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Cite as: [2003] ScotCS 112

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OUTER HOUSE, COURT OF SESSION

F24/01

OPINION OF LORD BRODIE

in the cause

K W

Pursuer;

against

D W

Defender:

________________

Pursuer: McNair, Q.C.; Drummond Miller WS

Defender: Hayhow; Turcan Connell

12 February 2003

Introduction

The parties to this action of divorce were married at Beattock, Moffat, on 6 August 1994. There is one child of the marriage, C W, born on 24 September 1995 and therefore, as at the date of the proof in the action, seven years of age. The parties separated on 20 November 1999. Since then they have neither lived together nor had marital relations. The pursuer now lives in Edinburgh. The defender lives in Douglas, Isle of Man.

The pursuer seeks decree of divorce on the ground that the marriage has broken down irretrievably by reason of the parties' non-cohabitation for a period of two years and the defender's consent to decree of divorce being pronounced. Number 16 of process is a form of consent to decree of divorce. It is signed by the defender, as he acknowledged when giving evidence. The pursuer spoke to the fact that the parties have lived apart since 20 November 1999 and this was corroborated by the evidence of her mother, Mrs J B. I am accordingly satisfied by that evidence that the marriage has broken down irretrievably. I shall therefore grant decree of divorce.

C lives with the pursuer in what is a five-bedroom house in Edinburgh. He attends primary school. The pursuer described him as happy and well cared for. The defender said in evidence that he was very happy with the arrangements made for C's care. He maintains contact with C by telephone. He has had C with him for the weekend. I did not understand it to be suggested that there will be difficulty over future contact between C and the defender. The pursuer stated in evidence that she encourages C to see the defender. Counsel for neither party moved me to make an order in terms in of Section 11(1) of the Children (Scotland) Act 1995 and, having regard to the terms of Section 11(7)( a) of that Act, to which my attention was drawn by both counsel, I shall make no order in relation to residence or contact.

The contentious issues between the parties related to the pursuer's claim for aliment of C, stated as a claim for payment of £150 per week while C remains under the age of 18; and financial provision for the pursuer herself. There was no dispute in principle as to whether the defender should pay aliment for C but the parties were at issue in relation to the figure at which aliment should be assessed. In terms of her third conclusion the pursuer seeks a transfer of shares in a company, Bluegate Limited; and in terms of her fourth conclusion the pursuer seeks (1) a capital sum of £700,000, and (2) a periodical allowance of £500 per week payable until C reaches the age of 16 or such other period as to the Court shall seem proper.

It was explained to me that the need to make an order for the payment of aliment for C arose from the defender's residence in the Isle of Man in that in terms of Section 44 (1) of the Child Support Act 1991 the Secretary of State has jurisdiction to make a maintenance assessment under the Act in respect of a person only if that person is habitually resident in the United Kingdom. Provision for the aliment of C therefore fell to be determined in accordance with Sections 1 to 7 of the Family Law (Scotland) Act 1985.

I record that I heard the evidence of the pursuer; Mr Alan Barr, a solicitor with an expertise in taxation; the pursuer's mother, Mrs J.B.; and the defender.

The Parties' Cohabitation, Marriage and Present Circumstances

The parties cohabited for about a year before their marriage in August 1994. The pursuer had been married previously. The parties began living together at an address in Edinburgh, which had been purchased by the defender in the summer of 1993. In cross-examination the defender agreed that the house had been bought as a home for the pursuer. In answer to the question: "She was to live there from the time it was bought?" he said: "She would be living there from the time it was bought." The necessary funds were provided by the proceeds of sale of a property in which the defender had previously lived, a loan from his parents in the sum of £15,000 and a loan advanced by the Yorkshire Building Society. As appears from production 7/11, the amount required to redeem that building society loan in June 1996 was £47,393. It was initially the pursuer's evidence that she had expended some £6000, obtained as a settlement on the dissolution of her first marriage, on costs associated with 39 Craigmount View, although she was uncertain as to detail. She specifically mentioned contribution to the cost of the central heating system. The defender assessed this contribution to the cost of the central heating at £1000 but he accepted that she may have met other costs. I shall proceed upon the basis that the pursuer contributed something between £1000 and £6000 towards costs associated with the acquisition, improvement or furnishing of the house at 39 Craigmount View.

At the time when the parties began living together the pursuer was working as a nursery assistant. The defender was a director of and employed by a printing concern, William Nimmo & Company Limited ("the Company"). His job description was technical director. There had been a family connection with the Company. He had been employed by the Company, in a number of positions, since late 1973. He had been a member of the board of directors since 1977 or 1978. His brother was the managing director. The Company was in a poor state when the defender first became involved. Its fortunes improved in the late 1970's and in the 1980's consequent upon investment in plant and equipment. Its position continued to improve into the 1990's but in a less marked fashion. The defender was a shareholder in the Company. Production 7/14 shows a series of allotments or transfers of shares in favour of the defender. By 26 August 1988 the defender had acquired 3024 shares in the Company. This shareholding represented 23.24 per cent of the whole issued share capital of the Company.

In or about March or April 1996 the defender sold his shareholding consequent upon an acquisition of the Company by a third party. The acquisition was facilitated by 3I plc. As at that time the defender's brother held the majority shareholding and it was his brother who had taken the lead in looking for a potential buyer and in negotiating the sale. A sale had been under discussion from at least November 1995. Production 7/35 is a copy letter dated 28 November 1995 from Mr George MacRitchie of 3I plc, addressed to the accountant acting for the defender, setting out what I understood to be the whole consideration for the sale of the defender's shares in the Company and the giving up of his employment with the Company. It brings out a total of £966,620. That total is made up of six elements. They are described in the letter as follows:

1. £716,650 in cash for the whole of [the defender's] shareholding in [the Company]

2. £106,300 in cash by way of a depreciatory dividend.

3. £37,630 in cash by way of an additional dividend.

4. £66,540 in cash by way of a pension contribution.

5. £30,000 by way of cash being a tax free redundancy payment.

6. £9,500 by way of [the defender's] company car. Any tax to be paid by [the Company]

Reference is made in the letter to the possibility of the purchaser making a contribution to the defender's transaction costs. The defender's understanding, as explained by him in evidence, was that the making of a depreciatory dividend was in place of a higher value being attributed to the shares.

