Financial Orders

Our family law solicitors are asked if it is possible to divorce your wife and keep everything. In this blog, we explain your options if you want to keep all the assets after your separation. For expert advice call our team of specialist divorce lawyers or complete our online enquiry form. Can a husband divorce his wife and keep everything?  It is technically possible for a husband to divorce his wife and keep everything but most divorce solicitors will tell you that it is an unlikely outcome in financial settlement negotiations or financial court proceedings unless your circumstances are unusual. If you are a husband your best bet to keep all your assets after a separation or divorce is to sign a prenuptial agreement before your marriage or a postnuptial agreement after your marriage. Even if a wife has signed a prenuptial or postnuptial agreement the document is not legally binding on a spouse under English law. The agreement will carry weight provided both husband and wife took independent legal advice on the contents of the agreement and there was no coercion to sign the document and completion of the paperwork only took place after husband and wife disclosed their assets. If these safeguards were not put in place the court may disregard the terms of the prenuptial or postnuptial agreement. Even if you ticked all these safeguarding boxes, the court may conclude that if the wife gets nothing, as you are keeping everything, the outcome is unfair because the wife’s needs are not being met. The court may therefore disregard the terms of the agreement. A prenuptial agreement solicitor will normally recommend that your prenuptial agreement or postnuptial agreement does not allow you to keep everything as it is better to have an agreement that works and therefore one that gives your wife a modest financial settlement that meets her financial needs rather than sign a prenup that says you will get to keep everything if you divorce but the prenup then doesn’t work in practice if you split up from your wife. [related_posts] If my wife agrees that I will keep everything, can I get a financial court order? The court can be asked to make an agreed financial consent order. The agreed order is lodged by your divorce solicitor after your conditional order of divorce has been pronounced. The order must be accompanied by a standard court form (called a statement of financial information) summarising the details of your marriage and your personal and financial circumstances. If this prescribed form is not completed the court will not approve your financial court order. If, for any reason, the figures provided in the form are wrong (for example you say your company shares in a family business are worth £10,000 rather than a more realistic 1 million) your wife will be able to reopen her financial claim at a later date because of inaccurate financial disclosure that led to the financial court order being made. Your ex-wife could ask the court to make another financial court order giving her a reasonable share of the assets. Therefore, inaccurately valuing assets on the form does not give you the financial security you need. If the shares in your family business continue to increase in value, then by the date of your wife's further financial settlement application, your company shares could be worth 10 million.  Providing inaccurate information in the court paperwork could cost you a lot of money if your ex-wife is advised to reopen her financial claims. If you complete the prescribed form to accompany your application for an agreed financial court order and include accurate asset figures, and the document shows you will be keeping everything and your wife will be getting nothing, the judge may refuse to make the agreed order. The judge may ask questions in an email or letter to your divorce solicitors or may invite you and your wife and your family lawyers to a court hearing so the judge can understand the rationale behind the making of the financial court order.  You may think that the answer to keeping everything lies in making a deal with your wife that she doesn’t get anything but neither of you ask the court to make a financial court order. However, you then run the risk of your ex-wife deciding to apply for a financial court order at a later date and asking for money or property or a share of your pension. This could work against you if your property or other assets have gone up in value from the date you agreed with your wife that she would walk away with nothing whilst you keep everything. What should you do if you want to keep everything after your divorce?  If you want to leave your wife with nothing the best option is to talk to a family law solicitor about whether you can achieve this and how to do so. Your family lawyer may tell you that it will be an uphill task and that you may be better off focussing on a lowball offer that meets your wife's reasonable needs but is pitched at a level where you can get a clean break financial court order from the family court.  A clean break court order means your wife can't come back later on and ask for more spousal maintenance or a share of your pension or equity in your house. That’s why it’s crucial to secure a court order to give you future financial security so you can plan for your future and not have concerns that your wife years later could come back and ask for money because she had nothing at the time of your separation. For expert advice call our team of specialist divorce lawyers or complete our online enquiry form.  

