Divorce

Parties must promptly reveal all their assets when required by the Court process so to do.      Failure to do so only worsens the party's case with the Court taking a dim view of partial-disclosure or deliberate and improper delaying of matters;  cost penalties await and indeed risks the Judge looking at that party as showing bad faith which may well influence the final judgment.

Matrimonial Split

Once married is everything you both own all in the one pot ?    Yes and No  (give me a one-handed lawyer please  -  on the one hand ....on the other....)    The starting approach is everything must be disclosed (the quaint words of the traditional marriage service spring to mind  " with all my worldly goods I thee endow ..."      Judges have developed two types of approach to adjusting this where they see fit :-

1. The (supposedly) scientific approach whereby the court tries to identify the whole matrimonial pot and then attempts to exclude non-matrimonial assets; this leaves the matrimonial property to be divided according to the equal sharing principle.
2. The artistic approach whereby the whole pot is adjusted from the 50:50 starting point to another percentage split based on " judicial feel" as to what seems fair, to reflect the existence of  "non-matrimonial assets"      

Observant readers will notice that as ever with Divorce there is some uncertainty and a client needs sound legal advisors to present their cases    persuasively .

A civil partnership is a legally recognised relationship between two people. 

At present, the law in England and Wales permits same-sex couples to marry (same-sex marriage was legalised in 2014 with the passing of the Marriage (Same Sex Couples) Act 2013) or enter a civil partnership  (legalised by the Civil Partnership Act 2004) but only allows mixed-sex couples to marry. 

The Supreme Court has now determined that the Civil Partnership Act 2004 is incompatible with the European Convention on Human Rights.  As such, Theresa May has announced that mixed-sex couples are now going to be allowed to have civil partnerships.

The proposed change comes after the Supreme Court, in June, ruled in favour of Rebecca Steinfeld, 37, and Charles Keidan, 41, who wanted to be allowed to have a civil partnership.  They, like many others, felt that marriage did not fit with their ideologies.  Unlike marriage, civil partnership has no historical connection to religion or the church.  For some, the fact that marriage is steeped in patriarchal tradition (with the woman being “offered up” or “given away” to the man and for her to thereafter “obey” him) is offensive and does not sit comfortably with the idea and desire for both parties to a legal union to be recognised as entering it willingly and equally.

The process of entering into a civil partnership is straightforward; with no need to exchange vows and the union becoming valid after both parties simply sign the civil partnership document.

Sharp v Sharp [2017] changed the way the courts divide up a divorcing couple's assets where the marriage is short and childless.

The Sharp’s had been married for four years, following two years of living together.  They separated in 2013 when Mrs Sharp discovered her husband's infidelity.  

They had no children together and both worked full-time.  At the start of their marriage they were both earning similar basic annual salaries of around £100,000, but Mrs Sharp received bonuses thereafter of £10.5 million.  Mr Sharp's bonuses were insignificant. 

Before they got married they bought a property in joint names for £1.02 million which was funded solely by Mrs Sharp.  During the marriage they bought a second property in joint names for £2 million.  Other than the jointly owned properties they generally kept their finances separate.

Originally the court awarded Mr Sharp £2.725 million but Mrs Sharp appealed, saying this was too much on the basis that:-

Asking ten “critical” questions before embarking on a serious relationship can help couples thrive according to a 2018 study by the University of Exeter.

Long-term relationships last when they are built on friendship, respect, realistic expectations, shared interests and humour, according to the research.

Evidence from couples, as well family lawyers, mediators and judges has helped identify the ten key aspects of a relationship which other couples can use to reflect on to see if they are likely to thrive and stand the test of time.

Continuing to ask the ten critical questions can also help couples build their relationship.

The questions are:

1. Are my partner and I a 'good fit'?
2. Do we have a strong basis of friendship?
3. Do we want the same things in our relationship and out of life?
4. Are our expectations realistic?
5. Do we generally see the best in each other?
6. Do we both work at keeping our relationship vibrant?
7. Do we both feel we can discuss things freely and raise issues with each other?
8. Are we both committed to working through hard times?
9. When we face stressful circumstances would we pull together to get through it?
10. Do we each have supportive others around us?

'Cohabiting couples need basic legal protections’ A coalition of legal organisations has written to The Guardian (September 2018) urging the government 'to take steps to bring forward, as a minimum, basic protections for cohabiting couples.'

The organisations note that marriage numbers are declining. Currently, one in eight adults in England and Wales are cohabiting, a trend steadily increasing since 2002.

However, a recent survey showed as many as two in three cohabiting couples were unaware that there is no such thing as "common law marriage" in England and Wales.

As such, parties who end a cohabiting relationship; whether of short or long duration, do not have the right to bring legal claims against the other for a fair share of the capital or pensions held in the sole name of the other and nor are they entitled to receive monthly maintenance from their wealthier partner.

The letter to the Guardian states:

At present, the only ground for divorce is that the marriage has irretrievably broken down (not irreconcilable differences as it often believed). The court cannot hold that the marriage has broken down irretrievably unless the petitioner satisfies the court of one or more of five facts, three of which are fault-based (adultery, behaviour, desertion). Two of the facts relate to periods of separation – two years if both parties consent, and five years without consent.

