On the 6th of April 2022 divorce law in England and Wales changed forever. Gone was the necessity to attribute blame for the breakdown of the marriage, and in came a modern no-fault divorce system.
It was the most radical change to divorce law in England and Wales since the civil courts were first able to grant divorces in 1858.
Two years on, we look at the effect of the change.
In particular, we ask four questions: Has no-fault divorce led to more couples getting divorced? How has the new possibility of couples jointly applying for the divorce worked out? Has the removal of fault from divorce led to more couples settling matters relating to children and finances by agreement? And: Has it led to fewer couples getting married?
A major objection to the introduction of no-fault divorce was that it would make divorce easier and therefore lead to a flood of couples getting divorced rather than trying to save their marriages, and a permanent increase in the divorce rate.
During the legislation process in the Lords, the Bishop of Carlisle voiced a typical concern, stating:
“Reducing divorce to a statement made by one party that the marriage has broken down undermines the seriousness with which marriage and divorce are regarded … What is more, studies suggest that making divorce quicker and easier will significantly increase the already high divorce rate, with all the implications that has both for human misery and financial cost.”
So have these fears materialised?
To answer this we will look at the latest available statistics for the Family Court (the latest divorce statistics are for 2022, and therefore do not cover a full year under the new regime). The statistics cover the quarter October to December 2023, but also include earlier figures.
The statistics show that there were 23,517 divorce and civil partnership dissolution applications in that quarter, which was actually down from the same quarter in the previous year, when the figure was 25,636.
And the figures for 2021, the last full year under the old divorce regime, were actually pretty similar to the figures for 2023.
In short, there seems to be no evidence yet that no-fault divorce has led to more couples getting divorced.
The new system of no-fault divorce introduced for the first time the possibility of a couple jointly applying for the divorce.
It was hoped that a large proportion of divorcing couples would make joint applications, thereby making divorce more amicable.
So how many couples have chosen this route?
The latest Family Court statistics show that in the quarter October to December 2023 25% of divorce applications were made jointly.
This may be rather lower than some had hoped, but it is not an unreasonable ‘return’, and it may yet be that more applications will be made jointly in future, as the possibility becomes more widely known.
One of the biggest arguments in favour of no-fault divorce was that it would reduce animosity between divorcing couples, by removing the need for one party to blame the other for the breakdown of the marriage. This, it was hoped, would lead to more couples settling arrangements for children and finances by agreement, rather than having to go through contested court proceedings.
Has this hope been realised?
Once again we will look to the Family Court statistics for the answer.
As to court applications relating to children, 54,652 were made in 2021, the last full year of the old divorce regime, whereas in 2023 this dropped to 50,789.
But as to financial remedies, there were 12,446 contested applications in 2021, compared to 12,910 in 2023.
So the answer thus far is somewhat inconclusive.
Another fear of the opponents of no-fault divorce was that it would undermine the institution of marriage, thereby leading to fewer couples getting married, and more couples choosing simply to cohabit, which it is feared is a less secure form of relationship, particularly for any children.
This comment of Fiona Bruce MP when the new legislation was debated in the House of Commons is typical. She said:
“People will marry less due to the low expectation of permanence in marriage, and they will cohabit more as the distinction between the two is eroded and what marriage really means becomes confused: no longer “till death us do part”, but “until I give you six months’ notice to quit, with no reason given.””
Unfortunately, we will have to wait to see whether Mrs Bruce’s fears will be borne out, as statistics for marriages in England and Wales since April 2022 are not yet available.
The latest published marriage statistics are for 2020, and they showed that the number of marriages that year was the lowest on record since 1838. Marriage appears to already be in decline, and whether no-fault divorce has hastened the decline, only time will tell.
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We are thrilled to announce the launch of our new Divorce Support Club podcast.