Applying for a Financial Court Order when you Have Reached a Divorce Financial Agreement If you have reached an agreement with your ex-husband or your ex-wife about how your assets will be split after your divorce you may question if you need a financial court order. A divorce solicitor will tell you that a court order is necessary and explain what could happen if you don’t obtain an order. For expert advice on divorce and family law call our team of specialist divorce lawyers or complete our online enquiry form. Why you need a financial court order If you have reached a divorce financial settlement by agreement, you still need a financial court order. There are several reasons why you need an order: It gives you financial security – if your ex-partner changes their mind and wants more than you originally agreed upon you can rely on the court order to prevent additional claims for cash. For example, your ex may say the original agreement was unfair because the value of your business has gone up more than the equity in the family home or that they need more because they did not get a share of your pension when they negotiated the financial deal You can enforce a court order – you may think that your ex-spouse won't breach your agreement but, for example, if you agreed that the family home would be sold, they may be reluctant to sell the property if it means they have to downsize. A court order can include the mechanics for the sale and if a spouse is resistant to a sale the court can order that a judge has the authority to sign the transfer documents. You may think it unlikely that you will need to enforce an order but situations change, such as your ex-spouse or you meeting a new partner, and that altering the dynamics Pensions – if your financial agreement includes pension sharing the pension administrator is not allowed to implement your agreement until they have a financial court order, pension sharing annex, and the final order of divorce   Third parties – you may need a financial court order where third parties are involved. For example, if one of you is at potential risk of bankruptcy with the involvement of a trustee in bankruptcy. For example, if a mortgage company will only transfer the mortgage into your ex-spouse’s sole name if the transfer is made under a court order or if there is a spousal maintenance order so your ex-spouse can persuade the mortgage company that they have enough income to be able to take the mortgage over on their own Clean break – some financial agreements include a clean break to stop any future financial claims by you or your ex-spouse. If you have negotiated a clean break, it is important to have the security of a binding financial court order that endorses and confirms the clean break [related_posts] Applying for a financial court order If you have reached a financial agreement through direct discussion, solicitor negotiations, or family mediation there is normally no need to go to a court hearing to get your financial court order. Your divorce solicitor can send the paperwork to the court for approval and, in the vast majority of cases, a judge will agree to make the financial court order with no alterations to the draft order or only minor ‘drafting tweaks’. Broken down into stages, to obtain a financial court order you have to: Check there is an agreement that is capable of being made into a financial court order – if you negotiated your agreement direct then your divorce solicitor can check your agreement for you Check if the court can make a financial court order – the court can only make a financial court order once you have obtained a conditional order of divorce. If you got divorced some time ago and have a decree nisi of divorce the court can still make a financial court order Check if any relevant third parties are OK with the agreement. For example, the mortgage company if a house and mortgage are going to be transferred into one spouse’s name or a pension administrator if a pension sharing order is being requested Draw up the draft financial court order and exchange it with your ex-spouse’s solicitor and make any changes needed Swap statements of financial information summarising your assets and income. These statements are filed in court with your draft financial court order. The court will not approve a financial court order unless these statements are prepared and filed Send the draft financial court order to any relevant third parties. For example, to a pension administrator for their approval of the wording of the pension sharing order Ask the court to approve the financial court order by sending the court the required paperwork and court fee. In the vast majority of cases, the judge will make the financial court order requested if the order has been properly prepared and the statement of financial information explains why the court order has been agreed upon Answer any questions the court may have on the proposed financial court order Once the sealed financial court order is received from the court send it to any relevant third parties. For example, the pension administrator, financial advisor, or property solicitor if the financial court order includes pension sharing, investment transfers, or the transfer of property Finalise the divorce proceedings as without the final order of divorce the financial court order cannot be enforced Diary up. If the financial court order includes spousal maintenance your divorce solicitor should check and diary up review dates for increases in line with retail price index rises or end dates and make sure everything in the court order has been sorted out, such as the implementation of a pension sharing order, the taking out of life insurance or changes to a pension nomination That list may look exhausting but the job of a divorce solicitor is to convert agreements into financial court orders. At Evolve Family Law we recognise that if you have reached a financial agreement, you do not want to hang around whilst divorce solicitors get out their fountain pens to prepare financial court paperwork and then post it back and forth between spouses and solicitors. Evolve uses technology to standardise and speed up the process of drafting family court orders, and as importantly, to make the obtaining of a financial court order more cost-effective and value for money for you. It is the combination of experience and technology that means Evolve Family Law can offer transparent pricing and fixed fees for financial court orders. We are proud to say that we are one of the first law firms in the country to publish our fees online in a handy user-friendly guide without hidden extras as the quoted fees include VAT. Some financial court orders are more complicated than others, especially where there are businesses or trusts involved, and in other situations, you may not be able to reach a financial agreement and so need advice on the financial court process. Whatever the situation you find yourself in, Evolve Family Law can help with friendly approachable expert assistance combined with transparent costs. The first step is to contact us to discuss how our divorce solicitors can help you. For expert advice on divorce and family law call our team of specialist divorce lawyers or complete our online enquiry form.

