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Getting The Right Divorce Financial Settlement     

Divorce And Financial Agreement

Fear and uncertainty over your future are all but inevitable during a divorce. You’re potentially facing a very real change in your financial circumstances – at what is already an emotional time. But as experienced family law solicitors, we’re here to help you safeguard your rights and property.

There are many fundamental financial questions that could arise, such as: Where will I live after the divorce? What will happen to the family home? Will I lose half my savings? How will I pay all the bills? How will I cope?

What will happen to my pension? What about my car? Can I keep treasured family heirlooms and other items of sentimental value? Will I be liable for my former partner’s debts?

Bring your divorce financial worries to us – we’re here to help you solve them. We will provide the legal expertise and l support you need to get through the process as quickly, cost effectively and painlessly as possible.

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How Do You Divide Assets In A Divorce?

As specialist family law solicitors, our role is to help you achieve a fair and final financial settlement that enables you to make a fresh start and draw a line under all the unhappiness that has brought you to this point.

Good family law solicitors use a non-confrontational approach to help you achieve a fair settlement more swiftly and at less cost – ideally out of court so you maintain full control of the process. Going to court can be expensive and time-consuming: it should always be a last resort.

Yes, a robust approach is sometimes required. But superior negotiating with a cool head will always be better than angry confrontation. It is more likely to help you achieve a fair and secure financial outcome in the long run.

Divorce And Dividing Assets Are Two Different Processes – Why This Matters

Be aware from the outset that:

  • getting divorced (the legal ending of your marriage) and the division of finances are two separate processes
  • it is the second part – the division of finances – that will be the more expensive aspect of your divorce, so it’s crucial to get good legal advice from family law solicitors with extensive experience.

The first part – ending the marriage – may be faster, more amicable and less expensive than you expected. But do not let that lull you into a false sense of security. Do not let it prompt you into trying to handle your own division of assets without a solicitor – you will need their legal expertise if you are to achieve a fair financial settlement.

These days, more people are having to represent themselves in court because they cannot afford a solicitor and they cannot obtain Legal Aid. The reality is that they cannot afford not to have a solicitor – otherwise they risk falling victim to an unfair settlement.

They could unwittingly agree to sharing non-matrimonial assets that were never part of the marriage. Or their former partner may exploit a loophole in the agreement and come back for more money in later years.

Financial Disclosure Of Assets And Liabilities In Divorce

Disclosure is a key step in the process of resolving financial matters between separating spouses. It involves both parties providing full details of their financial circumstances including:

  • assets
  • income
  • liabilities
  • other relevant financial information.

The purpose of financial disclosure is to ensure transparency and fairness in the division of assets and financial arrangements following divorce. Here is an overview of the process:

Initial disclosure (including Form E) – at the outset of divorce proceedings, both parties are typically required to provide an initial disclosure of their financial circumstances. This includes completing a financial statement (Form E), which details their income, assets, liabilities and expenses. Form E is a comprehensive document that provides a snapshot of each party’s financial situation.

Exchange of documents – in addition to completing the Form E, both parties are also required to exchange supporting documentation to verify the information provided in their financial statements. This may include bank statements, tax returns, payslips, mortgage statements, investment portfolios, pension statements and any other relevant financial records. Parties are obliged to provide accurate and up-to-date documentation to support their disclosures.

Supplementary disclosure – if either party identifies additional assets or financial information that was not initially disclosed, they have a duty to provide supplementary disclosure to ensure that all relevant information is available for consideration. This may occur if new assets are discovered or if there are changes in financial circumstances during the divorce process.

Review and analysis – once both parties have exchanged financial disclosure, their respective legal representatives will review the information provided and assess the value of the assets, income and liabilities disclosed. They may also identify any discrepancies or areas of contention that need to be addressed during negotiations or court proceedings.

Negotiation or mediation – armed with a comprehensive understanding of each party’s financial situation, negotiations can begin with the aim of reaching a mutually acceptable settlement. Parties may engage in direct negotiations, mediation or other alternative dispute resolution methods to resolve financial matters amicably and avoid the need for court intervention.

