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Many people question why they need a financial court order. That’s because they assume that if they get divorced then their decree absolute of divorce finalises everything and there’s no need to get a financial court order as once you are divorced it is an automatic end to any financial ties with your former husband, wife or civil partner. Manchester divorce solicitors say that isn’t right and that a financial court order is essential to give you financial security and peace of mind. In this blog we answer your questions about financial court orders and why you need one after a separation or divorce or dissolution of your civil partnership.
Does a divorce end financial ties between husband and wife?
A divorce doesn’t end the financial ties between a husband and wife or between civil partners. The divorce or dissolution ends the legal relationship of marriage or civil partnership. However, there can be ongoing financial ties or the potential for one spouse or civil partner to start financial proceedings to make financial claims months or even years after the divorce or dissolution proceedings have been finalised through the pronouncement of your decree absolute.
How can I stop financial ties with my ex-husband or wife?
To stop financial ties with an ex-husband or wife you first of all need to look at what existing financial ties you have, such as:
Is the family home still owned jointly? Is there a mortgage on the property? Could one spouse buy the other out and get the spouse released from the joint mortgage liability so that they can use their share of the equity and a mortgage to buy a new property?
Are you waiting for the sale of a family home and still contributing towards the outgoings on the property until sale?
Are you receiving or paying spousal maintenance?
Do you own a family business and does your spouse or civil partner have a financial interest in the business or are they employed by the business?
Are you retired and receiving some of your husband or wife's pension each month to support yourself?
There are many other examples of financial ties between a husband and wife or between civil partners. You may not appreciate the extent of your existing financial ties or the potential financial claims. That is why it is best to take legal advice, preferably before you separate but, if not, as soon as you are able to do so after you or your partner has taken the decision to go your separate ways.
Will a prenuptial agreement stop financial ties if there is no court order?
If you signed a prenuptial agreement or a postnuptial agreement it is important to let your divorce solicitor know because the agreement may limit financial ties between you and your husband, wife or civil partner. In the UK a prenuptial agreement or postnuptial agreement isn’t legally binding so it is best to take legal advice on your separation or divorce as you will still need a financial court order. That is the case whether or not you are both content with the financial terms set out in the prenuptial agreement or postnuptial agreement.
Will the death of a former husband or wife end the financial ties?
If your former husband, wife or civil partner passes away you may think that is the end to any financial ties but a surviving spouse or civil partner or a dependent former spouse or civil partner can bring a financial claim against the deceased spouse or civil partner’s estate if they can say that the Will or intestacy rules did not leave them with reasonable financial provision. That is why , if you are separating or divorcing, you not only need a financial court order to stop or limit any financial claims but you also need to review the provisions in your Will and take advice on how to avoid a claim against your estate.
Does a separation agreement stop financial ties between a husband and wife?
If you separate and decide that you don’t want to get divorced you may decide to sign a separation agreement to record how your financial affairs will be regulated. The separation agreement could provide for ongoing financial ties, for example, the payment of spousal maintenance or an agreement that the family home will stay in joint names and won't be sold until your youngest child is eighteen. Alternatively, the separation agreement could say that you both agree that there are no more financial ties between you and neither of you will make any future financial claims against the other.
Like a prenuptial agreement, a separation agreement isn’t a legally binding document and one of you could try to start a financial claim, despite the contents of the agreement or could ask for more provision than that detailed in the agreement. Depending on the circumstances in which the separation agreement was drawn up, the contents of the separation agreement may be heavily influential if one of you were to start financial court proceedings. However, divorce solicitors always recommend that the contents of a separation agreement are converted into a binding financial court order as soon as you are able to do this because a clean break financial court order will give you both financial security and peace of mind.
Does a financial court order stop financial ties between an ex-husband and wife?
A financial court order will either stop or regulate financial ties between an ex-husband and wife or between civil partners.
A financial court order that says that there are no existing financial ties between an ex-husband and wife and that neither one of you can bring any further financial proceedings against the other or their estate is called a clean break financial court order. This type of court order can either be made by agreement and approved by a family judge or made after a contested court hearing and a ruling by a family law judge.
In many family scenarios you may not be able to achieve a clean break immediately, for example, because you are waiting for the sale of a family home or the sale or transfer of shares in a family business or the implementation of a pension sharing order. However, the court can make what is known as a deferred clean break financial court order. That means once assets have been sold and other aspects of the court order complied with there is a clean break and spouses or civil partners can't bring any further financial claims.
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In some family situations it isn’t possible to end financial ties either immediately or in the long term. For example, in order to maintain a home for the children the family home may have to remain in joint names as you can't sell the property and the spouse looking after the children in the home can't get the mortgage company to transfer the existing mortgage into his or her name. You may only be able to sever financial ties when the family home is sold. Alternatively, if a former spouse or civil partner needs ongoing spousal maintenance for life you won't be able to stop income financial ties until the spouse or civil partner who is receiving the spousal maintenance remarries.
As it isn’t always financially possible to achieve a complete financial clean break and the end of financial ties between a husband and wife you should try to achieve as much financial security as you can by:
A capital clean break – this stops claims for more cash or for the transfer of assets but leaves open ongoing claims for spousal maintenance
A deferred income clean break – this gives an immediate capital clean break so a spouse can't ask for more cash such as money from the family home or for a bigger percentage of a pension but keeps open the income the financial ties until, for example, spousal maintenance payments stop. The court order could say that the spousal maintenance payments should stop after three years of maintenance payments with the clean break coming in automatically after three years because the court ruled that the spouse receiving the spousal maintenance should not be able to apply to extend the time spousal maintenance is paid for.
