The introduction of no-fault online divorce has brought about an increase in people firing off divorce applications without first seeking independent legal advice. Many such individuals incorrectly assume that once they have secured the final divorce order that is the end of the matter, but what they often fail to appreciate is that unless they have taken steps to obtain a separate order addressing what should happen with regards to the finances of the marriage, the financial claims between them and their former spouse will remain open. This means that it is possible for their former spouse to bring a financial claim at some point in the future, sometimes even several years after the marriage has ended.
In the case of Wyatt v Vince (2015) the parties obtained a divorce in 1992. At that time Mr Vince was pursuing a “new age” travelling lifestyle and the parties had nothing to share by way of income or capital.
Although the court file could not be located it appears that the parties went their separate ways without first obtaining a financial order dismissing Ms Wyatt’s claims. Ms Wyatt was then left to raise the children of the family without any financial support from Mr Vince.
Some years later Mr Vince set up a green energy business which proved to be incredibly successful. Indeed, it was so successful that 19 years later, when his former wife decided to bring a financial claim against him, he was a multi-millionaire.
Ultimately, Mr Vince agreed to pay Ms Wyatt a lump sum which was described as “modest” in comparison to his overall wealth, but he could have avoided this claim altogether if he had obtained a consent order providing for a clean break at the point of divorce.
How do you obtain a financial order on divorce?
The court will not, of its own volition, deal with the finances of the marriage or make a financial order dictating who gets what. The court will only involve itself in the finances of the marriage if one spouse makes a formal application for a financial order, either as part of their application for divorce, in answer to an application claiming relief or via a form known as a Form A (or a Form A1 if the fast-track procedure applies). It is also open to parties to agree terms and seek an order by consent.
Divorce application
As standard, it is sensible to include a claim for financial relief in the divorce application, even if at that stage the applicant has no intention of pursuing a formal claim for a financial remedy and hopes to reach a resolution by agreement.
If, however, they omit to do so, all may not be lost as it may still be possible to bring such a claim by completing a Form A, or a Form A1 at some point in the future.
Non-court dispute resolution
Just because one party pursues a financial claim it does not mean that contested court proceedings are inevitable. There are various ways in which the finances of the marriage can be addressed during the course of divorce proceedings. These include non-court dispute resolution methods such as arbitration and mediation.
Financial consent order
Most cases will settle at an early stage and a document known as a consent order, setting out the terms of any agreement, can be submitted to court. See What is a financial consent order? | Weightmans
Financial remedy proceedings
If court proceedings are required to resolve finances, an application for financial remedy must be brought. This must be made in addition to indicating an intention to claim in the divorce application.
For more information about Form A/A1 and financial remedy proceedings see: A guide to financial remedy proceedings | Weightmans
No time limit
Assuming an application for a financial order is included in an initial divorce application, there is no time limit within which a financial claim can be brought by fling a Form A or a Form A1. That being said, significant delay in bringing a claim, or remarriage, can have a substantial impact on the provision that the court may award.
Remarriage
Section 28(3) of the Matrimonial Causes Act makes it clear that if either party remarries after the final divorce order is made, that party cannot apply for a financial provision order or a property adjustment order, against their former spouse once the remarriage has taken place. A financial provision order can include periodical payments/maintenance, secured periodical payments and lump sum provision. A property adjustment order can include a sale or a transfer of property.
It is also important to bear in mind that a claim for spousal periodical payments/maintenance cannot be made, or any pre-existing periodical payments order will come to an end, if the person in receipt of the payments remarries, or either party dies. In contrast, claims may continue after the paying spouse’s death in some situations and expert advice is required when drafting an order if this is your intention.
Rather peculiarly, where the other party has not remarried, in theory that party could make an application against themselves in favour of the remarried party. This is because S.28(3) excludes a remarried party making an application but does not exclude the court from making an order in their favour.
The right to apply for a pension sharing order is not lost on remarriage. This means that if the parties did not obtain a financial order addressing what should happen with regard to their pension assets at the point of divorce, either party can bring a claim against the other’s pension even after they have remarried.
Applications made before remarriage but not pursued until after remarriage
Provided an application for a financial order is made in the divorce application, or answer, and the application is not dismissed on divorce (usually via a consent order), a party can still proceed with the application after they remarry, hence a Form A/Form A1 can still be issued following the remarriage. However, it is always preferable to make the claim prior to remarriage.
Delay
As highlighted above, it is possible for one party to pursue financial support from a former spouse several years after a divorce, hence there is no time limit to bringing an application and the court will not reject a financial claim purely on the basis that the party bringing the claim has delayed in doing so. However, in the vast majority of cases, it is far better to deal with the finances of the marriage at the point of divorce. Certainly, more often than not, delaying an application can be to the detriment of the party seeking relief. Possible drawbacks to delaying a claim can include the following:
- Before the court can consider an application for financial relief, the parties will need to exchange full and frank disclosure of their respective financial positions. Often, however, the disclosure process is met with some reluctance, and it is not uncommon for one or both parties to refuse to co-operate and share private financial information with their former spouse, particularly in circumstances where they have been separated from them for a number of years. Even in situations where both parties favour a clean break and simply seek an order dismissing their respective claims, the court will require them to complete a D81 form, which provides the Judge with a summary of each party’s capital, pension and income position. This can deter people from seeking a financial order and resolving matters once and for all.
