The Financial Aspects of a Divorce (Ancillary Relief)

#1
[align=justify]I am often asked how the matrimonial assets are divided following the breakdown of a marriage. Clients often get disappointed when I tell then it is not a simple arithmetical formula and that there is no certainty of recieving an actaul sum but that we have to base the figures on sometimes no more than intelligent "gut feel" and experience.

I thought I wouls write an article to explain why this is the case. I will post an article on the procedure soon.

The following is based upon the assumption that the parties involved are married to one another, whether they are hetrosexual or same sex.

There are three areas to consider:-

1. Maintenance for any children.
2. Maintenance (i.e periodical payments for husband or wife).
3. Division of capital assets and property.

1. MAINTENANCE FOR CHILDREN

Provided the children are the children of both husband and wife and provided the husband, wife and children reside within the jurisdiction (i.e England and Wales) the question of child maintenance is dealt with by the Child Support Agency.

The parties may enter into a voluntary agreement regarding child support and the Court may record this agreement in any subsequent Court Order dealing with other matters.

However, the person who is entitled to Child support for a child in their care can never be prevented from applying to the Child Support Agency for an assessment.

If the person so entitled is receiving state benefits ultimately the Child Support Agency are likely to become involved irrespective of whether the parties want such involvement.

In simple terms the non resident parent will pay 15% of their NET income (ie after tax and national insurance etc) where they have one child, 20% where there are 2 children and 25% where there are 3 children. There is a direct reduction for the number of nights a child resides with the non resident parent.

2. MAINTENANCE OF HUSBAND/WIFE

Husbands and wives have a mutual duty to help support one another. Whether periodical payments ("maintenance") is actually made by one party to another will often depend upon the disparity in their respective incomes.

However, Courts are now directed to create a clean break upon divorce whenever possible, so there is no continuing liability for maintenance either way if that is possible.

In practice if on the figures one party has a maintenance entitlement the Court will only take it away if it is impossible to compensate that party by for example giving them a greater share of any capital assets.

Often women harp on about their belief (from the information in the pub!) that the husband has to "keep them in the manner to which they were previously accustomed".

In reality, the low income that all serving personnel recieve relatively speaking even in the higher commissioned ranks, means that this will virtually never be achieved.

There is barely ever enough money to pay for basics, like a home for both parties let alone a lavish lifestyle for the now separated wife. In simple terms therefore, it is always a question of making ends meet not giving the wife a huge wedge of your income.

3. ASSETS AND PROPERTY DIVISION

When looking at the financial implications of a divorce how best to apportion assets the situation is never easy. It is not simply a question of putting all the details into a computer and pressing a button for an answer.

Generally speaking the starting point will be an equal division between the husband and wife of their assets/property. This also includes pensions. However military pensions are a complicated animal and you should always take legal advice if you have been serving for several years to ensure that you dont give away too much of your pension.

The Courts are, however, directed to take into account a whole list of things which after consideration may suggest that to be equitable one party should have rather more than half.

The sort of things taken into account are as follows (known as the “Section 25 factors”):-

a) The ages of the husband and wife;

b) The length of the marriage;

c) Whether there are children;

d) The parties respective earning capacities;

e) Whether any party or child has any disabilities;

f) The parties pension policies;

g) What contributions the parties have made in the past;

h) What contributions the parties are likely to make in the future.

In simple terms it is often a question or establishing what is available for distribution, who needs what and how best can these needs be satisfied, being as fair as possible to both parties.

In reality however, taking a sterotypical family of 2 kids and a husband and wife, there is hardly ever enough money to keep the wife and kids in the matrimonial home (for the benefit of the kids not the wife) and then the husband paying the mortgage and say 20% of his income for the kids maintenance and get a property for himself too!!

The outcome therefore is usually seeing what we as lawyers can do when we have very few assets to play with to try to meet everyone's needs and not their desires.[/align]

Tell me if I am giving too much information, not enough information or if the posts are boring ....please
 
#3
Interesting...

