties ceased to reside at Colton Farmhouse in about 1994 when the defender purchased at a price of £260,000 the house known as Duncrievie House , Crieff, which became the parties' matrimonial home and remained so until the time of the separation. The purchase of Duncrievie House was funded from the proceeds of the sales of farmland narrated above. Those sale proceeds also provided the source wherefrom the defender was able to purchase the farm of Balneathil, near Kinross, in 1995. Following the purchase of Duncrievie, a considerable amount of money was spent on alterations to, and refurbishment and redecoration of, Duncrievie House. No. 7/53 is a manuscript list prepared by the defender of the contractors' and tradesmen's bills incurred on those improvements. It was not disputed that the contractors' and tradesmen's charges were paid for by the defender, in large if not total measure from the funds realised by the sales of the farmland.

In addition to both the farms received by way of donation from his father and also his mother's interest in the partnership to which the defender succeeded by inheritance, the defender was the recipient of testamentary benefaction from other relatives. From the estate of Mrs Jessie Robertson (the defender's step-grandmother) he received in 1991 shares with the value at that time of £17,487 (no. 7/50 of process). The estate of his grandmother, Mrs Margaret Marshall, gave to the defender in 1991 shares then worth £5,219 (no. 7/52 of process). The defender gave evidence to the effect that his understanding was that, in accordance with advice given by his brother, a solicitor, those inherited shareholdings and others held by him prior to his marriage were rationalised in a personal equity plan - item (k) - to which additional annual payments had been made within the limits allowed under the personal equity plan legislation. Although the defender's brother did not give evidence and the precise details of the share transactions were not fully explored in evidence, I have no reason to reject the defender's understanding of that rationalisation and the subsequent additions to the PEP.

Among other matters canvassed in the defender's evidence were his bank accounts. The defender explained that the Bank of Scotland account which is item (g) on the inventory was the interest bearing account into which the proceeds of the sale of Colton and parts of Lochead had been placed. The account listed at (h) on the inventory contained funds transferred from account (g), which was used to feed the Bank of Scotland account listed as (i). That account was the current account which the defender operated for ordinary day-to-day requirements. Since the farm business had always banked with the Clydesdale Bank he had also a personal account with that bank (item (j)).

So far as the insurance policies were concerned, the NFU policies had been set up some considerable time ago and the premia were paid by drawing on the "feeder" bank account. The Equitable Life Policy derived from a sale of a Hambro Life Policy which he had held since his youth.

In considering the extent to which the net value of the matrimonial property may have derived from gift or inheritance it is also, in my view, relevant to consider the evidence in relation to the parties' earnings during the marriage. Because the pursuer was performing the function of caring for the children and the household she was not in a position to make any significant financial contribution by way of actual earnings. It appeared that for a very brief period she and a cousin endeavoured to carry on a business of retailing dried flowers, but it was evidently not particularly profitable. So far as the defender's earnings are concerned, the accounts of the farming enterprise are to be found in nos. 7/4 and 7/52-61 of process. Those accounts are agreed accurately to show the profits and losses of the farming business. The accounts for the accounting year ending 30 November 1989 are missing but the figures for the defender's share of the net profit/(loss) and salary (prior to the mother's death) for the other years of the marriage are as follows:-

For a limited period of time during the parties' cohabitation the defender had part-time employment with a firm of land agents and surveyors in Dunfermline, namely Macrae & Macrae. It appears that, anticipating the BSE crisis, the defender had sold-off most of the cattle on his farms and reduced the level of farming activity, he being, as he said, in the happy position of having substantial capital enabling him to ride out the BSE storm. In these circumstances he was able to take up employment with Macrae & Macrae. However, he did not find the office-based employment particularly congenial and he therefore reverted to farming on a full-time basis. At all events the total income received by the defender from his employment was modest - approximately £8,300 before tax.

In light of the evidence relating to the parties' earnings during the marriage and the largely undisputed evidence from the defender as to the sources and history of his patrimony, it is in my view plain that to a very large extent the net matrimonial property derives from the realisation of assets acquired by the defender by way of succession or gift and the interest accumulated on the deposited proceeds. It may be added that the defender retains ownership of Lochead Farm (under exception of the parts sold-off) but that does not constitute matrimonial property. I further add that neither counsel submitted that in addressing issues of the source of the agreed matrimonial property and its consequences for the fair sharing of that property any particular distinction should be drawn between the discrete items in the inventory contained in the Joint Minute. They accepted that a global approach should be adopted.

