Financial Matters – The Law – Important info to know if getting divorced / separated

In any case where finances need to be dealt with following separation of the parties, the Court has a very wide discretion as to how it applies the assets available to the needs of the parties.  The law in this area is governed by Section 25 (2) of the Matrimonial Causes Act 1973 which sets out a number of criteria, which are applied by the Court.  The law also requires the Court to consider the needs of the children and this is the Court’s first consideration when dealing with financial matters.

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The facts which need to be considered by the Court are:

a) The income, earning capacity, property and other financial resources which each of the parties has or is likely to have in the foreseeable future, including, in the case of earning capacity, any increase in that capacity which it would be reasonable to expect that party to take steps to acquire;

b) The financial needs, obligations and responsibilities of each of the parties, now and in the future;

c) The standard of living enjoyed by the family before the breakdown of the marriage;

d) The age of each party to the marriage and the duration of the marriage;

e) Any physical or mental disability of either party to the marriage;

f) The contribution which each of the parties has made or is likely to make to the welfare and family, including contribution by looking after the home or caring for the family;

g) The conduct of the parties, if that conduct is such that it would, in the opinion of the Court, be inequitable to disregard it;

h) In the case of proceedings for divorce or nullity of marriage, the value to each of the parties to the marriage or any benefit which, by reason of the dissolution or annulment of the marriage, that party will lose the chance of acquiring.

The Court will apply each of the factors to your particular set of circumstances and decide the amount of importance which would be placed against each criteria.   It will then check the result against the principle that, wherever possible, assets should be divided equally.

In addition to the above, it is fair to say that general principles are followed by the Court.  Wherever possible, they will seek to minimise the effect of any disruption on the children and will be particularly concerned with the housing needs of the children.  Not only will this be considered when dealing with the property matters, but also when considering the income position of the party with the care of the children.

Most assets are considered matrimonial assets, notwithstanding that they may be in one or the other party’s sole name.  The value of the assets is considered at the time the Court hears the case, not the date of separation.

The Court has a wide range of powers to deal with all assets within the marriage.  The options open to the Court are any one, or a combination of the following:

a) The Court can order an adjustment of the parties’ interest in the house. For example, it can transfer the property into one party’s sole name, or it can postpone one party’s interest until the children are independent or can order a sale immediately in appropriate circumstances.

b) The Court can order one party to make maintenance payments, per month, to the other, to supplement that party’s income;

c) The Court can order one party to pay the other a lump sum from capital already in the marriage;

d) The Court can order maintenance or a lump sum for any child of the family (provided the parties agree).

e) The Court can make orders in relation to one party’s pension benefits in favour of the other.

The position concerning pensions is that the Court can allocate some of the benefits under one party’s pension, to the other. It is now more likely for the Court to “share” one party’s pension with the other by transferring part of the pension.

The Court’s job is to juggle all of these factors to try to reach a conclusion which is fair and reasonable in all of the circumstances.  This is usually considered to be an “art” rather than a “science”.  We can advise you as to the types of orders which would be made or are likely to be made in the circumstances of your case.

This is only intended to be a brief guideline to the law governing financial matters on divorce and there are a considerable number of other principles etc, which the Court will have regard to.

Proposals can be put forward at any stage, during financial proceedings, to settle and it is usually in both parties’ interests to try and resolve matters at an early stage.  It is in neither parties’ interests to use all of the assets available to pay lawyers’ fees when these assets would be better applied to the needs of the parties and the children.

If you would like to arrange a meeting to discuss your concerns directly, please contact our Divorce Solicitors directly:

Either Sara Fildes (01243532777)       | Email: Sarafildes@owenkenny.co.uk

David Small (01243 790532) |   Davidsmall@owenkenny.co.uk