Have I got a clean break financial court order?
Divorce solicitors find that one of the most common reasons that people don’t understand their financial court order is that they don’t know if they have got an end to financial ties or not. A good divorce solicitor will spend the time with you so that you understand:
The range of capital and income court orders that a family court can make either with the agreement of a husband and wife or after a contested court hearing
The different types of clean break and end of financial ties that can be achieved
Why a clean break may be very important in your particular financial and personal circumstances. For example, if you are a family business owner and you think that your business will significantly increase in value, you are the beneficiary of a discretionary trust, you anticipate receiving a substantial inheritance from a member of your family or you believe that your ex-husband or wife will squander their financial settlement and want to be able to ask for more from you
The prospects of you achieving an immediate capital or income clean break financial court order if the judge had to make a ruling on whether to make a clean break financial court order. This information then enables you to try and negotiate and clean break with your former spouse and invite the court to make an agreed financial court order
The risks associated with a clean break order. For example, if there is a contested court hearing your spouse after a long marriage may be likely to receive spousal maintenance for life. You could agree to give them a one-off cash lump sum instead of ongoing spousal maintenance to achieve your capital and income clean break. The risk to the payer is that spousal maintenance would not have to be paid if your former spouse remarried, predeceased you or if you lost your employment or business. The risk to the former spouse receiving the one off cash sum is that if the paying spouse’s income increased or business becomes more profitable they could have asked for an increase in the amount of spousal maintenance or for a bigger capitalised spousal maintenance figure. There isn’t often a right or wrong answer on whether or not to agree to a clean break as only you knows how valuable a clean break is in terms of having financial security. However, the important thing is that you are able to make an informed decision on what is best for you and your family.
Manchester divorce and financial settlement solicitors
Cheshire and Manchester based Evolve Family Law solicitors specialise in resolving financial issues after a separation or divorce. For legal assistance with financial court orders or any other aspect of family law call Evolve Family Law or complete our online enquiry form to set up an appointment, a video conference call or telephone appointment.
A divorce court ruling on a Sharia law marriage has called into question the validity of Sharia law marriages conducted in the UK. You may question why that is important to you as, after all, if you celebrated an Islamic marriage ceremony, witnessed by all your friends and family that is what counts as you are married in the eyes of God.
Whilst our Manchester divorce solicitors would not disagree with the significance of the marriage ceremony to you, in the English family court you may not be legally married. Your status as a husband or wife or as a cohabitee could make the difference between whether you get half the family wealth or nothing if you separate.
The case of Mr Khan and Mrs Akhtar
The legal status of Islamic marriage in the UK is in the news headlines again because of the long running case of Mr Khan and Mrs Akhtar. In the high court Mrs Akhtar sought a divorce from her husband, Mr Khan. He opposed the divorce petition on the basis that they weren’t legally married. Although you would have thought it obvious that they were married because the couple had participated in a Nikah ceremony in a London restaurant conducted by an Imam with about 150 guests, Mr Khan said the marriage wasn’t legal as whilst it might be a legal marriage under Sharia law it did not meet the requirements of English marriage law.
The first judge ruled that the marriage was a marriage but classed it as a void marriage. This decision allowed Mrs Akhtar to start financial proceedings as the wife of Mr Khan, something that she could not have done if the high court had ruled that the couple were not legally married. Although the court ruled that the marriage was still a marriage (even though it was void) back in 2018 it has taken until February 2020 for the court of appeal to hear the case and conclude that the couple were not legally married under English law.
Interestingly the appeal wasn’t brought by Mr Khan but by the Attorney General who is joined as a party to court proceedings where the validity of a marriage is called into question. The court of appeal ruling is making Manchester divorce solicitors ask where the decision leaves Mr Khan, Mrs Akhtar and their four children and, just as importantly all those other husband and wife's who have celebrated a Nikah marriage ceremony recognised in Sharia and Islamic law but not under UK marriage law.
Is an Islamic marriage valid in the UK?
The court of appeal held that the marriage of Mr Khan and Mrs Akhter was invalid (rather than void) and therefore the Islamic marriage isn’t a legally recognised marriage, notwithstanding the 150 guests who attended to witness the marriage ceremony.
The court of appeal ruled that the Sharia law wedding wasn’t a valid marriage because the ceremony took place at a venue that isn’t registered as a wedding venue and therefore no registrar was therefore present to conduct the ceremony. Back in 2018, the high court took a different approach and ruled there was a valid marriage recognised in both Sharia law and under English case law because although the couple hadn’t complied with English marriage law requirements they both held themselves out as a married couple. The court of appeal said that this wasn’t enough as they both knew that they needed to participate in a registered civil marriage ceremony to comply with English marriage law.
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Does it matter if your Islamic marriage isn’t recognised in the UK?
You may question whether it matters if your Islamic marriage isn’t recognised in the UK family law as a valid marriage because, from your perspective, it is your marriage under Sharia law that is the important ceremony to you and your family. However, if you separate and you try to start divorce proceedings you may find yourself in the same position as Mrs Akhtar; told that there is no need for English divorce proceedings because you are not legally married under English law. That means, that for the purposes of your financial settlement, in English family law you will be treated as a cohabitee or unmarried partner.
If your marriage is legally recognised then within divorce and financial proceedings a husband or wife can bring financial claims for a share of:
The family home
Any other property you own – this property includes houses or commercial property owned in your joint names or in your sole name
Your business – your spouse does not need to hold shares in your company or to have worked in the business to be able to make a financial claim against business assets
Your pension – your spouse can claim a share in your pension even if your pension was set up prior to your marriage
Your savings and investments – your husband or wife can claim a share of your savings and investments even if they are owned in your sole name
Your income – a claim can be made for the payment of ongoing spousal maintenance.
