Last month, we published an article detailing the different processes available to resolve finances on separation. No matter what process has been used, once an agreement has been reached it is vital that the agreement is recorded in a final financial order. Last year, 74% of divorcing couples failed to obtain a final financial settlement in a Consent Order and this could lead to a rise in financial claims in years to come.
Why do I need a final financial order?
Even if your divorce has been finalised and your assets have been divided as per an informal agreement reached between you both, your ex-spouse is still able to make financial claims against you in the future if you have not obtained a final financial order, dismissing all the possible claims you and your spouse (or ex-spouse) have against one another.
If you have not obtained a final financial order on divorce and you have since come into a substantial amount of money, such as inheritance, a lottery winning or a successful business venture, that new found wealth is vulnerable as your ex-spouse could make a claim on your wealth.
You may recall reading the news in 2010 when Neil Page won £56million on the Euromillions and was ordered to pay £2million of those winnings to his ex-wife, who had left him ten years earlier. Additionally, in 2015, the Supreme Court granted permission for Kathleen Wyatt to make a financial claim against her ex-spouse, Dale Vince, 30 years after their divorce. Dale went on to become a multimillionaire businessman and the Supreme Court said that Kathleen may be able to rely on her greater contribution to the upbringing of the couple’s children to justify a financial order being made in her favour.
The subsequent orders made by the court were as a result of the parties having not obtained a valid, full financial order on divorce and the ex-spouse was therefore able to make a claim at a later stage.
How do I obtain a final financial order?
Once you and your ex-partner have agreed on a settlement, you should find a solicitor to draft the agreement into a consent order. Both parties must obtain independent legal advice and if you are both happy with the agreements agree to be bound to those terms then the order can be filed with at the court with a court fee of £50 and ask the court to make the consent order into a final financial order.
In order to obtain a final financial order, a consent order must be sealed by a Judge. The action of sealing an order is not a rubber stamping exercise and a Judge must consider the agreement to be fair to both parties. In order to decide whether the agreement is fair, a Judge must have sight of the parties’ basic financial disclosure, in the form of a D81. This will give the Judge a ‘snapshot’ of each parties’ capital, income and liabilities and a Judge will read this alongside the order and decide whether to make the agreement in to a binding order. Once the consent order has been sealed and the terms of the order have been given effect, the financial claims following on from divorce end.
The bottom line is that any financial agreement reached between you and your ex-spouse must be fair. There are a number of factors that are taken into account which may influence what is fair in the circumstances and these are set out in Section 25 Matrimonial Causes Act 1973. Some examples of the factors are the length of marriage, any children and the consideration of assets acquire pre and post the marriage.
If you are in doubt about the financial settlement you have reached with an ex-spouse, or require advice on where to start, please contact one of our specialist solicitors today on 0118 977 4045 and book an initial fixed fee meeting today.
This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.