The impression one gets (from the usual sources on telly) is that the ex-wife strips the ex-husband, and keeps stripping until the reading of the will. Shurely it isn't so? If, for instance, the break is reasonably amicable and there aren't kids still at school, the savings, income and capital (excluding that brought to the union before marriage) of both the main and second income generators should be proportionately divided between the two parties?
 
#4
Judge D

On a personal note, what is the outcome normally for the 'sharing' of a military pension and when is this payable to the spouse? Mine is being a right bitch an demanding £27,000 to be bought out of it after just 10.5 years together. Doesn't seem to be quite fair to me.

What does the judge/court take into consideration when dealing with pension stripping?
 
#5
Whiskybreath said:
Interesting...

The impression one gets (from the usual sources on telly) is that the ex-wife strips the ex-husband, and keeps stripping until the reading of the will. Shurely it isn't so? If, for instance, the break is reasonably amicable and there aren't kids still at school, the savings, income and capital (excluding that brought to the union before marriage) of both the main and second income generators should be proportionately divided between the two parties?
in simple terms (where there are no children involved or if they are all adult):

the shorter the marriage the more likely you are to keep what you brought into the marriage on your way out of the marraige.

the longer the marriage the more likely it will be shared equally (the judges use the word "equality" to be very accurate - which is different to equally) including any preacquired assets on your way out of the marriage.

if it is amicable, you can agree anything you want (almost)
 
#6
Daytona955 said:
Judge D

On a personal note, what is the outcome normally for the 'sharing' of a military pension and when is this payable to the spouse? Mine is being a right bitch an demanding £27,000 to be bought out of it after just 10.5 years together. Doesn't seem to be quite fair to me.

What does the judge/court take into consideration when dealing with pension stripping?
one of my later articles was going to be on pensions in divorce so I will be brief here now (since i dont have time do write a full reply):

in essence pensions can be offset, earmarked or shared. offsetting a pension means you are trading off the value of the pension against another asset, say the house. earmarking means that the original pension stays intact but when the pension holder retires, the other party gets a proportion of the monthly sum paid and possibly a proportion of the commuuted lump sum. Finally, a shared pension is where some of the value of the pension is physically lifted from the one partys pension and put into the other partys pension.

I dont recall militray wills being capable of being shared, i would need to check that for you again. Getting old and all that!

There are many further considerations to take into account, Pm me with more details and I will see how i can help further. You say you were together for 10.5 years but how long have you had the pension?
 
B

Biscuits_AB

Guest
#7
Daytona955 said:
Judge D

On a personal note, what is the outcome normally for the 'sharing' of a military pension and when is this payable to the spouse? Mine is being a right bitch an demanding £27,000 to be bought out of it after just 10.5 years together. Doesn't seem to be quite fair to me.

What does the judge/court take into consideration when dealing with pension stripping?
Are you not entitled to any of her occupational pension for the duration of the same period? Seems a tad one sided.
 
#8
Biscuits_AB said:
Daytona955 said:
Judge D

On a personal note, what is the outcome normally for the 'sharing' of a military pension and when is this payable to the spouse? Mine is being a right bitch an demanding £27,000 to be bought out of it after just 10.5 years together. Doesn't seem to be quite fair to me.

What does the judge/court take into consideration when dealing with pension stripping?
Are you not entitled to any of her occupational pension for the duration of the same period? Seems a tad one sided.
yes he would be - in exactly the same way
 
#10
Just a couple of quickies on savings and property. When I separated we split the savings as they were 50/50. In the event of divorce proceedings will this be taken into account or can the ex demand a further 50 percent of my current saving.
I also heard somewhere that you can change the title deeds on the house if it is not sold so that if the wife retains the property due to the kids and location of school a future partner cannot gain financially should the house be sold. Is this correct?
Many thanks
 
#11
JudgeDredd said:
Daytona955 said:
Judge D

On a personal note, what is the outcome normally for the 'sharing' of a military pension and when is this payable to the spouse? Mine is being a right bitch an demanding £27,000 to be bought out of it after just 10.5 years together. Doesn't seem to be quite fair to me.

