WHAT THE COURT MUST TAKE INTO ACCOUNT WHEN MAKING FINANCIAL ORDERS UPON DIVORCE

The Court can make orders in divorce or judicial separation proceedings re-adjusting the parties’ finances. Such orders can be made either with the consent of the parties (to endorse an agreement they have reached between themselves) or without the parties’ consent after a contested hearing. The Court will always consider whether an equal division of the available capital would be a fair outcome. Where possible, it will achieve a clean break, a full and final settlement.

When making such orders, the Court has to consider all the circumstances of the case, the first consideration being the welfare of any child under 18, and must also give particular consideration to the following factors:

1. Resources of the parties
   
   The income, earning capacity, property and other financial resources of both parties as they are now, and what those circumstances will be in the foreseeable future must be considered. Non-means tested benefits, fringe-benefits and any inheritance the parties can expect (where the donor has already died) are all taken into account as a party’s resources. If one of the parties has a new partner, that partner’s resources are taken into account to the extent that they reduce that person’s outgoings. Both parties must declare whether they have any intention to co-habit or re-marry in the foreseeable future.
   
   
2. Needs
   
   The essential needs of the parties are important, the most basic need being accommodation for the parties and any children. In particularly wealthy families, the Court will then try to achieve a fair distribution of the families’ wealth by considering their standard of living and their contributions to the family.
   
   
3. Standard of living
   
   The Court will try to maintain the standard of living enjoyed during the marriage. However, where this is not possible, the Court will endeavour to share the reduction in standard of living equally between the spouses.
   
   
4. Ages of parties and duration of the marriage
   
   These will have a direct impact on the resources of the spouses and any financial orders. A period of co-habitation before marriage can be taken into account, depending on the circumstances.
   
   
5. Any Disability of the Parties
   
   If either of the spouses suffer from a mental or physical disability, this will directly impact on their resources and needs.
   
   
6. Contributions to the family
   
   These include financial and non-financial contributions. For example, if one person has stayed at home to care for their children or be a housewife/househusband they will not be punished for failing to make a financial contribution.
   
   
7. Conduct
   
   Although in the divorce proceedings, one person may be “guilty” of adultery or unreasonable behaviour, he/she is not punished by having their behaviour held against them when the Court makes financial orders. Only extreme conduct can be taken into account by the Court when making financial orders, for example concealing assets, hiding the fact that he or she will re-marry, frittering away assets.
   
   
8. Potential Financial Loss
   
   The Court must consider any potential financial loss to either person as a result of the marriage ending. For example, one person may lose the right to a share in the other person’s pension when the marriage ends.

The Court decides how much weight should be given to each of these factors and they must each be considered by the Court, along with all the circumstances of the case, before making financial orders when a marriage ends.