New ruling finds Lotto winnings could be shared in the event of divorce

Should your numbers come up and you find yourself hitting the Lotto jackpot – what would you do? A leading family law solicitor has warned married couples that should the impossible happen, a recent High Court decision may affect the distribution of any prize money should the relationship end in divorce.

In the case of S v AG, the wife had been part of a syndicate which won £1 million on the National Lottery and her individual winnings amounted to £500,000. The majority of her prize was used to purchase and renovate a property which became the matrimonial home.

Emma Collins, Partner in the Family Law team at Manchester law firm Weightmans LLP explains:

“The key issue for the Judge to consider was whether the nature of the wife’s winnings amounted to matrimonial property – if so that fact would be a factor in favour of a 50/50 division.

“Ultimately, the winnings were held to be a mix of the two. The wife had been playing the Lottery without her husband’s knowledge and had been buying the tickets from her own earned income which led the Judge to find that the initial winnings were non-matrimonial.”

Despite the fact that a vast majority of the winnings were used to purchase the home the couple shared, as this ‘matrimonial asset’ had stemmed from a non-matrimonial source, the husband was granted a share in the property which amounted to 15-20% of its overall value as opposed to half.

Emma adds:

“If the wife had retained the funds separately rather than buying property it is likely that the husband’s award would have been even less.

“For those wishing to protect assets on divorce, the key points to note in this case was that the assets were attained and kept during the marriage entirely separate from the matrimonial finances.

“The wife used her own £2 from her own income to purchase the ticket in a syndicate that her husband had no knowledge of and athough it may be considered extreme in the particular circumstances, it does indicate a move away from the principles of sharing and towards a greater degree of certainty.

“It may not always be possible, particularly in long marriages, for there to be a clear separation of finances to enable the court to distinguish between matrimonial and non- matrimonial property.

“Therefore couples should still give careful consideration to the possibility of entering into a pre or post nuptial settlement in order to seek to secure their assets on divorce, a process which has found increasing favour with the courts in recent years.”