Background
The parties, Mr. Anthony Culligan (husband) and Ms. Diane Rosemin-Culligan (wife), were married for approximately 40 years and had three adult children. Their significant marital wealth included investments in Bitcoin which led to the creation of SETL Limited. In January 2023, the husband converted his substantial shareholding in SETL into illiquid minority interests in Colendi Holdings Limited (Colendi) via a share swap. The wife contended that this was done without her consultation, rendering a substantial matrimonial asset illiquid and subject to increased risk.
In September 2025, the High Court (MacDonald J) made a financial remedy order aiming for an equal division of total assets by value (£13.7 million each). However, the division of liquid versus illiquid assets was highly unequal: the wife received £9.5 million in liquid assets and £4.1 million in illiquid assets, while the husband received £4.1 million in liquid assets and £9.6 million in illiquid assets (Colendi shares). The judge decided that the wife’s share of the Colendi shares’ value should be a contingent lump sum, and her overall share of illiquid assets should be “kept as small as possible,” attributing only 30% of the Colendi share value to her. This decision was based significantly on the husband’s failure to consult the wife before converting the SETL shares.
The Court’s Holding
The Court of Appeal (Lord Justice Moylan, Lord Justice Coulson, and Lord Justice Arnold) allowed the husband’s appeal, concluding that the High Court judge’s decision regarding the division of assets could not be sustained. Lord Justice Moylan found that the judge had erred by basing the unequal division of the Colendi shares predominantly on the husband’s lack of consultation with the wife prior to the SETL/Colendi transaction.
The appellate court highlighted the inconsistency in the High Court’s reasoning: the judge had previously rejected the wife’s conduct allegations against the husband, yet subsequently relied on the husband’s “unilateral actions” to justify an unequal allocation of risk. The Court of Appeal also questioned the High Court’s interpretation and application of “Wells sharing” principles, suggesting that the characterization of “Wells sharing” as a “last resort” was potentially a flawed approach in determining a fair division of both readily realizable and risk-laden assets.
Key Takeaways
- The Court of Appeal emphasized that reasons for an unequal division of assets, particularly illiquid and risk-laden ones, must be legally sound and consistent with prior findings.
- A party’s decision to convert a matrimonial asset into a less liquid form, without consulting the other, does not automatically justify an unequal allocation of risk if it does not meet the high threshold for “conduct.”
- The principles established in `Wells v Wells` for sharing both “copper-bottomed” and “illiquid and risk-laden” assets remain central to achieving fairness in financial remedy orders.
- Judicial discretion in applying “Wells sharing” should not be unduly constrained by a “last resort” interpretation, especially when assets are reliably valued but present liquidity or risk challenges.
Why It Matters
This decision is significant for family law practitioners and divorcing couples in the United Kingdom, particularly those with substantial illiquid and high-risk assets. It reinforces the importance of consistent judicial reasoning in financial remedy cases, ensuring that decisions about asset division are grounded in established legal principles rather than potentially contradictory findings or overly rigid interpretations of precedent. The case clarifies that while marital misconduct can influence asset division, a party’s unilateral financial decisions, if not rising to the level of legal “conduct,” should not automatically lead to an unequal distribution of risk.
Furthermore, the ruling provides crucial guidance on the application of “Wells sharing,” underscoring the need for a nuanced approach to dividing illiquid assets. It suggests that courts must carefully balance the desire for a clean break with the overarching principle of fairness, particularly when a significant portion of matrimonial wealth is tied up in non-marketable or speculative investments. This case will likely lead to closer scrutiny of how illiquid assets are valued and distributed, ensuring that both parties fairly share the inherent risks and potential rewards.