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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

The cost of divorce
Thursday 4th December 2014

Research carried out by Resolution , the national organisation of family lawyers , has emphasised the financial damage of divorce on  families as well as the consequent impact on businesses .

According to the Resolution survey British businesses are suffering as a result of separation and divorce with one in ten divorcing employees having to leave their job after a separation , whilst sixteen percent of those surveyed reported on the negative impact of sick leave arising as a result of the stresses of relationship breakdown. All this has an adverse impact on business productivity .

It is estimated that divorce costs the British economy up to £46 billion every year with the British Chamber of Commerce highlighting the cost to business. Can the costs be reduced ? If a couple enter into a relationship with a cohabitation agreement or a prenup agreement in place then in the event of a separation the split is likely to be less adversarial and costly so investing time at the outset of a relationship can pay dividends and give peace of mind

 


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How Do I Get Divorced... Properly?
Wednesday 1st October 2014

A news article in today’s press - http://www.theguardian.com/law/2014/sep/30/court-annuls-italian-divorces-maidenhead - has highlighted that it’s not quite as easy to get a divorce as many believe it is.

This news relates to 180 Italian couples who paid a facilitator to achieve a speedy divorce for them to circumvent the Italian legal system which requires couples to live separately and apart for 3 years before a divorce is possible.

As this is not the case in England and Wales the divorce petitions were lodged in England falsely claiming that at least one party from each couple had been living in the UK.

Divorce law in England and Wales is quite complex and most people who go through the process pronounce it to be more complicated than they first imagined.

There is only one ground for divorce which is the irretrievable breakdown of the marriage.  This is established by the petitioning party proving one of the following five facts:

  1. The other party’s adultery
  2. The other party’s unreasonable behaviour
  3. Two years separation plus consent
  4. Two years desertion
  5. Five years separation.

There are very specific rules in relation to the service of proceedings and many legal technicalities pertaining to defences and requirements.

Furthermore, and pertinent to this news report, there are strict rules that govern where you may get divorced.  You may only get divorced in England or Wales if:

  • when you begin divorce proceedings, both you and your partner are habitually resident in England or Wales
  • both you and your partner’s last habitual residence was England or Wales and one of you still lives there when divorce proceedings begin
  • at the time the divorce proceedings begin, the respondent to the divorce is habitually resident in Wales or England
  • for 12 months prior to the start of divorce proceedings, the petitioner applying for the divorce has been habitually resident in Wales or England
  • for six months prior to the start of divorce proceedings, the petitioner has been habitually resident in England or Wales, and is also domiciled there
  • you and your partner are domiciled in England or Wales when divorce proceedings begin, or
  • no other court of a “contracting state” to the European Convention known as Brussels IIA has jurisdiction, and either you or your partner is domiciled in England or Wales when divorce proceedings start.

The 180 Italian divorces were annulled on the basis of fraud as effectively they had misled the court as to this point of jurisdiction.  Using a commercial mailbox address in Maidenhead they claimed that each couple met the jurisdictional requirements and it was only when an eagle-eyed court clerk spotted that multiple couples were claiming to live at the same address!

Jurisdiction and the requirements of each of the five facts can be technically difficult legal concepts and it is always best to obtain legal advice if you are in doubt.


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The UK's biggest divorce settlement?
Thursday 3rd July 2014

This week the high court will host what could be the largest divorce settlement recorded in the UK.

There have been a number of multi-million-pound eye watering settlements awarded to former partners in recent years, such as Sir Paul McCartney’s £24.3m payment to Heather Mills.  However, hedge fund manager Christopher Hohn has the potential to set a new record for the UK’s largest divorce award as a result of his estimated personal wealth of $1.4bn (£817m).

The couple married nearly 30 years ago and have 4 children .They cannot reach agreement as to the value of their assets or how their wealth should be split between them.  Lawyers for the wife, Jamie Cooper-Hohn, argue that the family wealth should be split equally, but the husband’s legal team propose that the wife should get a quarter of the assets on the basis that the husband made a special contribution to their accumulated wealth.