The Divorce Support Club, hosted by Claire Macklin – Divorce Support Coach, and our team of solicitors that take turns in hosting the sessions each month, aims to provide subscribers with valuable advice and support on different aspects of divorce. Each session is filled with tips from Claire and advice (legal and general) from the solicitor hosting that month. The Divorce Support Club also welcomes expert guest speakers throughout the year, to give detailed, expert advice on varying topics such as pensions, well-being and building confidence post separation.
“We’re excited to widen our community with the launch of our podcast” said Fiona, head of the divorce team and host of the Divorce Support Club. “Divorce can be a challenging journey in so many ways, and our goal is to provide a support network and valuable resources to help people to navigate their life during and after divorce.”
The Divorce Support Club visits a wide range of topics in relation to divorce including planning your future, supporting your children, self-care tips and more. It is a completely free service and subscribers are anonymous to one another.
The aim behind launching the podcast is to make the Divorce Support Club more accessible. If subscribers don’t have time to attend the live sessions or they need to be able to listen on the go, the podcast is an ideal alternative from the live webinar or the YouTube upload. Subscribers can simply press play, pop their phone in their pocket, and get advice whilst carrying on with their day.
To listen to the podcast, visit our Spotify channel. Episodes are released each month, a few days after the live session.
To subscribe to the Divorce Support Club and gain access to the full resources, please sign up here.
On the 22nd of February the Office for National Statistics (‘ONS’) published its latest annual figures for divorce rate in England and Wales, for the year 2022.
The statistics showed that the number of divorces granted in England and Wales plummeted to the lowest number since 1971.
In 2022, there were 80,057 divorces granted in England and Wales. (There were 74,437 in 1971, which was when the divorce laws in England and Wales were liberalised, resulting in a significant subsequent increase in the number of divorces).
The 2022 divorce rates were a 29.5% decrease compared with 2021, when there were 113,505 divorces, although the ONS point out that the higher divorce rates in 2021 may partially reflect delays in the number and timing of divorces granted during 2020 because of disruption in family court activity during the COVID-19 pandemic.
In 2022, divorce rates were 6.7 for men and 6.6 for women per 1,000 married individuals. These are the lowest rates since 1971, when the rates for both men and women were 5.9 per 1,000 of the married population
So what is behind the plummeting divorce rate?
The first thing to point out is that it is not due to fewer people being married, despite the fact that in December the ONS published figures that showed that the proportion of people aged 16 or older in England and Wales who are married or in a civil partnership had fallen below 50% for the first time.
Whilst that is true, and whilst there are certainly more people who have never married, the same figures showed that the actual number of people in England and Wales who are married has remained about the same for the last twenty years.
Clearly, more married people are choosing not to divorce, or at least delaying getting divorced.
Some speculate that the cost of living crisis is causing many to delay divorce proceedings.
Indeed, even before the divorce rate figures were published the financial services business Legal & General published research indicating that financial pressures had delayed some 19% of divorces
The cost of living crisis exacerbates the serious economic consequences of divorce.
Higher interest rates, for example, will have made it more difficult for divorcing couples to purchase new homes.
Higher inflation makes sharing expenses in one household more appealing than maintaining two separate households for couples.
Indeed, we’ll ascertain the impact of the cost of living crisis if divorce rates increase when the economic situation improves.
There was, of course, a very important change in the divorce laws in England and Wales in 2022.
On the 6th of April 2022 a new system of no-fault divorce was introduced.
The ONS notes that the number of divorces in 2022 may be influenced by the introduction of a new system, including mandatory waiting periods.
Those changes meant that a divorce under the new system would take a minimum of six months, whereas it was possible that a divorce under the old system could have been completed in less than that.
Obviously, no new divorces under the new system could have been completed until October 2022, at the very earliest.
Setting aside reasons for the decline, early figures suggest concerns about a significant increase in divorces due to no-fault divorce may be unfounded.
Back in 2017, for example, the Coalition for Marriage warned that the introduction of no-fault divorce would trivialise marriage and “cause the loss of 10,000 marriages a year by making the divorce process an administrative formality”.