• Prior to exchanging disclosure with the other spouse, it will be difficult for a legal representative to properly advise their client as they will not have all the information they need to assess the merits of any claim. If the parties divorced several years earlier, any knowledge one party has with regard to the financial position of their former spouse is likely to be of out of date and/or of limited value. Added to this it may be difficult to trace certain assets or locate historical documents. Indeed, the financial circumstances of the parties may have moved on significantly and in the absence of up-to-date disclosure it is impossible for the legal representative to know with any certainty whether or not it is in a client’s interests to bring a claim. There is certainly a risk that they could find themselves at the wrong end of a claim if they pursue an exchange of disclosure only to find that their former spouse is in a weaker financial position. - If either party has remarried or has started living with a new partner, the financial resources of the new spouse/partner are likely to be considered relevant by the court. If for example, the party seeking a financial order has remarried and their new spouse is of considerable means, this is likely to impact on their claim and reduce their financial needs.
- If the case involves pensions and one or both parties have made significant contributions to their retirement funds post-divorce, they may object to their former spouse benefitting from any post-separation contributions. In such circumstances they may seek to argue that pensions should be apportioned for a period of the relationship. Whether pensions should be apportioned is a matter of judicial discretion but apportionment may not be considered appropriate if the assets of the case are insufficient to meet the needs of the parties.
- People are often worried about opening “Pandora’s Box” and instigating family conflict by pursing a claim several years after the divorce. The other party may have assumed, given the passage of time, that no claims would be made and this may cause them to feel misled or resentful if the other party subsequently decides to bring a claim.
Delay is not an automatic bar
Family Judges have a wide discretion when considering an application for a financial order. Although delay is not an automatic bar to bringing a claim for financial relief, it is something the judge will take into account when weighing up what are known as the section 25 factors. The fact that there has been a delay in bringing a claim can have an impact on what constitutes a fair settlement and the judge hearing the case will be keen to ensure that any award reflects the merits of the case. The longer the delay in bringing an application the more difficult it may be to persuade the court to be generous when awarding financial provision and those bringing a claim after a significant period of delay will be expected to justify the reasons for their previous inaction. In the above mentioned case of Vince v Wyatt [2013] EWCA Civ 495[KS1] , Wilson LJ found that the wife's application faced "formidable" difficulties due to the delay, particularly in light of the following:
- the marital cohabitation lasted only two years;
- the marriage had broken down some 31 years earlier;
- Mr Vince did not begin to create his wealth until some 13 years after the breakdown of the marriage;
- the parties experienced the most basic standard of living when they were together;
- the wife had not made any contribution, financial or otherwise to the husband’s wealth; and
- the delay in the wife bringing her claim exceeded what could reasonably be expected.
Although Ms Wyatt quantified her claim at £1.9m, taking into account the facts outlined above, the Judge took the view that her claim was unrealistic. He commented that the delay could have eliminated her claim altogether. Ultimately, however, the parties reached an agreement for Ms Wyatt to receive a lump sum of £300,000.
Other delay cases
Other cases which considered delayed applications include:
- RN v TT [2024] EWFC 264 (B) – in this case the husband brought an application for financial remedy nine years after the parties separated. He had previously promised the wife that he would not bring a claim against her after she agreed to accept responsibility for his debts. The wife had capital and pension assets worth around £1 million. In contrast, the husband was living in rented accommodation and was reliant on benefits. HHJ Hess found that limited weight should be attached to the husband’s needs as they were not relationship generated. He went on to describe the husband’s financial contribution to the family as “negligible”. He therefore awarded the husband a lump sum of £35,000 and pension of £149,514.
- Pearce v Pearce (1980) 1 FLR 261 – the husband was an undischarged bankrupt. The wife raised their three children single-handedly post-divorce, managing on state benefits. The husband did not support the wife or his children financially post separation. The husband then inherited assets worth £34,000 and the wife applied for a lump sum order. She was awarded £12,000. Ormrod LJ stated that whilst the courts should not encourage applications long after divorce, justice might require an award despite the lapse of time.
Lessons to take away
If the parties to a divorce fail to obtain a final financial order, the financial claims between them will remain open. This means that even if they reach an informal agreement with regard to how they will split their assets nothing will be set in stone and either party will be free to change their mind and bring a financial claim at some point in the future.
It is impossible to predict the future and foresee what, if any changes, may lie ahead. For some, taking a gamble may pay off – it certainly did for Ms Wyatt – but more often than not, leaving the finances up in the air leads to stress and uncertainty. No doubt Mr Vince regrets not pursuing a final financial order at the point of divorce. Indeed, the vast majority of those seeking a divorce prefer to know where they stand and value the certainty and security a final financial order provides.
In all contested financial relief cases the court should order a clean break settlement where possible. This is an order which severs all financial ties between the parties and does not provide for ongoing spousal maintenance. A clean break settlement is not always appropriate but if achieved, it allows the parties to achieve financial independence in the knowledge that their former spouse will not be able to come back for a second bite of the cherry at some point in the future. That means that if one spouse subsequently sets up a successful business, inherits a small fortune or wins the lottery any monies they receive will be theirs to keep.
