Every couple, and every divorce, is unique. There are no set rules when it comes to diving assets. Instead, the Courts and the solicitors of each party will determine how assets should be divided based on a number of factors such as income and value of assets, standard of living, any dependency that one spouse has had on the other, any relevant behaviour of one or both spouses, and the financial needs and obligations of each spouse.
Our team of expert family law solicitors are experienced in striving to achieve the best result possible for every one of our clients. For bespoke legal advice and to find out how your assets may be split if you divorce, speak to our friendly team confidentially.
Divorce and Separation
Going through a relationship breakdown can be difficult enough without confusing legal jargon and worries about the process. Our free guide walks you through the divorce process, the first 3 steps you should take, and the different routes available to get the best outcome.
As a starting point, all assets accrued during a marriage – known as matrimonial assets – are split 50:50.
Both you and your ex may have claims against each other for all or any of the following forms of financial order:
- Spousal maintenance to ensure that a financially dependant spouse is able to maintain the same standard of living following Divorce
- Child maintenance to cover living costs of any children
- Capital (known as “lump sums”);
- Transfer of assets; this usually applies to your home or land, but can also include other assets such as shares or life policies;
- Pensions (which are dealt with by way of pension attachment or pension sharing orders);
In most cases, the financial and property issues are resolved by agreement. Sometimes, both spouses are able to reach an agreement between themselves. Alternatively, an agreement may be reached through mediation, collaborative law, or negotiations between your solicitors. It is usually necessary for financial information to be exchanged or requested before discussions or negotiations can take place.
Once and if an agreement is reached about the financial matters, this will be recorded in a draft Order which is submitted to the Court for approval.
A Court Order is necessary so that the agreement becomes final and legally binding. If necessary, it can be enforced by legal action at a later date.
You and your ex-spouse should provide full and frank financial information, known as ‘disclosure’ to your solicitors. Without this, any agreement or order may be invalid and hence either unenforceable or capable of being set aside.
The information which must be provided includes:
- Earnings, for example P60s, salary payment slips, business accounts
- Other income, such as dividends, interest, trust income, child benefit, tax credits, other state benefits
- The capital value of investments, including stocks, shares, unit trusts, investment trusts, endowments and other life policies
- Bank and building society accounts and cash sums
- PEPs and ISAs
- Valuable possessions
- Property and land
- Business assets
- Property outside the UK
When family lawyers and the Courts are considering the appropriate terms or orders to be made in relation to a particular case, they will be seeking to achieve a fair outcome by reference to the law as set out in the Matrimonial Causes Act 1973 and Court decisions based on that law. All the circumstances of the case must be taken into account.
The Act states that the Court must take into account the following matters:
- The income, earning capacity, property and other financial resources of each spouse, to include any such resources which may come into existence in the foreseeable future.
- The financial needs, obligations and responsibilities of each party.
- The standard of living enjoyed by the family before the breakdown of the marriage.
- The age of each party and the duration of the marriage.
- Any physical or mental disability of either party
- The contributions each party made or is likely to make to the welfare of the family in the foreseeable future, including any contributions by looking after the home or caring for the family.
- The conduct of each of the parties if it would be inequitable to disregard it.
- The value of any benefit which would be lost by the termination or annulment of the marriage, e.g., a pension.
None of the above matters has precedence over the other. It will be a matter for consideration in each case as to which factors should be given most weight. In the majority of cases, this may well come down to an assessment of the financial resources and needs of each party in both income and capital terms.
Each case is therefore considered on an individual basis. If the Court ultimately has to make a decision, it has a wide discretion.
If you and your ex cannot agree upon the terms of a financial and property settlement and/or one or both of you will not provide full financial details, it may be necessary to issue a formal application to the Court for a ‘financial remedy order.’ This will entail the filing of a special application (Form A) with the Court and payment of the Court fee.
Directions are given to timetable the applications through to a first hearing (the First Appointment) approximately twelve weeks after the applications are issued, with the filing of a full financial statement (Form E) by each spouse taking place five weeks in advance of that hearing and further documents being required by the Court two weeks prior to the hearing.
At the First Appointment, the Court will assess the issues and give the appropriate directions to progress the case. The appointment may be used for the purposes of settlement (“Financial Dispute Resolution”) if both you and your ex agree to this and all the necessary evidence and information is available to both of you and the Court. If not, then directions are given for the provision of any further evidence and information. The application is then adjourned to a further hearing when Financial Dispute Resolution will take place.
At the Financial Dispute Resolution appointment, the Judge will try to assist you both by expressing a view on any contentious points and suggesting possible terms of settlement. If you both then want to discuss and/or agree terms of settlement, final orders can be made. If this is not possible, further directions are given to progress the case to a final hearing on a later date.
A Final Hearing will usually last one or two days, when the Judge will have read all the relevant papers and will hear evidence from each party and/or their witnesses. Submissions will be made by any barristers or solicitors who are representing each party. The Judge will then make a decision as to the Court Orders which will be made. The right of appeal from such decisions is limited.
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