Do you suspect your ex is hiding assets from you in your divorce proceedings? If your ex is hiding assets there is a real risk you won't achieve a fair financial settlement. If you suspect your ex is hiding assets there is also a strong possibility that you won't be able to reach an agreed financial settlement because of your suspicions. That’s why if you think your ex is hiding assets in divorce proceedings it is best to get expert family law advice on your options. For expert Divorce and Financial Settlement advice call our team of specialist divorce lawyers or complete our online enquiry form. Is my ex hiding assets in divorce proceedings? Divorce solicitors will tell you that a husband and wife are under a duty to provide full and frank financial disclosure of their assets when negotiating a financial settlement. That’s the case whether you are negotiating through: Direct discussions Solicitor negotiations Family mediation Family arbitration Financial Court proceedings If things are amicable, or your finances are straight forward, you may not want to see reams of paperwork going back years but every family situation is different. You probably know if your ex has hidden stuff from you throughout your marriage or you may suspect that they started to do so when they met someone else or when the marriage got into difficulties and the relationship started to drift apart. If your ex is very keen to reach a financial settlement without providing any paperwork and wants to get an agreed clean break Financial Court Order as soon as possible this may raise a red flag for you or your divorce solicitor as you need some minimum paperwork to check things out. If you feel that you are being pressurised into accepting no or very limited financial disclosure documents, and into accepting your ex’s word for everything, talk to a financial settlement solicitor before agreeing to a division of assets. That’s because whilst your ex might be totally honest and just wanting to ‘cut to the chase’ and get an agreement, you are entitled to see supporting paperwork. It’s important to do so as any financial settlement you reach by agreement can't easily and quickly be unravelled if it turns out that you were right to have your suspicions about your ex hiding assets from you. [related_posts] Why is my ex hiding assets? There are many reasons why an ex may try to hide assets. Divorce solicitors come across these common excuses: It is inherited money It is savings from my income The new house is owned by my new partner so it isn’t really my asset even though the deposit came from me There is no need to get a business or pension or other asset valued as you can take my word for the value Money was owed to a family member and was not transferred to them to hide assets Cash that was put into additional bank accounts was forgotten Property owned abroad or owned before marriage doesn’t count towards the financial settlement so wasn’t disclosed as it isn’t relevant ( in the ex’s opinion) These are all excuses and should not be used as a reason to not provide full and frank financial disclosure. Sometimes an ex will try to hide money that might not be relevant to the financial settlement but you will both spend time and money arguing over the financial disclosure. However, if the asset had been disclosed at the outset your financial settlement solicitor could have advised you about its overall relevance to the financial settlement. For example, a pension accrued before a short marriage with a cash equivalent transfer value of £10,000 may not be of significance and your ex is wasting their time and money by trying to hide an asset that may be of limited relevance because of the duration of your marriage or your ages. However, by failing to disclose the pension, you and the Court may be far more sceptical about how honest their other financial disclosure is, such as, the extent of your ex’s declared self-employed income or the reason they have transferred money to a sibling or new partner. What can you do about an ex hiding assets? If you are separated or getting divorced and you believe your ex is hiding assets you may need urgent financial settlement and injunction representation. That’s because if your ex is hiding assets with the intention of reducing your financial settlement you may need an injunction order to stop them. Examples of when you may require a financial injunction include: Your ex is transferring money or property to a third party Your ex is putting their pension in payment and taking the maximum tax free cash sum to put the money out of your reach Your ex is syphoning money out of the family business by paying a family member for false invoices with a view to making sure the family business has a lower value placed on it as profits will be down Your ex is buying property overseas or transferring assets abroad Your ex is moving money out of joint bank accounts and putting it into cryptocurrency An injunction is a temporary measure to stop your ex from hiding or disposing of assets. It is best to consider a section 37 injunction application rather than assume that in financial settlement Court proceedings a new partner, parent or sibling can be joined into the