Determination of need in financial disputes arising from divorce
Introduction
We as lawyers sympathise with this, as do our courts. Because the facts and circumstances of every financial case within divorce will naturally differ, our clients sometimes find it very difficult to know what is going to happen to their respective ongoing financial security at a time when they desperately need certainty for their futures.
Reaching an agreement without adversarial court proceedings
Every outcome varies because not everyone is the same. However, do bear in mind that in the majority of cases, we can bypass the court if we can all sit down sensibly to achieve a ‘non-court dispute resolution’ backed up by an approved final order by consent approved by the judge without you having to go to court at all. This saves time, money and of course distress.
The law
The Family Justice Council was formed in 2016 as an essential guide for the benefit of the judiciary of England and Wales, to help them (along with statute and precedent case law) make fair orders in family law as consistent as possible.
In 2018, they supplied guidance regarding the determination of financial needs flowing from divorce. It is a very long read. Very helpfully though, recently, the High Court handed down a judgment, containing succinct, clear guidance as to the correct judicial approach to be taken, for the benefit of all concerned, on this very subject.
Court judgments are always lengthy and often complex for a layperson to understand, but this one has been particularly clear and helpful because it points out what laws/rules must be considered when they are presented with the facts of your respective financial circumstances.
- A court will calculate the whole of the assets together and then decide how to distribute them between you.
- Before it distributes, it will first consider what the fairest outcome is likely to be for both of you.
- For this, they consult the relevant factors contained in s.25 of the Matrimonial Causes Act 1973, including the priority needs of any children of the marriage.
- Your respective contributions, however made, throughout the marriage, are regarded as
- A clean break between you, rather than, say, any ongoing liabilities to each other is always encouraged so that you can both draw a line and move on.
- The first consideration of those assets is distribution to cater for each of your needs now and in the future.
- In cases where the assets are very substantial, respective basic need may become less relevant and therefore the court looks at the excess of need to determine how those assets are shared fairly between you.
- Priority of needs always comes first. Only after these have been exhausted, do the courts start looking at how a fair share is to be distributed between you of any surplus assets to those needs.
Conclusion
For the High Court to list these issues in this way is extremely helpful to both lawyers and couples who are facing the divorce finances court process, possibly for the first time.Do remember, decisions like these are made to help couples reach a resolution by agreement so that you do not have to go through an adversarial, expensive, lengthy court process to achieve the same result by a judge having to order it instead. That is where good legal advice comes in. Obviously, we can expand on each of these points and how they apply to your circumstances, so do come and see us to get you on the right track.
If you are facing a divorce and are concerned about the division of assets, our experienced family law lawyers can help. We will guide you through the complex legal process, ensuring your rights are protected. Contact us today for a free 30-minute confidential consultation to discuss your specific needs and learn how we can help you achieve a fair settlement.