In financial remedy proceedings, the court is famously reluctant to allow “conduct” to influence outcomes. The bar is deliberately set high. Most behaviour — even unpleasant, unfair or morally questionable conduct — is excluded from the financial equation.
But LP v MP [2025] EWFC 473 is one of those rare cases where conduct was so serious, so sustained and so financially consequential that it fundamentally altered the distribution of assets. The result? The wife’s financial award was reduced by 40%.
This judgment is an important reminder that while conduct arguments are rarely successful, when they succeed, the impact can be dramatic.
The Legal Test: Why Conduct Rarely Matters
Under section 25(2)(g) of the Matrimonial Causes Act 1973, the court may take account of conduct only if: “it would be inequitable to disregard it.”
This is an exceptionally high threshold. The authorities make clear that:
- Bad behaviour during the marriage is usually irrelevant
- Emotional wrongdoing rarely qualifies
- Financial misconduct must be gross, obvious and directly linked to financial outcomes
Most conduct arguments fail. But not this one.
The Allegations: Fraud and Coercive Control
The husband alleged that throughout the marriage and financial proceedings, the wife had engaged in:
- Fraudulent financial behaviour
- Systematic deception
- Coercive and controlling conduct
- Manipulation of financial structures
- Deliberate obstruction of disclosure
The court undertook a detailed forensic examination of:
- banking records
- company accounts
- financial transfers
- patterns of behaviour
- credibility across multiple hearings
The findings were stark. The wife had, over a prolonged period:
- hidden and manipulated assets
- misrepresented her financial position
- exerted coercive control to dominate financial decision-making
- and attempted to distort the litigation process itself
This was not incidental misconduct. It was a sustained financial strategy.
Why This Crossed the Conduct Threshold
The court found that the wife’s conduct:
- Directly affected the asset base, and
- Deliberately undermined the court’s ability to achieve fairness
This was not simply unpleasant behaviour — it corrupted the financial exercise itself. As the judge made clear, allowing the wife to benefit fully from sharing principles in these circumstances would: “offend the court’s sense of justice”. That is the precise point at which section 25(2)(g) is triggered.
The Outcome: A 40% Reduction in Award
Ordinarily, this was a case that would have produced an equal division of assets. Instead, the court imposed a 40% reduction in the wife’s entitlement. This is an enormous adjustment by family law standards. The court was explicit: this was not punitive, but corrective — designed to:
- strip out the financial advantage gained through fraud,
- neutralise the economic effects of coercive control, and
- restore fairness to the overall outcome.
Cusworth J’s Restatement of the Law on Conduct
In setting out the legal framework, Cusworth J drew together the leading modern authorities on conduct in financial remedy proceedings. He adopted the structured approach in OG v AG [2020] EWFC 52, where Mostyn J identified four distinct categories in which conduct may become relevant, and emphasised the need to avoid double-counting. He further relied on Tsvetkov v Khayrova [2023] EWFC 130, in which Peel J confirmed that conduct must be strictly proved, must cross a high statutory threshold, and must have a clear causative financial consequence. That approach was reinforced by the Court of Appeal in Goddard-Watts v Goddard-Watts [2023] EWCA Civ 115, confirming that conduct is not punitive and ordinarily requires measurable financial impact, with litigation misconduct normally addressed through costs. Finally, he noted Peel J’s clarification in N v J [2024] EWFC 184, which reaffirmed that even where misconduct is serious, it should only affect the substantive award where there is a demonstrable financial consequence.
Coercive Control: A Growing Theme in Financial Remedies
This judgment is particularly significant for its treatment of coercive and controlling behaviour in the financial context. Traditionally, coercive control has featured primarily in:
- domestic abuse cases
- child arrangements proceedings
LP v MP shows how coercive control can also be highly relevant to financial remedy proceedings, particularly where it:
- distorts financial decision-making
- suppresses the other spouse’s autonomy
- and drives unfair financial outcomes
This reflects a broader judicial recognition that financial dominance can be a powerful and abusive dynamic, deserving serious scrutiny.
Why This Case Matters
LP v MP is exceptional — but that is exactly why it matters. It confirms that:
- Conduct arguments remain alive — but only in extreme cases
The threshold is high, but not unreachable.
- Fraud and coercive control are now firmly within the court’s financial radar
This is not just about hidden bank accounts — it is about financial power and manipulation.
- Courts will impose heavy financial consequences where fairness demands it
A 40% adjustment is rare — and speaks volumes.
- Litigation conduct and marital conduct can overlap
Where behaviour corrupts the financial process itself, the court will intervene.
The Bigger Message
Family law is fundamentally a jurisdiction of fairness. While it avoids moral judgment, it cannot ignore deliberate financial wrongdoing. LP v MP sends a clear warning: those who manipulate, deceive or financially dominate their spouse risk losing the protection of the sharing principle altogether. In extreme cases, conduct does not merely influence the outcome — it reshapes it.