With a view to mitigating the tax liability consequential on the sale of the defender's shares in the Company, the parties moved to the Isle of Man. The plan was that they should live there for three years and then return to Edinburgh and buy a house. The defender sold the house at 39 Craigmount View. Production 7/11 indicates that the free proceeds of sale of 39 Craigmount View amounted to £68,003.98. Notwithstanding what appears in production 7/21, which would suggest that only £52,007.11 had been transferred to the branch of the Royal Bank of Scotland International Limited at Douglas, Isle of Man, I accepted the defender's evidence to the effect that there had been a mix up of some sort by the Bank and, accordingly, I find that the whole free proceeds of sale of the house at 39 Craigmount View were remitted to defender's account with the Royal Bank of Scotland International Limited. Having sold 39 Craigmount View, the defender purchased the house in Douglas, Isle of Man, in which he presently lives. The pursuer's parents also moved to the Isle of Man. The defender had intended to purchase a business in the Isle of Man but he has as yet been unsuccessful in doing so.

Following their move to the Isle of Man, the parties' relationship deteriorated. This occurred over a period of time. By July 1999 the parties were discussing separation. Whereas the defender wished to remain in the Isle of Man, the pursuer wished to return to Edinburgh. It was agreed that she would do so. A house in Edinburgh was purchased in September 1999. The pursuer has lived there with C since about that time. With a view to maintaining his Isle of Man residency, the defender arranged that title to the house in Edinburgh be taken in name of a company, incorporated in the Isle of Man, Bluegate Limited ("Bluegate"). Bluegate is controlled by the defender. He is one of two directors, the other being his accountant, Mr Peter Simpson. He and Mr Simpson, as his nominee, own all the issued shares in Bluegate. In order that it might purchase the house in Edinburgh the defender advanced Bluegate a loan in the sum of £199,827. That sum remains owed by Bluegate to the defender. The pursuer described the purpose of the purchase in Edinburgh as being to provide a family home in Edinburgh. I took that to be effectively accepted by the defender when he came to give his evidence. He was asked in cross-examination: "The house in Edinburgh was bought as a family home?" He answered: "It was bought as a home." The defender has, however, stayed in the house in Edinburgh on only one or two occasions. The house in Edinburgh has five bedrooms. Two of these are unfurnished. Otherwise the house is fully furnished.

The defender has supported the pursuer and C financially since the parties separated by allowing the pursuer to draw on a joint bank account. The pursuer, who is not in employment, is entirely dependent upon this support. As the pursuer put it in evidence "[the defender] puts in enough to cover the bills". No statements relating to the joint account were produced to the court. The pursuer compiled a list, headed "Schedule of Monthly Costs", production 6/3, in about April 2001 in the context of the then current negotiations between the parties' representatives over the aliment of the pursuer and C. It comprises monthly figures set against various items of expenditure. It brings out £1823 as the total for a month. However, at least by the date of the proof, a number of items in the list were not being incurred and, under cross-examination, the pursuer readily conceded that the figures were excessive for the purpose of assessing what was presently reasonably required for her and C's maintenance. She nevertheless disputed the proposition put in cross examination that she was managing on about £900 per month. Her estimate was about £1300 per month, of which she allocated about £360 to £400 to the support of C. When giving evidence the defender was prepared to accept this estimate by the pursuer. The pursuer receives Child Benefit for C at the rate of £62 per month.

The current value of the house in Douglas, Isle of Man is £276,000. The current value of the house in Edinburgh is £240,000.

The pursuer, at the date of the proof, was 38 years of age. She is in good health. As I have indicated above, she is not employed at present. She has not been employed since early in 1995 at which time she worked as a nursery assistant. She has no formal training in child care. She estimated that an untrained nursery assistant might currently be paid something of the order of £5 per hour. She has not as yet attempted to find work but would wish to do so, initially on a part-time basis, deferring full-time work until C is about 10. Her counsel described her as a personable person who would be attractive to an employer, it being borne in mind that she has not been in employment for some time and has no formal qualifications beyond an O level in typing, these being factors which will limit her earning potential. I would regard that as a fair assessment. Since the parties' separation the pursuer has entered into a relationship with another man, Mr C M. The pursuer regards it as too early to say how this relationship might develop but she did not rule out her eventually marrying Mr M.

C attends school from Monday to Thursday between 8.50am and 3.15pm and between 8.50am and 12.25pm on Friday. The pursuer's parents have returned to Edinburgh from the Isle of Man. They live in Corstorphine. They have early morning jobs. It would be possible for them to pick up C after school if this were to be necessary by reason of the pursuer working, although it was the pursuer's view that they should not have to do this. The Primary School organises what are described as an After School Club and a Holiday Club. I heard no detailed evidence about these facilities but I understand them to provide supervised activities for children such as C immediately after the end of the school day and during school holidays. I heard nothing which persuaded me that it would be inappropriate for C to attend the Clubs when the pursuer is at work. When asked whether she had considered moving from her present address, the pursuer explained that this would be disruptive for C who was happy in the house in Edinburgh, the location of which she described as "perfect". When asked in examination-in-chief whether he shared the view that C, together with the pursuer, should continue to live in Edinburgh, the defender responded by saying that while he had suggested that they might move to a smaller house, he was happy that they should remain there if the court formed the view that that would be in C's best interests. I therefore asked him, should I find it impossible to reach a properly informed view as to what was in C's best interests on the evidence, whether I would be correct to proceed upon what would be no more than an assumption: that it was in the best interests of children that they should move house as little as possible while growing up. The defender accepted that it would be reasonable for me to proceed on such an assumption. Thus, whatever the precise terms the court's order should take, I took it from the defender, and this was confirmed by the position adopted by his counsel in submission, that the defender accepted that the pursuer should be put in a position to secure the house in Edinburgh as accommodation for herself and C.

The defender, who at the date of proof was 46 years of age, does not enjoy good health. He described problems with his back and leg which he explained as being due to sciatica. He has "terrible" pain and consequential difficulty in walking and driving. He suffers from depression which is associated with worry over his physical health and the current divorce proceedings. He requires medication which includes painkillers, anti-inflammatories and anti-depressants. I found the defender to be a credible witness who gave his evidence with moderation. From observation in court he appeared to have difficulty with his mobility which did not seem to be exaggerated. His demeanour and manner when answering questions were consistent with a depressed mood. His account of his symptoms in evidence was consistent with what appears in the letter from his general practitioner, Dr Blackman, production 7/15, and in the letter from Dr O'Rourke, a general practitioner in Inverness, consulted by the defender on 23 and 31 October 2002, which is production 7/34. Neither of the general medical practitioners gave evidence, but I accepted the defender's account of his symptoms and therefore concluded that he is, at least at present, precluded from most forms of employment. He is accordingly entirely dependent, for his present income, on return from investments. It is true to say, as counsel for the pursuer submitted, that the defender is a person with some experience of business and, while his current health problems may have an adverse affect on his ability to work, it does not necessarily follow that he will be entirely unable to work in the future. However, I am unable to conclude, as the pursuer's counsel invited me to do, that the defender's earning potential is better than that of the pursuer. Rather, while I regard it as probable that the pursuer could obtain employment, at least at the relatively modest rate of remuneration mentioned by her in the context of what might be paid to a nursery assistant, should she wish to do so, I cannot conclude on the basis of the evidence that the defender will probably be able to obtain remunerated employment in the future.