By contrast, if you are an unmarried partner or cohabitee you won't be able to claim:
A share of your partner’s pension
Spousal maintenance
Any other assets unless you can prove that you are an owner of that property or that you were promised a share in the property.
If you have children with your partner you can try to claim housing provision and child support for your children but Manchester divorce solicitors say it is a lot harder to bring a financial claim if you are a cohabitee rather than a husband or wife whose legal status in recognised in English law.
What should I do if I have an Islamic marriage?
If you have an Islamic marriage and you are concerned that your marriage won’t be legally recognised in English law it is best to take legal advice from a Manchester divorce solicitor. A discussion about your legal relationship status does not commit you to making any decisions and is completely confidential.
Islamic marriages and prenuptial agreements
If your husband or wife does not want to participate in a legally recognised marriage ceremony because they appreciate the extent of the financial claims that can be made by a husband or wife on separation (in contrast to an unmarried partner) then one option may be to look at signing a prenuptial agreement to record a fair financial settlement should you separate at a later date. It is vital that you take expert legal advice before committing to sign a prenuptial agreement.
If you are concerned about the status of your Islamic marriage then whether or not you are contemplating a separation or starting civil divorce proceedings you should take legal advice on your situation and options. The specialist divorce law team at Manchester divorce solicitors at Evolve Family Law in Whitefield can help you.
Call our Whitefield divorce solicitors or complete our online enquiry form.
For many Jewish women the prospect of getting divorced not only makes them worry about how their children will cope, raises fear for their future financial security but makes them question whether they will end up in limbo, with a civil law decree absolute of divorce from the Manchester divorce court but no religious Get. A new case may bring hope to those worried about securing a Get after their separation and civil divorce.Manchester divorce solicitors
If you are divorcing and are worried about securing a Get or about negotiating the childcare arrangements for your children or your divorce financial settlement then the Manchester divorce solicitors at Evolve Family Law in Whitefield can help you. Call us on 0345 222 8 222, complete our online enquiry form or email robin@evolvefamilylaw.co.uk
Whitefield based Evolve Family Law solicitors are approachable and friendly, providing pragmatic expert divorce advice, financial settlement solutions and children law resolutions. Call us on 0345 222 8 222 and let the Whitefield divorce solicitors help you.Obtaining a Get
The law has tried to help those trapped having secured separation or a civil divorce but unable to move on with their lives because they are not able to secure a religious divorce or Get. In what is being described as a landmark case, a woman has used legislation designed to protect victims of domestic violence to secure her Get. In this blog we look at how she achieved her Get and the alternatives to her course of action.
Obtaining a Get by private prosecution
An unnamed women from London obtained her Get after launching a private criminal prosecution against her husband for coercive control.
The case is thought to be the first time that the UK criminal justice system has been used as a means to secure a Get to enable the London woman to be able to remarry according to Jewish law.
If you are wondering about what the judge and jury said, this is a case where the private prosecution of the husband was withdrawn when he agreed to give his wife a Get. That meant his crown court trial didn’t take place and therefore the jury did not have to assess whether the man was guilty or innocent of the law against ‘coercive control’.
The wife used Section 76 of the Serious Crime Act 2015 to bring the private prosecution. The 2015 Act created a new offence of coercive or controlling behaviour in an intimate or family relationship. An offence is committed if:
A person repeatedly or continuously engages in behaviour towards another person that is controlling or coercive and the two people are personally connected
The person committing the behaviour knows or ought to know that their behaviour will have a serious impact and the behaviour does have a serious impact on the person subjected to the behaviour.
To be charged with an offence under the 2015 Act you must have committed controlling or coercive behaviour towards a ‘personally connected’ person. The law says you are personally connected if:
You are in an intimate personal relationship or
You live together and are family members or
You lived together and were in an intimate personal relationship with one another.
Had the husband been found guilty of the criminal charge then he could have faced a maximum sentence of up to five years in prison. That was probably a very powerful motive to agree to give the wife a Get. However, some may argue that the Get was not freely given by the husband as he felt under pressure to provide the Get rather than offering it of his own free will.
Obtaining a Get through injunction proceedings
In the London case a private criminal prosecution was launched but the case is making Manchester divorce solicitors question whether a Jewish woman could apply for a civil or family court order alleging coercive control as a means to try and secure co-operation and the granting of the Get.
Many women assume that they cannot apply for a family court injunction order because their husband has not been violent towards them, or if he has it was ‘just a push or a slap’. The law on domestic violence is clear, domestic abuse includes emotional and psychological abuse as well as coercive and controlling behaviour. In addition, any form of domestic violence is unacceptable.
Accordingly, some women may want to consider if injunction proceedings would help provide leverage to secure their Get, in the same way that the wife used her private criminal prosecution to achieve her goal of freedom and an end to her being in legal limbo.
Obtaining a Get through UK divorce law
For a wife who wants to secure a Get but their husband is not co-operating the most widely known legal option is to use Section 10A of the Matrimonial Causes Act 1973, amended by the Divorce (Religious Marriages) Act 2002).
Under this legislation either a husband or wife is entitled to apply to the divorce court for an order stopping the decree absolute of divorce from being pronounced until the Get is obtained.