financial application to try to unravel the transfer of assets. Whilst that is possible it is normally best to stop the transfer taking place in the first place by securing a freezing injunction. If you have not already done so, a divorce solicitor will also advise you to start financial Court proceedings for a Financial  Court Order. Within the financial settlement application, the Court can make financial disclosure orders that your ex will need to comply with. If your ex does not comply with the financial disclosure orders then you can ask the Court to enforce the disclosure orders against your ex or ask the Court to draw inferences. For example, if the Court ordered disclosure of historical bank statements to reveal what happened to the £100,000 after the sale of a buy to let property and your ex flouts the disclosure order you can ask the Court to draw inferences as to why and ask the Court to add back in the £100,000 so you get a greater share of the other family assets. Financial proceedings and ex hiding assets If you have started financial proceedings and you are not satisfied with your ex’s Form E financial disclosure then a specialist family solicitor can review the financial disclosure with you and draw up a list of additional questions and request for extra non-standard paperwork . For example, if your ex is the director and shareholder in a family business and you suspect they have been syphoning money off to their new partner by creative accounting or use of the director loan account, you can ask for a forensic accountant to value the business and look at your accounting concerns as well as asking for an order that your ex disclose statements for their DLA. Alternatively, you can ask the Court to make financial disclosure orders to help you investigate if: Your ex is self-employed and the family lifestyle does not match their declared earnings Your ex has withdrawn significant sums from a business or personal account and that is not their usual pattern of spending Your ex previously mentioned an asset that they said would be a rainy day asset or pension but there is no mention of the asset in their financial disclosure There are lots of ways a tenacious divorce solicitor can ‘get to the bottom’ of financial disclosure, with the assistance of your background information and knowledge of your ex, combined with seeking the right injunction, financial disclosure orders and valuations. For expert Divorce and Financial Settlement advice call our team of specialist divorce lawyers or complete our online enquiry form

Getting divorced and reaching a financial settlement can be hard, even where there are only two of you involved in reaching a financial settlement and securing a Financial Court Order. It can be even harder when family members have given or loaned money, with disputes over whether the money was a gift or a loan and how the loan should be treated in the divorce and financial settlement proceedings. For expert Divorce and Financial Settlement advice call our team of specialist divorce lawyers or complete our online enquiry form. The recent financial settlement Court case of P v Q (Financial Remedies) [2022] EWFC B9 (10 February 2022) has confirmed how the Courts should treat family loans in a divorce. The case emphasises the importance of extended family members taking legal advice if they intend the transfer of money to be a loan or want a gift to be ring-fenced in the case of separation or divorce. Family loans in financial settlement proceedings If a member of the extended family gives money to a husband or wife during their relationship then undoubtedly at the time of the gift or loan the money is very welcome. When a couple split up, family loans can complicate things where there is a dispute about: Whether the money was a gift or loan. Whether the gift was to the husband or wife or to the couple jointly. If the money was a loan, the repayment terms. If the money was a loan, whether the debt should be included as a debt in the asset schedule. If the money has been repaid to the extended family member because of the divorce, whether the money transferred to the relative should be added back into the asset schedule. Whether the extended family member should intervene in the financial settlement Court proceedings. Things can get very acrimonious when family money is in issue, with one party saying the money was a gift and the other a loan. Expert divorce and financial settlement solicitors say it is best to: Get help from an experienced divorce and financial settlement solicitor. They will give you an unbiased view on whether the family Court will say the money is a gift or a loan. Whilst you may not like their opinion about the treatment of the family money, you don’t want to waste time or money on an argument that you are not likely to win. Look at the cost of arguing whether the family money was a gift or loan as you don’t want to spend more in legal costs arguing the point if the costs will be more than the amount to be gained in your likely financial settlement. [related_posts] The case of P v Q (Financial Remedies) [2022] EWFC B9 The case of P v Q involved an international family based in the UK and Germany. The wife was