$28m divorce case heads to Supreme Court

Mark Clayton, shown left in a 2003 photo, is seeking leave for the Supreme Court to hear his $28 million divorce wrangle. Photo: Andres Warner.

A $28 million divorce wrangle that has big implications for trusts is heading for the Supreme Court.

Mark Clayton has significant sawmilling interests in the central North Island and his business and other assets are owned by a series of companies and trusts.

He considers none of the trust assets are relationship property and that his ex-wife is entitled only to their $850,000 matrimonial home and $30,000.

Melanie Clayton, however, believes she is entitled to half of the value of the business and trust assets.

Her valuer was of the view that if her approach was upheld, she could be due half of a property pool estimated at $28.83 million when the parties were in the Family Court.

The pair, who separated almost a decade ago after 17 years of marriage, have already been through the Family Court, High Court and Court of Appeal.

Now the case is going to the Supreme Court after applications for leave to appeal were granted today.

The decision now being challenged redrew "the landscape" on trusts and relationship property, according to one lawyer on the case.

Earlier this year the Queen's Counsel for Melanie Clayton, Lady Deborah Chambers, said that was because the Court of Appeal found powers of appointment for trusts are property.

LeeSalmonLong partner Isaac Hikaka also said at the time the decision was the first with such a clear statement that this is a particular power that is an item of relationship property and that it has a specific value.

"So it's likely to have widespread effect not just on relationship property law but also the way in which trusts are framed going forward," Hikaka said in March.

The questions that will be considered by the nation's highest court include whether powers under the trust deed in question are property and if so, did the Court of Appeal made an error in valuing that power.