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A B C D E F G H I J K L M N O P R S T V W Y

Family

‘Former supermodel, Christina Estrada awarded UK’s biggest divorce settlement’
Friday 8th July 2016

There have been a number of multi-million pound divorce settlements to hit the headlines in recent years, such as Sir Paul McCartney’s £24.3million payment to Heather Mills, but this has set the record as the largest ‘needs’ based financial remedy settlement made by an English court. Former supermodel, Christina Estrada (aged 54) who married the billionaire Saudi oil baron, Walid Juffali (aged 61), in 2001 has just been awarded a £53million settlement in the High Court.

Ms Estrada filed for divorce in 2014 when she discovered that Mr Juffali had secretly married a 24 year old TV presenter. Ms Estrada, who has lived in the UK since 1988, obtained leave under Part III of the Matrimonial and Family Proceedings Act 1984 to apply for financial relief in England because she could not bring a case in Saudi Arabia.

Estrada, who rejected an offer of £37million, claimed that her personal financial ‘needs’ amounted to a figure in the region of £250million telling the Judge that this is the life she is accustomed to. It is reported that this figure included a £1.02million annual clothing and jewellery budget and £2.1million annual travel budget, that includes a private jet. Mrs Justice Roberts at the pre-trial hearing told the court that the couple, who have one child together, had enjoyed “an extraordinary standard of living” provided for by Mr Juffali.  

When a marriage breaks down, the court can divide assets, regardless of how or when the assets were acquired. The court has broad judicial discretion when determining how the ‘matrimonial pot’ should be divided but starts from the premise that, in the case of a long marriage, the ‘pot’ should be divided equally. However, the court’s role is to achieve fairness between the parties and the court has regard to a number of factors when dealing with financial claims upon divorce, and the ‘needs’ of an ex-spouse in one of them.

 


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Family Arbitration Ruling – Judge encourages the use of family arbitration
Tuesday 28th June 2016

A number of family court judges have recently reiterated the advantages of using arbitration to resolve the division of assets on divorce. An arbitrator makes a decision on who gets what assets, a bit like a judge, but in arbitration the husband and wife get more say in the arbitration process. Using an arbitrator can be speedier, more bespoke and confidential than using the traditional family court process

When enquiring about arbitration spouses are often concerned that if they use arbitration the arbitrator’s decision may not be binding.  That is an understandable concern because most families want certainty, they do not want to use a process where there is a risk that the decision could be challenged.

Whether a couple use arbitration or ask the court to decide how their assets are divided the arbitrator or judge’s decision can be appealed against.  A recent decision, called DB v DLJ, has confirmed that decisions made in arbitration can only be challenged in similar limited circumstances to a judge’s decision made within family financial court proceedings.

In DB v DLJ an arbitrator awarded the husband 55% of the family assets and the wife 45%, to reflect the fact that the husband’s business was well established at the time that the husband and wife commenced their relationship.  The wife was also awarded spousal maintenance. 

After the arbitrator’s decision the wife discovered that she had not secured planning on a property, thus reducing the property value and accordingly the amount of the award to her.  She therefore refused to agree to the arbitration award being converted into an agreed formal court order. 

The husband made a court application to show cause why the arbitration award should not be made into a financial court order.  The wife argued that there was a mistake in the arbitration award or, alternatively, the fall in value of her property invalidated the arbitration award. 

The judge, hearing the dispute, praised the arbitrator’s decision on how he had split the assets and encouraged the use of arbitration.  The judge decided that the unexpected refusal of planning on the property was not a mistake or a supervening event.  The judge thought that the wife could have discovered the position on the planning application, with due diligence, before the arbitration hearing. 

So the lesson is that it is almost as difficult to set aside an award made in arbitration as it is to try and set aside a financial court order made by a family court judge.  Couples should only commit to an arbitration hearing if they are satisfied that all their ‘’ducks are in order” and have satisfied themselves about the impact of planning decisions on property valuations and are satisfied with all the paper work prior to either an arbitration or court hearing.

For additional information about any aspect of family law please contact Leanne Instrall, solicitor, on 0161 836 8916 or by email at Leanne.instrall@brabners.com


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Brexit – implications for family law
Monday 27th June 2016

Brexit – implications for family law

Given the financial and political turmoil the last thing on most people’s list of concerns is how Brexit will affect family law proceedings.  Most people’s concerns are more immediate; how will Brexit affect employment, the property market, pension incomes and the value of financial investments?

