Government to Consider Changes to Family Law

The law governing how finances should be divided upon divorce has remained essentially the same since 1973, being contained in the Matrimonial Causes Act of that year.

But in the fifty-odd years since many experts have expressed concerns that changes to family law need to be made. A particular concern is that the law, which gives judges a wide discretion as to what financial settlement they may order in each case, is too uncertain, with the result that many couples are unsure as to what the court is likely to order. This in turn makes it more difficult for many couples to agree settlements, rather than go to court.

The law on divorce has of course recently undergone a very significant reform. No-fault divorce was introduced by the passing of the Divorce, Dissolution and Separation Act 2021. As that Act was going through Parliament the Government made a commitment to conduct a review of the law of financial remedies.

In 2023 the Ministry of Justice referred the matter to the Law Commission. The key question that the Commission was requested to answer was whether the current law provides a cohesive framework in which parties to a divorce can expect fair and sufficiently certain outcomes.

In December 2024 the Commission published a ‘Scoping Report’ setting out whether the Commission considers that the law requires reform, and identifying possible models on which reform could be based and what changes to family law can be made.

Does the law require reform?

The Commission concluded that changes to family law do need to be made, but felt that the shape that reform should take is a matter for Government to decide. The Scoping Report did not therefore contain any recommendations for reform.

The Commission considered that the current law does not reflect the significant developments to financial remedies law arising out of judicial decisions over the last fifty years. Combined with the wide discretion contained in the current law, the Commission felt that this means that it is not possible for an individual going through divorce to understand, by reading the statute, how their case will be decided.

And the uncertainty caused by the discretionary nature of the system makes it difficult to negotiate, thereby promoting dispute rather than settlement. Even if a couple seek legal advice, said the Commission, their lawyers may not agree about the appropriate outcome, and for those who do not obtain legal advice, the position is even less clear.

In short, the view of the Commission is that the law does not “provide a cohesive framework in which parties to a divorce or dissolution can expect fair and sufficiently certain outcomes”.

Four possible changes to family law

Whilst it did not make any recommendations, the Commission did identify four models upon which reform of the law could be based.

The four models represent a spectrum of changes to family law, ranging from retaining wide discretion at one end, to creating far more certainty at the other end. The four models are:

Codification – Under which there would be minimal change to the existing law contained in the Matrimonial Causes Act, but the case law that has amended the law over the last fifty years would be codified. Under this model the court would obviously retain a wide discretion.

Codification-plus – Under which the existing law would be codified, and there would also be additional reform to deal with specific areas where the law is not yet settled, for example in relation to nuptial agreements and the effect of a party’s conduct upon the settlement (see below). Under this model the court would retain discretion, but limitations on discretion may be introduced in relation to areas of reform.

Guided Discretion – Under which a set of underpinning principles and objectives would be introduced, which guide the exercise of the court’s discretion. The Commission states that: “A model based on guided discretion retains, to a greater or lesser extent, some judicial discretion, which can then be exercised on a case-by-case basis. However, legislation prescribes how, and when, the discretion can be exercised.”

Default Regime – Under which a ‘matrimonial property regime’ would be created. Such a regime would impose a set of rules which come into effect from the date of the marriage, and which dictate with a high level of certainty the financial outcome when the marriage comes to an end. Under such a regime the court would have very little discretion, and couples would know when marrying how property will be divided on divorce.

As will be seen, there is little in the way of specifics in these four models. However, the Commission did also look at five specific areas where there might be reform, as set out below (although again the Commission did not make any recommendations).

Nuptial agreements

Many couples enter into nuptial agreements, setting out what is to happen in the event that the marriage should break down and there should be divorce proceedings. Nuptial agreements can be made either before the marriage (a ‘pre-nuptial’ agreement), or after the marriage (a ‘post-nuptial’ agreement).

Nuptial agreements are not legally binding in England and Wales, although the Supreme Court ruled in 2010 that the court should give effect to a nuptial agreement that is freely entered into by each party with a full appreciation of its implications, unless in the circumstances prevailing it would not be fair to hold the parties to their agreement.

The Law Commission essentially suggests that the law on nuptial agreements be reformed in accordance with a recommendation they made back in 2014, i.e. that nuptial agreements should be binding, provided that certain legal safeguards were met (such as the parties having independent legal advice), and provided also that the agreement provided for financial needs (if it did not then the court could make an award to meet those needs).

Spousal maintenance

The next matter that the Commission looked at was whether there is scope for reform of the law to incorporate a maximum term for spousal maintenance.

A number of influential people have argued that there should be a limitation upon the duration of spousal maintenance orders, as they consider that unlimited orders can amount to a ‘meal ticket for life’.

Whilst not making any recommendation, the Commission did point out that lifetime maintenance orders are actually quite rare. It also pointed out that many of the interested parties that they spoke to were concerned about the effect a term limit on maintenance orders could have on vulnerable spouses. And even where they expressed support for a time limit, many supported retaining some discretion, depending on the circumstances.

Children aged 18 and over

The Scoping Report also considered whether there should be wider powers for the courts to make orders in respect of children of the family who have already attained the age of 18. Under the present law financial support for children generally ceases when they reach 18 years old.

The Commission says it has been told that the current law is unsatisfactory, as increasingly parents are still providing financial support for children beyond the age of 18. And the financial burden for supporting such a child can often fall on the parent with whom they are living.

The Commission report that interested parties suggested that the court’s powers to order financial provision for children aged 18 and over should be extended. It was suggested that the age at which provision ends by default should be revised upwards, possibly to the age of 21. Alternatively, financial provision could end upon the occurrence of a particular event, such as when the child finishes a first undergraduate degree, or becomes financially independent.

Conduct

The next specific matter that the Commission considered was whether there is scope for reform in the operation of “conduct” as a factor to which the court must have regard when making a financial award.

At present conduct only has a bearing if it is particularly serious, for example in a case where the husband attempted to murder the wife, who was unable to work as a result.

The Commission says that some commentators suggest that there should be a greater recognition of domestic abuse as conduct, making the point that victim-survivors of abuse suffer poor financial outcomes following divorce, and that the financial consequences of domestic abuse should instead properly fall on the perpetrators

The Scoping Report concludes that it would be beneficial for the law to state clearly: what forms of behaviour will be considered conduct; the impact that conduct will have on a claim for financial remedies; and the process to be adopted when making an allegation of conduct.

Pensions

The final specific area that the Commission looked at was pensions.

The problem here is that many people have little or no awareness of their spouse’s pension, with a quarter of divorcing individuals not even knowing whether their spouse had a pension.

And pension sharing orders may not be made as often as they should, with many couples preferring an ‘offsetting’ arrangement, whereby instead of a share in a pension, a spouse receives a greater share of other assets. But offsetting can result in unfairness, particularly for women as their longer-term financial wellbeing is ignored in favour of the practicalities of their current financial needs.

The Scoping Report explores suggestions for reform of the law regarding pensions on divorce, including the possibility that equal sharing of pension rights should be a statutory requirement, so that pensions are automatically shared on divorce.

What happens next

We will now have to wait and see whether the Government agrees that the law should be reformed and, if so, what form that reform should take.

Under a Protocol between the Lord Chancellor (on behalf of Government) and the Law Commission, the responsible Minister will respond to the Scoping Report as soon as possible, and in any event with an interim response within six months of publication of the report, and a full response within a year. Matters should therefore become clearer by the end of 2025, at the latest.