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The Family Justice Council Guide to Sorting Out Finances on Divorce

Stuart Clark, Associate Solicitor at The International Family Law Group LLP, reviews the newly published guide for LiPs dealing with their financial matters after divorce or civil partnership dissolution.

Stuart Clark, Associate Solicitor, The International Family Law Group LLP

Stuart Clark, Associate Solicitor, The International Family Law Group LLP

As reported in Family Law Week on 5 April 2016, the Family Justice Council has published its Guide, Sorting out Finances on Divorce.  It is said to be directed to litigants in person and therefore is an important document for the increasing numbers dealing with their financial matters after divorce or civil partnership dissolution either between themselves, in mediation or through the family courts.  Nevertheless I consider it is a most valuable read for all family lawyers.  It sets out the law and practice in a very clear, summary and comprehensive fashion.

Our problem in England and Wales is that the law cannot be found in any one place.  The 1973 legislation is of only peripheral relevance to our 2016 law.  Instead it is found in a vast number of cases, of the High Court, Court of Appeal and Supreme Court, layered upon each other with nuances,  differences and sometimes complete contradictions.  Specialist lawyers try to find our way through this judicially imposed labyrinth in order simply and clearly to advise our clients and avoid unnecessary litigation.  This Guide performs the task of explaining the law of financial resolution in an excellent fashion and distils complex judgments into simple language.  The authors are to be highly congratulated.

The Guide was specifically prompted by the Law Commission which was given the task of recommending law reform in respect of the definition of matrimonial property and of needs.  They recommended there should be greater clarity in the understanding of the law, hence prompting this publication.

The vast majority of decided cases regarding the resolution of financial disputes following a divorce/dissolution are focussed toward the cases which reach the higher echelons of the family courts: the big money and international cases in the High Court and above. Whilst the principles of those cases of course permeate toward the middle and lower-money and needs cases, the guidance has sometimes been far too lofty.  Deriving from cases involving tens of millions of pounds tends to put the judgments out of perspective of ordinary people.  The large majority of cases, the needs cases, are so far removed from the big-money proceedings that litigants in person face a minefield in merely trying to find out the law.  This Guide is the answer.  Written by specialists who know the law very well including in these big money cases, it has been directly applied to the ordinary cases where the need for knowledge of what will happen in the financial settlement is greatest.

There was a danger that this Guide from the Family Justice Council would fall into a familiar trap in trying to extrapolate big principles without giving practical advice to the vast majority of litigants who are seeking to resolve their financial affairs on a needs basis. The contributors, some of whose practices are inclined toward the bigger money cases, have not fallen into that trap.  On the contrary, the Guide is easy to read and highly accessible. Not only are the key principles summarised succinctly and informatively, but the Guide provides astute practical advice without being bogged down in minutiae. It advises only where it is appropriate to do so and is up front about its limitations. It helpfully states that legal advice should be taken where matters are more complex, for example in relation to big money cases, business interests, trusts, third-party interests, marital agreements, non-disclosure and, to an extent, pensions. All specialist practitioners would of course commend this!

The key in the majority of needs cases is of course meeting the housing and income needs of the spouses and, as a priority, the children. The Guide highlights these issues in both its explaining the law and in the case studies. It offers practical advice on what litigants should be thinking about when trying to resolve their finances and planning for the future and how in difficult circumstances to split the limited marital pot to meet needs of both and any children as satisfactorily as possible. Again, it is honest about the limitations of what can be achieved in family settlements. That said, the only minor criticism to be levied is the focus too often on selling the former matrimonial home. Whilst in many cases this is the only practical solution it is also what many litigants and practitioners try to avoid as much as possible either to prevent the wasted costs of sale or owing to emotional, practical and other attachments to the property. If one improvement could be offered it would be to include a case study where this could be achieved. It would be difficult but this is the focus for many litigants.

(As a further parenthetical note, and whilst proffering some constructive feedback, the Guide states at page 6 that it does not apply to litigants who live outside of England and Wales. Whilst it is appreciated that the intention was to narrow the scope of the Guide to where the finances are being resolved through the courts of England and Wales, this provision unintentionally excludes the many international litigants whom we deal with and who, notwithstanding their foreign residence, are resolving their financial affairs alongside a divorce in the courts of England and Wales as if an entirely national case.) 

Those minor issues aside, the Guide is excellent. As is highlighted in the foreword by the President, the law has to be demystified and this publication has brought a much-needed measure of clarity for needs cases. As practitioners, we must help the cause in making the law more accessible and dispute resolution easier and more satisfactory.  This Guide has taken great strides in doing just that.