Private proceedings – it is becoming increasingly common to try and resolve matters outside court but using similar methods. You can have private proceedings, in which you can hire a retired judge or specialist family finance barrister to have the equivalent of a court hearing. This is known as a private FDR (Financial Dispute Resolution). This can be a very effective way of resolving matters.

Arbitration is also becoming increasingly common. This is very similar to the court process. It offers the benefit of a final and binding outcome but without the lengthy delays associated with the court system. 

Court proceedings – if parties are unable to reach a settlement through negotiation or mediation, financial matters may be decided by a judge in court proceedings. In such cases, the court will consider the financial disclosure provided by both parties, along with any additional evidence or testimony presented. The court will then decide on the division of assets, spousal maintenance and other financial arrangements. There is a court-ordered timetable which can involve several hearings. 

Final agreement and consent order – once a financial settlement is reached, whether through negotiation, mediation or court proceedings, the terms of the agreement are formalised in a consent order. This legal document outlines the financial arrangements agreed by both parties and is submitted to the court for approval. Once approved by the court, the consent order becomes legally binding – and both parties must adhere to its terms.

Are Divorce Settlements Always 50/50?

Divorce settlements are not always 50/50. The settlement can depend on various factors – a 50/50 split is just one possible outcome. In England and Wales, the law provides for a fair and equitable distribution of assets based on the individual circumstances of each case. Some factors that influence the division of assets include:

Needs and contributions – the court will consider the financial needs of each party and any children (whose needs are paramount), including housing, income and standard of living. Additionally, the court will assess the contributions made by each party to the marriage, both financial and non-financial, such as caring for children or supporting a spouse’s career.

Duration of the marriage – the length of the marriage is also a significant factor in determining the division of assets. Generally, longer marriages may result in a more equal division of assets, whereas shorter marriages may involve a more discretionary approach by the court.

Assets and liabilities – the nature and value of the assets and liabilities owned by the parties will be taken into account. This includes property, savings, investments, pensions, debts and any other financial considerations.

Income and earning capacity – the court will consider the income and earning capacity of each party, both at present and in the future. This includes factors such as employment status, qualifications and health.

Children’s welfare – if children are involved, their welfare is a primary consideration. The court will ensure that the financial settlement provides adequately for the needs of the children. This will include housing, education and childcare expenses.

Age and health – the age and health of each party may also be relevant, particularly if one party has health issues or is approaching retirement age.

Prenuptial or post-nuptial agreements – if the parties have entered into a prenuptial or post-nuptial agreement governing the division of assets, the court will consider its terms when determining a fair settlement. However, such agreements are not automatically binding and will be subject to court scrutiny.

Overall, the division of assets in a divorce settlement is highly fact-specific: there is no one-size-fits-all approach. The court will consider all relevant factors to achieve a fair and equitable outcome based on the individual circumstances of each case.

How Is Property Divided In A Divorce? Will I Lose My Home?

The division of property in a divorce depends on factors including the laws of the jurisdiction where the divorce is taking place and the specific circumstances of your case.

In England and Wales, the court follows a principle of fairness when dividing property and assets on divorce. Here are some key points to consider:

Matrimonial vs non-matrimonial property – the court will typically consider both matrimonial and non-matrimonial property when dividing assets. Matrimonial property includes assets acquired during the marriage, such as the family home, savings, investments and pensions. Non-matrimonial property may include assets acquired before the marriage or received as gifts or inheritances.

Needs and contributions – the court will take into account the financial needs of each party and their contributions to the marriage, both financial and non-financial. This can include factors such as caring for children, maintaining the household, or supporting a spouse’s career.

Children’s welfare – if children are involved, their welfare will be a primary consideration when dividing property. The court will prioritise ensuring that suitable housing is available for the children and that their needs are adequately provided for.

