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Financial settlements on divorce.


A key concern on the break-up of any marriage is how you are going to cope financially.

The courts have a wide discretion to make orders and redistribute assets and income to achieve a fair result. Each case is considered on its own individual merits and facts. Whilst we cannot give you any exact answer (because the level of discretion is so wide) we can give you an idea of what you can expect within certain limits and help you through the process.

Do you think you need legal help with your financial settlements?

Call the family law team to discuss your options

Telephone: +44 (0)20 7870 3877

or email: family@fletcherday.co.uk

What is a divorce financial settlement?

A financial settlement is usually made in conjunction with bringing a set of divorce proceedings and allows you to finalise the terms of any financial arrangement when you leave your spouse. Sometimes financial settlements are made as part of less formal arrangements and occasionally after the end of divorce proceedings (although it is usually better if you divorce and agree finances at the same time). You may often read about ‘quickie divorces’ and/or even ‘nightmare divorces’ in the media. The reality for most couples is that agreeing a divorce is relatively straightforward but in most cases, financial settlement takes anything from a simple set of direct negotiations to filing and, in many cases, agreeing at court. Occasionally though, if the case does not settle at any preliminary hearings, the courts will run a trial (known as a ‘final hearing’) to resolve you and your spouses’ differences and competing requests. Sometimes arbitration and using a mediator can also be an effective way of formulating an agreement and we can consider this and how to best approach your matter once we know more about your position.

Where we can, we encourage parties to agree their divorce financial settlements without the need for contested court proceedings and in an amicable fashion as this is usually quicker and cheaper for both you and your estranged spouse. Where necessary we can make an application to the courts and represent you throughout and argue your case to achieve the best possible result.

Why you should obtain a financial settlement

Any divorce financial settlement needs to be ultimately approved by a Judge and the court. If you do not take this important step, anything you agree can be potentially overturned. It is therefore very important you take this step when divorcing or seeking a judicial separation.

What does a financial settlement include?

A divorce financial settlement can include all types of different types of claims and considerations including:

  • Rights to property (formally called a ‘property adjustment order’)
  • Distribution of savings and bank accounts
  • Maintenance for you and your children (this can be applied for before any final settlement  – known as maintenance pending suit) and maintenance after divorce (including ongoing child support and spousal payments)
  • Pensions – in many cases and, where appropriate, you can obtain a share of a pension
  • Any international assets are considered as well and taken into account (we can advise you as to how these might be considered on a case-by-case basis)
  • Liabilities for debts and how they are to be divided
  • Trust or company interests (both of which the Family Court have generous jurisdiction to consider and review)

“When marriages break down it is very important that the parties reach a court approved settlement. Contrary to the popular clichés on both ‘amicable’ and ‘nightmare’ financial settlements there is is in fact a sensible middle ground. The team at Fletcher Day will help you through this process and strive to achieve this.”

Julius Brookman, Partner

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    FAQs
    What is a ‘clean break’ and should I get one?

    A Clean Break Order permanently severs any financial connections between you and your spouse and the courts are encouraged to make one in appropriate cases. It removes any possible future claim for maintenance or a lump sum. You might want to consider getting one if your earnings are likely to increase over time, or you might receive an inheritance or any other source of future wealth that your ex-spouse might otherwise claim against. Conversely, you should consider making a maintenance claim if you are the weaker financial party.

    My spouse has insisted I move out and I will "not get a penny" as the property is in their name. What can I do?

    You should not move out until you have sought advice on your individual situation and should treat any request to leave your house with caution. You also have rights to any property, even if it is in your spouse’s name by virtue of your marriage. You should seek advice as to how it is to be divided. We can also take steps to protect the assets, see here.

    My spouse makes all the money, how can I afford to divorce and go through the process of a financial claim?

    If your spouse earns more than you it is possible to get maintenance payments which can include an allowance for legal costs. There are also specialist litigation lenders which we would be happy to talk you about during an initial consultation. We would be pleased to discuss your individual needs further.