Family Law in Partnership - Page 8

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property rights during separation

The Effects of Restrictions on your Property Rights during Separation

Published on
Kerry Smith
Kerry Smith
Head of Family Law
at K J Smith

When a couple end their relationship, there is typically a big dispute between the two parties regarding all of their assets and finances.

In a lot of situations, it can often be the case that one member of the couple holds the legal title to the owned property, rather than any property being jointly owned.

This can bring potential issues to you if you are the individual that doesn’t have legal ownership of the property, but there are a number of things that you can do to help your situation.

What should you do if you aren’t named as a Proprietor of the Property?

Following the separation from your partner, it is important that you determine whether or not you are named as a proprietor of the property in question.

In the case that you aren’t named as the proprietor, you will need to contact the Land registry and permit yourself occupation by registering a ‘Home Rights Notice’ against the property as soon as you can.

By completing this process, you are essentially protecting your personal rights in relation to eviction and exclusion, and this allows you to enter the property and means that you can continue to live there, even if you had already previously left the family home.

Although this process provides you with the previously mentioned rights, it doesn’t give you ownership of the property.

Property Restrictions

Restrictions for the property in question will prevent any unnatural dealings with the property by your former partner, particularly as restrictions can ultimately prevent them from selling it.

In order to file a restriction against the property, you must demonstrate a particular interest in the property, as well as matching a variety of different criteria.

As restrictions specifically relate to the property and the way in which it is handled by the proprietor, they are typically used within family law cases.

The main focus of this would be to prevent the sale of the property without the consent of the individual, or their solicitors, that ensured the restrictions. This would work in a way that the Land Registry would notify the proprietor of the property of your wish to apply a restriction against the property, with any objections to the restriction leading the case to be reviewed be an adjudicator.

A restriction would be removed from the property in the event of divorce, a court ordering or even a voluntary release, from the individual that initially requested the restriction, be put in place.

A restriction would be put in place against a property up until one of the parties applies for its removal, but this is typically following an agreement between the two parties for it to be removed, ready for the sale of the property.

Home Rights Notices and their Purpose

These notices are specifically designed to protect the rights of third parties as they will be lodged within the charges register of the property title, which would in turn inform any potential buyers of the property.

By having such a notice, you will be informed of any attempts to sell or transfer the property, giving you the ability to stop any transactions.

There are three types of notice that can be registered including:

Registrar’s Notice – This type of notice is designed for certain circumstances, and isn’t a very common occurrence within Family Law.

Agreed Notice – This type of notice would need consent from the proprietor of the property.

Unilateral Notice – This type of notice does not require any consent from the proprietor of the property.

It is essential that you know where you stand in relation to your property and your living arrangements. In the case that you aren’t a named proprietor of the property, we advise that you make use of this guide and take the relevant steps to protecting yourself and your position.

Click here for more articles by Kerry Smith

About Kerry Smith

Kerry Smith is the head of family law at K J Smith Solicitors, a specialist family law firm who deal with a wide range of issues including divorce, domestic violence, civil partnerships and prenuptial agreements.

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Divorce with a business involved

Going through Divorce with a Business Involved

Published on
Victor Collins
Partner and Solicitor at Nelsons Solicitors

The family business comes in all shapes and sizes and in view of this can often be the most difficult financial settlement to conclude following a divorce.

In today’s uncertain economic climate there are potential storms on the horizon for the family business and in the event of a divorce, the business needs to be protected as quickly as possible for its survival and commercial viability for the future.

Why are there complications in these circumstances?

Dealing with the family business following divorce can raise many complex issues involving inheritance, financial contributions and other family members having a share or interest in the business.

How do the courts decide who gets what?

Historically, the family court and trial judge would seek to protect the family business from being heavily involved in a matrimonial settlement in order to avoid the business having to be sold. In view of the position, it was previously possible to try and ‘ring-fence’ the business. However, the position has changed following the case White v White 2001.

In the case, the court dealt with a 33-year marriage and assets totalling £4.6 million, the main being the family farming business. The case went to The Supreme Court, where Mrs White was awarded £1.69 million, 40% of the matrimonial assets, which resulted in the business having to be sold in order to provide Mrs White’s settlement.

Since the case, the law has leaned towards fairness and dividing the matrimonial assets and courts will only depart from equality where there is good reason to do so.

Understanding the business structure

The first step in resolving the family business is to understand the business structure, of which there are three main types:

1. The sole trader is the owner and controller of the business assets and personally liable for the business and its debts.

2. Partnerships can be formal or informal. There are various types of partnership. In view of the position the business structure can be more complicated. Partnership shares and ownership can vary as can business liability.

3.  A limited company can also be more complicated. This involves the issue of shares and appointment of directors within the company. There can be many owners of the business with restrictions being placed on the transfer of shares in the business.

Having established the family business structure, the next step is to value the business.

How is the family business valued?

The valuation of the family business is a crucial starting point since this determines what is in the ‘matrimonial pot’ for distribution between a divorcing couple.

The valuation of the business will almost always be based upon the current market valuation. Normally the valuation will be by a single joint expert who will be an independent qualified accountant.

In order to carry out the valuation the accountant will require full financial disclosure in relation to the business consisting of financial and management accounts. The accountant may also be instructed to deal with other issues such as: the liquidity of the business in order to raise funds and Capital Gains Tax payable on the transfer of shares, or disposal of the business.

When the family business involves land and buildings then it will be necessary to instruct an estate agent as a single joint expert to provide a valuation of these assets.

