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Did you have a Financial Court Order | HK News

Did you have a Financial Court Order when you divorced and why would you need one

| Published on August 9, 2019

Relationships and marriages sadly break down and at Humphries Kirk, we are here to help you make the process as easy as possible for you. Unfortunately, the process can be stressful to those involved but clear sensible advice is what we can provide.

Many people think that if they just deal with the actual divorce proceedings and agree any division of property, capital, pensions and investments between themselves that after Decree Absolute in divorce proceedings neither party to the marriage can go to the other in the future to make financial claims.

This is not the case. There should always be a document called a Consent Order confirming any financial settlement within divorce proceedings whether there are any assets or not. An example of how, after 18 years following the Decree Absolute a person can still make a financial claim against the other was well publicised in the case of Wyatt v Vince (2015).

The parties to the marriage had married in December 1981. The Wife had a daughter from a previous relationship but who was treated by the Husband as a child of the family. The Husband and Wife also had a son together. They separated in 1984 and the Decree Absolute was granted on 26 October 1992.
At the time of the Decree Absolute neither the Husband or the Wife had any assets.

The Husband’s green energy business then prospered in the late 1990s making him a multi-millionaire. The Wife’s financial circumstances continued to be modest.
The Wife then decided in 2011 to make an application to the Court within the original divorce proceedings for financial relief from the Husband in the form of a lump sum payment. Initially, in December 2012, a Deputy High Court Judge dismissed the Husband’s application for the case to be struck out. The Husband was not happy and appealed to the Court of Appeal who agreed and struck out the Wife’s claim for financial relief.

However, the Wife then appealed to the Supreme Court who allowed her appeal. The Supreme Court (which is the highest Court) acknowledged that the Wife had managed financially from low paid employment and partly on state benefits punctuated by periods of ill health. The Supreme Court felt the Husband was an ingenious and remarkable man who, having lived as a traveller for several years following the divorce, had used his scientific knowledge and his long standing interest in green power to become the sole shareholder of Ecotricity Group Limited providing wind powered electricity. The value of his company was considered to be at least £57 million.

The upshot is that there is no time limit for an ex-husband or ex-wife to make a claim if the finances have not been confirmed in a Court Order and the claims extinguished for the future by a “financial clean break”.
The Supreme Court confirmed in their Judgment that under the Matrimonial Causes Act 1973 that the Wife was able to make an application for financial relief some 18 years after the Decree Absolute. The final Judgment by the Supreme Court was made in 2015 some 23 years after Decree Absolute.

The Wife was successful and secured a lump sum payment from the Husband and the payment of her legal costs by the Husband.

It is advisable not to leave anything to chance and if two Parties cannot agree a financial settlement an application for financial relief should be made to the Court before Decree Absolute is granted.

It is very important to think of the financial future after divorce. A Party after Decree Absolute will not have any spousal rights over the other Party’s pension in the future. This is another reason why it is advisable to delay applying for Decree Absolute. A Pension Sharing Order can only be gained in divorce proceedings if a Consent Order is agreed confirming the financial agreement and attaching a Pension Sharing Order or Order of the Court. One Party may have had the role of homemaker and not had the ability to invest in a pension for their future.

It must be noted that an application to the Court for financial relief can be made by either Party in the absence of a Consent Order but whether that application will be successful very much depends upon the financial circumstances of the Parties since the divorce and at the time of the application. It should also be noted that not everyone’s circumstances within divorce proceedings or following divorce proceedings are the same and each case is unique in its own way and seeking legal advice is essential.

At Humphries Kirk we are happy to provide clear and concise advice in respect of any family issue which arises due to the breakdown of a relationship. For further information, contact Debbie Roper, associate and chartered legal executive within the family law team of the Wareham office, on d.roper@hklaw.eu or call 01929 552141.

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