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Jul 02

Divorce law is about to change – Will financial settlements be next?

Reading Time: 3 mins

Earlier this year, the government announced that it intends to introduce new legislation regarding the ‘no-fault divorce’, ending the historical need to apportion blame to one party.  Once implemented, couples will simply need to state that their marriage has irrevocably broken down and will not need to include one of the ‘five facts’ that are currently in place. Without the need to divulge details of adultery or unreasonable behaviour, couples will also gain much greater privacy as they navigate through a naturally difficult time.  There is also an expectation that no-fault divorces may also result in quicker and simpler financial settlements. Whilst this is likely to be true in some cases, a seeming lack of interest from the government to reform the area of financial agreements means that this may still prove to be a complex and challenging part of the divorce process. 


Old vs New Rules

Under the traditional rules, a divorce can only proceed if one of the parties is accused of desertion, adultery or unreasonable behaviour. If none of these factors are present, the couple must have been separated for over two years if both parties agree and five years if one of the parties does not agree to the divorce. 

Under the new proposals irretrievable breakdown will become the only grounds for divorce and it will no longer be possible to contest the divorce. The process will require the submission of a statement which confirms the marriage is no longer salvageable, after which the existing two-stage process will apply, in addition to a minimum six month time frame from petition to decree absolute, so as to factor in time for reconciliation. 


The Impact on financial settlements

Whilst the new rules do not have any legal weighting in regards to financial settlements, the removal of conflict caused by the need to apportion blame means that the issue of splitting assets will in some cases be more amicable and quicker to resolve. That said, many in the profession are in agreement that this area of law desperately needs reform, as at present it relies too much on the discretion of the judge. This makes court order outcomes less predictable and discourages couples from negotiating an agreement in advance, despite it being mutually beneficial in most cases to do so.

A proposed reform has been spearheaded by Baroness Deech in the House of Lords, in the form of her Divorce (Financial Provision) Bill. She has proposed that the starting point for the distribution of assets should comprise a straight 50/50 split on the net value of matrimonial assets acquired during the marriage. From this, courts can then make adjustments to the split depending on several factors including specific agreements made regarding property, the requirements of any children and the dissipation of assets. Furthermore, all assets acquired prior to the marriage would not be considered and inheritances awarded during the marriage would also be ring-fenced, except where specific circumstances required it to be included. There would be a statutory recognition of pre and post-nuptial agreements and controversially, a move towards capping maintenance payments to five years. This final point has drawn some criticism from those who feel this unfairly disadvantages individuals who have given up a well-paid career to look after their children. Having been approved by the House of Lords, this bill is now due for discussion in the House of Commons, although the chances of it becoming law in its current state are slim. 

What is clear is that the spotlight is firmly shining on divorce law reform in the UK and these small but significant steps are an encouraging sign that change is coming, something which is being warmly welcomed by couples and divorce lawyers alike. Despite continued uncertainty regarding future steps and implementation timescales, particularly regarding financial settlement reform, it is very much a case of ‘watch this space’. 


About the Author

Henry Brookman is a divorce solicitor and senior partner at Brookman, a highly experienced family law firm, with expertise in a full range of family legal matters including divorce in the UK and internationally, complex financial issues, property settlements and children’s matters. Brookman is ranked by the Legal 500 and has been awarded the Law Society’s quality mark, Lexcel. For more information visit www.brookman.co.uk.


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