German, living in England. The husband was English, living in Germany with the couple’s two children. The case had many unusual points, including the value and liquidity of company shares, particularly as the case was heard at a time when Russian forces were massing at the Ukraine border and there were expectations of share price volatility because the shares were held in an energy company. Divorce and financial settlement proceedings were started in the UK. The wife said the husband had given his mother £150,000 to reduce the amount the wife would receive as a financial settlement. The husband said he had given his mother the £150,000 to repay a loan and that the money should not be added back into the asset schedule. The judge acknowledged he had to consider the factors set out in Section 25 and Section 25A Matrimonial Causes Act 1973 together with any relevant case law when deciding how to split the assets and how to treat the family loan money. Section 25 Matrimonial Causes Act 1973 broadly says it is the duty of the Court when making a Financial Court Order to have regard to all the circumstances of the case, first consideration being given to the welfare while a minor of any child of the family who has not attained the age of eighteen. Amongst other things, and of particular relevance to family money and loans, the Court should have particular regard to: The income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future, including in the case of earning capacity any increase in that capacity which it would in the opinion of the Court be reasonable to expect a party to the marriage to take steps to acquire. The financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future. In the case of P and Q , the husband’s mother gave each of her three children the sum of £150,000 to help them with housing. No loan documentation was drawn up. There was no evidence that the husband's mother had gifted the money as part of an estate planning strategy. No demand was ever made for repayment of the £150,000 and there was no discussion about the circumstances when repayment was required. In evidence the mother said she hoped the family would repay the money to her if she was in need. The husband repaid the £150,000 to his mother without his mother asking for the money. The wife argued the transfer was a device to remove £150,000 from the asset schedule so she lost out, using the sharing principle of a 50:50 split, of £75,000. The judge had to consider if the £150,000 (and other family monies) were gifts or loans. The judge held that for money to amount to a gift there must be an intention to give away – with no expectation of repayment. Accordingly, the £150,000 was a loan. The arguments didn’t stop there as the judge, using case law, then had to go on to consider the nature of the hard or soft loan to determine if the £150,000 should be added back into the asset schedule. When looking at the treatment of loans in financial settlement proceedings, the judge said the family Court needs to consider: If a judge concludes there is a contractually binding obligation by a party to the marriage towards a third party, the Court should then consider whether the obligation is a hard obligation debt or a soft debt. There is no set test to decide if a loan amounts to a hard or soft debt. A common feature of family loan analysis in financial settlement proceedings is to consider if the obligation to repay will be enforced. Factors pointing to a hard loan include that the terms of the obligation feel like a normal commercial arrangement, there is a written loan agreement and a written demand for payment, a threat of litigation or intervention in the financial settlement proceedings, there hasn’t been a delay in enforcing the debt and the amount of money owed is such that it would be less likely for a creditor to waive the obligation to pay. Factors pointing to a soft loan include that the debt is owed to a friend or family member who remains on good terms, the loan is informal without a commercial arrangement feel to the loan, there has been no written demand for payment despite the loan repayment date having passed, there has been a delay in enforcing repayment, and the amount of the money is such that it would be more likely for the creditor to be likely to waive the obligation to repay. Using these principles and looking at the facts of the husband's loan from his mother, the judge concluded the loan fell into the ‘soft’ category of loan. For the financial settlement, that meant the loan monies were added back into the asset schedule, thus increasing the amount to be shared between the husband and wife by £150,000. Divorce and private client considerations when making or receiving family loans If you are thinking about making a gift or loan to a family member, it is sensible to take private client advice to try to ensure your gift is either tax efficient for inheritance tax purposes or ring fenced and protected in case of divorce through the use of a loan document, preferably combined with a prenuptial agreement or postnuptial agreement. For expert Divorce and Financial Settlement advice call our team of specialist divorce lawyers or complete our online enquiry form.

