The Law relating to Finances & Divorce in a nutshell

Finances and Property

Whether divorcing or separating, the same rules apply. If a Court is asked to look at finances, there are only certain orders it is allowed to make.

Effectively, this forms a set menu of financial rights, which each spouse has against the other.

Although it is possible to agree whatever the couple want, it is more usual to follow the same format as the court would use.

For these reasons, it is important to consider the Orders that a Court can make.

It is also important to understand what a Court has to bear in mind before it makes an order.

There is a checklist of things that have to be considered – checklist

The orders that a Court can make shape the structure of a financial settlement or order.

The considerations affect how much is paid and for how long. The orders that a Court can make are limited by law.

Between spouses, a court can order:

Maintenance

Maintenance is often called "periodical payments".

Interim Maintenance

This can be claimed as soon as the Petition has been issued and is intended to be an emergency measure to provide income before the final amount is settled or dealt with at a final hearing. A recent case in the Court of Appeal has said that the Court can order part of a spousal order to include payments in respect of children pending a CSA assessment. DorneyKingdom-V-DorneyKingdom 15/6/00. This overturned the previous thought that the court could only make a children order by consent.

Maintenance Pending Suit

Similar to Interim Maintenance but will end upon Decree Absolute, so we would advise you apply for both.

Maintenance can be for a fixed term (e.g. 2 years) to cover a period of training or to allow for children to reach school age and for the receiving party to obtain employment.

It can also be for life and will usually end upon remarriage, cohabitation and death.

After Retirement

Where a petition for divorce is sent to the court after 1st July 1996, the court can order maintenance or the lump sums that may be available on retirement to be paid direct from any pension scheme in which one or other spouse has a benefit. (This is called pension earmarking).

This will only usually apply where the parties are fairly close to retirement age.

Lump Sum Orders

The court can only make one order dealing with capital. A lump sum order can be made by installments, and if it is, then it can be varied (although that is rare).

If there is an ongoing order for maintenance, the court can be asked to make a capital order whenever the maintenance is varied to achieve a Clean Break. This is an exception to the general position set out above.

Maintenance can always be varied up or down as circumstances often change, maintenance rights can also be dismissed.

Lump sums can be payable in respect of savings, stocks and shares, investment policies such as endowments and ISA’s.

Property Adjustment Orders

The court can order that all or part of a party’s share in privately owned property be transferred to the other party or to the children. This will usually either be for a fixed term such as to a child’s 18th birthday or remarriage.

The court can order that the other party’s share be paid later on.

Where the parties are in rented accommodation the courts can transfer the tenancy to the other party.

If there is a potential to buy under the Right to Buy Scheme for council property this can be taken into account.

Orders for Sale

The Court can order that any property owned by the parties is sold and can make orders for the division of the proceeds and payment of mortgage legal fees and other debts.

Property Protection

The Court can hear emergency applications to protect property or money being disposed of before a final hearing. This is known as a Mareva Order or in Matrimonial matters a Section .37 order (s.37 Matrimonial Causes Act 1974)

If you believe the other side is hiding money or property you can apply to the High Court for an "Anton Piller" order requiring the other side to allow your representatives to enter their premises to search for and seize documents or property. This order is rarely used except in High Value cases.

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Information on this page is current and last updated: 12/03/2008

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