Enforcement of family financial orders

The Law Commission has recently published a consultation paper detailing proposals to improve the existing options faced by individuals seeking to enforce financial orders made within family proceedings.

Court orders made within financial remedy proceedings (those arising as a result of divorce or civil partnership dissolution) not only document a legally binding agreement but also enable enforcement of the order in the event of non-compliance. This is a complex area of law and proposals to simplify and improve the process should be welcomed.

Current provisions

At present, there are a number of options available to individuals seeking to enforce breaches of court orders, which usually relate to non-payment of a lump sum, failure to pay maintenance or refusal to cooperate with the sale or transfer of property.

  1.  General enforcement application

It is possible to make an application for enforcement generally which enables the court to determine the most appropriate method of enforcement, rather than the applicant. The defaulting party is required (as a preliminary step) to attend a court hearing to answer questions and produce documents.

  1. Third party debt order

Orders can be obtained against individuals or institutions (such as banks) requiring them to discharge the debt to the applicant direct.

  1.  Charging orders

Charging orders enable a charge to be placed on property which can then be realised when the property is sold.

  1.  Attachment of earnings orders

Such orders are only beneficial when the defaulting individual is in receipt of employment income. The order requires an employer to deduct payment from the defaulter’s salary which is then paid to court for onward payment.

  1.  Judgment summons

This involves an application for the defaulting party to be imprisoned as a punitive measure.

  1.  Execution of documents

The court has the power to execute documents in place of an uncooperative individual.

Proposals

The Law Commission proposes to distinguish between those individuals who can’t pay and those who simply choose not to. The majority of proposed changes relate to those individuals who choose not to pay. For those individuals whose non-compliance can be said to be involuntary, recommendations would give judges new freestanding powers to cancel any maintenance arrears (presently, the court can only do this where a formal application to vary the original order has been made).

The difficulty with the existing enforcement options is that they are slow and require the applicant to bear the initial costs of the application, even if these are subsequently ordered to be paid by the defaulter.

Third party debt orders and charging orders currently involve a two-stage process (involving interim and final orders); the Law Commission proposes that this is streamlined so as to favour the applicant. In practice, a final order could be made without the need for a court hearing unless legitimate objections were raised by the defaulting party. This should lead to faster payment.

Third party debt orders cannot currently be made against a joint bank account, often leading to injustice where the defaulting party places funds in an account jointly with another individual (in some cases to deliberately frustrate enforcement). The proposals seek to address this anomaly, subject to safeguards being put in place to adequately protect the other joint account holder.

Because third party debt orders are currently only effective where the debt owed by the third party to the defaulting party is already in existence, proposals would allow the applicant to recover funds when they become available at a later date. This would enable an applicant to enforce maintenance payments or a lump sum which is being paid in instalments without having to made separate applications each time the maintenance payment or instalment became due.

Attachment of earnings orders can fail where the employee moves jobs. The proposals would permit HMRC to provide details about the new place of work in a form of “tracking.”

A new range of coercive measures has also been proposed:

  1.  Disqualification from foreign travel

It is proposed that restricting a defaulter from leaving the country would be an effective additional method of enforcement.

  1.  Disqualification from driving

Proposals to disqualify a defaulter from driving for a period of 12 months have been put forward as an alternative enforcement remedy (although safeguards would need to be in place so as not to unduly impact on the defaulter’s ability to earn an income).

  1.  Curfew orders

Arrangements for electronic tagging requiring defaulters to remain at a specific place for up to 12 hours a day are considered to be a further useful tool in the new armoury of enforcement provisions.

From a practical point of view, it is proposed that all enforcement applications should be dealt with by the judge who made the original order (or a specialist enforcement judge) to ensure continuity.

For advice about enforcing a family financial order, or if you have any other family law queries, contact one of our specialist family law solicitors .