Last week Mr Justice Bodey highlighted an immensely important point in relation to separation, divorce and matrimonial finances which is often overlooked if parties are unrepresented. The consequences can be costly.
The case which was reported in the Telegraph involved a long marriage and unusually a significant period of post-divorce cohabitation. Despite the marriage being officially dissolved many years earlier, the parties continued to reside together until the husband invited his new partner and child to reside in the matrimonial home. Understandably, the wife was not happy about this particularly as it was coupled with the suggestion that she should stay on as some sort of housekeeper.
This consequently forced the issue of how the parties would deal with the matrimonial finances. Of course for many years this had not been an issue as the husband and wife still lived together as if married and no doubt practical arrangements continued as if the marriage had not been dissolved. However in light of this change in circumstances the wife sought a financial order. Even though the parties were divorced many years before, because they had not dealt with their financial claims against one another arising from the marriage, those claims were still active. Married couples have the ability to seek property transfer and/or adjustment orders, lump sum, periodical payments and pension sharing orders. The ability to seek these orders continues to exist until such time as the Court has approved or determined what should happen in respect of the matrimonial finances. This is a fact that many are unaware of and can often lead to disputes when one party seeks to pursue a financial order against the other many years down the line. It is important to note that there is no limitation on claims of this nature. The only exception being that a Respondent in the divorce proceedings is not able to instigate financial proceedings after they have remarried.
In this case the parties must have known about their potential claims against one another as an agreement of sorts was entered into around the time of the divorce. The agreement provided that the wife was entitled to a maximum settlement of £3.4 million. However Mr Justice Bodey effectively quashed that agreement and ordered the husband to pay the wife one half of his £13.6 million fortune. The reason he took this decision was because he considered that there was no distinction between the life the parties led as husband and wife and that following the divorce. The wife was most likely financially dependent on the husband both before and after the divorce and the mere fact of the divorce did not change the position. Hence the wife’s financial claims against the husband were active despite the divorce.
It is unfortunately all too common for separated couples to live in the same household. Living arrangements are dictated by funding and if one spouse cannot afford to rent a property or if there are mortgage limitations both parties can become stuck in limbo. If you are in this situation or if you are divorcing it is essential that you seek legal advice about your rights and responsibilities arising from your marriage.