Financial Settlements in High-Net-Worth Divorce Cases

Here are some questions parties commonly raise with our team here at Askews Legal LLP.

What is a divorce financial settlement?

A financial settlement sets out how matrimonial property, (any assets or income acquired during the marriage and sometimes prior to the marriage), will be divided when a couple divorce or dissolve their civil partnership. In many cases, the financial settlement is agreed between the parties, or via Alternative Dispute Resolution (ADR) methods such as, round table negotiation or mediation. Where a dispute cannot be resolved, going to court to obtain a Financial Remedy Order is the only way to achieve a resolution.

Is a financial settlement agreed between the parties legally binding?

If parties to a divorce or civil partnership negotiate the division of matrimonial property and assets between themselves, their family lawyers can draft a Consent Order (a Financial Remedy Order made by agreement) which sets out the agreed terms. Both parties would sign the document and it would be submitted to the court for a judge to approve. If approved, it will become legally binding and the parties must comply with the terms agreed.

When evaluating whether the division of property and assets under a Consent Order is fair, the court must consider the factors under section 25 of the Matrimonial Causes Act 1973. These include the:

• Resources available to both parties, both now and in the future.

• Needs of both parties and, most importantly, of any children.

• Length and duration of the marriage.

• Standard of living enjoyed by the parties.

• Contributions of each party (financial and non-financial).

• Conduct of the parties.

• Benefits lost by either party because of the divorce.

What if I think my spouse is hiding assets?

Both parties have a duty to make full and frank financial disclosure of all assets, income, and liabilities. In court proceedings this is achieved through completing Form E (Financial Statement). Form E can also be used when parties are trying to reach agreement without court proceedings and if attending mediation, the mediator will require financial disclosure.

This is important because until the assets and their value have been identified, it is impossible to consider how they should be shared.

If, having exchanged financial disclosure, you have suspicions that your spouse is concealing or disposing of assets to avoid them becoming part of the settlement, inform your family lawyer immediately. Will I get spousal maintenance?

This is entirely dependent upon individual circumstances. If you are the economically weaker party and your spouse has sufficient income to make payments to you, you may be able to negotiate or secure an award from the court for Spousal Maintenance.

The court can order one party to pay Spousal Maintenance to the other for as long as it thinks fit, subject to the death of either party or the remarriage or civil partnership of the receiving party but will usually make a spousal maintenance order time limited. This is commonly five years as this is considered a sufficient length of time for the receiving party to place themselves in a financially independent position. This depends upon individual circumstances.

To talk to our family lawyers at Askews Legal LLP, email enquiries@askewslegal.co

Please note that this article does not constitute legal advice.

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