Contrary to popular belief, your individual assets (whether obtained before marriage or during) may be taken into consideration as part of the ‘marital assets/pot’ for the purposes of financial provision on marital breakdown. If parties do not enter into a legally binding agreement as to division of marital assets before the divorce is finalised, they are leaving themselves open to future claims.
Our key piece of advice is to always ensure that your finances are resolved before your divorce is finalised. This is to protect yourself from any future claims or losses from your ex-spouse. If finances are not resolved by way of a sealed order, there are a number of claims that your ex-spouse may bring, for example –
- Maintenance payments so that you have to contribute to their monthly income;
- Transfers of property – whether owned jointly (or they have an interest as the former matrimonial home);
- Lump sum orders – meaning that you may have to pay a sum of money to your ex-spouse; and/or
- Pension claims – if you have not resolved your position regarding your pensions on divorce.
It is not to say that all claims would be successful, and they would very much depend on the circumstances and background of the marriage in question. In any event, it is best practice to ensure that a financial arrangement has been agreed during divorce proceedings.
Where parties are able to amicably come to an agreement, whether that be between themselves or by negotiations through a solicitor, they may enter into a Consent Order where they can set out the agreement reached, including a provision that no claims can be brought against either spouse in the future.
If it appears that an agreement cannot be reached initially, parties must attend mediation in the hope that this will avoid the need for court intervention. If an agreement is reached through mediation, then a Consent Order can be filed at court for consideration and approval. If mediation is unsuccessful, the parties can issue financial proceedings and if an agreement is still not reached within those proceedings, the court will make the final decision considering the factors under Section 25 of the Matrimonial Causes Act 1973.
If you require advice about financial consequences following a breakdown in your relationship, please contact our specialist Family team on 08000 147720 or send us an email at family@ramsdens.co.uk to book a free half an hour consultation.