How Assets are Divided on Divorce

The most important and paramount consideration is the welfare of any child of the family under the age of 18. Consideration will be given first and foremost to providing accommodation for the children.

In practice, this means that the appropriate outcome will be one which balances the financial needs of each parent, whilst at the same time making appropriate arrangements for the children’s financial needs.

There are other factors which are also relevant:

• The income, earning capacity, property and other financial resources which each party has, or is likely to have in the foreseeable future. In the case of earning capacity, it would also be relevant to examine whether it was reasonable to expect one party to take steps to acquire an earning capacity;
• The financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future;
• The standard of living enjoyed by the family before the breakdown of the marriage;
• The respective ages of the parties and the length of the marriage;
• Any physical or mental disability of either party to the marriage;
• The contributions which each of the parties has made or is likely in the foreseeable future to make to the welfare of the family, including any contribution by looking after the home or caring for the family;
• The conduct of each of the parties in rare and exceptional cases; and
• The value to each of the parties to the marriage of any benefit which, by reason of the divorce, that party will lose the chance of acquiring.

The court has wide ranging powers to order:

• An immediate or delayed sale of property;
• A transfer of property;
• A payment of a lump sum;
• Maintenance pending suit to assist the spouse in funding expenses pending divorce;
• Interim and continued maintenance payments;
• Child maintenance payments in limited circumstances;1 and
• Pension Sharing.

There is no automatic guarantee that assets will be shared equally, but often this is the most appropriate solution to produce fairness for both.

Consideration will be given as to whether it is possible to achieve a "clean break" financial settlement, which will prevent either party from making any further future financial claim against the other.

A spouse will not be penalised for remaining in the home and looking after the children whilst her husband goes out to work. The court will treat a spouse's contribution to the marriage as equal, albeit that one spouse's contribution was an economic and the other a homemaking contribution.

Sometimes, it is not practical for the parties to achieve financial independence immediately, and in those cases it may be appropriate for there to be a maintenance order in favour of the spouse. 

Even a short marriage may create financial dependence.

The court will adopt a different approach to "matrimonial" assets and "non-matrimonial" assets. Matrimonial assets mean the assets built up by the parties during the marriage, like the family home. Matrimonial assets are generally divided to meet the reasonable needs of the parties. 

"Non-matrimonial" assets are assets built up prior to or subsequent to the breakdown of the marriage, or assets acquired through an independent source. For example:

• inherited wealth;
• personal wealth generated prior to or after the breakdown of the marriage;
• personal injury compensation;
• interest in a trust.

These assets may not be shared between the two parties save to achieve a fair outcome. The courts retain a wide discretion to treat each case differently depending on the facts.

At Myerson, we work extensively for business owners or their spouses in arranging the valuation of business assets to determine liquidity or to determine the extent to which a party can provide income to meet future maintenance payments. 

The family team also has significant experience of working for those whose assets comprise commercial and residential property portfolios or inherited wealth. Our family lawyers work closely with other in-house private client, commercial property and corporate lawyers to make sure you receive a bespoke service to protect your interests.

We act with integrity. We do not fee build at the client’s expense. We provide experienced and commercial advice to ensure the client achieves the right outcome.

We understand the stress caused when relationships break down. We work hard building close relationships with the best forensic accountants, tax specialists, pension actuaries and independent financial advisers to assist the client to get the right information and help them rebuild their family's future.

If you would like to talk to us, in confidence, about how we can help, please call us on 0161 941 4000, or contact us online.