DIVISION OF FINANCES ON DIVORCE

The division of finances on divorce is usually by agreement between solicitors, endorsed in a Court Order rather than following a court hearing. There should be no discrimination between husband and wife, or between the money-earner and the home-maker.

The law governing the Courts’ approach (and therefore the approach of solicitors advising and negotiating on behalf of clients) to financial settlements on divorce is based on the Matrimonial Causes Act 1973.

In October 2000 the House of Lords gave an important judgement on the interpretation of this Act, giving Mrs. White 40% of the matrimonial assets. Since then, there have been a number of other cases in which the Courts have given further guidance on what is a fair division. In particular giving Mrs. Lambert 50% of the matrimonial assets and the Arsenal footballer Ray Parlour’s wife, 40% of his income.

Behaviour in financial proceedings is not considered on the basis of moral or emotional conduct. Infidelity or domestic violence is only taken into to account if it has a financial impact. Examples include disabling one of the parties and so reducing their future earning ability, or deliberately running up debts so as to prevent the other spouse from receiving their share of the matrimonial finances.

The aim of the law is to arrive at “fairness”. Although a starting point may be 50:50 the overall situation of the parties may mean a departure from equality in certain circumstances. For example, consideration is given to the facts in each case including:

1. age of the parties (including life expectancy of each party in respect of future income) and length of the marriage
2. contribution both in financial and other ways (including bringing up children and inheritance)
3. resources and needs of the parties
4. standard of living during the marriage

If there are children, the first consideration is their welfare, including their housing needs, and this may impact on the overall financial settlement.