In time, people will learn that EU law has affected almost every area of our personal lives, including family law on divorce, child care arrangements and finances on separation. EU law determines where divorce court proceedings can be commenced and enforcement options.

Just as there will be political and financial uncertainties in the days and months to come, the implications of Brexit on family law are uncertain at present. 

The intricacies of EU law on UK divorces will in all probably not be a priority for most divorcing couples but rather their focus will be on the impact of financial and property market uncertainty on values of assets during their ongoing divorce and financial proceedings.

Brexit is likely to influence valuations placed upon properties, businesses, and pensions.  The rule in financial court proceedings is that assets are valued at the time of the court hearing to determine how the money and assets should be divided.  Accordingly some divorcing couples may regret settlements reached shortly prior to Brexit, leaving one spouse with cash and the other with property. Divorcing couples will ask if such orders can be appealed against as ‘unfair’. The general answer will be no as Brexit was a foreseeable event, in much the same way as the 2007 property crash was.

Couples in the midst of financial court proceedings may now be scrambling round for further valuations, depending upon the nature of their assets.  However, it is trite to say that only time will really tell with how valuations of properties, investments and pensions will pan out. Accordingly, from a courts perspective, the safest and most equitable option may be to share assets across classes so that both husband and wife take the rough with the smooth, if there is a smooth to be found following Brexit.

What is clear is that there is a need for separating couples to take professional independent financial and legal advice to ensure that they share the risks and any rewards flowing from Brexit.

 


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Sports Star’s ex-wife calls for a change in the definition of “adultery”
Tuesday 14th June 2016

Sports Star’s ex-wife calls for a change in the definition of “adultery”

Family lawyers are often asked ‘’exactly what is “adultery?” This is because adultery, as a reason for divorce, alongside unreasonable behaviour, is one of the most widely used grounds for divorce in England. 

Adultery is defined as a spouse having had sexual intercourse with a member of the opposite sex. In order to get divorced, a spouse also has to say that that they cannot continue to live with their husband or wife.

To most people’s surprise, there is no time limit on adultery. Many think you can only commit adultery while living with your  spouse and that if you split up and then meet a new partner that is not ‘’adultery’’. That is not correct because as long as you are legally married, in law, any new sexual relationship with a member of the opposite sex is classed as adultery.

The ex-wife of a sports personality is campaigning for a change in the law so that adultery is defined as simply as a spouse having had sexual intercourse with another person.  This is because her ex came out as being gay .The only basis upon which she could get divorced from him was his “unreasonable behaviour”.  It is reported that neither one of them felt comfortable in 2016 with defining his coming out and forming new relationships as “unreasonable behaviour”. Neither did the wife want to wait for a divorce, as if the couple had waited for 2 years after their split up, they could have got divorced on the basis that they had been separated for over 2 years as they both agreed to the divorce.

The point, validly made by the ex-wife, is that if same sex couples can enter into civil partnerships and can, with the recent change in the law, get married and divorced why can they not commit adultery?

Many may think that it really does not matter why or how a couple get divorced.  In many ways that is right .That is why Resolution, the national organisation for family solicitors, is trying to take steps to get away from the culture of having to allege adultery or unreasonable behaviour in divorce proceedings in order to get a quick divorce. Resolution is campaigning for a change in the law for no fault divorce, without the need to wait for 2 years in limbo before being able to get divorced. 

Until the Resolution campaign is successful divorcing couples will have to continue to work their way around the minefield of the divorce process.

For advice on an aspect of divorce process please contact Leanne Instrall on 0161 836 8916 or by email at Leanne.instrall@brabners.com


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After the Supreme Court pressed the green light for ex-wife’s financial claims, renewable energy entrepreneur Dale Vince calls for a time limit on divorce pay-outs
Monday 13th June 2016

The highly publicised financial claim brought by Dale Vince’s ex-wife, Kathleen Wyatt, has been resolved by agreement with the green energy tycoon paying Ms Wyatt a reported £300,000. 

Kathleen Wyatt had been seeking a £1.9M pay-out from Dale Vince, the former New Age traveller, who is now reportedly worth over £100M. All of that £100M had been created after the couple separated and Mr Dale founded Ecotricity. 

Mr Dale met and married Kathleen Wyatt in 1981.  They became New Age travellers together and had a son in 1983.  They separated some years later and Ms Wyatt raised the couple’s son alone.  They divorced in 1992.  Neither one of them had any money at the time of their divorce and they did not get a financial order.  A clean break financial order would have prevented either one of them from being able to make any financial demands on the other.  Not bothering with a financial clean break order is not unusual in the situation where a couple are young with few assets, and don’t envisage becoming an entrepreneur.

