We believe it is in a divorcing couple’s best interest, both emotionally and in terms of cost, to try and agree a financial settlement; whether by negotiation between solicitors or during mediation. However, we know that is not always possible and our divorce solicitors can draw on a wealth of experience to assist you in making an application to the Family Court for a financial order.
Before you can apply for a financial order you will need to make a referral to a mediation service and attend a Mediation Information and Assessment Meeting, known as a MIAM. The mediator will also invite your spouse to a separate MIAM. The mediator will explore whether mediation would work in your circumstances rather than using the court process. If it is decided that mediation is not appropriate you will be given a form to send to the Court alongside your application. There are some circumstances where mediation is not considered appropriate, such as if there has been domestic violence in a relationship, and our solicitors will advise you whether an exemption applies.
What happens after financial proceedings are started?
Once an application for a financial order has been issued by the Family Court a tight timetable is given to ensure that the divorcing couple are focussed on moving towards a resolution. The Family Court will prepare a list of directions that the divorcing couple much each complete, there will also be a strict timetable although it is common for there to be months between hearings to give enough time for the documents to be prepared. The directions can be separated into two stages.
The first stage of the directions focuses on gathering financial disclosure. The financial statement requires the divorcing couple to each provide information about; property, assets, liabilities, business assets, pensions, earned income, investments, state benefits, income needs and capital needs. The financial statement also requests information about standard of living during the marriage and any contributions or circumstances that a party believes should be taken into account when the Judge makes a decision. It can take a considerable length of time to prepare this document as evidence needs to be provided to support what has been entered into the form. Our solicitors are experienced in completing financial statements and can guide you through the process to make it as straightforward as possible.
The second stage of the directions focus on the information that is needed after the financial statements have been sent to your spouse and the family court. Once both you and our experienced finance solicitors have had the opportunity to consider your spouse’s financial statement, requesting further information and additional documents from your spouse, a questionnaire will be carefully prepared. This allows you to ask questions about the financial information you have received from your spouse and raise any queries you may have or highlight information you feel may be missing. At this stage you will also have to prepare a statement of what you believe are the key issues for the Judge to decide, a chronology setting out the key dates for the Court, the legal costs incurred and whether the first hearing could be used as a dispute resolution hearing.
How many hearings will I have to attend during financial proceedings?
An application for a financial order is designed to be dealt with by the Family Court within three hearings; the First Directions Appointment, the Financial Dispute Resolution Hearing and the Final Hearing. If there are any complicated factors it may be that the Family Court will list the court proceedings for additional directions hearings.
What happens at the First Directions Appointment?
The First Directions Appointment (FDA) has to be attended by the divorcing couple and their legal representatives. The Judge will have seen all of the documents filed with the Court and will listen to the position of each of the divorcing couple. The Judge will then decide which issues need to be addressed and any additional information that needs to be obtained so that the Court and the parties have all the information they need. An example of the type of directions a Judge might make at a First Directions Appointment include directing a valuation of property, a valuation of a business or a report on pensions.
At the end of the hearing the Court will list the next hearing which is known as the Financial Dispute Resolution Appointment (FDR). The Judge will leave enough time for any additional reports or valuations to be completed and for the parties to have time to consider them properly so that by the time everyone comes back to the Court the divorcing couple are in a position to try and reach an agreement and resolve the financial dispute between them.
What happens at the Financial Dispute Resolution Appointment?
At the Financial Dispute Resolution hearing the Judge will have considered all of the additional information and will give the divorcing couple an indication about what decision a Judge would make if the hearing was listed for a Final Hearing and the Judge was imposing a decision upon them. The purpose of the hearing is to try and assist the divorcing couple to negotiate a settlement and reduce the costs, both financially and in terms of time. It is therefore essential that both parties and their legal representatives are present. If the proceedings continue to a Final Hearing the FDR Judge’s opinion on what might happen at a Final Hearing, and any negotiations between the parties, are kept confidential so the Judge dealing with the final hearing is not aware of them and is not influenced.
We will always try and assist you to reach an agreement about your finances and we find that most financial proceedings settle around the Financial Dispute Resolution hearing. If an agreement can’t be reached then a Final Hearing will be listed by the Court and any additional information that might be needed will be directed by the Judge. The divorcing couple might each be directed to send a statement about any contentious issues, any factors the Court might take into account, what orders they would like the Court to make and their reasons why they believe it is fair. This statement would be sent to the Court and each other
What happens at the Final Hearing?
Just because the Court can list financial proceedings for a final hearing does not mean that this has to happen, the divorcing couple are encouraged at all stages to try and reach an agreement about the financial matters and, if it is possible to reach an agreement, a consent order can be submitted for approval by the Court.
If it is not possible to reach any agreement then a final hearing will take place, the divorcing couple will have to attend and both will give evidence. The Judge will listen to the evidence in addition to the evidence he/she has read and will make a final decision. When the Judge makes a decision he will apply what are known as the ‘s25 factors’. These are taken from s25 of the Matrimonial Causes Act 1973 and are matters to which the court is to have regard in deciding how to exercise its powers:
- The income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future, including in the case of earning capacity any increase in that capacity which it would in the opinion of the court be reasonable to expect a party to the marriage to take steps to acquire;
- 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 age of each party to the marriage and the duration of the marriage
- Any physical or mental disability of either of the parties 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, if that conduct is such that it would in the opinion of the court be inequitable to disregard it;
- In the case of proceedings for divorce or nullity of marriage, the value to each of the parties to the marriage of any benefit which by reason of the dissolution or annulment of that marriage, that party will lose the chance of acquiring
Once the judge has considered all the evidence he or she will make a decision on what should happen. This judgment is written down into a final order bringing the proceedings to an end.