The Government is proposing to remove the fault based facts and the ability to defend a divorce.  The reasons are as follows:-

1. The breakdown of a marriage is a difficult time for families. The decision to divorce is often a very painful one. Where children are involved, the effects in particular where there is ongoing conflict, can be profound
2. Under current law in England and Wales, couples must either live apart for a substantial period of time before they may divorce, or else they must make allegations about their spouse's conduct. This is sometimes perceived as showing that the other spouse is "at fault".
3. Both routes can cause further stress and upset for the divorcing couple, to the detriment of outcomes for them and any children. There have been wide calls to reform the law to address these concerns, often framed as removing the concept of "fault".

As such, the Government proposes a shift away from blame with 2 objectives:

• to make sure that the decision to divorce continues to be a considered one, and that spouses have an opportunity to change course
• to make sure that divorcing couples are not put through legal requirements which can lead to conflict and poor outcomes for children

The short answer is yes. 

Prenuptials must be considered by the court as a factor of the case, in the event that there is a dispute as to how to divide up the assets and income on divorce.

When determining terms of financial settlement on divorce, prenuptial agreements must always be given weight, and often decisive weight as part of the circumstances of the case.   They may affect not only whether to make any award at all, but also the size and the structure of any award.   The following propositions of law are drawn from the leading case of Granatino v Radmacher:

1. It is the court, and not the parties, that decides the ultimate question of what provision is to be made;
2. The over-arching criterion remains the search for 'fairness', in accordance with section 25 as explained by the House of Lords in Miller/McFarlane(i.e. needs, sharing and compensation).   But an agreement is capable of altering what is fair, including in relation to 'need';
3.  An agreement (assuming it is not 'impugned' for procedural unfairness, such as duress) should be given weight in that process, although that weight may be anything from slight to decisive in an appropriate case;
4. The weight to be given to an agreement may be enhanced or reduced by a variety of factors;
5. Effect should be given to an agreement that is entered into freely with full appreciation of the implications unless in the circumstances prevailing it would not be fair to hold the parties to that agreement.   i.e. There is at least a burden on the husband to show that the agreement should not prevail;
6. Whether it will 'not be fair to hold the parties to the agreement' will necessarily depend on the facts, but some guidance can be given:

i) A nuptial agreement cannot be allowed to prejudice the reasonable requirements of any children;

ii) Respect for autonomy, including a decision as to the manner in which their financial affairs should be regulated, may be particularly relevant where the agreement addresses the existing circumstances and not merely the contingencies of an uncertain future;

A pre-nuptial (or pre-marital) agreement is an agreement made by a couple before they marry or enter into a civil partnership, which sets out how they wish their assets to be divided if they should divorce or have their civil partnership dissolved.

The House of Commons Library Briefing Paper is available for you to download here.

In a recently reported case, a wife successfully argued that she should not be held to the terms of a pre-nuptial agreement which limited her entitlement to c£1.6m.  Instead, she was awarded:-

• A housing fund of £1.35m; and
• Capitalised spousal maintenance of £1.6m

The parties had met in 2000 and married in 2008. By then they had one four-year-old child together and the wife had given up her career to care for him. They were living together in the husband’s pre-owned substantial property in Berkshire and his business interests were worth in the region of £30m.

The husband’s case was that the wife should be bound by the terms of the pre-nuptial agreement. The wife’s case was that the pre-nuptial agreement was unfair and failed to meet her reasonable needs.

The Judge found that the terms of the pre-nuptial agreement were unfair and should not be upheld in circumstances where:-

• The parties had enjoyed a budget of £1m a year during the marriage, of which up to £250,000 was spent on holidays.  
• The husband would continue to be able to draw £1.5m net from the business each year. 
• The family home was worth just over £3.5m.

KA v MA [2018] EWHC 499 (Fam)

In a 2014 case, a pre-nuptial agreement was not upheld in circumstances where, had it been, the husband would have been prevented from buying a home or paying off his debts.  On the other hand, his wife would have continued to live in luxury with the children.  The judge said: "If all the facts were the same but the genders reversed, it is inconceivable that the pre-nuptial agreements would outweigh making a substantial award to the wife, even if the children were primarily living with the husband and only intermittently staying with her."

The couple married in July 2005 and had three children. They split up in 2012 following rows over money. The husband had no assets at all. His net debts, including all he owed in costs, amounted to about £226,000. The wife was property rich and owned the £6.7m house she lived in. In July 2005 the couple had signed a pre-marital agreement, and then two supplementary agreements.

The wife said she was "distressed" by the ruling. She said her husband had contributed nothing to the marriage in terms of capital and had made repeated promises not to claim against her family's assets.

The husband’s solicitor said that he was given sufficient funds to meet his real financial needs, including a home in which to live, having made financial contributions himself during the marriage from employment and his own inheritance and "Marriage brings with it important legal and moral obligations to care for the other spouse in a time of need, including if a marriage breaks down.  Whilst those obligations can be properly regulated and defined by a pre-nuptial agreement, it cannot be right for it to remove entirely the obligation to provide for real need."

Luckwell v Limata [2014] EWHC 502 (Fam)