As mentioned above no-fault divorce was only introduced in April 2022 and we will clearly have to wait for the 2023 figures to give a fuller picture, but the 2022 figures obviously show no sign that no-fault divorce has led to an immediate increase in the number of divorces.
So you have decided that you want a divorce. But how do you go about getting one? This guide should provide you with the basic information that you need to know.
Divorce essentially involves three steps: making the application, receiving the conditional order (where the court confirms your entitlement to the divorce), and getting the final order.
We will now go through each of these steps in a little more detail.
Completing an application and sending it to the court initiates the process. Please note that one cannot make the application until one year has elapsed from the date of the marriage.
One party can make the application, or both parties can make the application jointly.
The application contains, amongst other things, details of both parties, details of the marriage, and a statement by one or both parties that the marriage has broken down irretrievably. The court must accept that statement as proof that the marriage has broken down irretrievably, which is the ground for divorce.
The application must include your original or certified marriage certificate and the current court fee of £593.
The court will issue the application and check it. If there are no problems, they will send notice to the applicant(s) that it has been issued.
If one party made the application, the court will send a copy to the other party along with a form. The other party should complete the form, acknowledging receipt of the application and stating whether they agree with the divorce.
The other party cannot oppose the divorce because they do not believe that the marriage has irretrievably broken down. They can only oppose the divorce if they do not believe that the court has jurisdiction to deal with the divorce, if they can prove that the marriage was never valid, or if the marriage has already legally ended.
After issuance, the applicant(s) must wait twenty weeks from the application date before progressing the divorce. This is often referred to as the ‘period for reflection’, during which the applicant(s) can consider whether they do, indeed, wish to have their marriage dissolved.
If they wish to proceed, after 20 weeks, they can apply for the divorce to move forward.
The court will then check that the divorce can proceed and, if so, fix a date for the conditional divorce order to be made. By making the conditional order the court is stating that there is no reason why a divorce cannot take place.
After six weeks have elapsed from the conditional order the party or parties in whose favour the conditional order was made may give notice to the court that they wish the conditional order to be made final. (Please note that it is usually not advisable to finalise until financial arrangements have been sorted out.)
If the court receives the notice and finds no reason not to, it will finalise the conditional order.
If given over 12 months later, the notice must include an explanation stating why the application wasn’t made earlier.
Lastly, if one party has received a conditional order but hasn’t applied to finalize it, the other party can apply to make the conditional order final anytime after three months from the first available application date.
Please note that the above only covers the process of getting the divorce itself. It notably excludes sorting financial and child arrangements, which can be more complex.
For further information on how we can help, please see our Divorce & Separation page.
Whenever anyone thinks about financial planning through divorce, one of their first thoughts will be that it will be expensive.
But does that have to be true?
It’s inevitable that there will be costs associated with divorce, and that assets will usually be divided between the parties.
However, there are many steps that can be taken through financial planning to minimise the costs..
There are a number of practical steps that you can take that will help you get through the divorce.
Firstly, you should close all joint accounts, and separate your finances from those of your spouse, as far as possible. Obviously, if a joint account remains open then your spouse can drain it, including any money that you deposited into it.
Secondly, gather together details and paperwork in relation to all of your assets (including pensions) and liabilities. This will help you fully understand your financial position, and you will have to disclose these details.
Thirdly, make a budget. This will help get you through the divorce, and beyond. The budget will tell you your financial needs, which will be a vital piece of information when the financial settlement is decided.
Lastly, refrain from making any major financial commitments, until the divorce settlement is finalised. You may find that you will not be able to afford those commitments.
In most divorces the matrimonial home is the most valuable asset, and its value will usually be divided between the parties. Obviously, you will want to protect the asset, pending finalisation of the divorce settlement.
This is not a problem if the home is owned by you and your spouse jointly, as your spouse cannot deal with the property without your agreement.
But what if your spouse is the sole owner of the property?
You have a right to occupy the matrimonial home, even if your spouse is the sole owner. You can protect that right by registering a notice of home rights at the Land Registry. This will also effectively prevent your spouse from selling or re-mortgaging the property, as the buyer or lender would not proceed with the transaction until the notice is removed.
