Consent Order following Divorce Pitfalls of not finalising Financials

In England & Wales, the grant of Decree Absolute legally dissolves a marriage but this does not necessarily mean the end of your possible financial commitments to your former spouse.

The final divorce petition proceedings is split in two parts. The first is the pronouncement of Decree Nisi which is issued upon the Court being satisfied that parties have proved their marriage has irretrievably broken down. Thereafter, following a short period of time, the decree absolute is granted, which ends the marriage and gives parties the right to remarry.

According to English law, a person must have issued a divorce petition to be able to make a financial claim and there are crucial time elements between the divorce and the issue of financial orders. There is no provision for financial applications to be made on their own and a Decree Absolute does not sever the financial ties between parties.

Unless there is a Financial Order in place, parties can make claims on each others assets at any point in the future, even if these assets were acquired after your divorce. It is therefore crucial that an agreement is reached on the division of property, savings, and any other assets that are owned solely or jointly at the time of marriage. An agreement can be reached between the parties themselves or seeking assistance from the Court by issuing an application for financial remedy.

For an agreement to be legally binding it must be recorded in the form of an order, approved and sealed by the Court. This is the only way to avoid a potential threat of a financial claim being made against you after a divorce.

Parties going through divorce proceedings must note that there are crucial time elements between divorce and the issue of financial orders for reasons set out below:

Former Matrimonial Home 
If you have no legal interest in the matrimonial home, you can protect your position by registering a home rights application with the Land Registry. This will prevent your spouse selling or taking out further secured loans on the property without notice first being given to you. However, this protection is only given whilst being married to the legal owner and is lost from the date of decree absolute. Upon receiving the decree absolute, the Land Registry will remove the restriction on the register. It is therefore advisable to delay the application for decree absolute to preserve your home rights until a financial settlement has been reached particularly if there are concerns over the premature disposition of the matrimonial home.

Death
A financial order made either by an agreement between the parties or through contested proceedings will not become enforceable until after the decree absolute has been granted. If one spouse dies prior to the grant of decree absolute then the agreed financial order will not be enforceable.

When death of a spouse comes before the grant of decree absolute, then the deceased’s estate will be distributed in accordance with their will, if they had one, or the rules of intestacy. In these circumstances, the surviving spouse may benefit more than what was agreed in the financial settlement especially if there are joint assets. If, however, the deceased spouse did make a Will which disinherited or made inadequate provision for the surviving spouse then they could find themselves in difficult financial circumstances and yet be without the benefit of making a financial claim on divorce. The surviving spouse could bring a claim against the deceased spouse’s estate under the Inheritance (Provision for Family and Dependents) Act 1975 but this could be challenged by other beneficiaries. Also, this type of claim is not available if the deceased spouse died domiciled abroad which could leave the surviving spouse without any means of making a claim.

On the other hand, if one spouse dies after the grant of decree absolute but with no financial order in place, unfortunately the surviving former spouse would not be able to bring a claim on divorce under the Matrimonial Causes Act 1973. They would also be unlikely to inherit under a Will and the intestacy rules, where property passes to a spouse, would no longer apply to them.
Any financial claim by a surviving spouse would have to be brought under Inheritance Act 1975 but,as an ex-spouse, their claim would be limited to maintenance only. This could make a significant difference if there are considerable matrimonial acquired assets in their former spouse's sole name.

Motive
Usually, the petitioner is advised to delay the application for decree absolute until a financial agreement has been reached for reasons discussed above. Also, delaying the application could encourage the Respondent to negotiate a financial settlement, especially if they want to re-marry. However, this advantage is not endless. The Petitioner is entitled to apply for the Decree Absolute from six weeks and one day from the date that the Decree Nisi is granted, whereas the Respondent must wait until a further three months have passed. After that time, if the Petitioner continues to delay the application with a view to settling the Financial Order then the Respondent could make an application for the Decree Absolute. Unless the Petitioner can show that there are exceptional circumstances which mean they would be prejudiced by the ending of the marriage then the Respondent’s application is likely to be successful and the Petitioner may find themselves paying the Respondent’s costs.

As can be noted from above it is important for divorcing parties to ensure that a Financial Order is in place at the time of obtaining Decree Absolute as without it would mean a potential threat of a claim in the future.

A Financial Order is the only way to ensure that all existing financial obligations and commitments are severed between the two of you.

So if you are considering applying for a financial order to legally separate your money, property and assets, or simply want to know more, do not delay and contact us:
Aschfords Law, 45 -47 Station Road, North Harrow, HA2 7SU
Office telephone – 020 3002 9147
Mobile – 07582 932830
Email - info@aschfordslaw.com

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