The Finances of Splitting-up

The sorting out of financial matters during and after a divorce is referred to as ‘Financial Remedy‘ proceedings. It used to be called ‘Ancillary Relief’.

If you want an expert family law divorce lawyer to protect you during marriage breakdown – contact us or email us your questions.

This is separate from financial issues relating to children.

By being married, a person does not automatically acquire an interest in their spouse’s assets or vice versa.

The law in England and Wales sets out certain criteria which must be taken into account when formulating a financial settlement in divorce. How those criteria are applied varies according to the circumstances of each case.

The court role is to balance the criteria in assessing the claims of each spouse.

Most of the law in this area is governed by the Matrimonial Causes Act 1973 (MCA), which sets out the factors that the courts must take into account in deciding what is fair.

The courts will look at the following issues before deciding:

• the welfare of a child of the marriage;
• the income, earning capacity, property and resources of each party to the marriage;
• the financial needs, obligations and responsibilities of each person;
• the standard of living enjoyed by the family before the breakdown of the marriage;
• the age of each person and the duration of  the marriage;
• any physical or mental disability;
• the contribution made by each person to the welfare of the family, including looking after the home and bringing up children;
• the conduct of each person, but usually only if it is so bad it would be unfair to ignore it; and
• any serious disadvantage to either person which would be caused by ending the marriage.

In cases where the family’s resources and assets do not satisfy both spouses needs, then the needs of the economically weaker spouse (often the parent with whom the children are going to live) is usually given priority in terms of the allocation of resources.

This is what is called a ‘needs ‘approach. However, in the case of long marriages where there is a surplus of assets, the courts have recently moved away from the ‘needs‘ approach towards an equal division, sometimes even based on contributions made during the marriage.

If you want an expert family law divorce lawyer to protect you during marriage breakdown – contact us or email us your questions.

Any agreement regarding the splitting of assets following a divorce must be approved by the court. If it is not approved by a court, it is not valid. We will always ensure that you receive what you are rightfully entitled to.

This type of agreement is called a ‘Consent Order‘.

What can the court do

The courts powers to make financial orders upon divorce are considerable and include, but are not limited to:

• A Periodical Payments Order (often called maintenance payments or alimony)
• A Secured Provision Order (similar to maintenance but secured against an asset such as the former matrimonial home)
• A Lump Sum Order (essentially a large cash payment)
• A Transfer of Property Order (where a property is transferred from one or both parties to a single party on divorce)
• A Pension Attachment Order or a Pension Sharing Order

The court has the power to make a combination of these Orders where necessary.

What happens if my case does go to court

Either party can start the process at any time after the divorce petition has been filed by filing a notice of application seeking Financial Remedy.

You can do this at any stage before you re-marry, but the proper time to do this is during the divorce. When the court receives the notice, it will fix a First Directions Appointment (FDA) for 12 to 16 weeks after the issuing of an application.

Before the FDA, both parties must exchange their financial information, in the format of a sworn statement of means known as a ‘Form E‘.

At any stage either party can propose a settlement, but this has to be done cautiously and only after full financial disclosure has been made.

If an agreement can be reached at an early stage this will avoid the need for going to court and the agreement can be protected by an order of the court, to which both spouses agree, known as a ‘consent order‘.

If the matter does not settle at the FDA, it is then listed for a further hearing  known as a “Financial Dispute Resolution” hearing (FDR). Here, the Judge will actively try to help the couple reach an agreement. It is important to know that at this stage the Judge cannot force you to do anything you do not want to do.

If an agreement is not reached at the FDR then the case  is listed for a final hearing and the trial judge will hear the evidence and make a final decision on how the finances should be split.

Clean Break Orders

The majority of divorce settlements comprise three main elements from the above list comprising  periodical payments, capital orders (lump sum and/or transfer of property) and long term security  such as pension attachment or pension sharing orders. In some cases, all three elements are bound together in a one off settlement.

This is commonly referred to as a ‘clean break‘. Clean break settlements are normally only appropriate where there a short, childless marriage involving a young couple or where the couple’s resources exceed their needs.

Where there are children or where the parties age is higher it is often that clean break orders are not appropriate, because it will naturally be more difficult for the parties to move on with their lives.

It is possible to have a ‘clean break‘ agreement but maintenance still being payable for any dependent children.

We often handle cases where there are multiple properties, often owned in different countries or complex finances & cryptocurrency investments. When faced with these issues it is vital that your legal team are the best.

If you want an expert family law divorce lawyer to protect you during marriage breakdown – contact us or email us your questions.

If you believe your spouse is concealing assets, let us know right away. We are experts at analysing complex financial transactions and locating concealed assets, capital and investments.

For more details about Clean Break Orders read on..

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