Divorce, inevitably, is a time of change. Yet, when it comes to the financial aspects of divorce, the courts try to retain stability: indeed, until it was superseded in 1984, the Matrimonial Causes Act instructed the court to “place the parties…in the financial position in which they had been if the marriage had not broken down”.
While this clause has now become defunct, the general principle remains. Known for their wide discretion and generosity toward financially weaker parties, the English courts view both parties in a marriage as equals, regardless of their financial contribution during their time together.
Because of this, and based on the precedent of White v White, the English courts will generally share everything earned during the marriage equally between both parties. Although this is the norm, they may deviate from this principle in exceptional circumstances, if one party provided an overwhelming contribution for instance.
Therefore, using equal distribution as a starting principle, the courts will assess the full range of assets built up during the marriage, including those held through corporate entities or in trusts.
After ascertaining the true extent of the joint assets, the court will consider the Section 25 factors. Beginning with fairness, these factors range from the needs of any children and dependents, the future earning capacity of both parties and, importantly, the standard of living enjoyed by the family before the breakdown of the marriage.
While this is a factor that is taken into account, it is important to stress that this does not mean the same standard of living is guaranteed – for many, it will be impossible to replicate the same standard of living after divorce.
In high net worth cases, where the family have enjoyed a very high standard of living and there are substantial financial resources, the parties’ needs will be computed in a more nuanced way. For high net worth and ultra high net worth individuals, having the best legal team on your side will ensure, where possible, you are able to maintain a similar standard of living.
Whether you are looking to protect your assets or ensure you receive your fair share, it is essential to have the best legal representatives on your side from the outset. As a top family law firm, Vardags can help you get the best possible result from your financial proceedings. From producing accurate valuations of your assets to countering excessive proposed needs and entitlements, our invaluable support and expertise will ensure you get the financial settlement you deserve.
If you would like to know more about the issues covered in this article, Vardags offers a free consultation to qualifying individuals.
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