The review set to reshape divorce financial orders

It’s been over a year since no-fault divorce was introduced, allowing couples to end their marriage on better terms without assigning blame. This development has reduced acrimony and paved the way for more amicable separations.

Call for change in financial division

Attention has now shifted to the legislation governing financial divorce settlements , which has been in place for over 50 years. The Law Commission is reviewing whether the Matrimonial Causes Act 1973 and its equivalent for civil partners (the Civil Partnership Act 2004) still work effectively in today’s society, given the significant changes in family structure and finances.

Key areas of the review

• Judges’ discretionary power to decide how financial assets should be divided, and whether there is a need for a clear set of principles to give more certainty to divorcing couples.
• Whether the courts should have wider powers to make orders for children over the age of eighteen.
• How maintenance payments for an ex-spouse or civil partner should work.
• What consideration the courts should give to the behaviour of separating parties when making financial remedy orders.
• Orders relating to pensions and whether they are overlooked when dividing parties’ assets.
• The structure of the system for making regular financial payments from one person to another after divorce.
• The factors judges must consider when deciding which, if any, financial orders to make.

The need for clarity in financial orders

The legislation sets out, in fairly broad terms, the factors a court should take into account when considering the division of assets. These include the parties’ income, financial needs, standard of living, and contributions to the family.  But over the years the courts have applied their own interpretations. Different judges have taken different approaches.

It’s meant that it can be extremely difficult to predict how a financial order in a particular case would look.

Our family law solicitors have vast experience in the types of issues that arise when two people are trying to divide their marital assets. Often we can help them deal with this between themselves or through mediation, avoiding having to go to court at all. But, sometimes, only a judge can get a resolution.

The Law Commission’s review is still in its early days, with a ‘scoping paper’ not expected to be published until September 2024.

We all want the very best for our clients, and for this to happen family lawyers need to be in the best possible position to advise them on the decisions that are so important for their future. There can never be complete certainty when it comes to judicial outcomes, and it is important that judges retain discretion, but we welcome much needed clarity on this issue.

Kate Rayner