In another recent court case, spousal maintenance law was used as a means to achieve a Get. A Manchester businessman appealed against a financial court order made in divorce court proceedings. The court had ordered him to pay spousal maintenance at the rate of £1,850 a month until he gave his wife a Get.
The husband, Mr Moher, appealed saying it was wrong to order him to pay spousal maintenance until he gave his wife a Get because it introduced compulsion and, under Jewish law, a Get should be given of your own free will. The court of appeal disagreed and upheld the spousal maintenance order.
Talk to your divorce solicitor
If you need a Get then it is important that you tell your Manchester divorce solicitor this so that they know, in any negotiations, just how important the Get is to you and to your future happiness.
Once your Manchester divorce solicitor understands that you need the Get to re-marry under Jewish law and to have more children then this should be a priority for them. Even if your husband says he will cooperate and give you a Get or you do not contemplate re-marriage, it is still important to record the agreement on securing a Get in case your husband decides not to co-operate.
Robin Charrot, divorce and financial settlement solicitor at Evolve Family Law based in Whitefield, Manchester says:
‘’ Obtaining a Get can sometimes be hard work when a husband refuses to cooperate or prevaricates. It is vital that your divorce solicitor understands the importance of the Get to you. I have had solicitors question why it is significant to obtain a Get if a wife has achieved a civil UK law divorce as well as sorted out a child arrangements order and her divorce financial settlement. From my perspective, if a client wants Get it means the difference between a wife being able to get over her divorce and move on with her life feeling positive about her future and feeling trapped and forever controlled by her former husband. That is why the Get is so important and why the London landmark private prosecution will generate a lot of interest in Whitefield and North Manchester. It is another option to explore to secure your Get.’’Manchester Divorce solicitors
If you are contemplating a separation or starting civil divorce proceedings but are worried about obtaining a Get then Manchester divorce solicitors at Evolve Family Law in Whitefield can help you. Call the Whitefield divorce solicitor us on 0345 222 8 222, complete our online enquiry form or email robin@evolvefamilylaw.co.uk
Whitefield based Evolve Family Law solicitors are approachable and friendly, providing pragmatic expert divorce, children and financial settlement law advice. Call Evolve Family Law on 0345 222 8 222 and let us help you.Latest From Our Marriage & Divorce Blogs:
When it comes to pension rights and answering the question ‘do I have to share my pension if I divorce,’ the frustrating response to hear from a Manchester divorce solicitor is that there isn’t a yes or no answer to your pension rights question. In this blog we look at just how complicated it can be to unravel pension rights on divorce and answer some of the common questions that are raised by husbands or wives worried about the thought of having to share their pension on divorce.
Pension and divorce experts
Our Manchester divorce solicitors are often told by husbands or wives that their pension can't be shared on the breakdown of their relationship for a whole variety of reasons including:
The pension can't be touched until I retire so can't be shared now
The pension was started before the marriage
The pension is linked to the family business
You can't share a final salary pension on divorce
The pension isn’t valuable enough to share on divorce
My employer won't let me share my work pension on divorce
Pensions can't be shared if you are in a civil partnership and not married.
All of those are wrong! If you start off on ‘the wrong foot’ with misinformation about pension rights on divorce it is very easy to either:
Believe your pension can't be touched and therefore be unwilling to negotiate on pension rights and divorce
Assume that your husband or wife's pension can't be worth much and is incapable of being divided or shared until you both reach retirement age.
To avoid reaching fixed views on pension rights and divorce it is best to take early legal advice from Manchester divorce solicitors and financial advice so you know where you stand legally and financially. Early advice means neither of you should have entrenched pension positions and be more open to negotiating a financial settlement that may or may not involve sharing pensions.
Joint pensions
Many husband and wife's assume that their pension is a joint pension with their spouse. A Manchester divorce solicitor or financial advisor will tell you that a pension is only legally owned by one party so technically the pension will belong to you or to your spouse. Even though you may or may not own the pension, on divorce most pensions are capable of being shared so that the non-owning husband or wife gets a share of the pension.
Pensions can be a complex topic as there are so many different types of pension. You may be adamant that your pension is joint with your husband or wife because:
You are both shareholders and company directors in a family business and have a pension linked to the business
You both set up private pension schemes at the same time
You have property or land owned in a pension fund.
No pension is a jointly legally owned asset. Even if you and your spouse both have funds in a SIPP or own a business property within a pension fund you will both have individual shares in the pension pot.
Although pensions are not joint assets because they are not legally owned by both of you they will normally be taken into account in any divorce financial settlement and can be shared or the pension value offset against the value of other family assets.
Are pensions ever ignored in divorce financial settlements?
In most separations and divorces pensions are not ignored in the divorce financial settlement. That is because the pension is often the most valuable asset after the equity in the family home.
There are a few limited family scenarios where the value of the pension won't feature highly, for example:
A young couple with no children
A very short marriage with no prior period of cohabitation before marriage and no children
A marriage where the husband and wife agreed to ignore the value of pension assets if they separated or divorced by signing a prenuptial agreement or a postnuptial agreement. This is OK if the terms of the prenuptial agreement or postnuptial agreement meets the needs of the husband and wife.
Are pensions always shared equally?
Pension assets may not be shared at all, for example, you may agree or the family court may order that one of you gets a bigger share of other assets, such as the equity in the family home or savings.
If you do agree to a pension share or the financial court order includes a pension sharing order then your husband or wife could get a percentage from one to a hundred percent of your pension fund.
