Our solicitors always seek to use the least confrontational method available to achieve a financial settlement in your divorce. Sadly, however, there are times when matters are irreconcilable and an application to court is necessary.
The Court has wide discretion when deciding the terms of a divorce financial settlement and will seek to reach a conclusion that is fair and reasonable to all involved. In doing so, it will take into account factors such as:
- the value of existing assets
- the couples respective future earning potential
- the length of time for which the couple were together
- any future benefit they might miss out on such as pensions
- the financial status of any new partner
- whether there are children – if there are, rehousing those children will be the first consideration where they are under 18
- These factors are more widely set out in section 25 of the Matrimonial Cause Act.
When couples separate or divorce, family courts can address a variety of financial issues, particularly if an out-of-court agreement isn't reached. Here's a breakdown of the key financial matters handled in family courts.
Division of marital assets
This involves dividing the marital assets and debts accumulated during the relationship fairly. Marital assets can include:
- Property - the family home and any additional properties or land
- Spousal maintenance
- Savings and investments - such as joint bank accounts, individual savings accounts, stocks and bonds
- Pensions - both private and public sector pensions accrued during the marriage
- Valuable possessions - for example, jewellry, cars and antiques
Child maintenance
While the Child Maintenance Service (CMS) usually calculates child maintenance payments based on the paying parent's income, the family court can intervene in some situations, such as:
- Determining school fees - if not already covered by the CMS calculation, the court may order additional contributions for school fees
- "Top-up" maintenance - For very high-income earners (above £156,000 per year as of 2024), the court can order "top-up" maintenance beyond the CMS calculation
Other financial considerations
- Pre-nuptial agreements - couples can enter into pre-nuptial agreements before marriage (usually out of court) to outline how finances will be handled in the event of divorce. These agreements, while not legally binding in the UK, can be considered by the court during financial settlements
- Post-nuptial agreements - similar to pre-nuptial agreements, post-nuptial agreements can be established after marriage to specify financial arrangements in case of separation. Again, these are agreed outside of court, but they can be taken into consideration in a financial dispute heard in court in the event of a divorce or separation
- Disclosure - full and frank financial disclosure from both parties is essential for the court to make a fair financial order. Financial advisors can assist with this process
In summary, the family courts do play an important role in settling financial disputes, such as ensuring a fair and equitable division of assets and sometimes addressing child maintenance needs. However, we do strongly recommend that you try to reach an out-of-court agreement. Whichever route you choose, we’re here to help you make the right decisions in seeking a fair financial settlement.