Other factors – the court will consider a number of factors including the length of the marriage, the standard of living enjoyed during the marriage, the ages and health of the parties and their respective earning capacities.

Sale vs transfer of property – in some cases, the family home may need to be sold and the proceeds divided between the parties. In other cases, one party may be permitted to retain the family home, either outright or subject to certain conditions, such as offsetting other assets or making a payment to the other party.

Spousal agreements – if you and your spouse have entered into a pre-nuptial or postnuptial agreement governing division of property, the court will typically give effect to the terms of the agreement – provided that it meets certain legal requirements and is considered fair and reasonable.

What Are Matrimonial Home Rights?

Matrimonial home rights in England and Wales provide legal protections for spouses or civil partners regarding the family home during divorce or dissolution proceedings. Matrimonial home rights are established under the Family Law Act 1996.

They typically apply to the family home where the couple lived together during their marriage or civil partnership. These rights allow one spouse or civil partner to remain in the family home or to prevent the other spouse from selling or transferring the property without their consent – even if the property is owned solely by one party.

Key aspects of matrimonial home rights include:

  • Occupation – the right of the non-owning spouse or civil partner to occupy the family home, regardless of whether they are a legal owner of the property. This means they cannot be evicted from the property without a court order during divorce or dissolution proceedings.
  • Consent for sale or transfer – the non-owning spouse or civil partner has the right to consent to the sale or transfer of the family home. This means that the owning spouse cannot sell or transfer the property without the consent of the other party, even if they are the sole legal owner.
  • Protection of interests – matrimonial home rights are designed to protect the interests of both spouses or civil partners, particularly in situations where one party may attempt to dispose of the family home without the other party’s involvement or consent.

However, matrimonial home rights do not confer ownership of the property to the non-owning spouse or civil partner. They simply provide certain legal protections and rights of occupation and consent regarding the family home during divorce or dissolution proceedings.

Matrimonial home rights cease to apply once the marriage or civil partnership is legally dissolved – or if the court makes a final decision that affects the ownership or occupation of the family home.

What Is A Matrimonial Home Rights Notice?

A matrimonial home rights notice is a legal document that a spouse or civil partner can register against the title of a property to assert and establish their rights regarding the family home.

This notice typically includes:

  • the name and address of the parties involved
  • details of the property
  • a statement asserting the rights of the non-owning spouse or civil partner to occupy the property and prevent its sale or transfer without their consent.

The notice may also include information about the marriage or civil partnership and any pending divorce or dissolution proceedings.

To be legally effective, a matrimonial home rights notice must be registered. Once registered, the notice becomes a legal charge against the property and is binding on any future buyers or lenders.

What Happens If There Is A Declaration Of Trust In Place?

A declaration of trust is a legal document that clarifies the ownership interests in a property, particularly when the legal title does not accurately reflect the beneficial ownership.

This can be useful if a property has been purchased with help from the ‘Bank of Mum and Dad’. It confirms their financial interest in the property.

In the context of divorce or dissolution, a declaration of trust can have implications for the division of assets. But its effect will depend on various factors, including the specific circumstances of the case and the laws of the jurisdiction.

A declaration of trust can provide clarity regarding the ownership interests in a property – particularly if one party asserts a greater contribution to the property’s purchase or mortgage payments. This can be relevant when determining the division of assets during divorce proceedings. However, the courts are not bound by the terms of the trust and can look beyond it, particularly if it does not meet the parties’ needs.

If one party has made significant financial contributions to the purchase or maintenance of a property but is not listed as a legal owner on the title, a declaration of trust can help preserve their beneficial interest in the property. This can be important for protecting their financial stake in the property during divorce negotiations or court proceedings.

A declaration of trust can impact the negotiations for a financial settlement in divorce. It may influence the division of assets, especially if the property is a significant asset in the marriage. The court will consider the contents of the declaration of trust – along with other evidence and legal arguments presented by both parties – when determining a fair division of assets.

It is important to note that a declaration of trust is not a  legally binding document. The courts will generally uphold its terms if it has been properly executed and still reflects the intentions of the parties involved.