The Impact of Domestic Violence On A Divorce Financial Award In this blog divorce financial settlement solicitor, Robin Charrot, looks at a recent court case involving divorce financial settlement claims and allegations of domestic violence to see how divorce settlements work and how the court treat domestic abuse allegations when making financial settlement decisions. The financial settlement A wife, age 55, separated from her husband. They could not reach a financial settlement by agreement and financial  court proceedings were started. Sadly, the scenario of a husband and wife splitting up and going to court to get a financial court order isn’t unusual but what marks this case out is that the wife was a barrister and had a property portfolio in her name, acquired through her earnings during the eleven-year marriage. The husband, age 58, wasn’t working and had not worked independently of the wife throughout the marriage. Again, there isn’t anything unusual about this save for the situation not complying with the unusual gender stereotype. However, the wife said that as well as her being the bread winner in the marriage, the husband had been violent to her on two separate occasions. The wife said that meant the husband should get nothing by way of financial award. The husband argued that wasn’t fair. The domestic violence allegation The financial court looked at the domestic violence allegations. The husband had been prosecuted but was acquitted so had no criminal conviction for domestic abuse. None the less the family court said it could take the allegations of domestic violence into account because the family court had made findings about the domestic abuse. A husband or wife should therefore not assume that just because a spouse did not report domestic abuse to the police that the family court will disregard domestic violence. However, the court also made it clear that just because there has been domestic violence in a relationship that does not mean that the perpetrator of the domestic abuse should end up with nothing. The financial court proceedings The family court ordered the wife to pay the husband £625,000 as a financial court order but the wife disagreed and appealed. She thought the ruling was unfair. The second judge said that £200,000 of the £625,000 award should be a charge to the wife, repayable by the husband’s estate on his death or repayable by the husband to the wife if the husband were to remarry or live with a new partner. The wife asked the court to reduce the lump sum payment to £425,000. On appeal, the court kept the payment at £625,000 and cancelled the charge. This means the wife has to pay the full £625,000. The court calculated that £625,000 was necessary to enable the husband to buy a new house with a budget of £400,000, with £25,000 to buy a car and pay living expenses and £200,000 to cover costs. The appeal judges concluded that the domestic violence findings did not mean there should be no financial  award or a charge back of some of the financial settlement. The appeal judges favoured a clean break financial settlement with no ongoing financial ties between husband and wife.  The costs of not agreeing a financial settlement When determining the appeal, the judge said the family financial  proceedings had become ‘an exercise in self-destruction' because the legal costs had become disproportionate to the family assets so it was hard to achieve a financial settlement that either husband or wife thought was fair. As the appeal court concluded that the findings of domestic abuse made against the husband do not justify making what would otherwise be an inappropriate order the £200,000 charge was removed giving him a lump sum of £625,000. [related_posts] The lessons from the court case The lessons from the court case are that arguing over principles doesn’t always pay as whilst the wife was the breadwinner the husband was nonetheless entitled to a financial  award to meet his needs. Those needs were not extinguished by the finding of domestic violence in the relationship by the family court although it is fair to say that the award is smaller than if no domestic violence allegations had been made. It is therefore important to raise allegations of domestic violence but not to expect that the court will make no award or an award that is lower than an amount that meets the perpetrators basic needs if the other party has his or her needs met. In this case the wife was not only a barrister, she specialised in family law. What that tells us is that it is important to get independent and impartial expert family law legal advice as early as possible. Whilst you may not like the legal advice it may save you a lot in legal costs if that legal advice enables you to reach a pragmatic financial settlement. Evolve Family Law are North West and Online Family and Divorce Solicitors For legal help and advice on divorce and family law call us or complete our online enquiry form.