Various fees are likely to be incurred in the course of the divorce, from court fees to expert’s fees.
The amount of these fees can be quite substantial. There is currently a £593 court fee to issue the divorce application.
A simple way to save on these fees through financial planning is to share them with your spouse.
The divorce application can now be made jointly by both spouses, and they can agree to share the court fee.
Similarly expert fees can be shared, by the parties agreeing to instruct a joint expert, and to be bound by the expert’s valuation.
It is essential that you take expert legal advice. Obviously, the advice will cost money, but it may save you far more in the long run.
For example, good advice will help you to avoid unrealistic expectations, or arguing matters that will not be relevant to the outcome, such as the reasons for the marriage breakdown. If you have a good idea of what you may be entitled to, and avoid arguing over irrelevant matters, then you are likely to make smart financial planning decisions and to make a substantial saving on costs.
You may also need to take financial advice, for example in relation to pensions. Your lawyer will be able to put you in touch with a financial adviser.
Matters can be agreed with your spouse directly, through solicitors, or with the help of out of court solutions, such as family mediation and collaborative family law.
Note that before you can agree matters both parties will have to make full disclosure of their means, so that everyone knows what is at issue. It is therefore best to make this disclosure as quickly as possible.
If you can’t agree matters, consider arbitration, whereby the parties agree to have their case decided by a trained arbitrator, and to be bound by the arbitrator’s decision. This can be far cheaper than contested court proceedings.
There is of course no answer to this. The amount that the divorce costs will ultimately depend upon the issues involved, and upon the parties. As indicated above, if they are able to agree matters then the costs will be relatively little. On the other hand, if they argue about all matters then the costs will quickly skyrocket.
For further information on how we can help, please see our Divorce Finances page.
The popular media is full of stories about high profile divorce cases, often involving celebrities, and almost all involving huge sums of money.
And even the law reports of financial remedy cases largely comprise big money cases, as only couples with substantial assets can afford to get involved in expensive contested court proceedings.
Anyone reading these stories and reports can be forgiven for getting the false impression that such cases are the norm in our family courts.
But new research has shown that that is far from true.
The research project, entitled Fair Shares, which was led by the University of Bristol and funded by the Nuffield Foundation, surveyed 2,415 recent divorcees, providing the first representative picture in England and Wales of the financial and property arrangements that couples make when they divorce.
And the findings of the research were both surprising and worrying.
Perhaps the most surprising finding was just how little many couples have to share on divorce.
Far from the millions that we see in most reported cases, the research found that of those divorcees surveyed the median value of their total asset pool, including the net value of the former matrimonial home and any pensions, was only £135,000.
And nearly a fifth of those surveyed had no assets at all to share on divorce.
Perhaps it should not be surprising given how modest the assets could be, but the research found that the majority of divorcees left the marriage with under £50,000 by way of assets.
A fifth of divorcees ended up with less than £25,000, and a quarter ended up with nothing or only debts.
Only one in 11 came out of the marriage with £500,000 or more.
So much for big money divorces.
The research also found that equal division of the assets, if any, was not the norm, with only 28% of divorcees reporting that they had divided their assets roughly equally. In some cases there was an unequal division simply because the assets were divided in accordance with who owned what.
And a particularly worrying finding was that only 11% of cases involved sharing of pensions, suggesting that many people were missing out on their pension entitlement. The main reasons given for so few pension sharing cases were general lack of interest in the pension, and a strong sense that it ‘belonged’ to the spouse who had been contributing to it.
And that brings us to the last finding of the research: how few couples sought legal advice and help in sorting out their financial and property arrangements.
One of the most important things a lawyer will do before advising a client upon their entitlement in a divorce settlement is ascertain the value of the assets. Obviously, without this information it is impossible to know what a fair settlement is.
But the research found that over half of divorcees who had reached a financial arrangement had done so by themselves, only a third made use of lawyers to sort out their financial arrangements, and 12% had sought no advice at all.
