The coronavirus pandemic looks set to have a major impact on family finances in the long and short term with predictions that up to one million people could lose their jobs.
Mounting concerns of divorced and estranged parents include sustaining child maintenance payments if their income ceases along with making decisions over court proceedings.
Here are responses to some key questions.
How do I continue making maintenance payments during the crisis if my income dries up?
- Communicate with your ex-partner – try to provide them with as much verified information explaining why the payments can no longer be met with the aim of reaching an agreement
- Any such agreement should be confirmed in writing and ideally would be entered into with each party having taken legal advice
- It may be that a lower figure can be agreed in the short term on the basis that any “arrears” are paid later – but it will very much depend upon the facts of each individual case
- If the above fails and maintenance is being paid under a court order and you cannot continue to pay, you may have to make an application to the court to vary or suspend the order
- This is not a simple process but failure to do so might result in arrears building up that could be enforced at some future date
- We strongly advise against ignoring the situation. Gather your information, communicate and take legal advice
I am in court proceedings relating to financial matters. Should I consider adjourning and/or turning to other out of court processes?
- It’s important to remember that the courts are already under great pressure which has been exacerbated by the ongoing situation
- This could be an appropriate time to arrange a process that brings your ex and both your lawyers round the “virtual” table to start a dialogue and mediation
- Courts are very supportive of parties who wish to use non-court methods to resolve issues – your family lawyer will be able to advise on the various options and their pros and cons. They include Arbitration which will enable easier access to a “private Judge” to assist on any disagreement. In addition, when normality returns there will be a considerable backlog for the courts to resolve and access to arbitration will enable a resolution to be reached much quicker.
Should court cases be adjourned until the crisis is over?
- If it is clear that the financial information that everyone has worked on will become – or already has become – obsolete. Consider adjourning any hearing until the position is clear. There is no point reaching agreement, or having a determination by a Judge, based upon inaccurate information. In Arbitration the private judge can adjourn the determination for a limited time to enable the situation to be reviewed.
What is the impact of the pandemic on all the financial information gathered to date such as business valuations, investments, incomes etc?
- This will be different in every case. However, it is likely that any previous business valuation will now be potentially unreliable as the company may have been detrimentally affected by the economic fallout
- As above, it is dangerous for decisions to be made based upon inaccurate information
The importance of parties remaining calm and sensible – and setting their differences aside to work together though this unprecedented period – cannot be understated.
About Norman Taylor
With four decades of experience relating to financial issues arising from family and relationship breakdown, Norman has extensive experience in medium to high value cases.
Norman is respected nationally and locally as an enthusiastic advocate of non-confrontational, solution-based resolution of family issues.
He has been recognised for his work in promoting, developing and championing collaborative law in Yorkshire.