When you take the decision to separate you may not realise just how big an impact your divorce may have on your future income. The financial services company, Legal and General has revealed that women’s income falls by a third and men’s income by 18% on divorce.  In this blog we look at the impact of divorce on your income. The divorce statistics You may be shocked by the divorce statistics and question why a woman’s income on divorce should reduce by more than men’s income.   The Legal and General research suggests that there are several factors behind the statistics, such as: The reality is that many women earn less than their male counterparts during the marriage because of career choices and childcare In divorce financial settlements women are more likely to ask her for and get a financial settlement that includes the family home or more than half the equity in the sale proceeds of the family home. If you get a greater share or all the equity in the property, then you are less likely to be awarded spousal maintenance or to receive a share of their husband's pension fund and the making of a pension sharing order. [related_posts] Will a divorce impact on my income? When a couple separate it is usual to go from a two-income household to a one-income household with a consequent reduction in income.   If a reduced income means that you can’t manage to pay your reasonable outgoings, the court can make an order that the other party to the marriage pay spousal maintenance. The payment of spousal maintenance can continue indefinitely until terminated by death, re-marriage of the receiving party or further order. Alternatively, the court can order that spousal maintenance is paid on a time limited basis.   What amounts to reasonable outgoings will depend on the standard of living enjoyed during the marriage as well as the affordability of the current outgoings considering: The ability of one spouse to afford to pay spousal maintenance and still meet their own reasonable outgoings and The ability of the other party to the marriage to either find work or increase their earnings capacity so they can meet all or a greater proportion of their own reasonable outgoings.   Divorce solicitors will tell you that when it comes to income on divorce and whether your respective incomes will be shared (through a spousal maintenance order) comes down to a range of factors, such as: Whether you have young children to support and whether the care of children impacts on your earnings capacity Whether any disability or age impacts on your ability to seek employment or increase your income Your income and earnings capacity The extent of your reasonable outgoings The length of the marriage Other factors, such as the existence of a prenuptial agreement that sets out whether and how long spousal maintenance should be payable on separation and divorce.   Perhaps, just as importantly, parity of income on divorce can come down to a question of priorities. You may want to forgo a pension sharing order on divorce as your priority isn’t income on retirement but instead getting the equity in the family home so you can rehouse yourself without a mortgage. Alternatively, you may want the capitalisation of your spousal maintenance payments so that you get a cash lump sum instead of ongoing monthly payments.   Whatever your priorities it is best on separation or divorce to take legal advice from a specialist divorce solicitor so you can understand the range of options for your financial settlement and work out which one is best for you and your family. Without expert legal and financial advice, you may not appreciate the value of the pension fund belonging to your spouse and how a pension sharing order could be to your financial advantage.   The divorce solicitors at Evolve Family Law will not only look at your financial settlement options but they will also reality test them with you. For example, if your priority is to keep the family home and you are willing to forgo a pension sharing order or spousal maintenance to keep the property then this may not be a realistic or best option if you can’t afford to pay your reasonable outgoings on the property as you aren’t getting spousal maintenance or a pension sharing order. Our Manchester and Cheshire Divorce Solicitors Evolve Family Law specialise in separation and divorce proceedings and resolving financial settlements .Call us or complete our online enquiry form for expert legal assistance with your financial settlement. Evolve Family Law have offices in Whitefield, North Manchester and Holmes Chapel, Cheshire but our family law solicitors are also experienced in working remotely and offer meetings by telephone appointment or video call.

