Financial remedy proceedings: understanding the process

Depending on the circumstances, the court may make orders concerning:

• the sale or transfer of property;
• lump-sum payments;
• spousal maintenance;
• pension sharing or pension attachment;
• the division of savings and investments;
• business interests;
• the payment of liabilities; and
• the dismissal of future financial claims.

A financial order is separate from the divorce itself. Obtaining a final divorce order does not necessarily prevent either former spouse from bringing financial claims later.

The court considers all the circumstances of the case, including:

• each party’s income and earning capacity;
• property and other financial resources;
• present and future financial needs;
• the needs of any dependent children;
• the parties’ ages;
• the length of the marriage;
• any physical or mental disability;
• the standard of living during the marriage;
• contributions to the welfare of the family;
• any loss of benefits, including pension benefits; and
• conduct in the limited circumstances where it would be inequitable to disregard it.

There is no automatic formula guaranteeing an equal division. The outcome depends on the facts, available resources and the parties’ respective needs.

Both parties have a continuing duty to provide full, frank and accurate disclosure.

This can include:

• property and mortgage information;
• bank accounts and savings;
• investments and shares;
• pensions;
• income and benefits;
• businesses and company interests;
• debts and liabilities;
• trusts or other beneficial interests; and
• significant changes arising during the proceedings.

Failure to provide proper disclosure can cause delay, increase costs and affect the court’s decision. In serious cases, an order may later be challenged because relevant financial information was withheld.

The standard process commonly includes:

1. MIAM and non-court dispute resolution

   Unless an exemption applies, the applicant will usually be expected to attend a Mediation Information and Assessment Meeting before filing an application.

2. Form A

   Form A is used to begin most contested financial remedy proceedings.

3. Form E disclosure

   Each party completes Form E and provides the required supporting documents.

4. First Appointment

   The court identifies the issues, considers what further disclosure or expert evidence is required and gives directions for the case.

5. Financial Dispute Resolution appointment

   At the FDR, a judge considers the available information and encourages the parties to reach a negotiated settlement. The judge does not normally decide the case at this hearing.

6. Final hearing

   If no agreement is reached, the court hears the evidence and makes a binding decision.

Some lower-asset cases in participating courts may follow the Express Financial Remedy Procedure. The applicable directions and timetable should therefore be checked in every case.

An agreement may be reached through:

• direct negotiation;
• mediation;
• solicitor-led negotiation;
• private FDR;
• another form of non-court dispute resolution; or
• discussions during proceedings.

Where an agreement is reached, it normally needs to be incorporated into a consent order and approved by the court before it becomes legally binding.

Common problems include:

• issuing proceedings without understanding the likely range of outcomes;
• incomplete or inconsistent Form E disclosure;
• missing pensions, businesses or beneficial interests;
• failing to update financial information;
• asking unfocused or disproportionate questionnaire questions;
• relying on property values without appropriate evidence;
• overlooking mortgage capacity or future housing needs;
• confusing non-matrimonial contributions with automatic ring-fencing;
• making proposals without considering implementation, tax or affordability; and
• reaching an informal agreement without obtaining a court order.

Price Family Law can provide support with:

• strategic assessment of the financial position;
• preparing or reviewing Form E;
• identifying disclosure gaps;
• preparing questionnaires and replies;
• chronologies, schedules of assets and statements of issues;
• preparing for the First Appointment and FDR;
• analysing settlement proposals;
• preparing open and without-prejudice offers;
• position statements and hearing preparation;
• organising court bundles; and
• preparing a clear case strategy and action plan.

Specialist advice may be required from a solicitor, pension expert, accountant, tax adviser, mortgage adviser or valuer.

Financial remedy support may be provided through:

• Complete Case Support;
• a £495 Strategic Case Review; or
• a One-Off Fixed Fee Service for a defined piece of work.

The appropriate service and fixed fee are confirmed following the free consultation and an assessment of the work required.

The current court fee for a contested financial-order application is £321, although court fees can change. Help with Fees may be available to eligible applicants.