What could happen to the family business?

The final stage of the process is to decide how to deal with the family business as a settlement between a divorcing couple.  This will normally involve three options:

1. Putting the business up for sale: This option enables a divorcing couple to sell the business and divide the profits. However, selling the business may not always be practical or feasible for various reasons. It will also mean ‘selling the goose that lays the golden egg’.

2. Buying out the other spouse’s interest: This can involve a cash payment from the business to achieve this object. This can also involve a set-off, for example, one spouse taking ownership of the family business and the other spouse taking ownership of the former family home.

3. Co-owning the family business: For divorcing spouses who do not wish to sell the business then co-ownership of the business is another option. However, this is subject to the spouses being able to continue running the business together and being able to get on.”

Professional advice

It is important for divorcing spouses to ensure the correct professional experts are instructed to deal with the family business on divorce.

This not only involves specialised solicitors but also other professionals to deal with valuation and taxation implications in order to ensure the business is not at risk going forward and at the same time achieving a settlement which is fair and reasonable.

About Victor Collins

Victor qualified as a solicitor in 1983 and joined Nelsons in 2013.

He is a well-respected expert in financial settlements, regularly handling divorce cases with substantial assets with a particular emphasis on those involving a family business.

Victor has also developed a niche specialism advising on pre-nuptial, post-nuptial and separation agreements.

For more information on Nelsons Solicitors please visit www.nelsonslaw.co.uk or call 0115 958 6262.

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What Can Brexit Teach Us About Divorce?

What Can Brexit Teach Us About Divorce?

Published on
Natalie Jenner
Head of Divorce and Family Law at Parslows

If you’re currently going through a divorce, you’re not alone.

The entire population of the UK and the rest of the EU are going through the same thing. With a divorce bill and even divorce papers, Brexit is often talked about in terms of divorce. As such, it’s worth asking what the split between the UK and the EU can teach us about the dissolution of marriages.

1. The Decision Can Be Sudden, But The Process Can Take Years

The UK has always had something of an internal conflict about whether or not it wants to be part of the EU. However, on 24th June 2016, a slim enough majority of the voting public decided that the relationship had run its course, and that was that.

The decision came out of nowhere, leaving the rest of the EU “stunned”, but the process of actually handling the divorce has been a long and drawn out affair. Even with the agreement to “accelerate” Brexit talks, it’ll still be 2019 before the UK leaves the EU — almost three years after it voted to do so.

The decision to get divorced can also come out of nowhere, leaving many people as “stunned” as the EU were, but the process can also be convoluted. Between getting your decree nisi and your decree absolute, a divorce can take a whole year to fully complete.

Of course, the decision only appears “sudden” from the side that’s not expecting it. From the other side, it’s a decision which has had a lot of thought put into it…

2. Only One Half of the Relationship Needs to Be Unhappy

Divorce isn’t always a mutual decision. It’s perfectly possible for one person to be happily married while their partner is thinking of whether or not to leave them. This is why people can be surprised by a divorce, even if the signs have been there for years.

Brexit is also a perfect example of this. The EU had no intentions of kicking the UK out, but the UK has been considering leaving the EU for a long, long time.

3. Divorce Doesn’t Need to Be Expensive

The negotiations between the UK and the EU came to a standstill when the issue of the “divorce bill” stopped both sides from reaching an agreement on anything. On the one hand, there is the reported €75 billion the UK owes the EU once it leaves. On the other hand, there is the apparent €10 billion the EU owes the UK once it leaves.

While no divorce in the history of divorces has ever been that expensive, some famous settlements have been pretty eye-watering. Of course, a divorce doesn’t need to cost that much. If the EU and the UK could settle their differences, the figure could be a lot smaller. In much the same way, joint asset valuations are a great way of coming to a compromise both ex-partners can agree on.

4. Public Divorces Are Messy

For the UK and the EU, a public divorce is the only option. The results are not pretty.

The news media is constantly churning out stories about how Brexit negotiations are going. The worse it looks, and the more disputes each side have, the more news it generates.

However, all of this is a necessary evil in the name of free speech. The public doesn’t want to be shielded from the ugliness of the negotiations. They want to know every detail and it is the duty of the news media to tell them about every detail.

By contrast, if you have children, the last thing you want is a messy, public divorce.

For most parents, the ideal way to handle the situation is to keep it out of the courts and to keep everything private. In short, you do want to shield your children from the ugliness of it all. So, be civil, be discreet, and remember: once upon a time, you both loved each other.

About Natalie

Natalie Jenner is the Head of Divorce and Family Law at Parslows. She specialises in dealing with civil partnership dissolutions, financial settlements, child issues, wills, and divorces as well as many other family legal matters.

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How Divorce can Affect Farming Families

Moving on to Pastures New: How Divorce can Affect Farming Families

Published on
Victor Collins
Partner and Solicitor at Nelsons Solicitors

The breakdown of a marriage in any family is an upsetting and emotional experience for those involved.

However, the ramifications and financial upheaval can be considerable and far reaching where a divorce affects a family farm.

There are few other occupations where home and work are so interrelated – the farm is not just a home and business, but a way of life. A farm can involve close family involvement and vested interests and can often be a capital rich, but income light, asset.

Why are there complications in these circumstances?

A farm may have been in the family for a number of generations, resulting in parents and siblings inheriting and sharing the agricultural business. This complex ownership means in the event of a divorce, resolving the family farm as a matrimonial asset can be a very difficult process involving special consideration.

How do the courts decide who gets what?

