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Divorcing the In-Laws: Marital Disputes and Their Effect on Wider Family Finances

In most cases, a marriage represents the joining of two families, rather than simply the two individuals who take vows. It is perhaps unsurprising therefore that the emotional fallout of a divorce can similarly involve the wider family, however few expect to find themselves embroiled in ensuing legal proceedings.

Disputes over the availability of family wealth in trusts or businesses are common and those who employ such structures to organise their finances have usually received advice as to their vulnerability on divorce. However, the gifting or loaning of property and cash during a marriage can often take place on an informal basis with little consideration or legal advice as to the consequences upon divorce. Such fluid family finances provide fertile ground for disputes over ownership during a divorce.

The complexity (and as such the costs) of these disputes can quickly spiral as a result of the number of transactions and parties involved. The level of acrimony can also quickly mushroom as family members take umbrage at the idea of family-funded assets being used to meet the needs of an “undeserving ex-spouse”. As might be expected, for a statute grounded in the concept of comity, the Act expressly provides that in construing its terms regard must be had to its international origin and the need to promote uniformity in its application and the observance of good faith.


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Divorcing the In-Laws: Marital Disputes and Their Effect on Wider Family Finances


Christian R. Luthi
Director and Chairman

Bermuda   +1 441 298 7814

Ben Adamson

Bermuda   +1 441 298 7824

This article was first published in The Royal Gazette.


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