Financial court proceedings were started by Ms Wyatt, in 2011, nearly 20 years after the divorce.  Both had moved on with their lives and were in new relationships and had further children. In contrast to Mr Dale’s business success, Ms Wyatt had held down low paid jobs and had on occasion had to rely on state benefits.

Ms Wyatt’s financial claim was rejected by the Court of Appeal who thought it was too late to apply. However in March 2015 the Supreme Court set aside the decision, ruling that there was no time limit in law for claims for financial provision on divorce.   This gave Mrs Wyatt the green light to go ahead with her financial proceedings and pursue the £1.9M pay out that she was seeking.

Last week it was reported that Mr Vince and Ms Wyatt agreed to settle her financial claim.  A family High Court judge, Mr Justice Cobb, approved an agreed financial court order awarding Ms Wyatt what was described as a “modest” award of £300,000. The media report that it is not known how much Ms Wyatt will actually receive after payment of some outstanding legal fees.  Some have speculated that she may receive very little. 

It is suspected that Mr Vince took the economic decision to agree to pay Ms Wyatt the £300,000 as he could have spent more than that amount, in legal fees, battling over whether or not Ms Wyatt should receive anything. As a result of their agreement the court will not hear detailed argument on when, if ever, financial claims of an ex should fall away, if there is no clean break order.

In the press, Dale Vince has called for a statute of limitations for divorce cases and is described as being very disappointed that the Supreme Court decided not to throw out Ms Wyatt’s application, brought over 30 years after their relationship ended.

Legal costs of these complex court proceedings could have been avoided if the couple had entered into a financial clean break order at the time of their divorce in 1992.  At that time neither of them had much by way of assets.  They both probably thought that neither would ever amount to much. Many spouses have taken the same risk or been oblivious to the thought of their ex-spouses claiming against future business ventures, inheritances or windfall payments received many years after the split.

The moral of the tale is perhaps that spending a little sometimes saves a lot.

At Brabners we advise husbands and wives to get a financial court order at the time of a divorce. None of us have a crystal ball and it is better to hope that there may be a successful budding entrepreneur or lottery winner than take the risk.

When solicitors advise families on estate planning , many people do not know if they have a financial court order and, if so, if it is a clean break order or not. It is imperative to check whether there is a financial clean break order as this can be a trigger to decide to get a financial clean break order or can affect estate planning decisions. 

Many former spouses assume that they have a clean break just because they got divorced.  That has never been the case and all the Supreme Court decision has done is to confirm that, unless there is a change in the law, there is no statute of limitations for divorce cases and that the financial court   process on divorce can be a lottery with the potential for different judges to come to a range of views on whether there should be a pay out and, if so, the amount.

 


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Money for children - not always just a question of child maintenance
Wednesday 18th May 2016

Most people have heard of the Child Support Agency (CSA), which has subsequently been replaced by the Child Maintenance Service (CMS). They are also aware that the parent with whom a child lives for the majority of the time can seek child maintenance from the other. They may however not be aware of the other potential claims that can arise on behalf of a child.

If the CMS are asked to calculate child maintenance they will make an assessment based on a percentage of the other parent’s gross income, with certain deductions being made if the child spends time overnight with that parent, or if they are financially supporting other children.

In certain circumstances a parent can also make further financial claims over and above the usual child maintenance claim.  Unfortunately this is an area that parents tend to be much less knowledgeable about.

If a child lives with a parent and they are under the age of 18, that parent (whether married or unmarried) may be able to make a court application on their behalf for additional money and financial provision. This is particularly useful where parents were unmarried and therefore do not have the ability to make financial claims on separation in the way they would if they were getting divorced.

The lack of knowledge about these applications can lead to parents failing to make an application when they may be able to get additional financial support for their child. It can also come as quite a shock to the other parent when applications are made against them and they had wrongly believed that the limit of their financial responsibility to their child was child maintenance payments.

So what additional money or financial support can a parent claim for their child?

This can include:-

  • Monthly payments to top up the child maintenance if the other parent earns more than £156,000 gross per annum
  • Monthly payments to assist the other parent in their role as the ‘carer’ for the child
  • Payment of school fees
  • Payments of lump sum of cash e.g. for the other parent to have a car
  • The provision of a home (either outright, or for the parent and child to live in until the child reaches 18)

When deciding whether to make an order the court will take into account all the circumstances of the case. This will include the income, earning capacity, property and financial resources that a parent has, as well as that parent’s financial needs, obligations and responsibilities. The court will also consider the child’s needs, as well as any disability they may have, among other factors.