The net value of the matrimonial property

I am invited to make orders for financial provision in favour of the pursuer. Any order which I make for financial provision must, in terms of Section 8(2) of the Family Law (Scotland) Act 1985 ("the Act"), be (a) justified by the principles set out in Section 9, and (b) reasonable having regard to the resources of the parties ("resources" meaning, in terms of Section 27 (1), present and future resources). The first principle set out in Section 9 is that the net value of the matrimonial property should be shared fairly between the parties to the marriage. Section 10(2) of the 1985 Act provides that:

"The net value of the matrimonial property shall be the value of the property at the relevant date after deduction of any debts incurred by the parties or either of them - (a) before the marriage so far as they relate to the matrimonial property and (b) during the marriage, which are outstanding at that date".

In terms of Section 10(3) "the relevant date" means the earlier of, subject to Section 10(7), the date when the parties ceased to cohabit, and the date of service of the summons in the action of divorce. Here the relevant date is 20 November 1999. My task has been made the easier by parties, through their counsel, entering into a Joint Minute of Admissions, Number 15 of Process, agreeing the extent and net value of specified items of matrimonial property at the relevant date. I am grateful to them for having done so. I have found it convenient to set out the information as to the value of the matrimonial property which appears in the Joint Minute in tabular form. I have employed the numbers and letters used in the Joint Minute of Admissions to identify the individual items of matrimonial property.

ASSET OR LIABILITY	DEFENDER	PURSUER
1. a. The former matrimonial home in Douglas, Isle of Man, in name of defender	£182,000
b. The whole paid up share capital of Bluegate Limited owned by the defender, the only asset of which was the house now occupied by the pursuer in Edinburgh, having a value at the relevant date of £190,000. The company had a net deficit of liabilities over assets of £9,443 as at the relevant date.	- £9,443
c. The defender's director's loan to Bluegate Limited	£199,827
d. Sums held in the Royal Bank of Scotland International Limited in the name of the defender.	£611,428
e. The defender's interest in the William Nimmo & Co Limited 1980 EBP pension scheme with Royal & Sun Alliance at transfer value.	£3984
f. The defender's interest in pension schemes with Scottish Provident referable to period of marriage at transfer value.	£113,272
g. An endowment policy in the name of the defender.	£4132
h. The pursuer's interest in pension schemes with Friends Provident referable to period of marriage at transfer value.		£3285
2. VISA debt	- £3881
TOTALS FOR EACH PARTY	£1,101,319	£3285
TOTAL VALUE OF MATRIMONIAL PROPERTY	£1,104,604

I should note that the Joint Minute of Admissions and therefore the above table, does not include values for the furnishings of the respective houses in which the parties live. The Joint Minute does not bear to be definitive as to what the matrimonial property includes and therefore does not exclude consideration of whether items (whether assets or liabilities) additional to what appears in the Joint Minute might properly be regarded as falling within matrimonial property. The pursuer conceded that the second-hand value of the furniture in the house in Edinburgh might be £3000. There was no evidence as to the value of the furniture in the house in Douglas, Isle of Man but there was evidence that it was furnished. The approach to valuing the furniture in the respective houses which was suggested by Mr Hayhow, on behalf of the defender, and accepted by Mr MacNair QC, counsel for the pursuer, was that the Court should proceed upon the basis that the furnishings in the house in Edinburgh were worth £3000 more than the furniture in the house at in Douglas, Isle of Man. Given the common position of counsel, I shall adopt this approach to the extent of bearing the fact in mind (the fact being that the house in Edinburgh is better furnished than the house in Isle of Man to the extent of some £3000 of value in furnishings) but, as both counsel accepted, this has to be viewed as a minor matter in the context of the agreed total value of the rest of the matrimonial property. Another element of what might be taken into account in valuing matrimonial property was the subject of submissions by counsel. I reserved an objection made on behalf of the pursuer to the leading of evidence on behalf of the defender that as at the relevant date he had a liability to pay income tax in the sum of £11,661.60, as appeared from production 7/19. He has since paid this debt but should this evidence be admissible it would serve to reduce the total value of matrimonial property at the relevant date. Mr MacNair objected timeously to the admissibility of this evidence on the ground of absence of record. He renewed the objection in the course of his submissions. He submitted that this was a case where the pursuer would suffer actual prejudice if the evidence was admitted. She and her advisers did not know how the income subject to tax had arisen. One could not, on the one hand, exclude the relevant income and yet, on the other, include the tax liability arising from it. This is what Mr Hayhow was attempting to do. In response, Mr Hayhow accepted that there was no record for this item being taken into account in determining the net value of the matrimonial property but he urged me nevertheless to admit the evidence and to take it into account. He submitted that it was not appropriate to view the pleadings in a divorce action with the same stringency as might be adopted in other proceedings. Now the information was before the court it would be inequitable and undermining of the purpose of Section 10 (1) of the Act to ignore it. I considered that while there was force in Mr Hayhow's submissions, a party in an action for divorce where there is a conclusion for financial provision is entitled to fair notice of what the other party contends constitutes the matrimonial property and what is its net value, insofar as these matters can reasonably be ascertained by the other party. Here there is no question but that the extent of his liability to pay income tax as at the relevant date was a fact within the knowledge of the defender and his professional advisers. It was not within the knowledge of the pursuer, and she and her advisers had no reason to make enquiry about debts which the defender had not disclosed. The extent of the liability, while relatively modest in the context of the total for matrimonial property, was not entirely insubstantial. No explanation was given for the omission of reference to this liability in the pleadings. I take it that it was simply overlooked, as might very easily happen for one reason or another, but no blame attaches to the pursuer or her advisers and I cannot be satisfied that there would necessarily be no prejudice to the pursuer by reason of admitting evidence of a debt where she has had no notice of that evidence in the pleadings. I therefore uphold Mr MacNair's objection with the result that I do not take this liability into account with a view to reducing the total of net value of the matrimonial property as is brought out in the Joint Minute.