The court is more likely to make a financial court order that includes pension sharing where:
The value of the pension funds makes it worthwhile to share the pension. If the pension only has a small value then the administrative costs of sharing the pension may not be justified
There are sufficient assets to not require one of you to need to receive all or the majority of the equity in the family home to rehouse yourself and to offset the value of the pension.
Even if you and your spouse or the family court orders that a pension is split equally between husband and wife that doesn’t necessarily mean that you will both get the same amount of pension income from your equal share of the pension fund. The pension income differential can be down to age or gender. That is why many Manchester divorce solicitors and family courts prefer to arrange for pensions to be shared to achieve equality of pension income on retirement rather than a straight equal division of the capital value of the pension fund.
How to value a pension in a divorce financial settlement
It is often thought by a husband or wife that valuing a pension in divorce and financial settlement proceedings is easy as you can just rely on the annual statement that pension administrators provide. Most of these annual pension statements will include what is said to be the ‘cash transfer value’ of the pension fund.
If the fund value of the pension is accurate then you may think it is a straight forward process to either agree a pension offsetting figure (the amount that one of you will receive for not getting a share of the pension) or agree the percentage of the pension share. However, the cash transfer value of a pension can be wildly inaccurate or misleading. For example, two pensions may both have a cash transfer value of £500,000. You would assume therefore that as both pensions are worth the same amount they will produce the same pension income on retirement. That’s not the case because one pension may be a final salary pension and the other a personal pension or a SIPP.
Getting expert legal advice and actuarial pension advice can be crucial in helping you:
Accurately value your pension assets
Reach a fair financial settlement.
Can I ring fence my pension and leave it out of the financial settlement?
Manchester divorce solicitors are often asked if pensions can be kept out of divorce financial settlements. Even if you both agree to ignore the value of a pension the asset still needs to be disclosed. A husband and wife are under a duty to provide full financial disclosure. Failure to give information about your pension isn’t in your interests. If you do not disclose an asset then any agreement or financial court order could potentially be overturned at a later date because of the lack of full and accurate financial disclosure.
It therefore pays to disclose the existence of all assets, including pensions, even if you and your spouse chose to ignore the value of the pension in your financial settlement negotiations.
Many husband's and wife's struggle with the idea that the value of their pension may not be ignored in the financial settlement, even though:
They started the pension before the marriage and all the pension contributions were made prior to the marriage
Their pension is in payment
Their spouse is in a new relationship and so they don’t think that he/she needs a share of their pension
They signed a prenuptial agreement to say that the value of a pension would be ignored.
Whilst all of the above point are very valid, a family court looks at a range of factors when deciding whether or not to make a pension sharing order as part of a financial settlement. For example, the court will look at both a husband's and wife's needs including pension income needs but will also factor in the length of your marriage, your ages and any pre-marriage contributions or wealth and the existence of any prenuptial agreement or postnuptial agreement.
When is a pension shared?
Many husband's and wife's are very keen to avoid a financial settlement that includes a pension sharing order because they mistakenly believe that their spouse will continue to receive the benefit of their hard work and ongoing pension contributions and pension growth from the date of the financial settlement until eventual retirement and pension draw down. That isn’t the case.
If you agree to your pension being shared or the court makes a pension sharing order after a contested financial settlement court hearing then:
The pension sharing order will be implemented after the pension administrators receive the financial court order, pension sharing order annex and the decree absolute of divorce. The pension administrator has four months from receipt of the relevant paperwork to implement the pension sharing order
Once the pension sharing order has been implemented there will be two separate pension pots (assuming there isn’t a one hundred percent pension sharing order) and any future pension contributions made by you after the order has been implemented will be credited against your pension pot and you will get the benefit of all the pension and investment growth in your pension pot
In most cases you will be able to decide when to take your pension completely independently of when your former husband or wife choses to retire and get the pension income from their share of the pension. The position is more complicated if your pension pot consists of property and is a Self-invested pension plans (SIPPs) or is a Small self-administered schemes (SSASs). It is also sensible to take detailed advice about the earliest date you will be able to take the pension income as the pension rules may be different for you and your former spouse and it is best to be fully informed before agreeing to a pension sharing order.
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Should I pension share or pension offset?
The question of whether you should pension share or offset is really down to your priorities. However, if you are not able to reach a financial settlement with your husband or wife by agreement then the decision over whether to pension share or pension offset may be taken out of your hands as a family judge will decide how your assets , including pensions, should be divided.
If you agree to a pension offset then the value of the pension is offset against other assets owned jointly or individually. This may be vital to you if your priority is to stay in the family home or to keep your shareholding in the family business or family farm. Equally, it can be short sighted to ‘put all your eggs in one basket’ and just get equity in the family home rather than a share of your spouse’s pension.
You may think that, in time, you can downsize and get money out of the family home to fund your retirement. However, the cash from the sale of a family home may not generate anywhere near as much in pension income as a share in your spouse’s final salary pension scheme would have.
Alternatively, you may be adamant that you want to keep one hundred percent of your pension because you realise just how valuable your National Health Service, police, fire service or final salary pension is in comparison to the income you could realistically generate from the pension offsetting figure. However, you may benefit from reality testing your plan to keep all your pension and get less or no equity from the family home as that may mean you struggle to rehouse yourself so you are asset poor and pension rich. All very well for the future, but does it mean you will have a tough time of it until your hoped for retirement and is it worth it?
When it comes to pensions and divorce financial settlements there are always choices to be made, from how you value the pension to whether you share or offset the pension. Taking expert legal advice from Manchester divorce solicitors can help you make informed choices, looking at the short and long term needs of you and your family.