It is therefore unsurprising that the research also found that over a third of divorcees did not know the value of their own pension pot, 10% of homeowners with a mortgage did not know what the equity in their home had been, and 38% of divorcees felt their knowledge of their ex-spouse’s finances during the marriage was not good.
The main reason for not seeking legal help was of course fear of the cost. However, the amounts spent on legal help were relatively low. A quarter of divorcees had had to find less than £1,000, with a further 18% having costs between £1,000 and £2,999. Only 9% had costs of £10,000 or more, with higher costs associated with greater wealth.
The message from all of this is quite clear: whilst assets may be modest, it is still worth seeking legal advice, as the cost involved can be far outweighed by the value of an entitlement that you may be missing out on.
For further information on how we can help, please see our Divorce, Separation, and Finances page.
Please contact us if you require any further information
In many divorces pensions are one of the most valuable assets, often second only to the former matrimonial home. It is therefore essential that pensions are properly taken into account in the divorce settlement.
Unfortunately, many people are unaware of the importance of pensions and how they are split on divorce, with the result that all too often they do not receive their true entitlement in the divorce settlement, which can result in them suffering economic hardship in old age.
In this post we will give a basic outline of how pensions are split in a divorce, but obviously there is no substitute for expert legal advice.
There are in fact three ways in which pensions can be dealt with on a divorce, although only one of these actually involves splitting of pensions.
The first way that pensions can be split in divorce is by way of an ‘offsetting arrangement”, whereby the pension-holding party keeps the pension, but the other party is compensated by having a greater share of the other assets.
Offsetting can be attractive where, for example, the party without the pension wishes to retain other assets, such as the former matrimonial home.
However, offsetting is not without its disadvantages.
For one thing it is impossible to equate the value of a pension with the value of a physical asset. They are quite different things.
And secondly of course the party without the pension can find themselves with insufficient pension provision, and insufficient time to accumulate sufficient provision.
This is where the court orders that part of the pension benefits be paid to the other party, when the pension comes into payment.
Pension attachment also has its disadvantages, for example the party in whose favour the order was made has no control over when the other party takes the pension.
Because of the disadvantages pension attachment orders are quite rare.
This is where the court will share the pension(s) between the parties.
Pension sharing involves the splitting of one party’s pension, usually on a percentage basis, so that part of the pension is transferred into a pension in the other party’s name.
Pension sharing is usually the most satisfactory way of dealing with pensions on divorce, as it can ensure a fair division of pension assets. However, only about 10% of divorces involve pension sharing orders, so many people are clearly missing out.
Now that we know the options for dealing with pensions on divorce, the next question is: how much should each party get?
Of course, before that can be answered we need to know how much the pensions are worth.
And valuing pensions can be quite tricky, often requiring the services of a pension expert.
In most cases the valuation used is what is referred to as the ‘cash equivalent transfer value’, i.e. the amount that could be transferred out of that pension fund into another.
Once a satisfactory valuation has been obtained, a decision can be made as to how much each party should receive. Whilst this is ultimately a decision for the court, financial advice may well be required to ensure that any arrangement works as desired.
In deciding how pensions should be split the court will take into account the same factors that it considers when deciding the financial settlement generally, such as the means of the parties, their needs, and their ages. Whether part of the pension was accumulated prior to the marriage can also be relevant.
All else being equal, and provided there is no offsetting, then a fair outcome could simply be that the pensions of each party are equalised, so that the value of each party’s pensions are the same. Again, however, expert advice should be taken as to what is a fair outcome in each case.
It’s a simple question, and one that must be asked by many people going through a divorce: what am I entitled to?
Unfortunately, the answer isn’t always so simple.
Obviously, when a divorce takes place the parties’ assets have to be divided between them, but what exactly are the assets?
Only when that question has been answered can we look at how the assets are divided.
The answer to the question comes from the general principle that marriage is regarded by the law as a joint venture, with both parties playing a full role, irrespective of whether they have contributed as a ‘breadwinner’ or a ‘homemaker’.