When financial proceedings are contemplated the first step lawyers should take is to consider the cost benefit of litigation and whether the emotional and legal costs justify court proceedings.  In any dispute involving £204m the legal costs are likely to be justified but many financial planners would argue that in a case of such wealth does either the husband or the wife need more than a quarter of their wealth as they have ample resources, whatever their lifestyle choices?

When a marriage breaks down, the divorce court can divide assets, regardless of how or when the assets were acquired.  The court starts from the premise that the wealth, after a long marriage, should be divided equally although the court will take into account contributions to both the home and the family wealth.

This ‘big money’ case has generated debate about husbands and the ‘special’ skills that can result in stellar wealth and how ‘special’ the contribution should be to justify a departure from equality.  That debate will no doubt continue with entrepreneurs and their spouses.  The public nature of this divorce perhaps could have been limited through use of arbitration or the couple entering into pre or post nup agreements.  Brabners are increasingly being consulted by entrepreneurs and business owners about these issues when thinking about new enterprises, business ventures and shareholder agreements.  The recent Law Commission report emphasises the importance of couples being able to have autonomy over their affairs and being able to enter into binding arrangements in the UK; to reduce the likelihood of expensive litigation if couples split up and cannot decide on how their assets should be divided when emotions are running high.  Another eye watering settlement may encourage the government to implement the Law Commission recommendations.

 


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Right property, right agreement
Tuesday 17th June 2014

The news is all about property prices rising and the increased hoops house purchasers have to go through to secure their first mortgage, with detailed mortgage assessment questionnaires to get through in order to take the first step on the property ladder.  With mortgages getting even harder to obtain, many young couples are looking to parents to provide the deposit or at least to help fun it.  As family lawyers we are always surprised by the number of families who give money to help buy a house without first contemplating what might happen to the deposit if the couple split up and go their separate ways.  If there is nothing in writing, a partner living at the property can try to make a claim against the property and, more importantly say there is nothing in the paperwork to say that the deposit should not be split equally between them.  If house prices rise this could result in a real windfall payment whilst disadvantaging the owner whose family helped with the deposit.

These problems can be avoided by family members lending the deposit to their children and their partners or buying houses through trust arrangements or getting children and their partners to decide what would be a fair division of the equity if they were to split up in the future.  It is always sensible to think about these issues, however unromantic it might appear, before a house is purchased and the joint commitment of a mortgage is taken out.  There are a range of options to consider depending on the priorities of wealth protection or inheritance tax planning and estate succession.

 


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Parents encouraged to agree child maintenance by the introduction of service fees
Wednesday 21st May 2014

The Government has announced that if separated families can not agree on the level of child maintenance payments, the parents will have to pay to use the Government Child Maintenance Service (CMS).

Parents who use the CMS will be charged an upfront application fee of £20. If parents require the CMS to organise their maintenance payments then the paying parent will have to pay an additional 20 per cent on top of their child maintenance payment. The parent receiving the maintenance payment will receive 4 percent less than they would have done if they had not used the Child Maintenance Service and arranged payment on a voluntary basis using the formula provided by the Child Maintenance Service.

The Government maintains that the introduction of fees will lead to savings for the taxpayer and that voluntary agreements are a better option for families.

The Family Team at Brabners provide advice on child support and on applications for top up child support where the paying parent earns in excess of £156,000 gross per annum or on applications for school fee orders.

 


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Radical Changes to Family Law
Tuesday 22nd April 2014

The greatest change to Family Law for a generation is happening on 22 April. The government's aim is to put children at the heart of the system and it will create a single Family Court which will replace the separate County Court and Magistrates Court system.

How will the new system affect you?

Single Family Court

A national Family Court is being created which will be split in geographic areas. Anyone wishing to issue an application for a children order or for a financial order in divorce must issue in the Designated Family Centre (DFC) and the DFC will allocate the case to the appropriate level of judge and location. For example, someone living in Chester will issue in Liverpool as this is the local DFC.

