Divorce settlements

The resolution of financial matters following separation can often be complex and contentious – but does not have to be.

Although preferable, sometimes it is not possible to agree to a divorce settlement with your former spouse. Once divorce proceedings are commenced, the Court would have the power to make an order as to how financial matters are to be resolved.

Where agreement can be reached between parties, either by themselves or with the aid of their solicitors, it is usually sensible to embody that agreement into an order which is approved by the Court. This then becomes a legally binding divorce settlement, and will take effect in the same way as an order made by a judge following a full hearing.

For anything further, one of our specialists would be delighted to meet you to talk through your options and answer any questions. Please contact us at any time.

How we can help you:

Our experts can advise on all financial matters through to divorce settlement (via the Collaborative or traditional routes as appropriate) or Court proceedings if necessary.

In the event that financial matters cannot be agreed, or for whatever reason you do not feel you are fully aware of your former spouse’s financial circumstances, you can apply to the Court for a financial order, even if it is not you who commenced divorce proceedings.

Court proceedings do not prevent ongoing negotiations and if an agreement can be reached, the Court proceedings can be halted. One advantage of Court proceedings is the knowledge that ultimately matters will be dealt with, and that the Court will set a timetable which both parties have to adhere to. Both parties will have to provide full and frank disclosure of their financial circumstances.

The Court's Powers

The Court can make a wide variety of orders, including a transfer of property, shares or other assets, the payment of cash sums and/or splitting of pensions. There is no set formula as to how the Court will deal with matters.

The Court takes various matters into account when deciding how to resolve financial issues. The Court will consider all the circumstances of the case, although will give first consideration to any minor children of the family. Under law, the Court is obliged to consider the following factors:

Income, earning capacity, property and financial resources the parties has now and in the future;

Financial needs, obligations and responsibilities either party has now and in the future;

The standard of living enjoyed by the family;

The ages of the parties and the length of the marriage;

Any physical or mental disability of either party;

The contributions each party has made to the family or is likely to make in the future;

In exceptional cases, the conduct of either party;

Any loss either party would suffer as a result of the divorce (usually pension provision); &

Any other relevant circumstances.

The Court wishes to achieve fairness and the starting point would be an equal division of the assets which may be altered once the above factors are taken into account. In most cases, the decisive factor is the reasonable needs of each party which can override an equal division of the assets.

The Court must give particular consideration to whether it is possible to achieve a ‘clean break’ settlement, which is a final divorce settlement involving no ongoing payments (except child maintenance) to one spouse.

The Court currently does not usually make orders for child maintenance unless it is agreed by both parties. Most cases if they cannot be agreed can be dealt with by the Child Maintenance Service.

Both parties have an absolute and ongoing duty to make full and frank disclosure of their financial positions, so that a proper financial agreement or order can be obtained.

The Court Process

Either party can apply to the Court for a financial order. The person commencing the proceedings will be known as the ‘Applicant’ and the other party will be known as the ‘Respondent’.

There are three main stages in the Court process:

The First Appointment

This takes place 12-16 weeks after an application is made. During that time each party completes and files a financial statement, setting out full details of each aspect of their financial position. A copy of the financial statement will be provided to the other party, and the other party can then raise queries upon the statement.

The hearing itself is largely procedural. The Court is concerned to make sure all relevant information about the parties’ financial circumstances is before the Court, so the judge may direct that certain matters are dealt with such as pension valuations or housing valuations.

The Financial Dispute Resolution Hearing

At this hearing, the parties are encouraged to negotiate a divorce settlement with the assistance of the judge who will usually provide them with guidance as to how he/she believes the matter may be settled.

Any agreement reached at this hearing can be embodied into an order and approved by the judge at the hearing or shortly thereafter. If matters can’t be resolved at this hearing, the matter will proceed to a final hearing.

The Final Hearing

Depending on the complexity of matters, this hearing can last anything from a few hours to a few days. Each party will give oral evidence and if appropriate may be questioned by the other party or their legal representatives, and the Judge. The Judge will make a final decision after hearing all the evidence.