11 January 2023
How will a no-fault divorce affect my financial settlement?
By Rob Colwell, Director and Head of Family Services, Hayes + Storr.
With the new no-fault divorce making it easier for parties to separate amicably, a final divorce order will only have the effect of dissolving a marriage, it will not resolve any financial claims that a divorcing couple may have against each other.
What is a consent order?
From a legal perspective, it is essential that your finances are protected through a legally binding agreement known as a consent order, otherwise you are at risk of your ex-spouse making a claim against your assets, property, income or pensions in future.
One party may agree to give everything to the other (out of guilt for example), and the couple can arrange this kind of settlement between themselves. However, it is still advisable to get a consent order sealed by the court which confirms the agreement.
A Judge does not have to agree to the settlement and will ask questions if it is not considered fair.
A consent order records the terms of a financial agreement and severs any financial ties between the divorcing couple.
Full and frank financial disclosure
Prior to issuing an application to the courts for a consent order, both parties are required to make ‘full and frank’ financial disclosure to reach a financial agreement. Financial disclosure requires the completion of documents that clarify both parties’ financial positions as part of the divorce process.
Voluntary disclosure of financial documentation can often achieve a settlement between the couple and their solicitors.
Division of Assets
The way assets are divided is generally based on how long you’ve been married or in a civil partnership, as well as your:
• Ages, health and ability to earn
• Property, money and living expenses
• Standard of living
• Role in the marriage or civil partnership, for example if you were the breadwinner or primary carer of the children.
In most cases, assets are split according to need or other statutory criteria and if children are involved, their needs will be prioritised. Long marriages where children aren’t involved often result in an equal split of assets.
Distributing the assets
Once an agreement is reached, most clients will document the agreement in a consent order. Once signed by both parties and sealed by the court, these documents are legally binding. The lawyers will use them to help the clients implement the agreement in the quickest and most cost-effective way.
For further help on divorce and financial settlements call 01328 863231 and ask to speak to the family department, or email: firstname.lastname@example.org.