How to divide wealth after a marital breakdown | Davis Blank Furniss
Kirsty Morbey

It has recently been confirmed by the Government that they intend to review the 50-year-old Matrimonial Causes Act in order to make it easier for divorcing couples to resolve the financial issues arising when their marriage breaks down. The hope is that this will help to avoid costly legal battles.

divorce law signing of an agreement

Does the law need updating?

The current legal guidance is often criticised as expensive and unpredictable, but sometimes divorcing couples have no other option than to turn to Court as there is a real lack of clear guidance on how wealth should be divided upon separation. However, Lord Christopher Bellamy, Justice Minister, told the House of Lords that he plans to ask the Law Commission to examine whether the Act needs updating. The Law Commission is to be tasked with investigating the matter and establishing exactly what the existing law and practice is and where the problems lie.  They will also run some comparisons with other jurisdictions, including Australia.

The general starting point for the English legal system is that the combined wealth of a divorcing couple will be split equally, even if one partner is the breadwinner.  This is in stark contrast to many other European countries where financial awards are far less generous and ongoing payments from a working spouse to a non-working spouse following a marital breakdown, which are known as Periodical Payments or maintenance, are only ever awarded for a limited number of years.

The current system has led to accusations of “jurisdiction shopping”, where many non-working wives of the very wealthy (soon to be ex-husbands) look to commence divorce proceedings in London as the Courts there are seen to be generous in their overall financial rewards when compared to other European jurisdictions.

Main issues with the law

One of the main issues faced by family lawyers practicing in this area is that the Law relies heavily on the discretion of the judge hearing the case, which can lead to unpredictable outcomes.  As the guidelines are now 50 years out of date, it gives rise to further arguments because society has changed so much in the last half century. The legislation basically allows judges to use their discretion to assess each case on its own facts and make different awards. This creates great uncertainty and makes it far more difficult for family lawyers to give specific advice.

Ultimately, six different judges looking at the same set of facts could come up with six different outcomes. There are also regional differences with the London courts seeming to be far more generous than a lot of the courts outside of the area. Society, marriage and employment have changed so much over the last five decades, so it is somewhat unbelievable that such important issues are still being decided upon a 50-year-old law. The report of the Law Commission will no doubt be eagerly anticipated by most practicing family lawyers and will (hopefully) lead to a positive reform for the future.

For impartial expert advice on all family law matters, contact our Family Team.

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