FACT SHEET 2 DEALING WITH THE FINANCIAL ASPECTS OF DIVORCE Financial matters on divorce can be dealt with by you and your spouse with minimal assistance from lawyers. However, you are advised to find out your rights and options before attempting to reach an agreement. In order for us to advise you about what would be an appropriate and reasonable settlement, there must first be full, frank and reciprocal financial disclosure. We recommend this is done by the exchange of standard financial statements (known as Form Es). These forms are exchanged by post on an agreed date, so that you and your spouse can compare your respective financial positions. This process is very important as it lays the foundations of the case. If you choose to reach a financial agreement without full and frank disclosure, as defined above, we cannot advise you as to the reasonableness of your settlement. However, we can draft the appropriate legal document, known as a Consent Order, which, if approved by a Judge, will make your agreement legally binding. Please note that the court cannot consider a proposed settlement without certain disclosures being made. These must be given on a prescribed form (Statement of Information) signed by both parties (or their solicitors) and sent to the court with the consent order

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How does the Judge decide what should happen to the finances? The Judge has to apply factors that are defined in s25 of the Matrimonial Causes Act 1973 (as amended). In summary, these factors are as follows: •

The first consideration is the welfare of any child of the family who is under 18. In practice this means the Judge would want to ensure that any children are provided with a secure home.

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The parties’ income, earning capacity, property and other financial resources now and in the future.

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The parties’ financial needs, obligations and responsibilities now and in the future.

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Standard of living prior to the breakdown of the marriage.

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Ages of the parties and length of the marriage.

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Any physical or mental disability of either party.

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Contributions of either party to the welfare of the family (to include looking after the home or caring for the family, as well as monetary contributions).

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The value to either party of any benefit (for example a pension) which (because of the divorce) that party would lose the chance of acquiring.

The Judge has a very wide discretion when considering how much weight to give to the above factors in any particular case. This means that two Judges could reach different decisions on the basis of the same facts. Therefore, it is our role to guide and advise you on the basis of our experience and the current law.

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What happens if we cannot reach an agreement? We would advise you to issue court proceedings, so that, if necessary, a decision can be made by a Judge. There is no magic period of time after which you must issue court proceedings. Sometimes a couple will try to negotiate for many months whilst others might choose to issue proceedings after a matter of weeks. This is a very personal decision and we can assist you with this on the basis of our experience. If you decide you want to go ahead with a court application (which is made using a Form A) then the court fee for this is £210. There are 3 scheduled court hearings: (1) (2) (3)

First Appointment Financial Dispute Resolution hearing (FDR) Final hearing.

This is because the court wants couples to try to reach their own financial settlements if at all possible. This means that only at a third and final court hearing will a Judge make an order determining the outcome of a case. To complete all 3 hearings normally takes a minimum of seven months (see below).

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What happens after an application is issued? •

The court sets a timetable and fixes a date for the First Appointment, which will be between 12 and 16 weeks after the court receives the application. If you start the proceedings you are known as the Applicant. If your spouse starts them you are the Respondent.

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Copies of the court application are sent to you, your spouse, mortgage lenders and pension providers.

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5 weeks before the First Appointment, Form Es have to be exchanged and filed at court. These documents must be taken very seriously as their contents have to be confirmed on oath either at the court office or before a solicitor.

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2 weeks prior to the First Appointment the following documents need to be filed at court and served on your spouse:

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(a)

A Concise Statement of the Issues in the case.

(b)

A Chronology listing important events & key dates.

(c)

A Questionnaire asking for any further necessary and relevant information and/or documentation in addition to that which has been included in the other party’s Form E. We can, for example, ask for an explanation of any large deposits and withdrawals shown on your spouse’s bank statements

(d)

We must file a document (Form G) stating whether we are in a position to treat the First Appointment as the FDR (see below) as well. We can do this only if, prior to the First Appointment, we have all the financial documentation we need to consider what an appropriate settlement might be. If there is important financial documentation missing, we inform the court that we are not able to treat the First Appointment as an FDR because of this.

Immediately before the First Appointment, we must file a Costs Estimate stating the legal costs (including any barrister’s or other fees) incurred to up to that point and likely to be incurred at the First Appointment.

Prior to the First Appointment, we consider also whether it is appropriate, at that stage, to instruct a barrister to advise or represent you.