Where a couple divorces, all assets are taken into account regardless of where they came from. Since the case of White v White 2001, the law has leaned towards fairness when dividing the matrimonial assets and courts will only depart from equality where there is good reason to do so.

However, an equal division of assets and wealth accumulated during a marriage is not always achievable for farmers. This is because of the need to preserve assets that were inherited or owned long before the marriage.

White v White happened to be a case where the parties ran a farm in a farming partnership.

Prior to this case, financial cases tended to be settled based upon a ‘reasonable needs’ basis. This meant that in farming cases it was a lot easier to protect pre-matrimonial assets such as the farm from being sold to fund a divorce settlement.

However, White v White established the principle of fairness. The court ruled that the ‘yardstick of equality’ should be applied so the contribution of both parties to the marriage, and its length, should be taken into account.

This means the financially weaker party should not be disadvantaged and discriminated against when making a divorce settlement.

When a divorce takes place in these circumstances, it is first necessary to ascertain the make-up of the farming business. This includes legal ownership of the land, family trusts and tenancies.

The next stage is to value the farm. In this respect, a specialist valuer is required. It is essential to ensure all aspects of the farm are valued, including land, buildings, farm machinery, livestock and subsidies.

Finally, it is time to divide the farm and the other matrimonial assets.

 How is the farm and other matrimonial assets divided?

Barron J, in her judgement in the Y v Y 2012 case, gave seven factors as a useful guideline and checklist in farming cases relevant to the principle of sharing:

  1. the nature of the assets (e.g. land/property, art, antiques, jewellery on the one hand, and cash or realisable securities on the other);
  2. whether the inherited assets have been preserved in specie or converted in to different assets, realised or even spent;
  3. how long they have been ‘in the family’;
  4. the established or accepted intentions of both the previous holders of the assets and the spouse who has inherited them;
  5. whether they have been ‘mingled’ (for example by being put into joint names of the spouses, or by being mixed with assets generated during the marriage);
  6. the length of the marriage and therefore the period over which they have been ‘enjoyed’ by the other spouse;
  7. whether the other spouse has directly contributed to the improvement or preservation of the inherited wealth.

Protecting your assets

A common mistake and misconception made by farmers and land owners is that a farming asset or business is ‘ring-fenced’ and therefore excluded from any divorce settlement. This is not the case.

The principle of equality established in White v White means that all assets, including the farm, must be taken into account when determining a divorce settlement based upon the requirement of fairness.

However, a trial judge does have the discretion to depart from this basic principle if it becomes clear an equal division of assets is not fair.

This is particularly the case if such a division is likely to damage the farm and business irrevocably.

For these reasons, farming cases can present a number of complex and unique challenges which require an experienced family solicitor specialising in farming cases for their resolution.

For more information on Nelsons Solicitors please visit www.nelsonslaw.co.uk or call 0115 958 6262.

About Victor Collins

Victor qualified as a solicitor in 1983 and joined Nelsons in 2013.

He is a well-respected expert in financial settlements, regularly handling divorce cases with substantial assets with a particular emphasis on those involving a family business.

Victor has also developed a niche specialism advising on pre-nuptial, post-nuptial and separation agreements.

 

 

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divorce, Brexit and visa problems

Divorce, Brexit and Visa Problems – a New Way to go Contactless?

Published on
Heidi Fleming
Family lawyer with
Bretherton Law

For most couples expecting a child, the choice of which hospital to go to is one of the decisions they have to make on the road to parenthood.

In the case of St Albans couple David Kiff and his pregnant Chinese wife Wanwan Qiao this choice was made more complicated by the fact that her spousal visa to remain in the UK was initially denied, and the couple have now been waiting seven months for a decision on her latest application.

With Wanwan due to give birth in September the Home Office granted a four-month extension to her stay, but this runs out in December.

The question for the couple is what to do should the visa not be renewed and Wanwan is deported, presumably taking her new-born child with her.

Whilst not related specifically to EU law, Mr and Mrs Kiff`s dilemma points to the difficulties likely to face many EU families in the aftermath of Brexit.

With Brexit negotiations over the reciprocal arrangements guaranteed to citizens under EU law still to properly begin the ease with which citizens from other parts of the EU will be able to return to their lives in the UK is very much up in the air.

Other stories are emerging every day – the BBC`s Victoria Derbyshire Show reported recently on the case of Estelle Degnan, an Anglo-French student who has lived in the UK with her British mother since she was six.

Because Estelle does not have comprehensive health insurance as a “foreign” student her application for permanent residency in the UK was rejected.

Confusingly, her sister Clara was granted British Citizenship, as she was still at school at the time. The likelihood is that whatever arrangements emerge for current EU citizens wanting to live in the UK there will be corresponding procedures and requirements for UK citizens wishing to reside in other EU countries.

Imagine the complexities where family relationships have broken down, leading to separation or divorce, with situations where one parent decides to return to their home country or move elsewhere with their children. How will these families agree access arrangements? Which courts will decide matters, British courts or EU?

This issue is not only a matter of UK versus EU courts. There are even contradictions within our own legal system, as UK family law and current immigration law do not always follow the same path.

Figures from the Office of National Statistics claim that 27.5% of births in 2015 were to women born outside the UK, and we can assume that a substantial percentage of babies were fathered by men who were born outside Britain. So potentially a quarter of all families in the UK may face these acutely personal problems.

The Government issued a paper in August 2017, setting out its` views on future legal arrangements between Britain and the EU. The opening statement reads: “In leaving the European Union, we will bring about an end to the direct jurisdiction of the Court of Justice of the European Union.”