Section 9 of the Act enjoins the court, when deciding what order for financial provision should be made, to have regard to certain principles whereof principle (a) is that:-

Further provision in relation to the notion of "fair sharing" of the value of the matrimonial property is to be found in section 10 of the Act. Subsection (1) of section 10 provides:-

So far as concerns the term "special circumstances" employed in subsection (1) of section 10 further provision is made in subsection (6) of that section as follows:-

Counsel for the pursuer - Mrs Davie - submitted that, notwithstanding the largely undisputed evidence that the bulk of the matrimonial property derived from assets gifted to the defender inter vivos or by testamentary provision, equal sharing should prevail. Under reference to Little v Little 1990 S.L.T. 785 and more particularly Jacques v Jacques 1997 S.C. (H.L.) 20 she submitted that there was effectively a presumption in favour of an equal division of the matrimonial property and that to overcome that presumption it was necessary that there be not just a special circumstance of the kind referred to in section 10(6) of the Act, but that the special circumstance or circumstances justified a departure from the presumption in favour of equality. The circumstance that much of the matrimonial property derived from inherited or gifted assets was not, she said, sufficient to justify a departure from the principle of equality. Counsel went on to submit - as I understood it - that where the inherited or donated assets had been used as a source wherefrom income was derived to provide the family with its means of support, the source of the capital funds ceased to be of relevance. Only if the inherited funds had been enclosed in a specific asset such as a "nest egg for retirement" would they be removed from the norm of equal division.

Mr Macnair for the defender submitted inter alia that the source of the matrimonial property in the present case constituted a special circumstance under section 10(6)(b) which clearly justified departure from the notion of equal division of the net value of the matrimonial property. Counsel referred to the underlying intention of the Act which he said was to achieve equal division of the wealth acquired during the marriage as a result of the efforts of the parties during its currency. Counsel referred to Latter v Latter 1990 S.L.T. 805; Whittome v Whittome 1994 S.L.T. 115 and The Scottish Law Commission Report. Very little of the accumulated capital worth in the net matrimonial property in the present case had been produced by the efforts of the parties, as opposed to inheritance or gift. Alongside such reported cases as Davidson v Davidson 1994 S.L.T. 506; Adams v Adams 1997 S.L.T. 144 and McConnell v McConnell (No.2) 1997 Fam. L. R. 108 there was the unreported decision of the Lord Ordinary (Rodger) in MacLean v MacLean (28 March 1996), the facts of which were closer to the circumstances of the present case. A feature of MacLean was that by transacting with the inherited agricultural land, the owner (the wife pursuer) had been able to realise a special capital value in the land. The husband defender (the claimant spouse) had also worked on the farm, without remuneration, during the marriage. The Lord Ordinary departed from the presumption of equal sharing and had given the claimant defender but 25% of the matrimonial property. Although, as counsel for the pursuer in the present case had pointed out, in MacLean it had been conceded that the origin of the matrimonial property constituted a special circumstance, that concession had been properly made by counsel for the wife pursuer in that case.

In my opinion the fact that to a large extent indeed the net value of the matrimonial property in this case derives from assets donated to or inherited by the defender does constitute a special circumstance which justifies departing from the presumption of an equal division of those assets. I consider that counsel for the defender is correct in saying that the broad policy underlying section 9(1)(a) and section 10 of the Act was that in principle an equal division should apply to the fruits of the economic efforts of the parties during the marriage. In his opinion in Whittome, Lord Osborne stated (at 126C):-

That view is constant with the approach proponed by the Scottish Law Commission at paragraph 3.79 of its Report on Aliment and Financial Provision (Report No. 67):-

Mrs Davie's submission that the source of the funds ceased to be capable of being a special circumstance if the surrogate of the inherited or donated asset is used to provide income for the family is not supported or vouched by any of the authorities placed before me and in my opinion it runs counter to the evident intention or policy of the Act. In my view, when arriving at a fair division of the matrimonial property in this case, due weight must be given to the fact that to a very large extent it derives from inherited or gifted assets which, had they not been sold, would have been outwith the scope of matrimonial property.

In addition to considering whether there are special circumstances justifying a departure from the presumption of equal sharing, it is necessary of course to consider the other principles to which one is required by the Act to have regard.

Section 9(1)(b) provides that:-

For the purposes of applying that principle regard has to be had to the particular factors set out in section 11(2) of the Act.

It was said on behalf of the pursuer that the defender had received the economic advantage of having had the benefit of the pursuer's services as a housekeeper, nanny, hostess and assistant in the farm business, any salary paid to her from the farm being used in effect as her housekeeping money. The counterpart of that economic advantage conferred on the defender was that the pursuer had been economically disadvantaged by her being unable to pursue a career either by commercially applying her equestrian skills or by following a course in interior design which she had wished to do at one point in the marriage but to which it was alleged the defender had taken objection.