Whitefield based Evolve Family Law solicitors are approachable and friendly, providing pragmatic expert divorce, pension and financial settlement solutions. Contact us today and let us help you.
It comes as a surprise to some people but we are regularly asked the question ‘how do I prepare to separate?’ It's good that we're asked, because the earlier you speak to a divorce solicitor about a planned separation the more they can help you reach an informed decision about whether or not to separate and assist you in making your separation as painless as possible.
Where to Start with Planning a Separation
The obvious place to start if you are thinking about a separation is to talk to your partner but although that seems the sensible thing to do it isn’t always the best approach because:
You may want to take legal advice before speaking to your partner as the advice on the potential child custody and financial settlement options may affect either your decision to separate or the timing of your separation;
Talking to a counsellor about your relationship difficulties may help you decide what you want to do and whether you want to suggest couple counselling or a trial separation to your partner. Alternatively counselling may confirm your decision that you want to separate or start divorce proceedings;
If your partner is abusive, has a history of hiding assets, or you are worried that if you tell your partner that you plan to leave that they may take the children or destroy sentimental precious possessions then in any of those situations talking to your partner about the separation may not be the best approach.
If you do decide to speak to your partner about a separation, then it may not come as a complete surprise to them. However, sometimes a partner has no idea about what their husband or wife is planning so they need time to accept your decision before being able to have a constructive discussion with you about the practicalities of your separation.
Talking to the Children About Your Planned Separation
Knowing when and how best to talk to the children about a planned separation is always a tough decision. Some parents think it is best not to tell the children about a planned separation until they really need to know, for example, if the house goes on the market or until divorce proceedings are started. However, waiting to talk to the children can be more unsettling to the children as they make pick up on the atmosphere in the family home or hear things from grandparents or friends but be too embarrassed or worried to talk to you about the separation.
In an ideal world, both parents should sit down together to talk to children about a separation. Don’t worry that you don’t know all the answers to questions about precise custody and contact arrangements or your future plans.
Practical Steps When Separating
Separating from a partner is very emotional but it can help to focus on practicalities such as:
The temporary living arrangements – a Manchester divorce solicitor will advise you that you should not leave the family home without first taking legal advice about whether that is the best option in your personal and financial circumstances. You could, for example, ask your partner to leave or potentially may have the grounds to start injunction proceedings if they won't leave voluntarily. If your separation is amicable then it may be possible for you to continue to live together at the family home until you reach a long term financial settlement but whether you are both staying at the family home or one of you is moving into rented accommodation or staying with family, you will need to reach an agreement on temporary financial matters and payment of bills and child support. You should not finalise any decisions about short term or long term financial arrangements until you have taken legal advice;
The parenting arrangements – the parenting arrangements for your children will very much depend on whether you are continuing to live together at the family home until you reach decisions about what should happen to the house. Sorting out the long term arrangements for the children may not be practical until you know one another’s housing plans and whether, for example, it will be feasible for mid-week contact to take place;
The financial paperwork - A Manchester divorce solicitor will tell you that you can't reach an informed financial settlement with your partner until you both know your up-to-date financial situation. That may involve finding out things like the value of the family home, the amount of the outgoings on the family home, the amount you have in savings or the value of the family business or pension. If you have a financial advisor or accountant they may have some of this information, such as an investment portfolio document or draft family business accounts.
Understand Your Separation Options
Prior to taking the decision to separate it helps to know what your separation options are and the ways in which you can reach an agreement over custody and parenting arrangements and your financial settlement.
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When it comes to separation your options are broadly:
A trial separation ;
A permanent separation. If neither one of you wants to start divorce proceedings you may want to record any agreement reached about the family home , other property and financial support in a separation agreement;
Starting divorce proceedings. Within divorce proceedings a court can be asked to make a financial court order to record the terms of any agreed financial settlement or, if you can't reach agreement, the court can decide how your assets and property should be divided and make a financial court order.
It is often assumed that if you go ahead with a separation that you and your partner will end up in court proceedings over custody of the children, who gets the family home or whether you will get a share of your spouse’s pension. However, experienced Manchester divorce solicitors say that you don’t have to end up in court. It is often possible to reach an agreement over the basis for the divorce proceedings, the custody and contact arrangements for the children and the financial settlement through taking legal advice and getting your solicitor to negotiate a parenting plan and financial settlement or advising you about your legal options during family mediation.
Taking advice on your separation can give you some of the information you need to make an informed and supported decision on whether or not to separate and how to best plan for your future.
Whitefield based Evolve Family Law solicitors offer pragmatic expert divorce, children and financial settlement solutions. Contact our expert lawyers today and let us help you.
A divorce can be traumatic but when a divorce occurs in a farming family, it can be particularly tough when the farm is not only the family business but also the family home.
In my experience as a family finance and divorce solicitor in Whitefield and Cheshire it is not uncommon for spouses to stay in unhappy relationships for fear of separating and the consequences on the family farm.
Some may question why divorce and a family farm are different to any other type of divorce. After all every divorce can be painful. However, with divorce and the family farm, often the farm has been in the family for generations. There is therefore great sentimental attachment to the farmhouse and land. Not only that, the farm is normally both the family home and the source of income for all the family, including extended family.
Adding to the complexities, the farm or some of the land could be owned by the older generation or parents may be paid an income out of farm profits as a means of providing a pension after they have transferred ownership of the family farm to a son or daughter.
Therefore, where do you start when facing the prospect of a divorce and sorting out what happens with the family farm.