In interviews this week Teresa May also stated clearly that: “When we leave the European Union we will be leaving the jurisdiction of the European Court of Justice. We will take back control of our laws”.

However, experts in European law have suggested that if the UK wants to remain closely linked to the single market and customs union we will have to adhere closely to European Court of Justice rulings.

Justice Minister Dominic Raab admitted as much in saying that Britain would need to keep “half an eye”  on ECJ jurisdiction.

Sadly none of these proposals will be of much consolation to the thousands of UK and EU citizens, like Estelle Degnan,  currently caught up in the muddle of contradictory rules, regulations and arguments, and as yet there seems to be no clear path to resolving the issues of residency, relocation, access and family relationships.

The sooner things are clarified the better for all of us.

For expert legal advice on issues of foreign jurisdiction and family law please contact Heidi Fleming at Bretherton Law on 01727 869293, or email heidifleming@brethertonlaw.co.uk

 

For further information on the topics raised in this article go to:

http://www.bbc.co.uk/news/uk-england-beds-bucks-herts-41012762

http://www.bbc.co.uk/news/av/uk-41030219/it-s-unfair-i-came-to-the-uk-aged-six

https://www.lawgazette.co.uk/law/practice-points/brexit-and-relocating-with-children-overseas-mind-the-immigration-and-family-law-gaps/5062521.article?utm_source=dispatch&utm_medium=email&utm_campaign=%20GAZ141016

https://www.gov.uk/government/publications/enforcement-and-dispute-resolution-a-future-partnership-paper

ABOUT HEIDI FLEMING

Heidi qualified as a Solicitor in England and Wales in 2009. She initially practised in Yorkshire and then as a Solicitor overseas in Gibraltar. She was subsequently called to the bar in Gibraltar in 2015. Heidi relocated to St Albans in late 2016 to join Bretherton Law‘s Family Department as a Senior Associate.

Heidi specialises in Family Law advising on high net worth Divorce, Nullity, Cohabitation, Financial Remedy, children matters and domestic violence cases.

Heidi also has experience in representing children, parents and other relatives in public law proceedings involving social services.

She is a member of the Law Society’s Children’s Panel and is able to represent Children within Private and Public Law proceedings.

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Divorce Form

Warning – New Divorce Form Could Lead to a Surge in Accusations of Adultery

Published on
Carmen Hudson (LLB)
Director DivorceBox

The ministry of justice launched an amended copy of the divorce application form earlier this month to much applause.

The form is intended to make it easier for those individuals who wish to get divorced without involving a solicitor and has been hailed as a success by commentators and family law charities alike.

1 in 3 divorces are now issued without involving solicitors.

The amended divorce application form has caused some concern amongst family law professionals for altering the provisions relating to adultery as a reason for the divorce application.

Naming and shaming a third party may feel good when completing the divorce application form but applicants are often unprepared for the consequences of doing so when seeking to complete the divorce application form themselves.

The worry is that many applicants fail to grasp the legal consequences of citing adultery in a divorce application and do not fully understand that in doing so they potentially add a third party to proceedings, which in turn could lead to delays in the divorce process, or worse a defended divorce application.

On a practical note citing adultery and potentially naming the ‘culprit’ can have far reaching personal consequences that the applicant can not envisage at this stage in the proceedings.

And may cause problems for many years after the divorce even after the ink is dry on the Decree Nisi.

As a divorce professional we always advise careful consideration before citing adultery in a divorce application.

The harsh reality is that the court is not interested in the reasons for your separation, only that the marriage/civil partnership has broken down irretrievably.

In short there is very little to be gained by citing adultery and a lot to potentially loose. It can delay proceedings, add additional expenses to your application and potentially involve a third party. Who will naturally want to clear ‘their name’.

The new divorce application form was intended to make things easier for those individuals who do not want to involve a solicitor.

But by altering the section relating to adultery the unintended consequences are that the Divorce Centres may see an increase in applications based on adultery and this may lead to further delays in processing times which the new forms were designed to reduce.

ABOUT CARMEN

Carmen Hudson (LLB) is a director and head of legal of operations at DivorceBox.com a online legal service provider specialising in online divorce (e-divorce).

After 15 years in dispute resolution she founded DivorceBox to offer a less intimidating alternative to traditional legal services.

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Arguing Causes More Damage than Divorce in Children

Arguing Causes More Damage than Divorce in Children, New Study Reveals

Published on
Kerry Smith
Kerry Smith
Head of Family Law
at K J Smith

In the lead up to a divorce, those parents who argue are causing their child to develop at a slower rate in comparison to the actual divorce according to new research.

It has been found that a lot of the damage caused to children as a result of divorce is down to the arguing that occurs before the parents separate.

The research, carried out by the University of Yorkshire studied the data of 19,000 children who were born in 2000 and it identified that there are behavioural problems, hyperactivity and emotional development in those children of divorced parents who argued prior to the divorce being finalised.

Therefore, the research identified that children of divorced parents have reduced cognitive and non-cognitive skills when compared to those children who are not exposed to divorcing parents although the divorce itself is not the main reason for this.

A lot of the damage is caused by the circumstances prior to the divorce as well as the characteristics linked to the family. This could be down to many of those families having a lower education as well as struggling financially or they could have regular conflicts. The conflicts between parents could therefore, harm the development of a child more than the separation itself.

Those children that have separated parents have behavioural development problems that are 30% worse than those children who come from families that remain intact.