Did you know that almost forty percent of people questioned admit to keeping money secrets from their partner? That information comes from a survey conducted by the Money & Pensions Service. In this blog we look at keeping money secrets during a separation or divorce. What the Money & Pensions Service Survey Reveals About Us The Money and Pensions Service survey questioned 5,200 people across the country about their financial habits and personal finances. The key findings are: Those in the age range 25-34 are the most secretive age group, with three in five not revealing financial details to loved ones Whilst nearly twenty five percent of those surveyed thought their husband, wife or partner was hiding financial things the reality is that nearly half said that they had hidden things themselves It is most common to hide credit cards and credit card debt – nearly forty percent of those replying to the survey had done so Undisclosed loans are the second most popular thing to hide from family with just over twenty per cent of those surveyed doing so Around twenty percent of those responding to the survey had a secret savings account.   As the Money and Pensions Service acknowledged there are many reasons why someone might hide money or not reveal their financial situation whilst in a relationship, such as: Wanting to build up a safety net of savings that their partner won't spend. That way there is a rainy day savings fund in case of redundancy or a large unforeseen bill, such as replacing the boiler Feeling the need to save money so that there is an escape route from an abusive relationship where the partner secreting the money is afraid that without hidden money if it will be impossible to leave their controlling partner  Hiding credit card debt or loans because you know that your partner will worry about the debts Feelings of embarrassment of having incurred debt, sometimes the debt was incurred before the new relationship and it now feels ‘too late’ to mention it.   The Money and Pensions Service encourages people to talk about their finances as, by doing so, it can make money worries more manageable, especially when you are concerned about other matters such as redundancy or the impact of Covid-19 on the prospects of your getting a 2020 bonus from your employer. [related_posts] Financial secrets and separation and divorce   As Manchester divorce solicitors we have to ask about financial matters so we can give the best advice on financial settlement options. Sometimes people are reluctant to mention undisclosed credit card debts or loans as their husband or wife doesn’t know about them. However, it is important that you do so as those debts may affect your ability to take over the mortgage on the family home or to secure another mortgage to buy a new property.    In cases where there is debt then in financial settlement court proceedings the court rarely wants to undertake a forensic exercise into how the debt was incurred and whether, for example, you should have bought the shoes or motorbike but instead will ask: Is the debt family debt – in other words whilst the debt was hidden from a husband or wife was the loan or credit card money used for the benefit of the family. For example, a credit card was used to clothe the family or to pay for family holidays or a family car What impact does the debt have? The court will want to know if the debt will stop a husband or wife from being able to buy another house or stay in the family home or meet their other needs.   In addition to debt and divorce, when it comes to financial disclosure on separation or divorce there is an obligation to provide what is referred to as full and frank financial disclosure of all your assets. That includes secret bank accounts that your husband or wife doesn’t know anything about or money given to a family member to ‘hold’ for you or cash that you keep.    Failure to provide full and frank financial disclosure may mean you are less likely to reach a financial settlement by agreement as your husband or wife probably won't believe your financial disclosure or a court drawing inferences or making findings against you in a financial settlement court hearing. For example, if your family business generates cash but according to your accounts you receive an income that amounts to less than your essential outgoings (mortgage payments, utility bills or other known expenditure) then the court could make inferences or findings against you.   Therefore, whilst there may be many reasons why you would want to keep things secret during a relationship, when it comes to a separation or divorce there is a court imposed obligation to be both ‘full and frank’ in your financial disclosure. We are Manchester and Cheshire Divorce and Financial Settlement Solicitors Evolve Family Law specialises in family law and divorce and financial settlements. If you have questions and need advice on your divorce and financial settlement options call Evolve Family Lawor complete our online enquiry form. We offer face to face appointments, remote meetings by appointment by video call or telephone.

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. [related_posts] 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.