Untangling shared finances is a key feature of most divorces and civil partnership dissolutions. In practice, the process is separate from, but often runs in tandem with, the divorce or dissolution process itself.
Financial disclosure (designed to lay all the information on the table to create a clear picture) is an essential part of the process and usually dealt with by each party completing and then exchanging a Form E. This is a court form which sets out detailed information about your:
Form Es must be prepared if you make a court application for a financial order, but in practice disclosure often happens before this, because it enables you to talk about reaching a settlement (either with the help of a solicitor or a mediator).
Any agreement about financial issues will have to be approved by a judge to be legally binding, so it is sensible to get legal advice before applying to court. It is important to make sure that your consent order is approved before your divorce or civil partnership dissolution is finalised. Once the order is approved, this prevents any future claims by either spouse, unless allowed for in the order.
A separation agreement is another option, used if you want to settle financial issues but are not yet able to obtain a formal consent order. It is not legally binding like a consent order, but does carry weight with the court if there is a later dispute about finances, particularly if you both had legal advice and went through financial disclosure before it was signed.
If you cannot agree a financial settlement, mediation should be considered as your first option (find out more about mediation). If you have considered or tried mediation and not reached agreement, either of you can make an application to the family court to make a decision for you.
The court has a wide discretion and will look at the list of criteria set out in Section 25 of the Matrimonial Causes Act (these criteria apply to different-sex marriages, same-sex marriages, and same-sex civil partnerships). In Lawrence v Gallagher (2012), the Court of Appeal made clear that these principles should apply in the same way to same-sex civil partners as they do to different-sex couples although in practice there is considerable flexibility and cases involving same-sex couples often have a different flavour. We work with many LGBT clients and can advise you on your particular situation.
The law requires the court to consider:
The court is not bound by any pre-nuptial agreement which you entered into before getting married or forming your civil partnership, but can take it into account. Find out more about pre-nuptial agreements.
The weight your agreement will be given is an evolving question, but it is clear that it stands a better chance of being given weight if it was signed sufficiently in advance of your marriage/civil partnership, and following full financial disclosure and independent legal advice for both of you.
In the case of Radmacher v Granatino (2010) the Supreme Court said that pre-nuptial agreements could be upheld by the court, at the court's discretion. In 2014, the Law Commission recommended that pre-nuptial agreements should be made legally enforceable by UK law. It therefore seems likely that the court will take more, rather than less, account of pre-nuptial agreements in the future.
The family court can make orders in relation to all your various assets (as to who should own them after you are divorced). The family court can also make orders for spousal maintenance i.e. for one partner to pay an income to the other after your divorce. Find out more about what might happen to:
The court process is designed to encourage you to continue negotiating to reach your own settlement, but with the court ultimately imposing an order if settlement is not reached. One of the benefits of making a court application is that the court process will impose a timetable for the process of resolving things, during which most cases settle. Either of you can send a completed Form A to the family court at any stage after a divorce or dissolution petition has been issued in order to seek a financial order. You must then go through financial disclosure if you have not already done so.
The court will then set dates for three hearings to determine the financial application. These are:
First Directions Appointment (FDA) - This is the first hearing in court and is normally mainly procedural. The judge will assess the information already provided and will determine what is required to progress the case to settlement. The judge might order:
Financial Dispute Resolution hearing (FDR) - The court will not make an order at an FDR, but a judge will hear from each of you, your proposals for settlement, and your reasoning, and will then give an indication of what he or she might order if this were a final hearing. This hearing is conducted on a ‘without prejudice' basis which means that the judge will not be involved in the case any further if it does not settle. This is designed to encourage open discussions in which you can lay your cards on the table without worrying that you might affect the ultimate decision if you can't agree. Many cases settle at or shortly after this hearing.
Final Hearing - At a final hearing, a different judge will usually hear oral evidence from each of you and any relevant experts, and will consider the written evidence and legal argument which has been filed. The judge will then reach a decision and will make an order deciding how your finances should be resolved.
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