In England and Wales, the number of divorces occurring is on the increase. The majority of these divorces involve children who are below the age of 16 while 66% of them include children under the age of 11.

When it comes to helping children who are involved in a divorce, there are a number of things that parents can do to ensure they are affected as little as possible. Children are simply children and so, they do not need to see any conflict or discussions. These should take place at a time when the children are not around.

Children also benefit from a routine, this means it is important to keep any routine that they may have.

Any disruption can cause them problems so continue to take them to school or pick them up at the same time, visit grandparents in the way they do and if they take part in an activity during the week, continue the arrangement.

In addition to this, negativity can also have a detrimental impact on their development. They do not need to see or feel the negativity from the parents as this will also impact them.

Regardless of any problems between parents, the children still need them as parents so it is important that they continue to be involved in their lives.

It is now believed that the research could assist Government interventions in a positive way so that parents can be educated in a way that will allow them to understand how they could be having a negative influence on the way in which their child develops.

The results show that those interventions that are intended to enhance co-operation as well as those interventions that ensure parents are aware of how negative conflict can be could help to reduce the number of divorces which will help to improve the non-cognitive skills of children.

About Kerry

Kerry Smith is the head of family law at K J Smith Solicitors, a specialist family law firm who deal with a wide range of issues including divorce, domestic violence, civil partnerships and prenuptial agreements.

 

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How to Approach the Thorny Issue of Pensions when Divorcing 

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Peter Jones
Founder
Jones Myers

Along with dwindling annuity rates and the demise of defined pension schemes, it is a fact of life that divorcees’ retirement incomes are inevitably lower than those of non-divorcees.

A further downside is that from April 6, 2016, thousands of people who divorce, remarry or form a new civil partnership can no longer use ex-spouses’ National Insurance Contributions to help increase their basic state pension.

This development makes it even more essential for separating couples to obtain sound financial advice – not only on their pension situation – but on a whole range of money, investment and insurance issues.

At Jones Myers we have a wealth of expertise in financial remedies – settling of financial matters on divorce. Our specialist team can assist in the complex area of pensions.

As pioneers of collaboration, which offers a viable and constructive alternative to going through the court system, Jones Myers highly experienced lawyers also work with other professional consultants to help both parties secure the best outcome possible.

Among these are neutral Independent Financial Advisers who provide crucial information and advice to both parties regarding pensions and financial planning generally.

This process is vital for the family’s new situation in which fundamental changes can include the extra cost of running two homes, reduced individual disposable incomes and a greater debt burden.

It is also important for couples to discuss their finances openly and honestly. The collaborative process is ideal for this as both parties agree to work through family and financial issues together.

However, when it comes to the divorce process there is no avoiding a full and frank disclosure of each partner’s finances. Neither party can put their head in the sand, nor should they believe that they can squirrel away assets.

Financial disclosure is designed to protect both parties and to ensure that each receives a fair settlement in the circumstances of that particular family, and which may well include an equitable split of pension benefits.

Clients who have resolved issues with their partners through collaboration say it brings wide-ranging benefits which include feeling more in control over their future and improved levels of communication with their ex-spouses. Agreements are reached more quickly and creatively, but far less confrontationally, than awards imposed within the court process.

For more information about financial planning or any aspect of divorce or family law call our team of experts at Jones Myers on 0113 246 0055 or tweet us on @helpwithdivorce

About Peter Jones 

Peter Jones is one of the country’s leading divorce and family lawyers. A qualified arbitrator and mediator, Peter set up Jones Myers as the first niche family law firm in the north of England in 1992 and has acted for a string of high-profile clients.

Renowned for his sympathetic approach, he is a former national chairman of Resolution, a former Deputy District Judge – and instigated the D5 Group of law firms that promotes excellence in family law.

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A Case for No-Fault Divorce
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A Case for No-Fault Divorce

Published on
Kerry Smith
Kerry Smith
Head of Family Law
at K J Smith

When it comes to the law and personal relationships, the UK is a curious mixture of the progressive and the archaic.

On the one hand, the law recognises same-sex unions, on the other the process of ending a marriage through divorce seems to be stuck in the past, specifically the 1970s and the Matrimonial Causes Act 1973.

Irretrievable Breakdown of Marriage in the 21st Century

In England and Wales a divorce can only be granted if it is shown that a marriage has broken down irretrievably and there are only 5 acceptable grounds for making this claim.

Adultery – In legal terms adultery is defined as having a sexual relationship with a member of the opposite sex, same-sex relationships are not recognized in this context.

Also adultery ceases to be recognized as grounds for divorce if the deceived party continues to live with their spouse for 6 months after discovering the affair.

Desertion/Living apart

If a husband and wife live apart for two years and both agree to a divorce

If one party leaves the other for two years and the other party requests a divorce

If a husband and wife live apart for five years and one or the other wants a divorce

Unreasonable Behaviour

One party behaves in such a way that the other cannot reasonably be expected to continue living with them.

De facto No-faults Divorce versus Legally-recognized No-faults Divorce

Looking at the list of reasons given above, it can be seen that currently the only way to be granted a divorce without some element of blame being attached to at least one of the parties is to wait at least two years, which can seem a very long time for couples looking to separate amicably and move on with their lives.

Because of this, Richard Bacon MP attempted to introduce the No-Fault Divorce Bill 2016, but this failed to get past its first commons reading.

Interestingly this appeared to be through lack of time as the second reading was postponed and postponed again, rather than through any strong, entrenched resistance to the idea itself.