For parents who have a high income and/or significant financial resources an application for further money and support is a real risk for them. They would therefore benefit from ensuring they understand the potential scope of their vulnerability to such a claim. In contrast a financially less well-off parent who has the main care of a child and a wealthy ex-partner may be well placed to consider an application to improve the financial circumstances in which their child is brought up.

 

 

 


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Unmarried couple’s dispute over property shows the need for ‘before the event’ documentation
Friday 6th May 2016

This week the media have reported on the case of Mr Powell and Ms Thomas, which has been dealt with by the Central Family Court. It illustrates the disputes that can arise when unmarried couples separate.

In 2012 Ms Thomas funded the purchase of a property in London which she held in her name. However, Mr Powell claimed that it had been agreed that he would undertake the renovation work needed on the property on the understanding that they would ultimately share in the property equally. He argued that he had borrowed £14,000 from his parents to purchase the materials and had carried out the work himself, thereby relying on their unwritten agreement. This was not accepted by Ms Thomas.

The Court in deciding the matter have awarded Mr Powell the equivalent of one third of the equity in the property and a sum to pay his legal costs. Mr Powell claims that he made an offer to settle the case outside of court for a sum which was lower than the amount now awarded, which was declined by Ms Thomas.

This case highlights the very real danger of failing to have an agreement about your property in writing when you are unmarried, and therefore not subject to the legal protections offered to married couples. In such situations the outcome can be uncertain as the court has to use its discretionary powers and consider the intentions of the parties, which can be unclear in the absence of written evidence.

The case also raises the issue of whether there could be less stressful and costly ways of dealing with such a dispute. In an ideal world the couple would have prepared a written agreement, such as a cohabitation agreement, in advance to confirm what would happen to their property in the event that they were to separate.

However, in the absence of this agreement and a very real dispute taking place what other options are available outside of a contested court battle?  In such disputes a couple may want to consider mediation, collaborative law or arbitration. These are all alternative methods of resolving disputes outside of the court process which can allow an amicable resolution with less in the way of legal costs and which avoids the stress of contested court proceedings.

For advice on any aspect of family law please contact Joanne Radcliff on 0161 836 8927 or by e-mail at joanne.radcliff@brabners.com.


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High Court exercises broad discretion over pre-marriage acquired shares
Thursday 5th May 2016

In financial proceedings on divorce, the first step is to establish what assets there are – or what is in the ‘matrimonial pot’.  A lot of people think that assets they had long before their relationship (such as inheritance, or a pre-owned property for example) should not be included as matrimonial property and therefore not be shared with their ex spouse. 

Whether something was owned before the marriage is of little relevance when all of the assets are required to meet needs (regardless of when or how they were obtained).  However, when there are ample assets to meet the needs of the parties, then the fact that something was acquired years before the marriage may be considered in relation to the overall division on divorce.  

In the recent case of Robertson v Robertson [2016] EWHC 613 (Fam), the court was asked to consider what proportion of the husband’s shareholding should be shared with the wife.  The husband owned the shares (in a company that would later to go on to be the hugely success online fashion retailer ASOS) for a few years before he and the wife met.  At the time of their separation the husband had sold part of the shareholding and invested it in property worth £20 million and retained shares worth £141 million.  The parties’ total assets were circa £219.5 million, so their needs and the needs of their two children would be met irrespective of the whether the shares were included.    

The husband argued that he had acquired all of the shares prior to the marriage and, as such, they should not be included as matrimonial property.  He said that the shares should be totally excluded, which would mean the wife received circa £30 million overall. 

The wife acknowledged that the husband had owned the shares before they met, but said that only the value of the shares at the time their relationship started (plus an amount which represented ‘passive-growth’) should be excluded – which the wife put at £4.84million.  The wife therefore wanted the total inclusion of the shares, save for the value she conceded should be carved out, which would mean she received circa £107 million overall. 

Rather than adopting a formulaic approach, Holman J exercised his broad judicial discretion and said that the only fair way to treat the remaining pre-existing shares (and the three investment properties) is to treat half as the personal non-matrimonial property of the husband, and half as the matrimonial property of the parties to be evenly shared. 

Holman J explained that he wanted to reflect the husband’s hard work before the marriage but, in fairness to the wife, thought that the pre-existing shares could not be excluded altogether.  This was because, although during the marriage, the husband had been the ‘money maker’ and the wife had been the ‘home maker’ – this was the way that the couple had chosen to run their lives, and it was only fair the wife received a share. 

