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Potential Future Changes to Divorce Law and Financial Provisions

break-up-580x395-1423407815793Is it right  that a spouse should receive maintenance from their spouse or former spouse in their own right and separate to any child maintenance that is payable? Many of you may be surprised to know that elsewhere in Europe it is not usual for Courts to award spousal maintenance or if they do, as in Scotland, they are time limited.  A Private Members Bill  is currently going through Parliament with the intention of changing the law here in England and Wales, and which will result in bringing us more “in line” with the rest of Europe when it comes to spousal maintenance.

That Bill is the Divorce (Financial Provision) Bill 2014 and it recently had its third reading in the House of Lords.  If this Bill is  passed, it would have the effect of time limiting spousal maintenance to 3 years, rather than allowing it to be paid during joint lives as sometimes happens now.

The Bill is important, however, for other reasons as it intends not just to reform spousal maintenance but financial settlements between spouses and in particular, in two other main areas.

The first relates to the actual division of matrimonial property on divorce.  At present, this is dependent upon a number of factors set out in section 25 of the Matrimonial Causes Act 1973:

  1. the income, earning capacity, property and other financial resources that each of the parties to the marriage has or is likely to have in the foreseeable future, including in the case of earning capacity any increase in that capacity that it would, in the opinion of the court, be reasonable to expect a party to the marriage to take steps to acquire
  1. the financial needs, obligations and responsibilities that each of the parties to the marriage has or is likely to have in the foreseeable future
  2. the age of each party to the marriage and the duration of the marriage
  3. the standard of living enjoyed by the family before the breakdown of the marriage
  4. any physical or mental disability of either of the parties to the marriage
  5. the contributions that each of the parties has made or is likely in the foreseeable future to make to the welfare of the family, including any contribution by looking after the home or caring for the family
  6. the conduct of each of the parties, if that conduct is such that it would in the opinion of the court be inequitable to disregard it
  7. in the case of proceedings for divorce or nullity of marriage, the value to each of the parties to the marriage of any benefit that, by reason of the dissolution or annulment of the marriage, that party will lose the chance of acquiring

The Bill, however, stipulates that matrimonial property should be divided equally except if it would be unfair to do so taking into account matters such as the agreement of the parties, where the monies came from to acquire any property, the nature of the property (is it also used for a business?) and the needs of any dependent children.

In addition the Bill makes it clear that “matrimonial property” is essentially all property that has been acquired after the parties married except for gifts and inheritances.

The second area the Bill deals with is the treatment of pre nuptial and post nuptial agreements.  This is perhaps not surprising, nor is it surprising that the Bill intends these to be treated as binding providing certain conditions are met such as the parties having had independent legal advice, there being a full disclosure of assets and, in the case of pre nuptial agreements, it is made at least 21 days before the marriage.

In the event the Bill is passed, it may well create more certainty for couples in the event of divorce, which I am sure is the intention, but the question I pose is this, is it going to provide better and fairer outcomes, and for whom?

This blog is written by Radmila Balac who is a Family & Divorce Solicitor in Coalville