Financial Issues
Financial Issues & Divorce
The need for a financial Order
A divorce brings an end to the marriage. It does not bring an end to the financial claims between former spouses. Only a separate Court Order can do this, by expressly recording what is to happen to the assets of the marriage and dismissing all future claims.
In the event of the breakdown of a marriage, it is hoped that an agreement can be reached. The details of the agreement will be recorded in a “Consent Order” which is sealed by the court. A court order is binding on both parties and is enforceable by the court if necessary.
Even if there are no assets of the marriage or if you do not wish to claim any of your spouse’s assets, we shall advise you to obtain a court Order to dismiss any possible future claims.
If the agreement is not recorded in a Court Order, there is the possibility that your spouse could make a claim against your assets in the future. The financial arrangements are usually dealt with alongside the divorce proceedings.
In order to ensure the financial Court Order is binding, both parties will need to provide full financial disclosure. This means both parties disclose to the other, their assets, liabilities, income and pension information to provide a full picture of the matrimonial finances. This will enable both parties to enter into a Consent Order in the knowledge that the agreement they have reached is based upon all the relevant facts. Failure to provide full financial disclosure may result in any Order being set aside (overturned) at a later date.
Resolving the financial Issues
There are different ways that you can resolve the financial issues arising from the breakdown of your marriage.
1. Between the parties themselves
If you feel comfortable doing so, you may wish to negotiate settlements with your spouse directly.
2. Mediation
This process involves both you and your spouse agreeing to meet with a qualified, impartial Mediator who will guide you through disclosure and facilitate your negotiations to reach an agreed financial settlement. Mediation is a voluntary process and any agreement you reach is not legally binding until you both choose to make it binding with the help of your solicitor.
This process involves both parties represented by their own independent solicitors, meeting together in a four way meeting to negotiate a settlement. This process excludes court proceedings. The process requires that both solicitors are trained in Collaborative Law. If the Collaborative process fails to resolve matters and an application is made to the court, both solicitors will withdraw from acting and the parties will need to appoint new legal representatives.
4. Through Solicitors
Negotiation can take place directly between the party’s solicitors through correspondence or via the telephone.
5. Court
It is not always possible to reach an agreed financial settlement without issuing court proceedings. Either party can make an application to the court for financial relief. The Court sets out a timetable and will give directions for resolving the financial issues.
It is still possible for matters to be resolved by negotiated settlement within the Court proceedings and we will be working towards reaching an agreed settlement.
If it is not possible to reach agreement, the Judge will make an Order settling the financial issues.
Regardless of the process adopted, it is imperative that you receive independent legal advice before agreeing a settlement. We shall of course provide you with our advice throughout the negotiation process and will explain to you the type of order we believe a court would be likely to make in your particular circumstances.
Once agreement has been reached, one party’s solicitor will draft a Consent Order. Both parties will need to sign the order and will also need to complete a standard court form entitled “Statement of Information for a Consent Order”. This provides the Court with a broad overview of the party’s respective financial circumstances. The Court can then consider the agreed order in light of the party’s financial positions and, if satisfied with the order, the Court will seal the order.
Please contact us to make an appointment or to take advantage of our free initial meeting for new clients