How are unusual assets valued for divorce?

How are crypto assets valued?

The Economist may have said that “there is no sensible way to reach any particular valuation” for cryptocurrencies in August 2018, but crypto assets have increasingly become relevant in financial remedy proceedings. As such, the courts are required to consider the valuations provided, as well as the extent to which they should rely upon them.  

Obtaining a reliable valuation of crypto assets is more difficult compared to valuing traditional assets though, as they generally trade in a highly volatile market and are subject to more extreme fluctuations in value.  

Like quoted shares, the value of crypto assets will be determined by reference to their share price. However, a valuation obtained a few weeks ago may be very different to one obtained today. For example, whilst Bitcoin hit an all-time of $73,000 in March 2024, it fell to $61,000 in June 2024. Therefore, the court may set a specified date for valuation or take an average over a chosen time period. Where the parties have significant crypto assets, it will be advisable that they instruct a forensic accountant with crypto expertise.  

How are antiques, jewellery and art valued?

Assets such as antiques, fine art, sculptures, jewellery, and watches may have significant financial value, and they also often carry sentimental or emotional significance.  Assets worth over £500 must be disclosed in a party’s Form E, so obtaining an accurate valuation of such objects is extremely important. 

Antiques and art 

Obtaining a reliable valuation of an antique or piece of art will generally require the assistance of an expert in antiques and/or art appraisal. There are various factors which they will have to consider, including an object’s authenticity, condition, and rarity, as well as the artist or maker of the piece, the demand for the item, and any historical or cultural significance attached to the item.  Fluctuations in the global art/antiques market, as well as wide economic shifts, will also affect the valuation. 

An expert may carry out a comparative sales analysis, which means comparing the sale price of similar items to determine a market value. The prices obtained at auctions, galleries, and private sales, will generally be considered. However, carrying out a comparative sales analysis may be trickier when dealing with rare and/or unique pieces. 

Jewellery and watches 

For parties who have high-value watches and/or jewellery collections, an expert valuation can be obtained from an appraiser registered with the Institute of Registered Valuers (IRV). The IRV is regulated by the National Association of Jewellers and is the leading authority of jewellery, watch, and silverware appraisals in the UK. 

Whilst it is possible to obtain cheaper online valuations, these are less reliable as the item itself is not properly inspected and the metals and/or gemstones are not tested or identified. The type of precious metal used, as well as the clarity, size, and colour of any diamonds or other gemstones will affect the value. 

how are horses valued?

Horses can be high-value assets, particularly if they have participated in professional racing or equestrian events, or if they are of a certain breed or from a prestigious pedigree. Other factors such as age, health, training, and competition record (if any) will also affect a horse’s value. 

Issues relating to horse ownership and the relevant expenses to maintain a horse are increasingly arising in HNW and UHNW divorces. For example, in Y v Z [2024] EWFC 4 the wife sought a sum of £602,400 to purchase new horses for the parties’ children, minus the proceeds of sale gained from the sale of the previous horses. 

To determine the value of a horse, a comparative market analysis looking at the sale price of similar horses, will be undertaken.  

How are pets valued?

Pets often form an integral part of a family unit, but they are considered personal property under the law.  This may come as a shock to many people – that the family court considers their beloved animal in the same way they would a car, or any other object.  

In this regard, English and Welsh law is perhaps lagging behind other jurisdictions. Whilst animals were recognised as sentient beings for the first time through the Animal Welfare (Sentience) Act 2022, and the new Pet Abduction Act 2024 further enshrines this principle, the UK has not gone as far as other jurisdictions. For example, France recognised animals as “living beings gifted with sentience” rather than personal property in 2014. Spain similarly followed suit in 2022.  

Whether the UK will take this next step remains to be seen. For now, whilst the emotional value of a pet typically far exceeds their financial value, only the latter will be considered. Similarly to horses, the breed, pedigree, health, age, and competition record will be relevant factors to consider. For a high-value pet, a comparative market analysis will likely be appropriate. 

how are farms valued?

Farms can constitute a significant portion of a couple’s assets. They are often inherited and passed down through generations, generating significant sentimental value as well as financial. Given the family ties attached to farms, they often also have complex ownership structures, with siblings or other family members having various competing interests. 

It is therefore crucial to obtain an accurate valuation, preferably from an expert who has particular experience in valuing farms. Similarly to other businesses, a farm may be valued on a net asset or income basis. Given that many farms are ‘asset rich’, owning land, machinery, buildings, and livestock, it may be more appropriate to value one on a net asset basis. The method chosen may have a substantial impact on the valuation, especially for farms which are asset rich but only have a modest stream of income.  

Given the complexities which may arise when valuing a farm, instructing a chartered surveyor as a single joint expert may be the best option. 

how are yachts valued?

In HNW and UHNW divorces, a yacht can become the centrepiece of a financial settlement. For example, the divorce between billionaire Farkhad Akhmedov and his ex-wife Tatiana featured a highly publicised dispute over Mr Akhemdov’s c.£330m superyacht.  

The size, condition, age, model and specifications of a yacht are all factors to be considered when determining its value. Yachts generally depreciate in value; however, certain types of yachts will depreciate faster or slower. 

A valuation can be obtained from a specialist yacht broker or appraiser, who will have the necessary expertise to determine a fair market value. 

How are car collections valued?

Car collections are often high-value assets which will have to be considered in financial remedy proceedings.  

Whilst cars typically depreciate in value, some classic cars may actually appreciate over time, given their increased rarity and demand for their unique attributes. 

As well as the more typical factors affecting market value, such as age, condition, mileage, and model, cars may be deemed high-value due to more niche considerations. For example, if a car was previously owned by a celebrity, featured in a film or music video, or otherwise has significant cultural or historical significance, its value will be boosted.  

To get an accurate valuation, it will be advisable to instruct an expert appraiser as a single joint expert. An appraiser will consider wider market trends, the sale price of similar cars, as well as the quality of modifications and restoration work.  

Vardags has years of expertise obtaining and defending valuations of unique assets. If you are considering or going through a divorce and require a valuation of an unusual asset, contact Vardags today for a free initial consultation with one of our expert divorce solicitors.  

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