Lottery winners occasionally appear in the news headlines with a photograph of the lucky winner usually posing with an oversized cheque, but it is not often lottery winnings are considered in the context of family law in Scotland. The recent case of J v J [2021] CSOH 67 came before Lady Wise in the Outer House of the Court of Session with one of the main issues being whether the assets and funds derived from lottery winnings were matrimonial property.
The parties were married in 2015 and had two children together. The husband worked in a shop that was owned by his parents, whilst the wife was employed as a nurse. During the marriage, in October 2015, the husband purchased a lottery ticket and won a large sum of money totalling over £11 million before the parties separated in October 2018.
In Scotland, matrimonial property is the assets and liabilities acquired by either one or both of the parties to the marriage between the date of the marriage and the date the parties separated. There are a number of exceptions to this general rule including any inheritance received by either party, or a gift received from a third party, during the course of the marriage. A key principle in determining what constitutes matrimonial property is whether the asset was derived from the income or efforts of the parties during their marriage.
In the current case of J v J, the husband purchased the lottery ticket using money taken from the till of the shop owned by his parents. The husband’s parents were also parties to the court action. They argued that the funds used to purchase the lottery ticket belonged to them, and consequently, the lottery winnings belonged to them, not their son. It was argued therefore that the husband was acting as an agent for his parents when purchasing the lottery ticket, and the funds were therefore not matrimonial property. On the other hand, the husband argued that the winnings were ‘family money’ belonging to both him and his parents as a family unit.
Whilst prima facie the lottery winnings may not seem to have been derived from the ‘income or efforts of the parties to the marriage’, a further exploration of the facts of the case is required. Although the husband worked in the shop owned by his mother and father, he did not receive a wage. Instead he would take money from the till for his various daily living expenses, which included his lunch and the purchase of lottery tickets. Lady Wise on delivering her judgement held that the money taken from the till was a benefit the husband obtained through his employment and that this benefit was in lieu of receiving a formal wage. There was no evidence of an agency arrangement, and there was sufficient evidence to demonstrate that the lottery winnings belonged to the husband, rather than as a family unit with his parents. Lady Wise held that the assets and funds derived from the lottery winnings were matrimonial property and therefore were to be taken into account when making orders in relation to financial provision.
An interesting aspect of this case is the evidence from a number of professional witnesses, including a relationship manager employed by HSBC. There was concern that the husband was disposing of his assets to avoid his wife’s claim for financial provision on divorce. Following correspondence from the wife’s solicitor, the husband began transferring assets into his mother’s name in order to divest himself of his assets in light of the parties’ separation. Despite an interim interdict being granted by the court to prevent money being transferred out of a number of accounts held by the husband and his parents, the husband’s mother attempted to breach the court order. In doing so she was in correspondence with the relationship manager at HSBC. Important evidence was led on their communications, but of particular relevance to the case was a comment made by the husband’s mother to the relationship manager at HSBC when she disclosed that the funds in her account belonged to her son, but they wanted to hide the money as he was going through a messy divorce.
If you are concerned that your partner may dispose of assets after separation in order to defeat any claim for financial provision you may have, you should contact a family law solicitor as soon as possible. There are steps that can be taken to protect your position.
If you and your spouse or civil partner are separating, our team of family law solicitors can assist you. Please contact a member of our team for further information.
This blog does not constitute legal advice and is intended for general guidance only.