This means that the matrimonial assets are all those assets accumulated during the marriage (i.e. up until the parties separated), through the joint efforts of the parties to the marriage.
And this in turn means that assets that weren’t accumulated during the marriage or through the joint efforts of the parties (such as inheritances) are not matrimonial assets.
But there is an exception to this rule. As we will see in a moment, the financial needs of the parties is one of the most important issues to be considered when dividing the assets. And sometimes the matrimonial assets are not sufficient to meet those needs. In such a case the non-matrimonial assets can be used to meet the needs.
Having established what assets are to be divided, we now turn to how they are divided.
And here it is often stated that the starting-point is that the matrimonial assets should be divided equally between the parties. That would obviously be considered to be fair in many cases, but it is not quite true.
What the law actually does is use a number of factors to decide how the assets should be divided, and then compare that decision against the ‘yardstick of equality’, as it is called, to determine whether the decision is fair.
In other words, departing from an equal division of the assets should only occur if there is a good reason to do so.
As just mentioned, the law uses a number of factors to decide how the assets should be divided.
Those factors include such things as the income, earning capacity, property and other financial resources of the parties, the ages of the parties and the duration of the marriage.
But in most cases by far the most important factor is the financial needs of the parties, including their income needs and their housing needs (particularly if they have children living with them). The law will try to ensure that those needs are met out of the available assets, if possible.
And often the income (or earning capacity) of a party will have a significant bearing upon their needs.
For example, a party may need to raise a mortgage in order to rehouse themselves, but this will be much easier for a party with a higher income. In such a case that party’s needs may be less than the other party’s needs, as they will not require as much from the assets to rehouse themselves.
So needs can often be a reason why there should be a departure from an equal division of the assets.
As can be seen, there is no easy answer to the question: what am I entitled to in a divorce? (And the above is just a brief summary of the law – for further information, see this page.) In many cases there will simply be an equal division of the assets, but often that will not be appropriate.
Obviously, the best way to find an answer in your case is to seek expert legal advice.
For further information, please see the Divorce, Separation and Finance page.
It’s a term that’s often used, but what exactly is a “no fault divorce”?
Put simply, a no fault divorce is a divorce that can be obtained without having to prove that the other party was at fault for the breakdown of the marriage.
To explain this in a little more detail we need a brief history lesson.
Divorce under civil law in England and Wales first became possible in the nineteenth century. And in order to get a divorce it is necessary for the party taking the divorce proceedings to prove to the court that the marriage has irretrievably broken down.
Until last year this normally entailed proving that the breakdown was the fault of the other party, for example because they had committed adultery, or because they had behaved unreasonably.
Proponents for no fault divorce often referred to this system as “the blame game”. For many years they argued that having to blame the other party for the breakdown of the marriage was unnecessary and likely to increase animosity between the parties.
And they finally got their way last year when a new system of no fault divorce was introduced in England and Wales.
Under the new system the ground for divorce is the same as under the old system: that the marriage has broken down irretrievably. However, the big difference is that it is no longer necessary to prove irretrievable breakdown – a simple statement by one or both of the parties that the marriage has irretrievably broken down is enough, as the court must accept this as proof that the marriage has broken down irretrievably.
Under no fault divorce there is therefore no need to blame anyone for the breakdown of the marriage.
The primary benefit of this new no fault system is that not having to blame the other party for the breakdown of the marriage removes one common cause of animosity between the parties. Obviously, no one likes to be blamed for causing their marriage to break down, and anyway in many cases the breakdown of the marriage is unlikely to be entirely the fault of one party.
Removing blame should hopefully reduce animosity, thereby making it more likely that the parties will be able to agree important issues such as arrangements for children and finances after divorce.
No fault divorce also means that it will no longer be possible to defend the divorce, as a statement that the marriage has irretrievably broken down cannot be challenged. Defended divorces could be time consuming and expensive, and were ultimately pointless, as a court’s decision that the marriage had not legally broken down was obviously unlikely to result in a reconciliation, and would therefore just prolong an unhappy marriage.
