Don’t be taken to

the cleaners!A Beginner's guide to divorce

settlements

Presented by

Darrell Webb

Today’s Topics

What orders the Court can make;

Why the Court will make them;

How to get the orders you want.

Preliminary Points

First thing to say is that what I tell you today only

applies to ‘married’ couples – not cohabiting couples.

There is no such thing as a ‘common law’ husband or

wife – you’re either married or you are not.

There is currently no legislation to protect the rights of

cohabitating couples – which is something to bear in

mind, depending on whether you are the financially

stronger or weaker party to the marriage.

Married couples

The power of the Court to redistribute

assets on divorce is governed by the

Matrimonial Causes Act 1973.

The orders that the Court can make fall

into two main categories:

- income orders; and

- capital orders.

Income orders

Maintenance Pending Suit - interim

maintenance

Periodical Payments - maintenance orders

Secured Periodical Payments - secured

maintenance orders

Capital Order

Lump sum orders – one-off cash payment

Property Adjustment Orders - requiring property to be transferred or held on trust

Orders for Sale

Pension Sharing Orders

Limitations

Can’t apportion debts

Can’t force either party to enter into new

mortgage arrangement

Can’t determine child maintenance unless

gross weekly income more than £3,000

Maintenance Pending Suit

Maintenance pending suit (MPS) is

financial support paid by one spouse to

the other after divorce proceedings start,

until the divorce is finalised and a final

adjustment of finances is made between

the parties.

Reasonableness test

A v A award

A v A requirements1) Does the applicant have assets that it is

reasonable for her to deploy to meet the litigation costs?

2) Could the applicant raise a litigation loan?

3) Could the applicant fund the litigation by way of Sears Tooth charge?

4) Is public funding available which would "furnish her with legal advice and representation at a level of expertise apt to the proceedings".

5) Has the applicant taken a stance in the litigation that is so unreasonable as to dissuade a court from ordering the provision?

Periodical Payments

The Court can order that maintenance be paid for the benefit of a spouse (‘Spousal Maintenance’) or for the benefit of a child of the family (‘Child Maintenance’).

1. Child MaintenanceThe Court no longer has the jurisdiction to determine Child Maintenance claims. This is now the remit of the Child Maintenance Service (‘CMS’)

CMS CalculationFor most the calculation will be: -

If you want to get an idea of the amount of maintenance that would be payable you can use the CMS’s Child Maintenance Calculator on their website at:

https://www.gov.uk/calculate-your-child-maintenance

Number of

children

Percentage applied to

the first £800 of gross

weekly income

Percentage applied to

amount over £800 (up to

£3,000)

1 12% 9%

2 16% 12%

3 or more 19% 15%

2. Spousal Maintenance• Variable

• Joint lives orders

• Termed orders

• Nominal maintenance

• End automatically on remarriage

• Capitalisations

Lump Sum Orders

• One time only order

• Cannot be varied

• Can be made in instalments

Property Adjustment

Orders The Court can order that property be

transferred or held on trust.

Property can include the household

contents, shares, cars, pets etc.

Property transfers subject to mortgage

Orders for Sale

Can make only if one of the following orders has been made:-

a) secured periodical payments order

b) a lump sum order

c) a property adjustment order.

Can be deferred or conditional

Can contain consequential provisions

Can be ordered even if owned with third party.

Pension Sharing Orders

Off-setting - to allocate one party a greater proportion of the matrimonial assets to compensate for their lack of pension or loss of benefit.

Pension attachment Orders – requiring payments made under the pension to be paid to the spouse.

Pension sharing Order – requiring the pension scheme to transfer a share of the member’s pension to into the other spouse’s pension scheme.

How does the Court

decide?First consideration to be given to welfare of

any children of the family.

Must have regard to all the circumstances of

the case.

Must consider the S25 MCA Factors: -

S25 Factors a) financial resources

b) financial needs

c) standard of living

d) age of parties and duration of marriage

e) any physical or mental disability

f) contributions

g) conduct

h) loss of benefit

Miller and McFarlane Needs – ‘In most cases the search for fairness largely begins and ends at this stage. In most cases the available assets are insufficient to provide adequately for the needs of two homes’

Compensation – ‘This is aimed at redressing any significant prospective economic disparity between the parties arising from the way they conducted their marriage’

Sharing – ‘The parties commit themselves to sharing their lives. They live and work together. When their partnership ends each is entitled to an equal share of the assets of the partnership, unless there is a good reason to the contrary. Fairness requires no less’

Generally...

Three stages:

Capital split

Income orders

Pension order

How to get the order you

want?Top Tips: -

Be realistic

Know what you want to achieve

Deal in needs, rather than percentages

Consider all your options

Don’t let the Judge decide

Pre-Nuptial Agreement

Bolt Burdon Solicitors Please contact us with enquiries:

Darrell Webb – Family Department

E: darrellwebb@boltburdon.co.uk

T: 020 7288 4795