Progress of the Divorce (Financial Provisions) Bill
Much needed reforms to financial settlements via the Divorce (Financial Provisions) Bill seem out of sight for now.
Many people going through a divorce or the ending of a civil partnership will have been faced with a harsh reality – the law governing the division of assets is a blunt instrument and sometimes feels unfair.
The Matrimonial Causes Act 1973 governs how a court is to determine what the parties assets are and how these should be divided in order to meet the needs of each party and those of any minor children. Section 25 of this Act specifically lists all the main factors the court must take into account. No one factor is given more weight than the other and the list is not exclusive.
The Act also allows the court to look at any asset or property which might not be considered matrimonial (for example one party’s inheritance or pension accrued pre-marriage) and if necessary that asset can be shared with the other party if the level of marital assets are insufficient to meet needs. This is where the main feelings of unfairness come from especially if one party has accumulated a large asset portfolio or spent time saving into a pension only to be faced with the possibility they may have to give some of this over to their spouse or civil partner.
The fact there is no set formula within the law of England and Wales to divide property and assets on a divorce or the ending of a civil partnership has meant that for years many people feel what they are left with at the end of the process can seem unfair.
One recent case is that of John Crowe from Suffolk. He recently spent over £12,000 in legal fees when he as his wife separated after 30 years of marriage and were unable to agree on the division of marital assets. During the proceedings he was shocked to discover that his wife had not saved into a pension scheme whilst she had been working. Based on a needs argument the court ruled that his wife was entitled to receive half of his pension, including the years he spent saving before they were married.
Mr Crowe said that was the most gruelling part. “She was married to someone else for ten of those years I was saving into the pension. It seems like financial bigamy. How can you be financially responsible for someone you didn’t know existed?”
There are those who are seeking reform to the law to try and make the process fairer. Baroness Shackleton has introduced the Divorce (Financial Provisions) Bill which seeks to amend the Matrimonial Causes Act by introducing a specific definition as to what constitutes matrimonial property and then provide better guidance as to how these assets should be divided, thus tackling the possible unfairness or risk that non-matrimonial property could be touched.
Unfortunately there is little hope in this Bill being passed into law anytime soon. The Bill has been in existence for some time and each time there has been an election or the prorogation of parliament the Bill has needed to start again from scratch.
The Government also does not support the Divorce (Financial Provisions) Bill, citing concerns that it could cause hardship. Without the necessary momentum it seems extremely unlikely that there will be legislative change any time soon, especially given the current uncertainties in the political sphere and demands on parliamentary time.
Until there is a change, spouses and civil partners must accept the reality, every asset must be disclosed, valued and considered when looking to ensure each party’s needs can be met to allow for independent living after the relationship has ended.
Amanda Erskine is a solicitor in the Family department at Barker Gotelee Solicitors in Ipswich.