
Rebecca Aston-Jones Senior Associate
Divorce myths: debunked
Despite what is portrayed in the media, there is no such thing as a ‘quickie divorce’. Even if you are a well-known celebrity, there is one divorce system and the process is the same for everybody.
Maintenance has always been a hot topic of conversation. Whilst it remains possible for a spouse to secure a maintenance order for life, this is incredibly rare. A court cannot force a party to find a job, but judges are keen to see parties move towards financial independence as soon as possible. If they can establish a ‘clean break’ between the parties, this will always be the preference.
Parties are expected to make full, relevant and continuing disclosure to each other, setting out full details of their circumstances. Early, voluntary disclosure is encouraged in order to assist negotiations and increase the chances of reaching an early settlement and avoiding court proceedings.
Usually, parties are required to disclose twelve months’ worth of bank statements, three months’ worth of payslips, up-to-date cash equivalent transfer values for all pensions, and any debts and liabilities. The consequence of not disclosing assets can be serious, such as a cost order being made against you, adverse inferences being drawn due to the lack of requested information or you could even end up in prison for contempt of court.
The starting point is 50/50; however, there may be justification to move away from equality. The judge assesses this at their discretion, which varies on a case-by-case basis. There are a number of factors taken into account, from the age of the parties, the parties’ standard of living before the breakdown of the marriage, contributions made by each party, the current and potential income and earning capacity of each party and the duration of the marriage. If there are children involved, their needs are paramount.
This is one of the most common misconceptions. It is essential to have a legally binding consent order drawn up, ideally at the time of divorce, to reflect the agreed financial settlement. Without an order in place, all potential claims between the parties remain live, which is risky for both parties further down the line as circumstances can change significantly.
Where possible, instruct a solicitor to draft a consent order for you to ensure that a judge ratifies the document, so that the document is legally binding for the future.
There is much discussion around whether a business is a matrimonial or non-matrimonial asset. Although parties normally have a strong claim to share equally in all matrimonial property built up during the marriage, they may have a much less strong claim to share in non-matrimonial property.
When deciding if a business is ‘non-matrimonial’, a court will consider whether the business was established before the marriage, if one of the parties inherited it, and if it has grown substantially post-separation due to the efforts of one particular party.
We often find that tax advisors encourage shareholders/directors to make their spouse a secretary or director of their company for tax purposes. However, this can cause financial implications further down the line if the relationship breaks down.
If you are a business owner, it is important that you seek early legal advice so that you are aware of your future risks. It might also be prudent to put a pre-nuptial or post-nuptial agreement in place to protect your business interests.
The court has a duty to consider all of the available assets and resources of the parties and often there is dispute around whether a trust should be treated as part of the matrimonial pot or not. The court might be called upon to decide whether trust assets should be used to meet the needs of the parties or to achieve equality and fairness in long marriages.
Through the disclosure process, you will need to establish your spouse’s trust interest, its value and whether they will have access to any trust income and/or trust assets. The trust interest may only be taken into account by the court on divorce if for example; the beneficiary spouse will have access to the trust assets at some point within the near future.
When parties have connections to multiple jurisdictions, it must be carefully considered where it is best to instigate divorce proceedings. The choice of one jurisdiction over another can have major implications. For instance, England and Wales are well known for broad powers to produce fair financial result, whereas other jurisdictions may be less flexible and generous. It is imperative that you take early advice and act quickly to secure the most favourable jurisdiction for your case.