However, if there are allegations of fraud, duress or unconscionable conduct surrounding the creation of the declaration of trust, its enforceability may be challenged in court. Unconscionable conduct is defined as serious misconduct that is clearly unfair or unreasonable.

What Is A Financial Order In A Divorce?

A divorce financial order, also known as a ‘financial remedy order’ or a ‘financial settlement’, is a legally binding court order that outlines how a couple’s finances and assets will be divided on divorce or dissolution of a civil partnership in England and Wales.

This order is typically obtained as part of the divorce proceedings and governs financial matters such as property, savings, investments, pensions and maintenance.

There are several types of financial order that may be issued by the court, depending on the circumstances of the case:

Consent order – this is an agreement reached between the parties regarding the division of their assets and finances. Once both parties have agreed on the terms, they can submit an application to the court for a consent order. If the court finds the agreement fair and reasonable, it will issue a consent order, which becomes legally binding.

Maintenance order – this specifies the terms of ongoing financial support from one party to the other, either as spousal maintenance (for the benefit of a former spouse) or child maintenance (for the benefit of any dependent children).

Pension sharing order – in cases where one or both parties have accrued pension assets during the marriage, a pension sharing order may be issued to divide these assets between the parties. This order allows for the transfer of a portion of one person’s pension rights to the other party.

Property adjustment order – this deals with the division of property, including the family home and any other real estate owned by the couple. A property adjustment order may specify the transfer of ownership or the sale of property to facilitate the equal division of assets.

Financial orders are tailored to the specific circumstances of each case, taking into account factors such as the length of the marriage, the financial needs of each party, their earning capacity and their contributions to the marriage.

It is essential to seek legal advice to ensure that any financial order accurately reflects your interests and provides for your future financial security.

What Is A Financial Clean Break Order In A Divorce?

A Clean Break Order is designed to sever all financial ties between the parties following divorce.

Typically, this order stipulates that neither party can make financial claims against the other in the future, providing a clean break and allowing both parties to move on independently.

While clean break orders are intended to provide finality and certainty, they are not entirely immune to modification.

However, the circumstances under which a clean break order can be changed are limited and any application to vary the order will be subject to scrutiny by the court.

Circumstances in which a clean break order can be revisited or modified include:

Fraud, mistake, or material non-disclosure – if it is discovered that the clean break order was obtained through fraud, mistake or material non-disclosure of assets or financial information, the court may set aside or vary the order.

Changes in circumstances – if there has been a significant change in circumstances since the clean break order was made (such as a substantial change in income or financial needs) either party may apply to the court to vary the order. For example, if one party loses their job or becomes incapacitated, they may seek to vary the maintenance provisions of the order.

Children’s needs – if there are dependent children involved, the court always retains jurisdiction to consider their welfare. If circumstances relating to the children change significantly, such as their financial needs or living arrangements, the court may revisit the clean break order to ensure that it remains in the children’s best interests.

Breach of order – if one party breaches the terms of the clean break order, the other party may seek enforcement or apply to the court for a variation. For example, if one party fails to make the required maintenance payments as stipulated in the order, the other party may seek legal recourse.

Next Steps: Get Expert Help

  • Consult A Family Law Solicitor. Professional advice is invaluable. Book a free chat with a family lawyer to discuss your situation.
  • Financial Planning. Start planning for your post-divorce financial future. Consult an independent financial adviser.
  • Support Systems. Divorce can be emotionally draining. Support from professionals, friends and family can be vital during this time.
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Meet the team

Richard Perrins

Partner, Head of Family Department

Lindsey Arnold


Anna Burton

Associate Solicitor

Sophia Haine


Georgia Foster

Trainee Solicitor

Molly Robinson

Solicitors Apprentice

Mollie-Anne Collins

Legal Secretary

Julie Read

Legal Secretary

Lorraine Woodrow

Legal Secretary

Tina Matthews

Legal Secretary