Fair sharing of the net value of the matrimonial property

The Submissions of Counsel

Mr MacNair, on behalf of the pursuer, began by drawing attention to the terms of Sections 8 (1), 9, and 10 (1) of the Act. When looking at Section 9, which contains the principles to be applied in deciding what order for financial provision, if any, should be made, Mr MacNair explained that he primarily relied on the principles in paragraphs (a), (b) and (c) of Subsection (1) together with what he submitted, under reference to the speeches in Jacques v Jacques 1997 SC (HL) 20, Lord Jauncey at 22 and Lord Clyde at 24, was the presumption for equal sharing of the net value of the matrimonial property which is found in Section 10 (1). Section 10 (1) provided that the net value of the matrimonial property shall be taken as shared fairly between the parties to the marriage when it is shared equally or in such other circumstances as are justified by special circumstances. The special circumstance founded on by the defender in the present case as justifying departure from equal sharing was that provided by Section 10(6)(b): the source of the funds or assets used to acquire much of the matrimonial property. As indicated by his pleadings, it was the position of the defender that the funds to acquire the matrimonial property were not derived from the income or efforts of the parties during the marriage and that accordingly they should be excluded from the division of matrimonial assets on divorce. It was not conceded by Mr MacNair, on behalf of the pursuer, that the special circumstance provided by Section 10(6)(b) did in fact apply to the present case but he pointed out that even where special circumstances did apply it did not necessarily follow that there should be unequal sharing - Jacques v Jacques supra. Should, however, the court determine that special circumstances did justify a departure from equal sharing, it was open to it to deal with the matter globally (by which I understood counsel to be referring to a division of the whole of the matrimonial property in other than equal proportions) or discretely (by which I understood counsel to be referring to an allocation or division of particular items of matrimonial property according to whether a special circumstance applied to the particular items). The court should look to the equities of the case. In that regard Mr MacNair referred me to the decision in Little v Little 1990 SLT 785.

At the end of his submissions Mr MacNair provided me with four schedules, each of which gave an example of how the net matrimonial property might be divided. One of these examples was the case of equal sharing, which would have required a transfer of value from the defender to the pursuer of £549,017. As this example was put in front of me, I have taken it that Mr MacNair did not formally depart from seeking a simple 50:50 division of the net matrimonial property as disclosed in the Joint Minute, number 15 of process. However, as I understood the way in which he developed his submission as to the application or otherwise of Section 10 (6) (b), Mr MacNair, while disputing the proposition that the court should simply exclude items of matrimonial property from division, as contended for on behalf of the defender, accepted that this was not a case where fair sharing required equal sharing. During submissions he stated in terms that he was not suggesting that the division should be 50:50, rather, the court should take a broad view. He did not dispute that the source of funds was a factor which might result in a substantial departure from the principle of equal sharing. The difference between the parties, as he saw it, was the whether the whole of the sums held in the Royal Bank of Scotland International Limited and the whole of the defender's interest in Bluegate should be excluded. He accepted, under reference to what had been said by Lord Kingarth in S D or S v S, unreported, 15 October 2002, at paragraph [17], that to exclude items of matrimonial property would be competent, but in practice Mr MacNair said it was unusual for the court to follow such an approach. Mr MacNair drew my attention to what he described as a series of cases where consideration of the source of the funding of matrimonial property had led to unequal divisions of that property, the larger share going to the party who (or whose family) had originally provided the necessary funds (that larger share being between 66 and 75 per cent in the cases cited): Davidson v Davidson 1994 SLT 506; MacLean v MacLean, unreported, Lord Rodger of Earlsferry, 28 March 1996; and R v R 2000 Fam LR 43. He did not quarrel with what had been said by Lord Eassie in R v R supra at 47: "...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." The corollary of what Lord Eassie had said, as Mr MacNair accepted, was that where what is under consideration is matrimonial property which is not the fruits of the economic efforts of the parties during the marriage, the principle of equal division did not apply. Mr MacNair stressed, however, that the principle of equal division related to equal division of the economic efforts of both parties. By that I understood him to mean that the parties to the marriage were to be regarded as in partnership with a claim to an equal share of what the partnership produced. It was not a question of a party having to justify his or her claim by reference to his or her individual effort. It was irrelevant that one may have worked in a business while the other looked after the home. For example, if it were to be taken to be the case that the value of the defender's interest in the Company had increased during the marriage by virtue of his efforts, then the whole of that increase should be equally divided irrespective of whether or not the pursuer was to be taken as also having made a contribution to that increase. This was, of course, subject to the impact of the application of the principles in Section 9 (1), including that contained in Section 9 (1) (b), it being observed that the reference in that paragraph was to "contributions by the other" was not qualified by the contributions being made during the marriage. The position of a matrimonial home, as defined by section 22 of the Matrimonial Homes (Family Protection) Act 1981, was, to an extent, special. Mr MacNair pointed to Lord Macfadyen's opinion in Cunningham v Cunningham, unreported, 3 November 2000, where, at paragraph [25], it is observed that "Money used to purchase the matrimonial home is, in my view, devoted in a particular way to matrimonial purposes, and the source of funds so used is in my view less important than would be the case of other types of matrimonial property." Mr MacNair reminded me that in terms of the Act the family home is treated differently from other assets in that Section 10 (4) provides that property will be "matrimonial property" even if acquired before the marriage if it was acquired for use by the parties as a family home. He referred me in this connection to the decision of the Second Division in Mitchell v Mitchell 1995 SLT 426.

Mr MacNair then turned to the special circumstances which were subject to averment by the defender. At page 12C of the Closed Record there are averments about the house in Edinburgh, owned by Bluegate:

"The property is a detached five bedroom bungalow with private gardens to both front and rear. It was acquired by the company in about September 1999. The house is the family house of the child of the parties' marriage. The company borrowed £199,827 from the defender to allow the purchase of the property. The defender applied certain of the proceeds which he obtained on the sale of his shares in William Nimmo & Co Ltd to the provision of said loan. Reference in this regard is made to the averments at Item (3) below."

"Item (3) below" refers to the funds, amounting at the relevant date to £611,428, held in the name of the defender with the Royal Bank of Scotland International Limited. The averments at page 13C of the Closed Record relate to these funds. At page 13C the defender avers that:

"... the funds derive from the sale by the defender of shares in a family business, William Nimmo & Co Ltd which were in each case either gifted to him by his parents or purchased by him prior to the marriage. The sum held at the relevant date represents the whole proceeds of the sale of the defender's entire shareholding in William Nimmo & Co Ltd in March 1996, together with the net free proceeds of the sale of the defender's pre-marriage home at 39 Craigmount View, Edinburgh. Neither of the foregoing sources of funds is referable to the economic efforts of the parties during the marriage. The funds remain in the sole name of the defender. The interest which they generate provides the defender with his only source of income ... Standing the source of said funds they should be excluded from the division of matrimonial assets on divorce. Reference in this respect is made to Section 10(6 (b) of the Act."

It is therefore the defender's position on averment that special circumstances of the sort identified in Section 10(6)(b) of the Act apply both to the loan to Bluegate and the balance of funds held by the Royal Bank of Scotland International Limited.