From the evidence led it was clear, and really not disputed, that the pursuer had done much as a housewife and a mother. Apart from the normal and demanding tasks required to be performed in the bringing up of the children, the pursuer had devoted energy into the decoration and improvement of Colton Farmhouse and later, particularly, in the organisation of the extensive refurbishment of Duncrievie. There was some dispute in the evidence as to the extent to which the pursuer might physically have worked on the construction of the foundations of a conservatory which was added to the house at Duncrievie but in my estimation that dispute is not of much materiality. My impression was that the pursuer was inclined to exaggerate the extent of her physical involvement. However that may be, I am satisfied that with her flair for interior design and decoration - readily conceded by the defender - and by her simply being present to supervise and deal with the tradesmen and contractors, the pursuer played an important practical rôle in facilitating the refurbishment of Duncrievie, albeit that the tradesmen's bills were of course settled by the defender from his funds. It also appeared that, as might be expected, the pursuer assisted to a degree in some farm matters if need arose. She attended occasionally to such tasks as fetching spare parts for machinery, or collecting the carcasses of sheep slaughtered for family consumption, or assisting in the feeding of the beasts at weekends. However, that activity was in large measure incidental to her rôle as wife and mother.

In relation to the pursuer's career prospects had she not been married, as I have already narrated, prior to the marriage she was employed in a children's home in Perth. It was not, I think, suggested that this was a particularly well-paid employment with prospects for advancement to even better remuneration. The pursuer gave evidence that during the course of the marriage she had wished to take up study on an interior design course but that, despite her sister's willingness to fund the course, the defender had refused to allow her to pursue this potential career opportunity. In his evidence the defender said that he was unaware of the sister's willingness to pay for the course; he did not refuse to pay for it or allow her to follow it up; and essentially the pursuer lost interest in the idea.

I do not regard this area of dispute as being of any great import in the ultimate decision which I have to take. However it is perhaps appropriate that I record my preference for the defender's version of events. My impression of the pursuer's evidence on this point was that, with hindsight, she was seeking to attach undue importance to the issue of the interior design course and the defender's supposed refusal to allow her to pursue it. I had the further impression that she believed that this might assist her financial claims in this action. However it appears to me to be on balance much more probable that in her busy life as a housewife, mother, organiser of tradesmen and the like, the pursuing of a course on interior design (which would have involved her being away from home) simply slipped down the daily agenda in terms of importance and eventually came to be dropped. At all events, as I have already mentioned, the defender readily acknowledged the pursuer's talent in matters of interior design. If she had not been married to the defender pursuing a career in interior design would have been an option alternative or additional to the commercial development of her interest in equestrianism.

In relation to the pursuer's interest in equestrian activities she deponed that she did have plans, or hopes, to set up a livery but after the marriage she was too busy with the upbringing of the children and other matters such as the refurbishment of Duncrievie to pursue that activity on a commercial basis. Her hope was that, following divorce, she could acquire a suitable property in order to carry on business in training and coaching riders already engaged in competitive equestrian activity. Subject to her finding such a property, the pursuer appeared to have confidence that her equestrian talents and contacts would enable her to make a success of such a venture.

A further principle to which the court is directed to have regard is that enunciated in subsection (c) of section 9, namely:-

The various factors to which regard should be had in applying that principle are set forth in subsection 3 of section 11 but I do not think it necessary for me to rehearse them here.

At present the defender pays the school fees for Victoria (whose father, I was given to understand, also makes an alimentary payment to the pursuer) and the defender pays aliment to the pursuer for Lotta and Ogilvie. He expressed his willingness to continue these arrangements. The defender has of course financial responsibility for Hamish, who stays with him. It appeared to be accepted by counsel that should the defender not continue to honour his commitment to aliment the children in the pursuer's care - and I have no reason to believe that he will not keep his word - the Child Support Agency could then be brought into play and aliment secured in that fashion.

It thus appears that the economic burden of providing financially for the children will to a material extent remain with the defender but, that said, the pursuer will obviously require to address the capital need involved in acquiring a home suitable for the children in her care (and for Hamish on his weekend visits to his mother and siblings) and that acquisition will in turn entail continued revenue expenditure on heating, maintenance and the like.

Counsel for the defender, for his part, pointed out that the defender, who currently stays with his widowered father, might wish to acquire his own home suitable for all the children to be together at weekends and that to some extent similar considerations would apply as regards the defender. However, in his evidence the defender did not suggest that in the immediate or relatively near future he had under contemplation moving from Colton House.

