Cohabitation, Clean Breaks and the Clothing Business

1st December 2016 Family Law

Setting aside the very raw emotions which can sometimes surface as the reality of a marriage ending begins to dawn on spouses, divorce can be a relatively simple process.

That is, I should say, if it's done correctly. Failing, however, to follow the series of administrative steps involved can have calamitous and costly consequences.

Whilst everyone will be familiar with the decrees (nisi and then, six weeks and one day later, absolute) which signify the legal end of a marriage, there are certain additional procedures either to bring a couple's dependence on each other to a close or, if maintenance is involved, at least regulate their dealings into the future.

Arguably the most important is something alternatively called a financial or consent order.

In short, it can perhaps best be described as a financial full stop, ending the potential for one spouse to make a claim on the other's cash or assets.

Some people might imagine that it's entirely unnecessary. 'Surely,' they say, 'a decree absolute does the job, doesn't it?'

Well, no, it doesn't. As figures from the Ministry of Justice make clear, roughly two-thirds of marriages end without such an order being put in place.

It means the prospect that, at any point in the future, a less well-off husband or wife might return to demand more. That's regardless of whether they had believed that they had previously come to an agreement on who gets what.

Given that someone might have been promoted, received an inheritance or even won the lottery in the interim, the potential for damage is considerable.

It's a situation which the Court of Appeal is currently deliberating over at the moment.

Glen Briers, the founder of a firm behind the Lambretta fashion brand is trying to prevent his former wife, Nicola, from getting an extra £2.7 million share of his fortune more than 10 years after they divorced (http://www.telegraph.co.uk/news/2016/11/28/wife-lambretta-millionaire-wins-27m-divorce-settlement-ten-years/).

The court has been told that Mr Briers started the company with his own money and had already given her £150,000 lump sum to pay off the mortgage on the family home (a £700,000 property, which she kept), a £10,000-a-year salary and child maintenance.

Even so, he acknowledges that they made only a 'verbal agreement' that those terms represented a clean break.

After a post-divorce relationship broke down, Mrs Briers returned with her claim and was awarded just over one-quarter of his £10 million wealth.

Nigel Page, who scooped a £56 million EuroMillions jackpot, found himself in a similar predicament and ended up paying his ex-wife a proportion of his winnings (http://www.independent.co.uk/news/uk/home-news/euromillions-winner-pays-out-2m-to-ex-wife-2140932.html).

We always advise that clients going through a divorce put a consent order in place. No matter how amicable a divorce may be, none of us can accurately predict circumstances or mindsets in the future.

Many individuals like Mr Briers and Mr Page now know that it is far from a meaningless piece of paperwork. As we tell the husbands and wives that we deal with, it is far better to be safe than sorry.

 

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Holly Tootill is a Partner located in Manchesterin our Family department

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