In Mr MacNair's submission, the defender had not established his averment at page 13C. The onus was on him to do so, it being for the person founding on the existence of special circumstances to establish that they do exist and the extent to which they justify an unequal division of matrimonial property. Merely showing that the shares had been acquired prior to the marriage did not amount to demonstrating that, when sold, their sale price was a fund which was not derived from the efforts of the parties during the marriage. If one imagined a case where a business had been incorporated six months prior to a marriage and then fifteen years later the business was disposed of by a sale of the shares it could not be correct to say, in the absence of further information, that the proceeds of sale simply came from the shares and therefore were to be regarded as having a source which pre-dated the marriage. Mr MacNair commended the approach which had been taken by Lord Kingarth in S D or S v S supra, particularly at paragraph [33]. In the present case Mr MacNair accepted that the business of the Company had a value at the time of the parties' marriage but it could not be said that it necessarily had the same value at the date of the sale of the shares. The defender might have led evidence about that but he had not done so. Mr MacNair accepted that, on the evidence, part of the funds which at the relevant date were represented by the loan to Bluegate and the balance held by the Royal Bank of Scotland International Limited came from the sale of the defender's shares in the Company. Part came from the proceeds of sale of the house at 39 Craigmount View, Edinburgh. However, precisely how the funds which make up the matrimonial property were derived is not known from the evidence. Moreover, as far as the proceeds of sale of 39 Craigmount View were concerned, under reference to Section 10(4) of the Act and the decision in Mitchell v Mitchell supra, Mr MacNair founded on the defender's acceptance, at the beginning of his cross-examination, that the house had been bought in order that the pursuer might live there with him, as indicating that this house had been matrimonial property albeit that it had been acquired by the defender prior to the date of the parties' marriage. As far as the sale of the defender's shares in the Company was concerned, it is the defender's case that the whole of the proceeds of the sale purchase, and therefore the whole of the sum of £611,428 held by the Royal Bank of Scotland International Limited which derives from these sale proceeds, is subject to special circumstances in terms of Section 10(6)(b) of the Act. Mr MacNair submitted that the evidence did not support that. Part of the total paid at the time of the sale of the shares is described in production 7/35 as dividend, at least some of which can be taken to have been derived from profit earned by the Company during that period when the parties lived together after their marriage. Part of that total was described as a "redundancy payment of £30,000". In the absence of evidence to the contrary, it should be treated as a redundancy payment properly so called and therefore as being of the nature of compensation for loss of an office or employment and not consideration for the purchase of shares. Moreover, as explained in Lord Sutherland's opinion in Tyrell v Tyrell 1990 SCLR 244 at 246D, it should be treated as a sum which had accrued at the date of its payment, which was during the marriage, rather than over the whole of the period of the defender's employment with the Company. In relation to the remainder of the total sum paid there was a paucity of evidence as to how the consideration for the transfer of the shares was arrived at. This presented the defender with a difficulty in that he could not say that what he had received had not been derived from the efforts of the parties during the marriage. Mr McNair accepted that the defender had said that the improvement in the Company's fortunes in the 1970s and 1980s had been more significant than anything which had happened thereafter, but he submitted that for aught that the evidence disclosed something may have happened during the parties' cohabitation, attributable to the efforts of the defender, which gave rise to the offer being made. Mr MacNair referred to the statutory accounts for the Company for years ending 31 March 1994 and ending 31 March 1995, productions 6/5 and 6/6. Moreover, the parties went to the Isle of Man in order to avoid tax. That was an effort on their part which was relevant for the purposes of Section 10(6)(b). Had they not gone to the Isle of Man there would not be as much as £611,428 in the bank account. To that extent at least, the sum in the bank account at the relevant date was derived from the efforts of the parties during the marriage.

In addition to the principle of fair sharing as provided by equal sharing, in terms of Section 9(1)(a) and Section 10(1) of the Act, Mr McNair relied on the principles set out in Section 9 (1)(b) and (c). These paragraphs are in the following terms:

"(b) fair account should be taken of any economic advantage derived by either party from contributions by the other, and of any economic disadvantage suffered by either party in the interests of the other party or of the family;

(c) any economic burden of caring, after divorce, for a child of the marriage under the age of 16 years should be shared fairly between the parties; ..."

Mr McNair pointed to the fact that the pursuer had given up work and had remained out of employment for some seven years in order to look after the matrimonial home, the defender and C. Her present ability to obtain employment is severely restricted by reason of the need to continue looking after C and her having been out of work over that seven year period. Mr McNair referred me to the decisions in R v R supra and Cuniff v Cuniff 1999 SC 537. Mr McNair reminded me of the terms of Section 11(2) of the Act which provides that, for the purposes of section 9(1)(b), the court shall have regard to any balancing of economic advantage and disadvantage as between the parties and the extent to which any resulting imbalance has been or will be corrected by a sharing of the value of matrimonial property. This, he explained, was to avoid any double-counting of the same factor. Mr McNair also drew my attention to Section 11(3) which required the court to have regard, for the purposes of Section 9(1)(c), of various factors bearing upon the burden of child care. As Lord Eassie had correctly observed at page 49 and paragraph 7-43 of his Opinion in R v R supra, "the simple payment of aliment is not the whole story". A number of aspects of the burden of child care would fall upon the pursuer in the present case.

Mr McNair moved me to make an award of a capital sum together with an order for the transfer of property in respect of the shares in Bluegate, as a means of securing for her the ownership in Edinburgh (which, irrespective of the title being held by Bluegate, was a matrimonial home in terms of Section 27 of the Act as read with Section 22 of the Matrimonial Homes (Family Protection) (Scotland) Act 1981. It would not be in the best interests of C that he be required to move from a house with which he was familiar and consequently have to change school. In relation to capital sum Mr McNair urged me to select an appropriate figure within the range indicated in the four schedules with which he provided me (which I have referred to in paragraph [19] above). Whether or not I made an order for the transfer of shares, the capital sum should be assessed at a sufficiently high figure that the pursuer would be in a position to acquire the house in Edinburgh, it being borne in mind that while Bluegate had title to the house it was also indebted to the defender in the sum of £199,827 and, accordingly, were I to make an order for the transfer of shares, I should also make an award of capital sum at a figure which recognised that that debt would have to be repaid. Responding to a characterisation by Mr Hayhow of the effect of a transfer of the title of the house in Edinburgh which I have recorded in paragraph [28] below, Mr MacNair warned me, under reference to the decisions in Wallis v Wallis 1993 SC (HL) 49 and Dible v Dible 1997 SLT 787, against falling into the error of valuing an asset at other than its value at the relevant date.

