Legal News | 24.07.18
Divorce – the pitfall of overlooking financial matters
Divorce is often the focus of separating couples following marital breakdown. It is a far from perfect process which takes many months to conclude. It is therefore understandable that many couples are eager to move on with their lives following the award of Decree Absolute, the final stage of the divorce process which will finalise their legal separation. This has however led to a significant number of divorcing couples never addressing the potential financial claims that follow divorce.
It is unfortunately not widely appreciated that divorce itself does not dismiss these financial claims and unless addressed following separation, the potential for you or your former spouse to pursue such claims can remain indefinitely.
The rise of DIY divorces will inevitably lead to a greater number of couples separating without ever having the luxury of legal advice. Separating couples may not appreciate that there is no time limit on either spouse pursuing a financial settlement following divorce. If for example you or your former spouse were to become wealthy 10 years after your divorce, there would be nothing to prevent a future claim for financial provision.
In fact a number of examples of exactly this occurring have made the headlines over recent years –
- The case of Wyatt v Vince  EWHC 1368 (Fam) involved a 3 year marriage and a financial claim pursued by the wife some 22 years after divorce. The basis for this delay appeared to relate to the fact that her husband took 13 years to build his wealth after the relationship breakdown. Ultimately this led to a lump sum order of £300,000 payable to the wife in full and final settlement of her claim, together with a costs orders totalling £325,000.
- Another recent example involved a spouse being ordered to make a 2 million pound lump sum payment to his former partner as a result of a Euro Millions win some 10 years after separation.
It is also important to recognise that an informal financial arrangement reached between spouses following separation will not be binding to the Court. Unless this agreement is formalised and approved as a legal Consent Order; the threat of your former spouse seeking to unpick this agreement at a later date remains.
I would therefore always recommend that clients obtain closure and seek to finalise financial matters alongside their legal separation. This will mean agreeing and formalising financial arrangements within a Consent Order which, once approved by the Court, will become a legally binding agreement between the parties.
If you would like further information on all financial matters following separation, the Family Team at Wansbroughs offer a free 30 minute initial consultation to all new enquiries. Call 01225 896100 or 01380 733300 or email email@example.com.