There is still strong pressure from the legal community to recognize no-faults divorce, as is already the case in some other countries. In particular Resolution, an association of 6,500 family lawyers and other related professionals are continuing to campaign for a change in the law.

They argue that permitting no-faults divorce would not only free up court time, but also have a far lower impact on children.

Moving from the Blame Game to Respectful Co-parenting

The fact that there is still a requirement to demonstrate blame in divorce cases is particularly odd given that over recent years the government has heavily promoted the use of mediation during divorce.

The whole point of mediation is for couple to work constructively together to find a mutually-agreeable way forward which will always have the interests of their children (if any) at the forefront.

Even when divorce is the outcome, the idea is to move forward positively, particularly if there are children involved.

Notwithstanding this if the couple wish to divorce immediately (rather than wait two years), when the case goes to court one or the other has to shoulder the blame for the end of the marriage.

About Kerry

Kerry Smith is the head of family law at K J Smith Solicitors, a specialist family law firm who deal with a wide range of issues including divorce, domestic violence, civil partnerships and prenuptial agreements.

 

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Divorce Solicitor calls for Financial Settlements

Lancashire Divorce Solicitor calls for Financial Settlements for all Divorces

Published on
Jacquie Birkett
Head of Family Law
Barber & Co Solicitors

Jacquie Birkett, a divorce solicitor and former chartered accountant, who is head of Family Law at Lancashire based law firm, Barber & Co Solicitors, has spoken out in an interview about why getting a financial settlement at the same time as divorce is so important.

Couples who opt for a divorce without coming to a financial agreement may come to regret it in the future. Even long after a divorce, an ex-spouse may make a claim in relation to financial issues arising from the breakdown of their marriage.

What part does a financial settlement play in a divorce?

It is absolutely vital for the parties to negotiate and arrive at a financial settlement on the breakdown of their marriage. Such a settlement means that both parties can move on into the future certain of their financial position and the options they now have. Any settlement reached should be set down in a final order made by the Court within the divorce proceedings.

Why is arranging a financial settlement so important?

Arranging a financial settlement provides certainty for both parties. This can help them make important decisions as they move forward into a new life and ensure that they do not need to worry about, for example, providing stability and security for their children.

What problems can arise if you do not arrange a financial settlement?

If an agreement is not reached as to how financial issues are to be dealt with on the breakdown of a marriage then this can make it extremely difficult for both parties to move on.

In principle either party can make a claim against the other in relation to those financial issues at any time in the future unless the party who wishes to make the claim has since remarried.

If a claim is made then the assets of each party will be valued at that time and not at their value when the marriage broke down thus including lottery wins, inheritances, the fruits of business success and the increase in value of property in the intervening period.

Does not having a financial settlement affect how the marital home is divided up?

If there is no financial settlement, then it is likely that one of the parties remains in the former matrimonial home often with the children of the family.

In these circumstances it is very unlikely that the spouse who has left the home will have any lump sum with which to pay a deposit on a new property for themselves. This may cause problems when the children come to stay or may prevent them staying at all if it has not been possible to source suitable alternative accommodation.

For the spouse who remains in the property there may also be problems in the future. If they stay there until the children reach 18 then the equity in the property will usually be split equally at this time.

If the property has increased in value and the spouse who has remained cannot afford to buy the other out then the property will need to be sold. If a financial settlement was reached at the time of the divorce it may have been possible to argue that equality should be departed from and for the property to have been transferred into that spouse’s sole name.

What consideration is given to spousal maintenance in a financial settlement?

This is a complex area and very much depends on the particular circumstances of each individual case. Recent decided cases have concentrated much more on the needs of the spouse who is to be paid spousal maintenance and the need to set that spouse on the road to independence rather than earlier cases when much more generous decisions were made. It is vital to get expert legal advice in this area to ensure a fair outcome.

If I own a business, is my spouse legally entitled to half of it or any future earnings?

This is another complex area and very much depends on the type of business you own and how you own it. The Court is unlikely to deprive a spouse of his or her means of earning a living. It will not kill the “golden goose” but nonetheless the business will be considered along with all the other relevant circumstances of an individual case.

Are financial assets always split 50/50?

No. The starting point is that matrimonial assets should be split on a 50/50 basis however this may be departed from after considering the children’s needs, the length of the marriage, the ages, health and income earning capacity of the parties, the standard of living enjoyed during the marriage, needs and any other relevant circumstances. As always everything depends on the facts of the individual case and there is no set formula which can be applied.

What happens if I re-marry and do not have a financial settlement from my previous marriage?

Re-marriage will have an effect on your needs and obligations as well as your resources and this will be taken into account when reaching any financial settlement.

You should also note that in certain circumstances it is not possible to make a financial claim once you have re-married so it is important to take legal advice before you do.

About Jacquie

Jacquie is the Head of Family Law at Barber & Co Solicitors.  

She manages the firm’s new office in Ramsbottom which provides a specialist family law service along with services in wills and probate, conveyancing and company related matters.

Jacquie has 14 years experience of practicing family law and deal with all aspects including:-

  • Divorce
  • Dissolution of Civil Partnerships
  • Financial issues arising from relationship breakdown
  • Pre-Nuptial and Post-Nuptial Agreements
  • Deeds of Separation
  • Cohabitation Issues
  • Children Issues
  • Grandparents’ Rights
  • Schedule 1 Children Act Applications
  • Private Adoption
  • Fertility and Parenting Law

Barber & Co Solicitors, has four offices across the North-West of England in Preston, Darwen, Ramsbottom and Clitheroe

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Ten Top Tips for Reducing the Financial Pain of Separation and Divorce

Ten Top Tips for Reducing the Financial Pain of Separation and Divorce

Published on
financial plan
Mary Waring
Independent Financial Advisor

Everyone wonders what life would be like without enough money.