Having confirmed the matters which were not in issue and having addressed me on the matters of furniture and tax liability which I have discussed in paragraph [17] above, Mr Hayhow, on behalf of the defender, turned to consider how, in his submission, Section 10(6)(b) applied to the evidence in the present case. He accepted that it was for the party who sought the court to depart from what he described as the "default option" provided by Section 9(1)(a) and Section 10(1), to demonstrate that the default option should not apply. However, he did not accept that this meant that there was an evidential onus on the defender in the present case such as had been put forward by Mr MacNair in submission. There was no hard and fast rule, independent of the timescale which was under consideration. The weight which Lord Kingarth may be taken to have attached to the absence of evidence as to the value of the defender's businesses at the time of the marriage in his Opinion in S D or S v S supra at paragraph [33], is to be understood under reference to the fact that the date of the marriage in that case was seventeen years before the date of the parties' separation. The case is different with a short marriage, as we have here. Mr Hayhow submitted that the evidence that the defender had become a director of the Company in 1976, that the parties had married in 1994 and that the shares in the Company had been sold in April 1996 was sufficient to constitute a factual matrix establishing that special circumstances existed. Agreeing with Mr MacNair, under reference to the speeches of Lord Jauncey and Lord Clyde in Jacques v Jacques supra, that, however, was but the first step in a two step process: unequal sharing must also be justified. What in practice that means is that the court must balance the equities in each particular case. The intention is not to confer a windfall benefit but, rather, to distribute the fruits of the parties' efforts during the marriage. That appears from the definition of "matrimonial property" in Section 10(4) of the Act. The whole force of that subsection is to credit parties with the value of their efforts, subject to the principles set out in Section 9(1) and the special circumstances illustrated in Section 10(6).

The approach urged on me by Mr Hayhow was to exclude items of matrimonial property from sharing by reference to special circumstances as identified in Section 10(6)(b), and thereafter to determine what order for financial provision should be made by reference to the principles set out in Section 9(1). In his submission, nothing in the corpus of case law, including the decisions in Davidson v Davidson supra and Maclean v Maclean supra which had been referred to by Mr MacNair, indicated that items of matrimonial property might not be wholly excluded from fair sharing. It is, as Lord Osborne had said in a passage in his opinion in Whittome v Whittome 1994 SLT 114, which is quoted with approval by Lord Eassie in R v R supra at paragraph 7-24, "the wealth acquired by the parties, ... or generated by their activity and efforts during the course of their life together [which] ...is to be shared equally". Mr Hayhow did not dispute the presumption that a domestic spouse contributed to the acquisition of wealth by the parties insofar as that wealth was acquired or earned during the marriage. That contribution might, for example, be made by providing child care. However, in the present case the marriage was in August 1994 and by November 1995 discussions for sale of the Company were advanced. C was not born until September 1995. Admittedly, in R v R supra Lord Eassie recognised the efforts of the wife during the marriage by allowing an apportionment of matrimonial property which had in large part been inherited by or given to the husband, but that was a case of a marriage of ten year's duration. Mr Hayhow submitted that, in the present case, the source of the funds or assets used to acquire the large part of the matrimonial property itemised in the Joint Minute was property owned by the defender before the marriage and that these funds or assets were not derived from the income or efforts of the pursuer. Accordingly, the relevant items fell to be excluded from the net value of matrimonial property which should be shared between the parties.

On an application of this approach, Mr Hayhow submitted that I should exclude the whole proceeds of the sale of the shares in the Company, insofar as accruing to the defender, from the net value of the matrimonial property to be shared with the pursuer. Mr Hayhow included within the proceeds of sale for the purpose of this submission the redundancy payment and the depreciatory dividend. He invited me to regard the sale of the shares as part of a single deal. The court should not be overly analytical in characterising what were properly a number of items in one package. From the references in the defender's evidence to their being all "part of the deal" and that "the payments were all lumped together", the court should conclude that what was made was simply a total payment in exchange for the defender giving up his interest in the business of the Company. Similarly, the loan to Bluegate should be excluded. This sum was derived from the proceeds of the sale of shares. I should not be persuaded that the house in Edinburgh was acquired as a matrimonial home, nor that the pursuer took any other sort of interest in it. In September 1999 the parties' relationship was in difficulties, the pursuer wished to be in Edinburgh, the defender wished to be in the Isle of Man. There had been discussions about separation. There was no question of the house in Edinburgh being a matrimonial home (the defender only stayed there once or twice) or other form of joint property. There was no implied gift to the pursuer. Lord Macfadyen's decision in Cunningham v Cunningham supra could be distinguished. What was in issue there arose from the way in which inherited funds had been applied. The property in question was, undisputedly, the matrimonial home. Here the house in Edinburgh is not a matrimonial home. It was not lived in by the defender. Its title is held by Bluegate. Mr Hayhow further urged me to exclude the proceeds of the sale of the house at 39 Craigmount View (all of which I should hold had been transferred to the defender's bank account with the Royal Bank of Scotland International Limited) from the net value of the matrimonial property. The house at 39 Craigmount View had not been matrimonial property. It had been purchased by the defender partly with his own money, partly with a loan from his parents, and partly with a building society loan. The only contribution which the pursuer spoke to her having made had been in respect of central heating. In relation to 39 Craigmount View, the pursuer relied on the definition of "matrimonial property" which is contained in Section 10(4) of the Act. Paragraph (b) of that subsection includes property which was acquired by them "before the marriage for use by them as a family home or as furniture or plenishings for such home". Mr Hayhow accepted that the evidence indicated that the parties had cohabited there and thereafter lived there together as spouses. He accepted that the defender had given the answers in cross-examination which I have recorded at paragraph [7] above but he submitted that there was no evidence to the effect that when purchased by the defender the house was acquired by him "as a family home". He referred to the decision in Mitchell v Mitchell supra. In any event it was the case that the source of the funds for the acquisition of the house at 39 Craigmount View was the defender. Thus, on Mr Hayhow's approach, items c. and d. in the Joint Minute fell to be excluded from sharing. On Mr Hayhow's arithmetic, which allowed for his contention that I should have regard to the tax liability of £11,661.60 which I have discussed discussed at paragraph [17] above, the balance available for sharing was £284,687.

Having thus excluded the items referred to above from the matrimonial property available for sharing, Mr Hayhow turned to consider the principles set out in Section 9(1) of the Act, as they applied to the exercise of sharing what remained. In his submission, the court should not find the pursuer to have suffered economic disadvantage in the interests of the defender or their family, as provided by Section 9(1) (b). She had chosen to give up work. She had not been deprived of a career. It might be thought that her experience as a mother would be relevant to the work of a nursery assistant. In consequence she may be the more attractive to a prospective employer. The onus is on the pursuer to show that she has been disadvantaged. She has not satisfied that onus. She has not applied for work. In any event regard should be had to Section 11(2)(b). The principle set out in Section 9(1)(c) was accepted as being applicable to the circumstance that it would be the pursuer who would be C's principal carer.