Children cases

From 22 April there will no longer be residence or contact orders. Instead there will be child arrangement orders. These orders will state "with whom a child shall live" and "with whom a child shall spend time with".

There is no presumption for a shared care arrangement but there will be a presumption of continued parental involvement.

Compulsory Mediation

Separating couples will be encouraged to settle their disputes outside of court. This means from 22 April, anyone wishing to apply to court for a children order or financial order in divorce must first attend a mediation awareness session, where a professional mediator will explain the mediation process - either together or individually. The person wishing to start court proceedings will have to produce evidence that they have attended mediation before their application will be accepted by the court.
 


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Fair is not a four letter word
Friday 14th February 2014

We are delighted to see Brabners’ new advertising campaign launched with Lancashire Life today.

Please check out our ad in the March edition. This is just the start of our exciting campaign to promote the Family Team.

It is the first of a new series of ads which seeks to develop and promote our expertise in:


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Plans are passed to charge fees for new child maintenance scheme
Wednesday 12th February 2014

The Commons has approved plans to make drastic changes to the child maintenance system. The Child Support Agency (CSA) will be abolished and replaced by the Child Maintenance Service (CMS).  The Government propose to close existing CSA cases within 3 years and then charge fees for parents wishing to use the new scheme. There will be a £20 application fee and an additional 4% charge if the CMS has to step in and collect payments.  If parents don’t pay they will be charged an extra collection fee of 20% on top of their maintenance payments.

The Government hope these fees will encourage parents to make their own arrangements but the Family Team at Brabners are concerned it will discourage vulnerable parents from using the new system.

When this matter was discussed in the Lords several peers expressed concern, including Lord Kirkwood who said that he did not believe it was realistic that the new charges would result in parents collaborating to come to a child maintenance agreement, saying: "This whole policy is built on sand."


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Pre Nups to be made binding
Wednesday 5th February 2014

It was reported on Monday that the Law Commission are to recommend the law be changed to make Pre Nuptial agreements legally binding.

A ‘Pre Nup’ is a private contract which is drawn up before a couple marry and sets out what they want to happen to their assets in the event of divorce.

At present such agreements are not legally binding upon a divorce court although they may be taken into consideration by the judge. This change follows a growing number of high profile divorces  involving multimillion pound payouts where some wealthy men have complained that the English divorce courts favour  wives.

It was reported in The Times on Monday that the Law Commission will propose that if certain safe guards are met, such as the requirement for each person to obtain independent legal advice, Pre Nups should be upheld by the court.

Brabners Family team have been asked by a growing number of their clients to prepare Pre Nups and, in fact, 83% of family lawyers have reported that they have been asked to prepare at least one Pre Nup in the last 12 months.  A change in the law is welcome as it will end the uncertainty which currently exists.

It is vital that anyone wishing to draw up such an agreement obtains specialist legal advice.


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Banker Bonuses - but don't forget spousal maintenance
Wednesday 15th January 2014

The BBC is today reporting that politicians are expressing outrage at the level of banker bonuses and highlighting the new European Rules that state that if banks want to pay bonuses greater than 100% of employee’s salary the bank has to get approval of shareholders. In the case of semi-nationalised banks that requires agreement from the Treasury.

Not only may bankers face a limit on their bonuses they may also face a further reduction in bonus pay through former spouses claiming a share of any bonus as part of their spousal maintenance package.

In December 2013 the court of appeal considered the treatment of the bonus payments on an appeal by a Russian banker against spousal maintenance decisions. The court concluded that the husband should pay 25% of his net bonus to his ex-wife as well as fairly generous monthly spousal maintenance payments. The husband appealed, and although he was unsuccessful in trying to argue that all of his bonus should be ring fenced and free from spousal maintenance claims he was successful in getting a cap on the bonus element of the spousal maintenance so his ex- wife could only get a maximum of £20,000 from his average bonus of about £200,000 per year.

Interestingly the husband in the case of H and W probably would not have met the EU cap criteria on bonuses as he worked for a Russian bank but his bonus actually equated to 100% of his basic salary.

 


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