When getting divorced it is extremely important to also give some thought to the financial implications resulting from the same.
The parties will either need to reach an agreement as to how their assets will be divided or, in some cases, Court proceedings will need to be instigated for the Court to make a decision in relation to the same. In either event, any order (whether reached by agreement or imposed by the Court) will need to be approved by the Court. When considering and approving any order then the Court will have regard to Section 25 of the Matrimonial Causes Act 1973 which is essentially a checklist of factors.
Below are some commonly asked questions in relation to the division of assets and financial claims following a divorce:
Q: Can I get divorced without having come to an agreement with my ex-partner in relation to the division of our assets?
A: The simple answer is that you can, but this is not an advisable course of action. This is because if the financial position isn’t resolved at the time of divorce then both party’s claims against the other remain live. This is the case until there is a clean break Consent Order which has been approved and sealed by the Court. This would potentially cause issues for either party if they were to come into significant wealth years after a separation and their ex-partner can still bring claims against them despite the fact that they are no longer married.
Q: If I have been the main earner during the course of the marriage and my partner has stayed at home to look after the children will I be able to seek more than a 50% split of the assets to take into account my enhanced contribution?
A: When deciding how to split the assets the Court will have regard to Section 25 of the Matrimonial Causes Act 1973. This is essentially a checklist of factors. One of the factors is the contributions that each party have made to the family. However, the Court will consider the party’s contribution to raising the children as valuable as the main earner’s role within the family. The key point is that the Court needs to ensure that both parties needs, and the children’s needs are met and this is the priority when deciding how assets should be divided upon a divorce.
Q: What is the Court’s approach to spousal maintenance?
A: The Court will consider three categories of asset namely capital, pensions and income. There is a presumption of equality with regard to capital and pensions, but this presumption doesn’t apply to income. Claims for spousal maintenance arise as a result of need. Therefore, if one party’s income sufficiently meets their needs whereas the other party is struggling to get by on a month-by-month basis then it is highly probable that they will have a genuine claim for spousal maintenance as their needs dictate it.
The Court’s approach to spousal maintenance is evolving. In every case, the Court must consider a termination of spousal maintenance with a transition to independent as soon as is just and reasonable. A term should be considered unless the payee would be unable to adjust without undue hardship.
Following the leading case of Waggott -v- Waggott the Court’s appetite for a joint lives order (i.e. a spousal maintenance order in favour of one party for an indefinite period of time) has diminished. There has been a continued shift towards non-extendable terms for spousal maintenance, designed to encourage the receiving party to re-enter the workplace and become financially independent.
Q: Do I have to go to Court to resolve the finances following a divorce?
A: The simple answer is no. There are lots of cases whereby either the parties are able to negotiate directly between themselves and reach an agreement; the parties attend mediation and reach an agreement during the same or negotiations take place via solicitor correspondence. If an agreement is able to be reached, then it will be recorded within a Consent Order which will be submitted to Court for a Judge’s approval once the Decree Nisi has been pronounced.
It is only if the parties are unable to reach an agreement by way of negotiations and / or mediation that Court proceedings are required.
If you require further advice regarding the above, then please contact me or any other member of the Family Team.