For advice on any aspect of family law please contact Leanne Instrall on 0161 836 8916 or by e-mail at leanne.instrall@brabners.com.


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Teenagers and the Welfare Checklist
Friday 15th April 2016

Teenagers and the Welfare Checklist

The recent dispute between Madonna and Guy Richie over the parenting arrangements for their son, Rocco (15), has thrown a celebrity spotlight on to how parenting disputes are considered in the Family Court.  The dispute arose when Rocco decided he wanted to stay in London with his Dad, rather than going to stay with his Mum in New York. 

Figures released by Cafcass (Children and Family Court Advisory and Support Service) in March 2016 reported a 9% rise in new private law children cases, in comparison to the previous financial year (see Joanne Radcliff’s blog on Cafcass statistics). With an increasing amount of cases coming before the courts, to what extent are a child’s wishes considered or listened to by the court? They are, of course, the subject of the court application and, in Rocco’s case, can be known to ‘vote with their feet’. 

When a court is considering making a Child Arrangements Order, it must have regard to what is known as the Welfare Checklist, as set out at Section 1 of the Children Act 1989.  One of the factors to be taken into consideration is the ascertainable wishes and feelings of the child concerned, but this must be considered in light of their age and understanding. 

Of course this is not an exact science and deciding what weight to give to a child’s wishes and feelings very much depends on the individual circumstances.  Younger children generally do not have as comprehensible understanding of what is in their best interests as older children may have.  I’m sure that if parents did exactly as 4 year olds wanted there would be no bedtimes and they could end up living on a diet of only sweets and fizzy drinks – which most adults would agree may not be in their best interest long term!  However, the older a child is the more likely it is that the court would be prepared to listen to and consider their point view. 

At 15 years old I certainly would have wanted a say in decisions about where I was going to live and think that I would have had a fairly good understanding of the situation, so it is understandable that a court in England would consider Rocco’s wishes and feelings when making their decision.  However, in all situations wishes and feelings must be considered in conjunction with the other elements of the welfare checklist to decide what is in their best interests overall.  Whilst wishes and feelings may be a key consideration, there may also be other compelling factors which the court must consider; such as educational or emotional needs, the likely effect of any change in circumstances or any harm they are at risk of suffering. 

Another story, which went viral on the internet last week, was that of Hilde Kate Lysiak.  Whilst Hilde is not the subject of a custody battle, the story highlighted the differing attitudes adults have towards listening to children and the weight that should be given to their point of view generally.  Hilde is a 9 year old girl and describes herself as a ‘serious reporter’ who set up her own news outlet and who some may feel seems to know her own mind.  However, she faced criticism last week when she reported on a local murder in her home town of Selinsgrove, Pennsylvania.  Hilde says she ‘wants to be taken seriously’ as a reporter, but it became clear that adults generally are far from being in agreement about whether her decisions (which include visiting crime scenes) are in her best interests!

For advice on any aspect of family law please contact Leanne Instrall on 0161 836 8916 or by e-mail at leanne.instrall@brabners.com.


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Cohabitation agreements - why unmarried couples need to know about them
Tuesday 5th April 2016

There is a common misconception that unmarried couples automatically have certain rights after they have lived with each other for a period time, which are often referred to by the label of ‘common law husband and wife’. However, in England and Wales there are no specific laws financially protecting couples who live together.

Research undertaken back in 2008 suggested that 51% of people believed that the status of ‘common law husband and wife’ provided individuals with the same rights as married couples. It seems likely that the general public will not have become much better informed in the years since then. People are therefore unaware that unmarried couples are left reliant on the rules relating to financial claims for children, general property and contract laws only.

So what options are there available for couples who are not married but want to protect themselves financially?

A couple can choose to enter into a cohabitation agreement when living together. This will specify what should happen to the property and assets they own in the event that they separate. This can include what percentage share they should receive from any sale proceeds or what options there might be for one to ‘buy out’ the other.

This may be particularly beneficial where family money has been given to them to help them purchase property. If this issue is not addressed then one person in the couple can find themselves with no legal basis to be reimbursed for the sums provided by parents or other family members.

A cohabitation agreement can also address what would happen to personal possessions and household items purchased together if they were to separate. It can also define how a couple intend to regulate their finances e.g. divide bills or run joint accounts, and consequently can help prevent disputes about financial matters which can arise otherwise.

If you would like to know more about cohabitation agreements or about any other issue surrounding relationship breakdown please contact Joanne Radcliff on 0161 836 8927 or by email at joanne.radcliff@brabners.com


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