For people facing up to the reality of divorce or the dissolution of a civil partnership, understanding how the finances will work when they are on their own can feel like one of the biggest worries of all.

Basic maths tells you that running two homes and paying two sets of bills is going to cost more than a single household, and the reality is that many people do find their finances constrained after divorce. That is why it is essential to create a clear financial plan if you are heading towards a separation.

While it is not actually true that divorces peak over Christmas, people do start taking stock over their lives over the festive period.

Research from family law solicitor network Resolution has found that the number of people making online enquiries about family law and separation does spike upwards in January.

Research and planning are crucial if you want to make your divorce as painless as it can possibly be.

Here’s our 10-point checklist for reducing the financial pain of separation.

Don’t rely on your friends for financial and legal help – speak to a professional.

Friends will always tell you what you want to hear, which may not be the truth. Divorce is an incredibly stressful process, but speaking to an expert can lay to rest misconceptions that may have been keeping you up at night, and even stopping you from heading for the door.

For example, it is common to meet women who have spent 20 years looking after the children who do not appreciate that this means they are treated as contributing to the household wealth at an equal rate to the principle breadwinner.

It’s not all about the house – don’t forget about the pension.

The person who will end up doing most of the caring for children, which is usually but not always the wife, often wants one thing above all else – to stay in the family home after divorce.

It can be tempting for the woman to want to keep the house and for the man to want to keep the pension. The roles can be reversed, but the reality is that it is usually this way round. Women should avoid this kind of deal as they will find they have nothing to live on later in retirement.

We are all used to the idea that our home is our biggest asset, but pension benefits can be worth even more.

If one of the parties in a divorce has a final salary pension worth £20,000 a year from retirement, that has an actual cash value of around £600,000, potentially worth more than the family home.

So it is important to factor in the full value of any pension assets into a financial settlement. In England, Wales or Northern Ireland the total value of all pensions built up will fall within the settlement calculation, whereas in Scotland it is only the value of your pension built up while you are married or in your civil partnership.

There are a number of ways pension assets can be recognised in the settlement – through a pension sharing order, where the other party receives a share of the pension, through offsetting the value of the pension against other assets, such as other investments or the value of the house, or through deferred pension sharing, where payments are made from a scheme at a later date when you or your former partner have started receiving the pension payments.

Downsizing – you don’t have to do it just yet, but it may make sense in future.

Many people – particularly women looking after children – find they cannot face the idea of leaving the marital home while the divorce process is ongoing. This desire for a safe and familiar environment at a time of extreme stress is entirely understandable.

But over the longer term this may not be possible. The cost of running a big family home may be too high to fund out of your post-divorce income, and releasing equity by moving somewhere smaller can make a big difference to your overall finances.

You don’t have to cut the cord connecting you to your family home right at the time of the divorce, but you should consider building into your long-term financial plan that you will move six months after the divorce has taken place.

Avoid court proceedings if at all possible.

Unless your ex is completely unreasonable, stubborn and set on having their day in court, do everything you can to avoid aggressive legal proceedings. Taking divorce proceedings to court is a bad idea emotionally, financially and can adversely impact your long-term relationship with your children.

However much you dislike your former partner, it is in your interests to separate on the best terms possible – remember that you will want to be able to feel comfortable going to your child’s graduation ceremony or 21st birthday party years down the line.

What’s more, court documents are public documents, which is why celebrities tend to opt for non-adversarial dispute resolution processes to protect their privacy.

Don’t go rifling through his or her possessions looking for evidence.

Evidence that has been obtained by covert means will not be admissible in the proceedings, so if you find your ex’s key to their secret drawer, there is no point sneaking in and photocopying all of his or her documents.

But it is worth starting asking more questions about financial matters, pensions and other assets if you are getting close to the point where your relationship is about to end.

It is quite common for one party to deal with financial matters, leaving the other party in the dark about what assets and liabilities the household shares. Start finding out what your household outgoings actually are – once you are on your own you will be responsible for all of these.

But do take action if your ex is hiding assets.

If you are worried that your ex is starting to siphon off funds to hide it from the settlement process you can make an emergency application for an emergency injunction to freeze his or her assets.

You need to have started court proceedings to do this, but if you find yourself in this situation it is fair to say it is unlikely that collaboration, mediation or arbitration is going to work for you.

Maximise state tax credits.

The idea of ‘going on benefits’ may not appeal to you, but tax credits are different and lots of people receive them these days.

Child Tax Credit and Working Tax Credit are both designed to assist families with children who are struggling to make ends meet. Neither Child Tax Credit nor Working Tax Credit impact your ability to receive Child Benefit.

The system is complex, but if you have one child and a household income of up to £26,200 then you would be entitled to Child Tax Credit.

With two children you are likely to benefit if you have a household income of up to £32,900. Working Tax Credit is for families on low incomes, and is based on the number of hours worked.

Make sure you don’t pay too much Council Tax

Council Tax is made up of two components – 50 per cent is a property tax and the other half is a personal tax, based on two people living in the property. As soon as your partner moves out, or you move into a property alone, make sure you get your single person discount. This will reduce your bill by 25 per cent.

