ontario
The law
I'm providing an answer from one jurisdiction, which should provide a sense of the sources of law and kind of analysis that might apply.
In Ontario, the net family property to be divided upon separation is any interest, present or future, vested or contingent, in real or personal property. Therefore it does not matter whether it is equity in a house, or money in a bank: £100,000 is £100,000. What does matter is that there could have been £237,500 to split up, and now there is only £200,000. That's the legal issue here. Should Bob's unilateral decision to reduce the family value by £37,500 affect the division of the value of the net family property?
In Ontario, the net value of family property, as it was on the "valuation date" (the earlier of the separation date or date of divorce), is equalized between the two spouses. The way this is worded in the Family Law Act is:
5 (1) When a divorce is granted or a marriage is declared a nullity, or when the spouses are separated and there is no reasonable prospect that they will resume cohabitation, the spouse whose net family property is the lesser of the two net family properties is entitled to one-half the difference between them.
That presumption of a 50–50 split can be overcome:
5 (6) The court may award a spouse an amount that is more or less than half the difference between the net family properties if the court is of the opinion that equalizing the net family properties would be unconscionable, having regard to:
...
(d) a spouse’s intentional or reckless depletion of his or her net family property;
...
(h) any other circumstance relating to the acquisition, disposition, preservation, maintenance or improvement of property.
So, the question will turn on whether the $37,500 that was paid is an "intentional or reckless depletion" or otherwise is a circumstance that the court considers would render a 50–50 split unconscionable.
The threshold for a finding of unconscionability of equal division is "exceptionally high." The circumstances must be "harsh and shocking to the conscience, repugnant to anyone's sense of justice, or shocking to the conscience of the court" (Serra v. Serra, 2009 ONCA 105, at paras. 47-48).
Examples
Pirhosseinlou v. Pirhosseinlou, 2012 ONSC 5249
A spouse lost a bunch of money making high-risk stock trades using credit card debt. The Court described the spouse as having made "bad investments, showed bad judgment, and caused a debt problem early in their marriage. I consider it a risky business venture that went very badly as profits declined and debt increased." The Court did not find an "intentional attempt to increase the debt load just before separation." The Court did not find that equal division would be unconscionable.
Dillon v. Dillon, 2010 ONSC 5848
A spouse built up debts "to feed [an] addiction to alcohol." The family was in a perilous economic situation at the time. The Court found that equal division would be unconscionable.
Naidoo v. Naidoo (2004), 2 R.F.L. (6th) 362 (ONSC)
A spouse built up $100,000 of gambling debt in the five years preceding the separation. The Court found that equal division in the circumstances would be unconscionable. But, mere speculative activity was not what made it unconscionable. It had to be considered in light of other factors: the amounts, the proportion of the family means that were put at risk, the parties' incomes, the resources each party brought into the marriage, and the conduct of the parties in condoning the activity.
Martin v. Martin, 2007 CanLII 3222 (ONSC)
A spouse built up significant debt throughout the marriage on "personal enjoyment" such as addictions, golf, and hockey. In this circumstance, equal division would have been unconscionable.
My own view
Spending 37500 of the net family value of 237500 in order to get a house in the neighborhood that the children (and presumably the entire family — more convenient exchanges, etc.) will benefit from post-divorce does not call out as unconscionable to me. Perhaps it was the perfect house in terms of location and value and other factors that may not have been around in a few months.
Of course, other facts could tip the scale. As you can see from the examples, all the circumstances are relevant, and to some extent, unconscionability is in the eye of the beholder.
If a Court were to find this unconscionable, it would simply order a small additional equalization payment to Alice up to half the "depleted" value.