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What happens at the First Appointment? The Judge will give appropriate directions to progress your case. You do not have to answer the Questionnaire before the First Appointment so, if it has not been answered, the Judge will set a deadline for a reply. However, whether such Questionnaires are answered at all, is up to the Judge. In some cases, a Judge might decide answers to Questionnaires are both costly and unnecessary, or may order that only some of the questions are answered It depends on the nature of the case.

4 If the value of a property or any other asset is in dispute then the court will usually order the parties to instruct a valuer on a joint basis and that the report be produced by a specific date.

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What happens if we do not reach a settlement at the First Appointment? A date will be fixed for an FDR. This will take place at least 8 weeks after the First Appointment. The exact date will depend on court availability and taking into account the deadlines that have been set by the court at the First Appointment. If a barrister has not yet been consulted, consideration will be given as to whether a barrister should be instructed at this stage.

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FDR appointment Prior to the FDR the court must be given the following: (a)

Notice of all offers, proposals and responses with regard to settlement.

(b)

Updated costs estimates.

At an FDR you and your spouse must try to negotiate a settlement by putting forward offers. In addition, the Judge can give an indication as to how he or she would determine the case if it was a final hearing. Offers made at an FDR are confidential and they cannot be referred to at a final hearing. In addition, the Judge who deals with the FDR cannot also deal with the final hearing. If you reach an agreement at the FDR, then the terms of your agreement are recorded in a consent order to be approved by the Judge.

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What happens if we do not reach an agreement at the FDR? If you do not reach agreement, the Judge will give further appropriate directions and fix a final hearing to take place at least eight weeks later. The timing of the hearing will depend on availability and allow for appropriate deadlines to be met.

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Preparation for final hearing •

If your case reaches this stage, and we have not already involved a barrister, we would normally do so now so he or she can provide further advice as required and begin to prepare for the final hearing.

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A conference with your barrister to discuss the current position and proposals for settlement might also be appropriate.

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If you are the Applicant, 14 days before the hearing we need to file with the court and serve on the other party your statement of open proposals.

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If you are the Respondent, 7 days before the final hearing we must file and serve your statement of open proposals.

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Updated costs estimate is produced.

What happens at the final hearing? Your barrister will have received a brief consisting of the full details of your case in advance of the hearing and will address the Judge on your behalf. Prior to going into court we will continue negotiations to explore the possibility of a settlement being reached. The barrister appearing for the Applicant begins the hearing by giving the Judge details of the case. The Applicant is the first to give oral evidence and will be asked questions by his or her barrister. Questions by the Respondent’s barrister come next, this being “cross-examination” and then the Applicant’s barrister has the right to ask any further questions arising from it. Depending on the nature of the case, other witnesses may be called, for example, a medical expert or accountant. After all the witnesses called on behalf of the Applicant have given their evidence, it is the Respondent’s turn to give evidence and call any witnesses, when the same procedure will apply. We strongly recommend that we attend the final hearing so as to be fully involved in any negotiations and to take full notes of the evidence and judgement. This is particularly important if there is any question of appealing from the order made by the judge. Based on the evidence presented at the final hearing, the Judge will make a final order in respect of the division of the financial assets and any other relevant matters. If the evidence has taken a long time, there is a

6 possibility that the Judge will reserve judgment and provide this on a later date, either in writing or orally.

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Can I appeal the order of the District Judge? You have a right to appeal but would need to show that the Judge was ‘plainly wrong’ in coming to his or her decision. This is a difficult exercise because a Judge has such a wide discretion in family cases. Should it be relevant, we would, of course, advise you as to the merits of such an appeal in your particular case.

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What happens after the final Order has been made? We will advise and assist with the implementation of the terms of the Order. If any difficulties arise, this might involve applying to the Judge for further specific directions about the steps to be taken. For example, if the other party fails to do what he or she is required to do by the order, we can apply for sanctions to be imposed to ensure compliance or, in some situations, for the Judge to sign documents, which the other party has refused to sign.

This fact sheet is intended to be a helpful summary of the procedure followed in most cases, and we suggest you retain it for future reference. You should also bear in mind that sometimes due to the nature of a particular case or the actions of the other party, additional steps may have to be taken.

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[email protected] www.longmores-solicitors.co.uk

24 Castle Street, Hertford SG14 1HP

Partners: Anna B Baptist, Graham J Field, Richard N Taylor, Richard Gvero, Christopher E Pease, Elizabeth L Gallop, Richard M Horwood Senior Solicitors: John R Wiblin, Robert M France Longmores is regulated by the Solicitors Regulation Authority