Did you know? When you get a divorce, with or without a solicitor, a final order does not protect your financial assets going forward.
Since the ‘No Fault Divorce’ (Divorce Dissolution and Separation Act 2020) came into effect, applying for divorce has been made easier. Those seeking to make an application for divorce, now do not have to rely upon such matters as the other’s behaviour or adultery for the divorce to proceed, as long as the marriage can be shown to have irretrievably broken down.
Increasingly, people have therefore decided not to use a solicitor to assist them with the divorce process. It is a common belief that by obtaining a Final Order (previously Decree Absolute) on the divorce that all ties are broken, and that the other party cannot bring a financial claim against them in the future.
However, this isn’t the case. When a Final Order on divorce is obtained, this doesn’t stop a person from pursuing a financial claim against the other when that person has not remarried, leaving people open to the risk that claims on their assets could be made AFTER the divorce is finalised.
This means that your ex-partner could come back to claim monies from you, that they think they are entitled to – this may include assets that you have acquired outside of the marriage, if a court were to decide that there wasn’t enough capital assets accrued during the marriage to meet both parties’ needs. In order to avoid that, it would be necessary to get a Financial Order and/or Clean Break Order.
Getting a financial order from the court alongside the divorce proceedings
It is very often the case that when parties have been married, they own assets together or own assets in each of their individual names. Some of the most common assets are property, including the family home, bank/building society savings accounts, investments and pension benefits. The court regards all of these assets, acquired during marriage, as relevant in deciding a financial settlement.
So, for example, if you have a jointly owned property, and although you may come to an agreement about the house, it is advisable to obtain a financial order on that agreement on whether the house is sold or transferred to the other person, so that there can then be a legally binding agreement which is approved by the court and means claims can’t be made at a later date.
There may also be other assets that need to be agreed as to how these are divided and to resolve this matter. The process of what is called financial disclosure is usually entered into so that each party knows about all the assets and any liabilities the other has.
When a financial settlement has been agreed and a consent order achieved, whether that be amicably or decided by the court (when parties cannot reach an agreement) this prevents either party from pursuing any further financial claims as against the other. This is often termed a clean break order.
Some people may think this situation is not relevant to them, if they didn’t own any assets during the marriage. However, typical examples may be where there has been a divorce but one party from the marriage after divorce acquires property, inherits money or potentially gains a lottery win. In such situations, if a clean break order had not been obtained then a financial claim could be made by the other party to the marriage.
You may think you don’t have any valuable assets, but have you thought about your pension? Inheritance that might come your way? The increasing value of your home? You will understandably want to protect these assets, not just for you, but perhaps for your family to benefit from in the future. It is common to think of these assets as something you have individually earned, but all assets are up for debate between divorcing couples, depending on circumstances, and can be, even after the divorce is finalised if you don’t organise suitable legal protection.
If you wish to speak to Emsley’s Family team about either a divorce or financial proceedings, then contact us and our friendly family team will be here to help and advise you further.
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