Rebuild your state pension

Many spouses, usually women, find that they have not built up full entitlement to state pension. To receive the full state pension you need to have worked and paid National Insurance Contributions for a minimum of 35 years, although you do get credit for periods you were not working when you were at home bringing up children under the age of 12.

Up until 2016 it had been possible for a divorcee to rely on their partner’s National Insurance Contributions record for the purposes of calculating state pension entitlement. But changes introduced in April 2016 mean this is no longer possible.

If you are on course to have an incomplete state pension contribution history by the time you retire then it often makes sense to buy extra years through ‘Voluntary National Insurance Contributions’.

These are good value, enabling you to buy around £230 a year for life from state pension age, for a one-off cost of £733. Over a 20-year retirement, that £733 would pay back £4,600.

Invest your settlement carefully

If you have been the financially active party to the relationship, the chances are you will have a clear understanding of how to manage your finances going forward, and crucially, you could well continue to receive regular income through work.

But if you have been staying at home looking after children, things can be very different. While the children are still around your settlement may entitle you to regular maintenance payments from the departed spouse. But once the children leave home you will be reliant on whatever money was agreed in your settlement.

Some people who are unlikely to get a suitable job will find they have to live on their settlement lump sum for the rest of their life. This may look like a large amount of money, but it will have to cover decades of expenditure, so it is important to get advice from a financial planner.

They will help you understand your finances and understand what lifestyle you can afford in the future. A financial planner will do a full lifetime cash flow looking at your future income and spending, and building in assumptions about investment growth, inflation and future taxes.

Based on these inputs and assumptions it will show you whether you’re going to run out of money. If this model shows you are going to run out of cash  you can run “what if” scenarios to see what the impact will be if you work longer than anticipated, downsize or cut your expenditure.

This will give you the knowledge you need to see exactly what you can afford and when.

About Mary

Mary Waring is a Chartered Financial Planner who specialises in advising female clients, particularly women going through a divorce.  She is also an affiliate member of Resolution

Follow Mary – Twitter 

If you are going through divorce or contemplating divorce and would like to discuss your situation please email me at mary@wealthforwomen.biz

(Main photo credit – Jonathan Simcoe)

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Survive divorce
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Six-step Formula to Surviving the ‘Divorce Season’

Published on
Vanessa Fox
Partner and Head of
Family Law
hlw Keeble Hawson

I hotly dispute the ‘divorce season’ myth, that family lawyers see an increasing number of divorce enquiries in January which are sparked by the strains of the festive period. In our experience, this month is quieter than usual and we receive more approaches in the spring and autumn.

For those of you who are experiencing the trauma and distress of a divorce – or a potential split – this depressing time of year can make the impact harder to handle. The ‘Christmas hangover’ can send focus and wellbeing plummeting at a time when it is vital to stay on the ball.

Here are six steps to surviving the ‘divorce season’.

  1. Seek legal advice on your rights before leaving the marital or shared home. Those who are married or in a civil partnership can’t make their partner leave the family home without a court order, regardless of whether both or either of you own/rent the property. Cohabitees have less legal protection and can be forced to leave the shared home if their partner rents or owns it solely. If not legally obliged to do so, it is often best to stay until matters are resolved, to avoid being accused of abandoning the family and to reach agreement first.
  1. Take proper financial advice before discussing options with your partner – a route that appears attractive could have many pitfalls so avoid rushing to make an agreement. Solutions that separating couples think are impossible often turn out to be achievable, and it is important to talk to an Independent Financial Advisor (IFA) immediately, rather than after the divorce. An advisor will explain your options and make sense of any offers your partner makes.
  1. Explore all possible repercussions and outcomes for you and your family and take the advice of as many family professionals – and trusted confidantes – as possible before calling time on your relationship. This includes couples counselling where a trained, independent counsellor can help you to talk through the issues and communicate more constructively. They can also help you to examine external factors that might affect your relationship, such as how arguments can escalate, as well as negotiate and resolve conflicts. While not a universal panacea, this process has saved many a marriage and long-term relationship.
  1. If divorce or separation is the only way forward, always put children and their feelings first. As the adults of the family, parents should behave like grown-ups, so keep full blown rows to a minimum, don’t criticise your former partner in front of the children and don’t ask them to take sides. Discuss the situation with them, reassure them that the divorce is not their fault – and outline any domestic upheaval so they have as long as possible to get used to the idea. If handled sensitively, you will find that children can survive divorce better than you do.
  1. During the divorce process, always make every effort to be courteous and polite with your former partner. While you may not always feel like it, the more civilised you can keep discussions and negotiations, the more focused and productive they will be – saving time, money and emotional expenditure.
  1. Finally, avoid contacting or texting the new partner of your former spouse/partner or replying to their texts. They should not play a greater part than necessary and your main focus should be to sort out the best outcome for you and your children and move forward.

In summary, before rushing into anything, ensure you have explored every option and take professional advice – both legal and financial. If divorce is inevitable, be civil to – and communicate effectively with – your ex-spouse.

Above all, spare your children from undue angst and stress.

About Vanessa Fox

hlw Keeble Hawson partner, Vanessa Fox, marked 25 years as head of the firm’s family law department in 2016.

Collaboratively trained and a qualified mediator, she has modernised South Yorkshire Resolution since becoming chair in 2013 and is also a member of the Law Society’s Family Law Panel and the Children Panel.

She can be contacted at on 0114 290 6232 or on vanessafox@hlwkeeblehawson.co.uk.

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