House of Commons Publishes Briefing Paper On Financial Provisions When A Relationship Ends

The House of Commons recently published a briefing paper on what happens to a couple’s property and assets when they separate in England and Wales.  Aside from arrangements for children, this is usually the main concern people have when seeking advice from a family Solicitor.

Following the Supreme Court decision in Owens v Owens [2018] UKSC 41 and the ongoing criticism of the lack of legal protection for cohabitees, the UK government has accepted that the family law system in England and Wales needs to be updated, bringing it into line with 21st-century family dynamics.

But for couples who are separating now, they need knowledge of the law as it currently stands.  If you were to separate from your partner today, here is how financial provisions would be made.  Please note, this does not constitute legal advice, and it is crucial to instruct a Solicitor as soon as possible, even if your separation is amicable, to ensure your best interests are protected.

Couples who are married or in a Civil Partnership

Most divorce applications are now considered at divorce centres and there has been an administrative separation of the process from contested financial applications.

A couple who have decided to divorce can agree between themselves how to divide their property and assets.  The England and Wales legal system is designed to support couples in working out any disputes without the involvement of the Court.  Often this is done through round-table negotiation or mediation.

However, sometimes a couple simply cannot reach an agreement between themselves.  There are many reasons for this; for example, in cases where there has been severe domestic abuse, it is not only unreasonable, but often unsafe to expect parties to work things out amicably.  In high-net-worth divorce cases, where assets may be held in multiple jurisdictions, one party may try to avoid providing full and frank disclosure regarding their wealth.  These types of situations may require Court intervention to ensure a fair financial settlement is obtained.

Although there are exceptions, domestic abuse being one of them, prior to a couple making an application to the Court for financial provision, they must attend a Mediation Information and Assessment Meeting (MIAM) with a Mediator.  He or she will explain the mediation process to them and they can decide if they would like to embark on the process.  If the answer is no, then the Mediator will sign a form stating the couple have attended the MIAM and they can proceed with their court application.

When assessing how to divide property and assets, the Court must have regard to the questions laid down in section 25 of the Matrimonial Causes Act 1973.  These include considering the current and future earning potential of each party, the needs of any children, any physical and/or mental disabilities of the parties, and the standard of living enjoyed by the spouses during the marriage.  This is not an exhaustive list.  Although the starting point is one of sharing the property and assets equally between the parties to the marriage, the Court may decide to move away from equal sharing after applying the section 25 factors.  A family law Solicitor will also have these factors in mind when advising their clients.

There is confusion among the general public as to whether pre or post-nuptial agreements are legally enforceable.  The answer is technically, no.  However, following the landmark Supreme Court decision in Radmacher v Granatino [2010] UKSC 42, if a couple have entered into a pre or post-nuptial agreement, they may see the agreement upheld as long as there is an absence of circumstances which would make such a ruling unfair.

Couples who live together without being married or entering into a Civil Partnership

Cohabitees do not currently enjoy the same legal protections as married couples or civil partners.  If a couple who are living together in a relationship outside of marriage or civil partnership do separate, their financial position can be terrifyingly precarious if they have not had a Cohabitation Agreement drawn up.  This sets out how property and other assets will be divided between the couple upon separation.

If one party to the relationship was the sole legal owner of the property the couple lived in prior to separation, the non-owning party might be able to make a claim under the Trusts of Land and Appointment of Trustees Act (TOLATA) 1996.  Under section 14 of the Act, the court may declare the nature or extent of a person’s interest in the property or order the land to be sold.

In summary

Working out a financial settlement upon separation can be done in an amicable way, provided couples receive experienced legal advice and representation.  A good family lawyer will do all they can to achieve a fair settlement without the involvement of the courts.  However, if litigation proves inevitable, they will ensure your interests are robustly represented.

Rosie Bracher is a specialist family law solicitors based in Barnstaple.  We have the knowledge and expertise to advise you on all matters involving separation and divorce.  Please contact our office on 01271 314 904 and arrange to speak to one of our team.