In an ideal world, a farming family takes advice before handing over ownership of the family farm to a son or daughter. Often a farming family is told by a private client solicitor that it is tax efficient to transfer ownership of the farm to the younger generation to minimise the payment of inheritance tax. That is all very well but unless specialist family legal advice is taken the family may be reducing the risk of paying a big inheritance tax bill but exposing the family farm to divorce claims.
Some farmers think that if the family farm has been gifted or inherited it will automatically be ring-fenced from any financial claims on divorce. That is not the case.
Even if an asset is:
Owned in the sole name of one spouse; and
Was owned by the spouse prior to the marriage ;and
Has been in the family ownership for a long time
Divorce financial claims can be made against the asset. In a farming family, the asset in question is normally the farm and land.
When a couple get divorced all the assets they own, individually or jointly, are taken into account when negotiating a financial settlement or the court makes a financial court order.
Although the court will factor in the relevance of a family farm having been inherited or gifted by a husband or wife the court has to look at the husband and wife's needs and, most importantly, the needs of any children.
Prenuptial Agreements and the Family Farm
If a family own a farm and want to leave it as a legacy or gift to a son or daughter the best option to protect the family farm from divorce claims is for prenuptial agreements to be signed at the time of any marriage.
Although the prenuptial agreement can try to ring-fence the family farm from any financial claims in divorce, whether or not the prenuptial agreement will work fully depends on the family needs at the time of the divorce and the availability of other assets to meet divorce financial claims.
In any family situation involving a family farm, divorce solicitors recommend legal advice is taken on the benefits and potential disadvantages of a gift or transfer before the family farm is transferred to a son or daughter. Advice can then be taken on the option of a prenuptial agreement or, if they are already married a post nuptial agreement .
Divorce and the Family Farm
If you are getting divorced and one of you owns a family farm then it is particularly important that both husband and wife get expert legal advice from specialist divorce and family finance solicitors.
It is likely to be the case that the farm owner wants to keep the farm and the spouse that does not own the farm wants it to be sold to raise money to buy a house to rehome him or her. There may be mention of the land’s increased value if farm buildings or land could potentially get outline planning permission so it can be developed for housing.
In any divorce and financial proceedings, assets need to be valued. That applies just as much when the asset is a family farm. A specialist valuation will be needed to look at the value of the farm and land as well as any ‘’hope’’ value in relation to planning permission and development opportunities or the sale of part of the acreage. In addition, the value of the farm asset will depend on the income produced.
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If a farm is owned in the sole name of a husband or wife (rather than ownership being shared with parents and siblings) then it may be possible to sell part of the land or a farm building or to raise capital by mortgage to meet a husband or wife's divorce financial claims.
When it comes to a family farm and divorce, the court may view the family farm as a non-matrimonial asset and hence will not say that the value should be shared equally between the husband and wife. However, the bottom line is that a husband or wife may get an award that affects the family farm if it is the only way that their housing and other needs can be met.
When a divorce solicitor is giving legal advice to either a farmer or their spouse the aim is to achieve a financial solution that provides a home for the husband, wife, and children and ideally does not affect the continued viability of the working farm. This can require creative resolutions to secure the family farm for future generations.
For help with divorce and financial claims or prenuptial or postnuptial agreements please contact our expert family lawyers
If you have taken the decision to separate from a husband or wife, it is tempting to leave sorting out financial and property matters and things can drift. Alternatively, a husband or wife can rush into an agreement, often without first getting accurate or up to date valuations of property and other assets.
Which Property Should be Valued in Your Divorce?
It is assumed by a separating couple that only the family home needs to be valued as part of their separation or divorce. That is not necessarily correct, as it is important that all relevant property is valued.
What then is ‘’relevant property ’’ that should be valued? The honest answer from a Whitefield divorce solicitor is that it all depends on the individual personal and financial circumstances of a husband and wife. However, property can be relevant even if it is owned in the sole name of a husband or wife. Property does not have to be owned jointly to be relevant to divorce proceedings and form part of the family wealth and financial settlement options.
If a husband and wife are splitting up then consider valuing:
The family home ; and
Any second home or holiday home or chalet (including overseas property ) ; and
Buy to let property portfolio; and
Any property owned by a family business. This is because if the property is included in the company business accounts the company shares cannot be accurately valued unless there is an up to date valuation of the property ; and
Any property held within a pension fund, such as a SIPP. This is because the value of the pension fund cannot be accurately ascertained without an up to date value of the property held in the pension fund ; and
Property owned by a third party, for example a family member, if a husband or wife has a beneficial interest in the property.
An expert divorce solicitor will look at the financial disclosure and advise you on what property should be valued and talk to you about the best way to obtain accurate valuations. The solicitor’s advice may depend on a range of factors, for example, the length of the marriage or when a property was last valued. Sometimes an independent surveyor may have recently valued business or pension property for business related or pension administration purposes. That can mean that a further report is not necessary but careful thought should be given to the purpose of the original valuation and the reliance that can be placed upon it.
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Valuing Property in Financial Court Proceedings
The first step in reaching a financial settlement is to find out what the family home and other property and assets are worth. If property and assets are not accurately valued then the financial settlement can result in unfairness to either the husband or wife.
If a couple cannot agree on the value of a property value, a court can order a formal valuation by a surveyor who is a member of the Royal Institute of Chartered Surveyors.
Normally a family judge will say that one surveyor, jointly instructed by the husband and wife, should undertake a valuation of property for use in financial court proceedings. The main advantage of using one single joint expert is there are no conflicting opinions on a property value by different surveyors and costs do not escalate by surveyors going to court hearings to justify their different property valuations.
