I am often asked why couples who are getting divorce cannot just agree how their assets are divided between them without the need for courts and lawyers and dispute.
In some cases where the assets have all been built up during the marriage by the couple themselves, and both spouses are able to be financially independent of the other, then the start point of equality might also be the end point. However life is rarely that simple!
The need for one spouse to house and care for the children is the first factor which influences the court in deciding how assets are divided. Another factor which leads to an uneven division of assets is when the spouses have very different earning capacities. Pensions can also be a factor for moving away from equal division.
However complications occur where one spouse had their wealth prior to the marriage or has made that wealth since separation. Arguments as to how to deal with pre marital wealth or post separation accrual have recently been considered in a landmark case Hart v Hart.
That case also considered that assets that had been inherited by one spouse during the marriage can also be treated differently than assets that have been built up together during a marriage.
In circumstances where not all the assets available were built up by the couple during
the marriage, or assets have been inherited, it is imperative that good quality legal advice is obtained by both spouses. In some circumstances it may be possible to “ringfence” or in other words to keep them from being divided on divorce. However it is not always possible to ringfence if there are insufficient other assets to ensure that both spouses can rehouse and meet their own outgoings.
This can be a complicated issue which needs to be properly dealt with in legal negotiations and indeed where those assets are held. If those assets to be ringfenced are “mingled” with the other joint assets of both spouses then it may not be possible to protect them. If you find yourself in this situation take advice at the earliest opportunity.
Back to In The Press