On an application of the principles in Section 9(1) to a sharing of the balance of the £284,687 identified by Mr Hayhow he submitted that an award of a capital sum of £156,577, being 55 per cent of the balance, would be generous and adequate recognition of her efforts and the burden of child care. However, making an award in that sum would be to ignore the acceptance by the defender, noted above in paragraph [15] above, of the desirability of allowing C to remain where he was living. Mr Hayhow accordingly proposed that, once I had made my decision as to how the matrimonial property should be shared, the case should be brought out by order with the object of giving the defender the opportunity to have the title to the house in Edinburgh transferred to the pursuer. This would be to give the pursuer an asset worth, at current values, £240,000 or 85 per cent of the balance of the matrimonial property as calculated by Mr Hayhow, a significant return, so he said, on a five year marriage. It would also confer a benefit when compared with a transfer of shares that there would be no charge to tax as there would be as and when Bluegate divested in favour of the pursuer or a third party purchaser. At the current value of the property that tax charge would, on the evidence of Mr Barr, amount to £12,000. The pursuer should therefore be required to pay the legal expenses associated with the transfer.

Decision

In making any order for financial provision in favour of the pursuer, which I propose to do, I must apply the principles set out in Section 9 of the 1985 Act, reading that section together with Sections 8 and 10, and having regard to the factors identified in Section 11. In carrying out this task I must keep in mind what was said by the Lord President (Hope) in Little v Little supra at 786L to 787C:

"The Act sets out in considerable and almost clinical detail the nature of the property with respect to which orders may be made, the principles which are to be applied and the factors which are to be taken into account. ...But despite all the detail much is still left to the discretion of the court. This is clear from an examination of s. 8 (2), which provides that the court shall make such order, if any as is justified by the principles set out in s. 9 and reasonable having regard to the resources of the parties. The concept of sharing the net value of the matrimonial property fairly, the flexibility which is given to the expression 'special circumstances' in s. 10(6) and the repeated references in s. 11 to all the circumstances of the case serve to emphasise that, despite the detail, the matter is essentially one of discretion, aimed at achieving a fair and practical result in accordance with common sense."

My starting point is the identification of what is the net value of the matrimonial property and the principle that it should be shared fairly. Here, for the reasons discussed in paragraph [17], I take as that net value the sum of £1,104,604 which is the total value of the items in the Joint Minute. The requirement of Section 9(1)(a) that, in making any order for financial provision the net value of the matrimonial property should be shared fairly, and the requirement of Section 10 (1) that the value is shared fairly when it is shared equally or in such other proportions as are justified by special circumstances, require me to consider whether the evidence establishes that there are special circumstances in the present case. The defender submits that special circumstances have been established and that they justify an unequal sharing, the greater part of the value being apportioned to the defender. He points to Section 10(6)(b). The relevant part of Section 10(6) is as follows:

"(6) In subsection (1) above 'special circumstances', without prejudice to the generality of the words, may include -

......(b) the source of the funds or assets used to acquire any of the matrimonial property where those funds or assets were not derived from the income or the efforts of the parties during the marriage;"

I have not been persuaded by Mr MacNair, for the pursuer, that the existence of special circumstances of the sort described in Section 10(6)(b) of the Act has not been established, but neither have I been persuaded by Mr Hayhow, for the defender, that the proper approach for me to follow is entirely to exclude the identified items of matrimonial property from the exercise of fair sharing which I am obliged by Section 9(1)(a) to carry out.

Notwithstanding the criticisms made by Mr MacNair, I am satisfied, on the basis of the evidence led, that, in very large part, the matrimonial property in this case was not derived from the income or the efforts of the parties during the marriage. I accept Mr MacNair's submission that when considering "income or efforts of the parties" in Section 10(6)(b), what is envisaged is the income or efforts of one or other of the parties, but I reject his submission that it was incumbent upon the defender in the present case positively to disprove that his efforts in any way whatsoever contributed to the consideration paid for his shares, in order for there to be special circumstances as described in Section 10(6)(b). Different circumstances might apply where a party is the sole proprietor of a business or effectively its sole proprietor. Here the defender was no more than one of more than one directors and one of a number of employees of the Company. The period under consideration, being from the date of the marriage to the date of the agreement of terms for the sale of the shares is relatively short. I do attribute some of the net value of the matrimonial property to the income or the efforts of the parties but I do not consider it to be necessary for me to more precise than that. The values of the interests in the pension schemes and the endowment policy which appear in the Joint Minute have, as I understand it, been agreed as specifically relating to the period of the parties' marriage, but, in addition, I take into account that one element within the total sum paid to the defender at the time of the sale of the Company's shares was described as redundancy payment and two elements were described as dividend, although I also take into account that at the time of the transfer of the defender's shares the parties had been married for less than two years. I take the elements described as dividend to be derived from profits earned by the Company at some time or another, but I do not assume that profit to have been earned entirely during the period subsequent to the date of the parties' marriage. I was not invited to consider the Company's accounts in detail and I have not done so. I take into account that the parties took steps to preserve the sum paid to the defender and the income arising from it from the incidence of tax, by moving their residence to the Isle of Man. I accept Mr MacNair's submission that this might be regarded as an effort of the parties, as that expression is used in Section 10(6)(b) of the Act.

