Will my divorce settle my finances?
17 November 2016
It’s a common misconception that a divorce deals with everything, particularly financial matters. This is not the case. The divorce process ends the marriage, it does not deal with anything else.
Options to Resolve Divorce Financial Issues
How you chose to resolve financial issues between yourself and your former spouse will often depend on what assets you have got and what kind of relationship you still have.
Many divorcing couples can agree on how to divide the matrimonial assets themselves, whereas others need help from either a Divorce Solicitor or Mediator. There are however times when the couple simply cannot reach an agreement and when this happens, one of them would need to make an application to the Court for a Financial Order, such as a Clean Break Order.
Before an application can be made to the Court, there must be or have been divorce proceedings. The Court cannot make a Final Order relating to financial matters until the Decree Nisi has been pronounced.
Will I Have to Go to Court?
If you and your former spouse can reach an agreement on your finances between yourselves, it is unlikely that you would have to go to Court. A Family Law and Divorce Solicitor can be instructed to draft the agreement order, known as a Consent Order, and this can be sent to the Court to be approved by a Judge.
In these types of cases, you would only have to go to Court if the Judge had a query regarding the agreement you had reached, which does not happen very often.
If you cannot reach an agreement with your former spouse and one of you makes an application to the Court for a Financial Order, then your case would be listed for a Court hearing and there are usually up to three Court hearings in total.
If by the end of the financial proceedings an agreement was not reached, the Judge would make a decision about how the assets should be divided and put this into a Court Order. Once this is done both of you have no option but to abide by the Court Order. We always recommend working to reach an agreement and our Divorce Solicitors have had countless successes negotiating with even the most uncooperative of spouse’s.
Court Order to Dismiss Future Claims
Even if there are no joint assets and you have agreed with your former spouse that you will each keep your own assets, it is still important to have this recorded in a Court Order to dismiss future claims. This is important as even after divorce, either spouse can make a claim against the other’s assets. For example, if one spouse had a large increase in earnings or won the lottery, the other spouse could seek a share of this.
Make Your Financial Agreement Legally Binding
If you can reach an agreement with your former spouse about your matrimonial finances, the only way to properly protect yourself both now and in the future is to have this agreement put into a Court Order. Until this is done, the financial agreement is not legally binding and either of you can change your mind about the agreement at any time.
Once the Court has approved a Financial Order, it is final and extremely difficult to change, unless there are exceptional circumstances.