What does the judge/court take into consideration when dealing with pension stripping?
one of my later articles was going to be on pensions in divorce so I will be brief here now (since i dont have time do write a full reply):

in essence pensions can be offset, earmarked or shared. offsetting a pension means you are trading off the value of the pension against another asset, say the house. earmarking means that the original pension stays intact but when the pension holder retires, the other party gets a proportion of the monthly sum paid and possibly a proportion of the commuuted lump sum. Finally, a shared pension is where some of the value of the pension is physically lifted from the one partys pension and put into the other partys pension.

I dont recall militray wills being capable of being shared, i would need to check that for you again. Getting old and all that!

There are many further considerations to take into account, Pm me with more details and I will see how i can help further. You say you were together for 10.5 years but how long have you had the pension?
Surely she is only claiming for some of your Army pension? Daytona, I know we haven't always seen eye to eye in the past, but personally, I agree with Bickies - fleece the bitch.

I (or he) was lucky. Mr Dale and I have both got Army pensions, cars, houses so we just kept what we had and I got half of his savings account because I had done and paid for the shopping for the last gazillion years.

I kept all the white goods and furniture because I had paid for it all (tsk - obviously). If I wanted to have been arrsey, I could have asked for half of his house because I ploughed a shite load of money into it before we got married (when we did get married, I paid for everything in the quarter) and personally didn't see the point in asking for the carpets to be ripped up and wanting the picture rails back, and exchanging them for half a bathroom.

The only bone of contention was the smelly dog. I took that stinking bastard on after his dearly loved mum (the witch) decided she couldn't cope with him (the dog I mean). When it came to divorce time, it was "we want the dog back". Fine says I. I got custody rights - picked him up at weekends and took him to MacDonalds and the zoo, park etc (dogs are crap on the swings and slides), but once His Lordship got posted to Canada, she decided she couldn't cope with the dog again, and asked me to come and get him. He's been with me (or Toppers - the step-dad) ever since. Not a chance will he ever go back. That's my only victory over the whole thing.

Anyhoo, I digress. Take her for everything. She might look and play sweet and innocent, but remember she is a woman. They (we) are snakes with tits, and what she says one day will change the next. I wouldn't even trust myself as far as I could throw me.

Hope this helps!!!!
 
#12
yater_spoon said:
Just a couple of quickies on savings and property. When I separated we split the savings as they were 50/50. In the event of divorce proceedings will this be taken into account or can the ex demand a further 50 percent of my current saving.
I also heard somewhere that you can change the title deeds on the house if it is not sold so that if the wife retains the property due to the kids and location of school a future partner cannot gain financially should the house be sold. Is this correct?
Many thanks
The law on divorce finances is never straightforward unfortunately, thats why there is so much confusion with the public and every barrack room lawyer can show you a case of a friend where x happened but y happened to another friend.

It would make sense, unless you won the lottrey or something like that for you to keep any additional saving you have accumulated since the separation and there is good case law that indicates (not proves) that you should keep your post separation acquired assets. So the answer should be no she cant get any of your new savings.

As for the new partner being prevented from getting his mtts on her/your dosh in the house. Ultimately, if say your wife has 60% of the home and you have 40% but you only get your share when the kids grow up or where the house has been transferred to the wife who is then in a relationship, she can unfortunately do what she likes with her share, including giving him a share.

As to whether he gets a share just by living there even for several years, that is quite unlikely (but it is possible if for example he pays substantially towards the development etc of the house he could get a share through the back door.)

The last point is very complicated law despite it being a simple question. I hope I have calrifed it a bit.
 
#13
The Military pension.

Great aint it. :) and just remember that when she is trying to get her greasy mitts on it this:

When you were last under contact or in some stinking sh*thole of a country earning that pension who did you see to your left and right covering your arrse?

Definately not her!
 
#14
JudgeDredd said:
3. ASSETS AND PROPERTY DIVISION

When looking at the financial implications of a divorce how best to apportion assets the situation is never easy. It is not simply a question of putting all the details into a computer and pressing a button for an answer.

Generally speaking the starting point will be an equal division between the husband and wife of their assets/property. This also includes pensions. However military pensions are a complicated animal and you should always take legal advice if you have been serving for several years to ensure that you dont give away too much of your pension.