Having taken the view that, in large part, the matrimonial property in this case was not derived from the income or the efforts of the parties during the marriage, there is no difficulty in identifying the source or sources of the funds or assets used to acquire the relevant matrimonial property (that is those items listed in the Joint Minute other than the interests in the pension schemes and the endowment policy): the proceeds of sale of the house at 39 Craigmount View and the sum paid to the defender on the transfer of his shares in the Company. The house at 39 Craigmount View had been purchased by the defender before the marriage (the pursuer making a small contribution by paying for the central heating and possibly meeting other costs). The shares had been acquired by him before the marriage. Thus, the net value of matrimonial property which I am required to share here is not, to borrow the language of Lord Osborne in Whittome v Whittome supra, the wealth acquired by the parties or generated by their activity and efforts during the course of their life together. Rather, it is the wealth of the defender. That is a circumstance which may justify sharing other than equally and, in my view, it does so here, in the context of what was a short marriage. There are, however, other matters to be taken into account. I respectfully agree with what Lord Macfadyen said in Cunningham v Cunningham supra, at paragraph [25]: "Money used to purchase the matrimonial home is, in my view, devoted in a particular way to matrimonial purposes, and the source of funds so used is in my view less important than would be the case of other types of matrimonial property." I rather took Mr Hayhow to accept that proposition, although his response to the citation of Cunningham v Cunningham was to attempt to distinguish it, in that he did not seek to argue that the value of the house in the Isle of Man should be excluded from sharing on the ground that it was purchased with funds derived from the sale of the defender's house at 39 Craigmount View or the sale of the defender's shares in the Company (as I take it to have been). Having regard to the passage of evidence referred to at paragraph [7] above and the terms of Section 10(4) of the Act, I find the house at 39 Craigmount View and the proceeds of its sale to have been items of matrimonial property. Having regard to the passage of evidence referred to at paragraph [11] above and the terms of Section 22 of the Matrimonial Homes (Family Protection) (Scotland) Act 1981, I find the house in Edinburgh to be a matrimonial home. The house in Edinburgh is not, strictly, the property of the defender. A company, Bluegate, is interposed. Thus, although it is a matrimonial home, the house in Edinburgh is not an item of matrimonial property. What is an item of matrimonial property is the debt owed by Bluegate to the defender. The debt was incurred in order to allow Bluegate to purchase a matrimonial home but, obviously, a debt is not a matrimonial home. Therefore, it may be said, the approach identified in Cunningham cannot apply. In fairness, that was not Mr Hayhow's argument. Rather, he took his stand on the whole circumstances as indicating that the house in Edinburgh was not a matrimonial home. I am not inclined to be too fastidious in my approach to the interests of the defender as creditor of and shareholder in Bluegate and the interest of Bluegate in the house in Edinburgh. My approach to them is to regard the house in Edinburgh as if it were not only a matrimonial home but also an item of matrimonial property, owned by the defender. I therefore approach the defender's interests as creditor of and shareholder in Bluegate as having a value, at the relevant date, which falls under the principle identified by Lord MacFadyen, just as is the case with the value of the house in the Isle of Man. Of course, that there are two matrimonial homes here, of broadly equivalent value, each occupied by one of the parties who finds it sufficient for his or her requirements, is, in itself, a factor pointing to a scheme of division which results in each party acquiring or retaining the house which she or he occupies, particularly where a consequence is to allow the child of the marriage to continue living in what has, for the last three years, been his home. That, in my opinion, would be an example of what Lord Hope described in Little v Little supra as a fair and practical result in accordance with common sense.

As invited by Mr MacNair, in addition to the principle set out in Section 9(1)(a), I have had regard to the principles in paragraphs (b) and (c) of the same subsection. I do not find the principle in Section 9(1)(b) to be applicable to the circumstances here. I do find the principle in Section 9(1)(c) to be applicable. The pursuer will have the economic burden of caring, after divorce, for the child of the marriage. This can only be partly alleviated by payment of aliment. On the other hand, I bear in mind that it is likely that the defender will have to rely upon capital as a source of future income.

Applying all relevant matters as well as I can, I would propose to make an order or orders which will have the result that the pursuer gets title to or control of the house in Edinburgh, with, of course, its furniture and furnishings, free of any consequential indebtedness and at no cost to her. If that is taken to give her a share of the matrimonial property valued at £190,000, I consider that sharing the whole of the matrimonial property fairly requires that the pursuer receive a further £100,000. Just what orders best achieve the outcome which I have indicated may be discussed at the by order hearing which parties agreed should held before any decree is granted.

Periodical Allowance and Aliment for Cameron

Mr McNair also moved me to make awards of periodical allowance (accepting as he did so that the effect of Section 13(2) was to create a presumption against an award of periodical allowance) and aliment for C. Mr McNair proposed a sum of £340 per month as aliment for C, being some £100 per week with allowance being made for receipt of Child Benefit at the rate of about £60 per month. I understood that figure to be advanced upon the basis that the pursuer could not be expected to contribute to the direct financial support of C herself, it being borne in mind, as Mr McNair had previously submitted that there was more to child care than simply providing money to pay the bills. As far as periodical allowance was concerned, Mr McNair reminded me of the evidence that the pursuer wished to take up part-time work when her responsibility for caring for C permitted her to do so. Her position, according to Mr McNair, was a reasonable one. Her parents should not be expected to provide such assistance as would be necessary for her to work full-time. There was, of course, no guarantee that work would be available or available immediately. It was accepted that the pursuer was personable and would be attractive to an employer, but she had no formal qualifications. While not unemployable, she could not command a vast sum by way of salary. Mr McNair submitted that I should award a sum of £900 per month (the £1300 spoken to by the pursuer as required for the support of herself and C, less £400, being the total of the aliment he sought for C and Child Benefit) for a period of a year, and then £500 per month for a further two years.

In relation to periodical allowance, Mr Hayhow submitted that there was a presumption that a capital payment was sufficient. The pursuer was capable of finding employment. Her child was in full-time education. The marriage had been a short one. The pursuer had been supported by the defender for three years since their separation. If the court was minded to make an award it should disregard the estimate of expenditure brought out in production 6/3. Something of the order of £800 might be considered but only for a period of six months. However, Mr Hayhow's primary position was that periodical allowance was not warranted.

Mr Hayhow accepted that an award of aliment should be made in respect of C. He proposed the sum of £260 per month which had been put forward by the defender. That, together with Child Benefit of £62 per month, would provide £320 per month. The pursuer also had an obligation to provide for C's support. She said in evidence that she proposed to look for work. The court should proceed on the basis that with an award of £260 per month all C's needs, insofar as they require to be met by the defender, have been met.

Having regard to all of the factors to which I must have regard in terms of Section 11(4) of the Act, I have come to the view that it would be in accordance with the principle described in Section 9(1)(d) (and in terms of Section 13(2)(b) that the proposed order for capital sum would, of itself, be insufficient and that no further order of capital sum would be appropriate) to make an order for periodical allowance at the rate of £900 per month for one year following upon decree of divorce. It is reasonable to conclude that the pursuer will need time to adjust, in that she has been for a very substantial time dependent upon defender. In fixing periodical allowance at £900 per month I have accepted the pursuer's evidence, which I did not understand the defender to attempt to controvert, that she required about £1300 per month for the support of herself and C, £400 of that being attributed to C. Again on the basis of that evidence and the fact that the pursuer will receive Child Benefit, I propose to fix aliment for C at the rate of £340 per month. I should make clear that by "month" in this context I mean a period of four weeks rather than a calendar month.

Further Procedure

As invited by counsel I shall make no orders consequential upon my decision before the case has been brought out by order and I have been addressed by parties upon the most expedient way in which that decision may be implemented. Again as invited to do, I have reserved all questions of expenses. I would take this opportunity to record my gratitude to counsel for both parties for the clarity and comprehensiveness of their submissions which I found to be of the greatest assistance in identifying and determining the issues before me.