3rd February 2023
Does my Divorce give me a financial clean break?
It’s a commonly held misconception that the divorce resolves all issues between the parties. However, this is not the case. Please note that the new terminology of the Court which refers to the Final Order of Divorce (which used to be called the Decree Absolute) is not also a Final Order in relation to the finances.
The divorce dissolves the marriage relieving the parties of their obligation to live with one another and negating the duties of marriage; it enables the parties to remarry. However, it does not resolve the finances and unless there is a Final (Financial Remedy) Order of the Court – which Order will be by Consent if there is agreement – then the couples’ respective financial claims in the marriage remain live. This presents a risk to both parties as either can make a claim against the other for the full raft of financial relief in the future regardless of their respective financial circumstances or the length of time since the divorce . The risk is claims can be made at any later stage for orders for income, property adjustment, lump sums, with regards pensions or inheritance. Whilst a long delay in making a claim will be considered as one of the circumstances by the Court when it looks at a claim, it will not negate that claim and may have limited impact on the outcome.
Beware, also that if one party re-marries, the other party, presuming they remain unmarried, will still be able to bring financial claims relating to the marriage against their former spouse and these claims will trump those of the new spouse. This can be of significant issue where property is involved particularly if the married couple reside there as it will be open to claims by the former spouse, or indeed where other property is owned and may be the source of income, a rental, for example, and both that property and income may become a source of claim. Income, savings, pensions, and inheritance are all at risk. Beware too if you re-marry without resolving the claims within your previous marriage then your own claims against the former spouse will be extinguished save under general property law which may limit your entitlement, you will have no general claim to income, lump sum orders or inheritance. Note too for the spouse who remains unmarried that the former spouse who has married can still make a claim against your pension and this can be an unpleasant shock later in life.
It is always advisable to sort out the money side of things when you divorce and if you did not do so at the time then to do so as swiftly after as may be possible. Do get a Final Financial Remedy Order (if by agreement referred to as a Consent Order). Please do take up the opportunity to see our Margaret Sculpher (telephone: 01892 502 354, email: email@example.com) at our Cranbrook office for a free, no obligation half hour of advice should you wish to discuss these issues.