The Courts are, however, directed to take into account a whole list of things which after consideration may suggest that to be equitable one party should have rather more than half.

The sort of things taken into account are as follows (known as the “Section 25 factors”):-

a) The ages of the husband and wife;

b) The length of the marriage;

c) Whether there are children;

d) The parties respective earning capacities;

e) Whether any party or child has any disabilities;

f) The parties pension policies;

g) What contributions the parties have made in the past;

h) What contributions the parties are likely to make in the future.

In simple terms it is often a question or establishing what is available for distribution, who needs what and how best can these needs be satisfied, being as fair as possible to both parties.

In reality however, taking a sterotypical family of 2 kids and a husband and wife, there is hardly ever enough money to keep the wife and kids in the matrimonial home (for the benefit of the kids not the wife) and then the husband paying the mortgage and say 20% of his income for the kids maintenance and get a property for himself too!!

The outcome therefore is usually seeing what we as lawyers can do when we have very few assets to play with to try to meet everyone's needs and not their desires.
Always bearing in mind that at the top of the list of the section 25 factors is the rider that the court must consider "all the circumstances of the case" and that the needs of the children while they remain minors will be the "first consideration of the court". That can knock you a long way off an equal division.
 
#15
Schweik

You are completely right to point that out. Sorry for the ommission and glad you brought me to task on that.

Oops.
 
#16
Judge I have been asked a question by a spouse of a soldier who are going through divorce and at the NISI stage I believe. She has been told by her solicitor that she has to get information on his house, pension and lump sum ect so he can action...whatever he actions. How can she provide these details they obviously do not talk and Glasgow apparently will not release this information for her solicitor. Have you any advice on where she can go or what she can do to get this information. He apparently is leaving the army soon but has told his solicitor he has been extended past his 22 which she says is lies. Any advice greatly appreciated. PM me if you would like anymore info :D
 
#17
Its a bit worrying that the Solicitor has told her to get the information! He is either unaware of what to do or if I am not being cynical he is trying to save her money.

The reality is that the wife's Solicitor should be asking the husband for the information direct (if the husband does not have a Solicitor acting for him)and if he wont provide it, the Solicitor should issue the application for ancillary relief (the financial aspects of the divorce) on a document called a Form A (which you can get free from the HMCS website).

This will FORCE the husband to get the info to the wife within a specified timescale laid down by the Court and if he doesn't - the Judge will criticise the husband and may even order him to pay the wifes solicitors wasted costs.

Even though proceedings are issued, deals can still be done behind the scenes to aviod costs when all this information is to hand and the court case cancelled (stayed and then dismissed).

I hope that answers your question, if not, post more info (or mail me) and I will respond more fully.
 
#19
Just a quicky regarding division of assets, if "he" has left and given "her" the house, plus contents and car (in total value of ~£150k). Plus pays more than his CSA decided 15% of net income for one dependant child, will the pension still be divided between them or will the above assets be seen as a fair portion of the dosh?
 
#20
cunning_stunt said:
Just a quicky regarding division of assets, if "he" has left and given "her" the house, plus contents and car (in total value of ~£150k). Plus pays more than his CSA decided 15% of net income for one dependant child, will the pension still be divided between them or will the above assets be seen as a fair portion of the dosh?
Impossible to answer this without detailed knowledge of the circumstances. You need a lawyer.

You don't mention whether or not there are children - who's welfare would be the first consideration of the court while they remained minors. You don't mention "his" and "her" ages, the duration of the marriage, the value of the assets, their incomes and their needs. There is a whole host of factors that a court would take into account.

CSA is not a part of the court's area of responsibility.

If the house plus contents and car (£150k ish) equal pretty well all the ready capital there is then it may well be that the court would set that off against the value of the pension (you do not give its "capital equivalent transfer value).

It may also be that "he" is giving her more than a court would give "her". Without full facts and figures its impossible to say. I'm not asking you to lay out those details here. I'm suggesting that "you", "he" or "she", whoever it may be, seeks good legal advice.

Its amazing how often lawyers come across situations where "he" and "she" sorted out an informal deal some time back, and it all falls apart later.
 

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