Another big benefit brought by the new system was that for the first time it is possible for both parties to make a joint application for the divorce. Obviously, joint applications are another way to reduce animosity between the parties.
As indicated above, a no fault divorce is initiated by one or both of the parties making the divorce application, supported by a statement that the marriage has irretrievably broken down.
The court must accept this statement as proof that the marriage has irretrievably broken down and, if the application was made by one party, the other party cannot defend the divorce.
After the divorce application is made a period of 20 weeks must elapse before the divorce can proceed. This is intended to give the parties an opportunity to reflect, to ensure that they do indeed wish to bring the marriage to an end.
If they do then after the 20 week period they can apply for the divorce to proceed. The court will then fix a date for the conditional divorce order (the equivalent of the old decree nisi) to be made.
Six weeks after the conditional divorce order is made an application can be made for the divorce order to be made final. The final divorce order (the equivalent of the old decree absolute) will bring the marriage to an end.
Please note that if the financial settlement has not been finalised when the six week period has elapsed it may be appropriate to delay applying for the final order until the settlement has been finalised.
For further information, please see the Divorce, Separation and Finances page.
Obviously it is often the case that one party to a marriage will have significantly more assets than the other, which they have acquired before the marriage. But will this have a bearing upon the financial settlement in the event of a subsequent divorce?
The answer is: it may have an effect, depending upon the circumstances.
If, for example, it is a long marriage and the assets that one party acquired before the marriage have become ‘mixed’ with the other assets, then it may have little or no effect.
Take, for example, the situation where in a long marriage one party owned a house before the marriage, but that house is sold and the proceeds are then used by both parties. It may then be difficult to subsequently identify the original value of the house separately from the joint assets.
In such a situation the fact that one party owned assets prior to the marriage may have little or no bearing upon the financial settlement.
But often it will be possible to identify assets owned prior to the marriage, or at least to ascertain the value of those assets, and take them into account in the divorce settlement.
So what is the approach of the courts in such a situation?
To answer this, we need to consider the concept of ‘matrimonial property’.
In brief, assets acquired during the marriage, through the joint efforts of the parties to the marriage, are known as ‘matrimonial property’, and therefore fall to be divided between the parties on divorce.
Other assets, such as assets acquired before the marriage, inheritances or gifts to one party, and assets acquired by a party after the separation are considered to be ‘non-matrimonial’, and will therefore remain the property of the party who owns them.
But there is an exception to this. Where the matrimonial property is insufficient to meet the needs of one party then the court can ‘dip into’ the non-matrimonial assets, in order to meet those needs.
The way that all of this works can be demonstrated by a 2011 High Court case.
In the case the parties were married in 1993, at which time the husband had assets of just over £2 million.
The marriage broke down in 2009. At that time the total assets were worth about £9.7 million.
Divorce proceedings ensued, and the wife argued that the assets should be divided equally. She also claimed that she required half of the assets to meet her needs.
The husband argued that he should be entitled to more than half, in the light of the assets that he brought into the marriage. He did not, in fact, seek to recover all of the money he brought into the marriage, but just asked for a division that would give the wife 43% of the assets, leaving him with £1.37 more than her.
Considering the case, the judge concluded that it would be wrong and unfair for none of the assets owned by the husband before the marriage to be excluded from the general principle that assets should be shared equally.
The question, therefore, was: how much should be excluded?
Taking into account the fact that the marriage was quite long and the assets that the husband had brought into the marriage had well and truly mingled with marital funds, the judge decided that an appropriate figure would be £1 million.
The result of this was that the wife received about 45% of the assets, and the husband about 55%.
That still left the matter of the wife’s needs.
The judge concluded that 45% of the assets would be enough to meet the wife’s needs. There would therefore be no further adjustment in the wife’s favour, although it should be said that the judge did not exclude more than £1 million, as he considered that that would not leave enough to meet the wife’s needs.
For further information, please see the Divorce Finances page.