A single joint expert is:
Independent of both husband and wife ;
Will not of had undisclosed prior dealings with either the husband , wife or the property ; and
Not influenced by whether the property is owned jointly or by the husband or wife or jointly with a third party. This is because the expert is focussed on the value of the property and not its ownership; and
Under professional and court rules on reporting duties to ensure that the report is independent and impartial.
Specialist Whitefield divorce solicitors also recommend that you take advice on the tax implications of the sale or transfer of property so that the tax bill can be factored into the financial settlement to achieve a fair net result.
A divorcing couple can worry about the cost of getting legal advice, property valuations and tax advice. However, given the importance of knowing how much property and assets are worth before looking at the wide range of property solutions, it is always sensible to get expert advice before deciding what to do. The cost of this advice and preparing any legal documentation is tiny compared to the cost and stress involved if something goes wrong without the right valuations and documentation in place.
For legal assistance with divorce financial settlements and representation in financial court proceedings please contact our expert divorce lawyers today
As leading Cheshire divorce solicitors, we are often asked if there is a simple hack to reduce the stress of a divorce. Many people thought that the government announcement that it intends to introduce ‘’no fault’’ divorce would result in less stressful divorces but most divorce solicitors say most of the stress of a divorce comes from:
Taking the initial decision on whether to separate or not;
Thinking about how you will tell the children about a planned separation or the decision to start divorce proceedings ;
Reaching an agreement about how much time the children will send in each household ;
Breaking the news of your decision to separate to close family or to mutual friends;
Worrying about how you will cope financially after a divorce ; that can either be immediate worries or long term concerns about the effect of getting divorced and the impact on your pension and retirement planning;
Concerns about whether or not you will need to move out of the family home and, if so, how that will affect the children, for example ease of getting to their current schools or seeing friends.
A good divorce solicitor will tell you that there is no one magic solution to reduce divorce stress, but some simple steps can help:
Take time for yourself
If you are facing a separation or divorce, you may be worried about how your children or family will react to the news. Often your wants and needs are low down on your list of priorities. Whilst that is understandable, it is not healthy. Whilst it is not legal advice, most good divorce solicitors would recommend that you take time for yourself, whether that is taking time for a chat with a friend or a trip to the gym.
Acknowledge how you are feeling
If you are feeling emotional or you think things feel out of control then speaking to a counsellor or to your doctor about how you are feeling can be a good option.
Limit social media
Social media and contact with friends via face book and other social media sites can be a comfort but it can equally be the major cause of divorce stress. That is because content and messaging, especially with a former partner, can quickly become overwhelming and distract you from the things that you do need to sort out.
Talking to the children
Parents are often reluctant to tell their children about a planned separation. That is normally because they want to protect their children for as long as possible. Parents also tend to think that they cannot talk to their children until they themselves know the answers to what the agreed parenting arrangements will be or whether the family home will be sold or not. However, children will pick up on the atmosphere or tensions at home and normally adult stress levels are reduced once children have been told about a planned separation.
Take legal advice
A divorce solicitor will be able to reach an agreement over parenting arrangements, custody and access and your financial settlement options. Practical and pragmatic advice taken either before your separation or at an early stage after your separation can help you reduce divorce stress and the likelihood of contested children or financial proceedings.
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For legal advice on your divorce or dissolution of civil partnership proceedings please contact us.
It is tempting to answer the question ‘’does length of marriage affect divorce settlement?’’ by saying that ‘’it all depends’’. However, many would say that reply is a typical politicians or lawyer’s answer and, if you are getting divorced, you want a clear answer, not something woolly.
The reality though is that the length of a marriage is a relevant factor when the court decides how much a husband and wife should get in a divorce financial settlement. Just how relevant the length of the marriage is depends on the couple’s financial and personal circumstances.
The short marriage and the divorce financial settlement
Many people assume that if a couple have only been married for a couple of years then the divorcing spouse will not get spousal maintenance or even a ‘’pay out‘’ or divorce financial settlement but it all depends.
If three couples have each been married for two years the financial settlement will be different for each couple, as highlighted by these three case examples:
Couple 1 Janet and John
Janet and John are both high flyers and each owned property before their marriage. They have no children. The short length of their marriage will be highly influential in reaching a financial settlement and clean break financial court order.
Couple 2 Mariah and Nick
The couple only got together just before their marriage two years ago and shortly afterwards the twins arrived. Mariah left work to look after them as Nick agreed juggling work and childcare was not in the interests of the twins. Although the couple have only been married for two years, the length of their marriage is not highly relevant, as the court will focus on the children’s needs when determining a fair financial settlement.
Couple 3 Bill and Ben
Bill and Ben married two years ago but within a matter of months, Bill realised that he had made a mistake. He has moved out and started divorce proceedings. He has assumed that he will get a clean break financial court order as the couple only lived together for twelve months out of their two-year marriage.
However, before the marriage, Bill and Ben had lived together in a continuous relationship for about fifteen years. The court takes into account pre-marriage cohabitation when looking at the length of the marriage, if it was ‘’seamless living together’’.
Although the marriage may have officially only been of two years duration, the family court could assess it as a long relationship of seventeen years when looking at what sort of divorce financial settlement would be fair to both Bill and Ben.
Does the length of marriage affect divorce settlement?
The case studies show that when a Whitefield divorce solicitor answers the question ‘’ does the length of a marriage affect divorce settlement ‘’ with a ‘’maybe’’ that whilst it may be a woolly answer it is the correct one until more information is available on a couple’s financial and personal circumstances.
For help with your divorce financial settlement please contact our specialist divorce lawyers.
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