Given that Morrissey/Marr wrote all the songs, and thus were entitled to the publishing half of the overall royalty (typically 50/50 between mechanical and publishing), and that they also had more responsibilities in terms of admin type stuff, production, album art, media interviews, etc., the overall 40/40/10/10 deal (I assume your 25/25/10/10 was a typo, being 30 short of 100%) was actually eminently fair to Joyce and Rourke.
Unfortunately most reporting on the issue (including Moz’s autobio) doesn’t make quite clear whether Joyce was truly claiming 1/4 of all royalties (including publishing, which would be insane), or just 1/4 of mechanical royalty, plus touring/merchandise income (though Moz says the tours never really made money). If the mechanical had originally been split 1/4th each and Morrissey/Marr split the publishing, then the overall total of the whole pie for each would be 37.5/37.5/12.5/12.5 - so the original 40/40/10/10 was not far off (again, especially given the extra duties taken on by Morrissey/Marr - Media weren’t exactly clamoring for Joyce interviews and promo appearances, no?). At the absolute most, Joyce should have gotten only 2.5% more. In short, Joyce was a grasping, greedy turd, looking for a payday years later (and lucked upon a biased, incompetent, arrogant judge and generally corrupt legal system, which aided and abetted Joyce’s lies and constant changes to his story) when his original money ran out and he had no viable post-Smiths career.