Financial Entitlement On Divorce
Reaching a financial settlement following a marriage breakdown can be complex and stressful so it’s vital to consult the experts, advises family law specialist Adrienne Baker
Upon facing the realities of a marriage breakdown, Forbes’ family team find that clients’ main concerns are that of the matrimonial finances. Whether you are the party wanting to protect assets or the party in a more vulnerable financial position, you will want to know what a financial agreement will look like for you. What you will be entitled to will depend on the complexity of the case and it’s not always a straightforward answer. Below are answers to questions you may have considered if you are contemplating a divorce.
1. What is a financial settlement?
An agreement designed to fairly separate your finances upon the breakdown of the marriage. If an agreement can be reached within divorce proceedings, a Consent Order recording the agreement could be sent to the court for a judge’s approval. If the judge deems the agreement fair, the order becomes a legally binding document. The benefit of a Court Order means your ex would not be able to make any further financial claims against you in the future.
2. How to prepare for a financial settlement
You should attempt to get your finances in order at the earliest opportunity, have discussions about how any financial obligations will continue to be paid and start to collate your financial information. Parties are under a duty to provide each other with ‘full and frank disclosure’. Your legal representative will be able to provide you with an extensive list of what disclosure will be required based upon your individual circumstances.
3. What assets will be considered?
All assets that each party own whether individually, jointly with each other or another person will form part of the ‘matrimonial pot’. The assets will then be broken down into ‘matrimonial’ and ‘non-matrimonial’. Matrimonial assets are the financial assets built up during the course of the marriage ie the family home. Non-matrimonial assets are financial assets which were acquired before or after the marriage but whilst such assets can be treated differently to matrimonial assets this does not necessarily exclude them from any financial settlement.
4. What if we cannot reach agreement?
Parties who are finding it difficult to discuss or agree any settlement with their spouse may benefit from some legal assistance and/or attending mediation. Another alternative is to seek the court’s assistance. For most parties it is a requirement to at least attempt mediation before issuing court proceedings.
5. How do the courts decide what is a fair settlement?
Its is a common misconception that all matrimonial assets are to be split on a 50/50 basis. It is not a rule but it is generally used as a starting point. The court’s aim is to divide assets in a way that is fair. S.25 of the Matrimonial Causes Act 1973 provides the court with a list of factors to consider in every individual case. The welfare of any children will be considered first and foremost and then the following:
• Parties’ income and earning capacity.
• Parties’ needs (eg where are they going to live).
• Standard of living throughout the marriage.
• The age of the parties and duration of marriage.
• Any disability.
• Contributions.
• Conduct of each party.
No matter what the value is of the overall matrimonial assets, configuring how they should be divided can become complex and stressful for all involved. It is advisable to seek the guidance of a family law specialist.
To discuss this with a family law specialist, contact Adrienne Baker, Solicitor by email: adrienne.baker@forbessolicitors.co.uk or call 01254 580000
