World’s Most Expensive Divorce
A US court must rule on what may be the world’s most expensive divorce in history, as oil mogul Harold Hamm’s wife seeks a share of his US$17 billion (A$18.2 billion) company. Hamm v. Hamm is in its second week at trial inside a closed Oklahoma City courtroom. The legal sticking point is whether Mr […]
World’s Most Expensive Divorce
A US court must rule on what may be the world’s most expensive divorce in history, as oil mogul Harold Hamm’s wife seeks a share of his US$17 billion (A$18.2 billion) company.
Hamm v. Hamm is in its second week at trial inside a closed Oklahoma City courtroom.
The legal sticking point is whether Mr Hamm, chief executive of Continental Resources and one of the world’s 50 richest people, gained his fortune through luck or hard work.
If his work made him wealthy â€” a US divorce law concept known as “active appreciation” â€” then Mr Hamm’s company is a martial asset and subject to equitable division.
If his wealth is due to “passive” factors outside his control, such as market forces or the efforts of autonomous managers, then it remains Mr Hamm’s personal property.
Mr Hamm founded Continental Resources in 1967, two decades before he married Sue Ann, and his company’s value has quintupled in recent years, according to an economic analysis by his wife’s legal team.
The Hamms never signed a pre-nuptial agreement.
Ms Hamm, 58, would only need to get about a quarter of Mr. Hamm’s net worth to surpass the $4.8 billion judgment reportedly made in May against Russian “fertilizer king” Dmitry Rybolovlev.
The market is anticipating a massive loss for Mr Hamm. The same day his divorce went public last year, his company’s share price fell 3 percent after months of gains.
The case is expected to conclude within the next few months.
*A report from Nine News Financial. READ MORE ABOUT:Â worlds most expensive divorce
Comments on Hammâ€™s case
It does not matter in Australian Family Law whether the â€œwealth is due to single â€˜passiveâ€™ factorsâ€ outside the husbandâ€™s control such as market forces or the efforts of autonomous managers and therefore would not form part of the property pool for division and would, as in America, form part of the husbandâ€™s personal property pool.
In Australia the value of the business would be given its full weight and value at the time of the trial and would form part of the overall matrimonial property pool.
However, if the extraordinary increase in the value of the business was due to the husbandâ€™s extraordinary business skills because of the â€œingenuity and stewardship which the husband had brought to the business outside of the other contributions made to the business by each of the partiesâ€ then the husband may receive a greater interest in the division of the net matrimonial assets because of such skills.
Moral of the Story â€“ If you wish to protect your assets and define the division of the matrimonial assets on the breakdown of a relationship then set out such division in a binding Financial Agreement under the provisions of the Family Law Act.Â By this means the parties have full knowledge of their entitlements should a separation occur.Â Without a Financial Agreement the ordinary principles for the division of the assets would apply.