Neither counsel suggested that the principle contained in subsection (e) of section 9(1) of the Act had any pertinence in the present case but counsel for the pursuer sought to invoke section 9(1)(d) in the event that the court were not to accede to her motion that the pursuer be awarded one-half of the net matrimonial property. She submitted that in order to continue to have a comfortable lifestyle the pursuer required that one-half share. On investing capital in a house with land and other facilities appropriate to enable the pursuer to develop her equestrian business she would only have the balance available to provide an income. (This assertion prima facie seemed to ignore the point that the equestrian business would in time provide an income but I assumed it to advert to a transitional stage.) For his part counsel for the defender resisted the suggestion that there be an award of periodical allowance. He pointed to the restriction on the award of periodical allowance effected by the Inner House in McConnell (No.2) and adverted to the terms of section 13 of the Act, particularly subsection (2) thereof.

As I have already stated, I am entirely satisfied that special circumstances exist justifying a departure from the presumption of equal sharing of the matrimonial property and that I require to give appropriate weight to the factor that the great bulk of the matrimonial property stems from assets which were inherited by or given to the defender.

As regards the other principles to which I must have regard I can, I think, summarise my views by saying that I consider that the pursuer has suffered some financial disadvantage by being unable to pursue an independent economic activity because of her natural commitment to the care of the children and the organisation of the family home, including in particular the design-input and de facto superintendance of the refurbishment of Duncrievie. While it is no doubt true, as counsel for the defender stated in the course of his submissions, that there was no evidence showing that an equestrian establishment such as the pursuer had in mind would have been readily profitable, I do not think it necessary that detailed accountancy evidence of such matters be presented in proceedings such as these. One in effect recognises the inability of the wife to follow up an independent economic activity because of her maternal and marital responsibilities. On the other hand, and among other matters, the pursuer's talent for interior design and her availability to superintend and deal with tradesmen in the refurbishment of Duncrievie constitutes to my mind a material advantage to the defender both in its direct consequences for the property at Duncrievie and his ability otherwise to pursue his farming activities.

In considering the pursuer's economic disadvantage I must also take into account the fact that had the marriage not occurred her ability to pursue an independent economic activity would be subject to any limitation stemming from her the requirement to provide suitable arrangements for the care of Victoria.

In relation to the future financial burden of caring for the children under the age of 16 I recognise the defender's willingness to continue to pay aliment for the children. However, I also perceive that the simple payment of aliment is not the whole story and that the provision by the pursuer of suitable accommodation for the children presents additional but not readily quantifiable costs and to that extent at least some of the burden of caring for the children must necessarily fall upon her.

As regards Mrs Davie's submission that, in the absence of an equal division of the matrimonial property a periodical allowance should be awarded I have to say that given the limited (if any) profits derived by the defender from his farms, it appears to me that any award of periodical allowance would require to be paid out of his capital. I therefore consider that the appropriate way to proceed is by assessing a suitable capital payment (cf. section 13(2)(b) of the Act).

I would also record that whereas counsel for the pursuer contended for an award to her client of 50% of the matrimonial property, Mr Macnair for the defender submitted - under particular reference to the Lord Ordinary's decision in MacLean - that 25% of that matrimonial property was "the top of the range" and that the appropriate figure should lie between £250,000 and £300,000.

While the Act provides guidance on the approach to be taken by the court in determining the amount of financial provision, it is important to appreciate that at the end of the day the matter is one for the exercise of a judicial discretion. As it was put by the Lord President Hope in Little v Little, in a passage approved in the House of Lords in Jacques, "... the matter is essentially one of discretion, aimed at achieving a fair and practicable result in accordance with common-sense".

While appreciating the force of Mr Macnair's submissions that the special circumstances of the origin of the matrimonial property require a departure from the presumptive norm of equal sharing, I take the view that his approach did not give sufficient weight to the pursuer's position as respects the other principles, especially principle (b) [economic advantages/disadvantages]. In the whole circumstances, exercising the essentially discretionary judgment which I have to apply and endeavouring to achieve a fair and practicable result, I have come to the view that a fair sharing of the matrimonial property will be achieved by my awarding to the pursuer a capital sum of £380,000.

Since it was indicated to me that an award of a capital sum of that amount might involve questions as to a deferment of the date of payment of a proportion thereof, pending sale of Duncrievie, I shall, as requested, put the case out By Order for discussion on the timetable for payment of that capital sum and the interest, of any, payable thereon.