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24/09/2012 By: Edward Heaton
The Law Commission has published a consultation paper considering the way in which finances are dealt with on divorce. The paper focuses on the uncertainty of the current system and potential ways of providing divorcing couples with greater clarity and certainty. The challenge, however, will be striking the balance between providing greater clarity and certainty whilst not creating an inflexible system that risks unfairness.
Under current divorce law, a judge is required to consider all circumstances of the case when looking at how the financial resources of a divorcing couple should be divided. This includes a wide range of specific factors, such as the parties’ respective ages, earning capacities and responsibilities. This means that much depends on the way in which the judge chooses to exercise his or her discretion and, whilst this results in an outcome tailored to the specific circumstances of any given case, it can also lead to an outcome that is difficult to predict.
The changes to the law following this consultation could be far reaching. One suggestion is for the introduction of a formula for calculating maintenance in a way that encourages financial independence as early as possible (which is likely to reduce the length of time for which maintenance needs to be paid). Another is for the introduction of a definition of “non-matrimonial” assets so that they may be ring fenced from being shared on divorce unless needed to cover the needs of the other parties.
If the suggestions become law, the result will almost inevitably be reduced provision (in quantum or term) for the financially weaker party and the loss of London’s reputation as the “divorce capital of the world”.
If you would like to have your say or just find out more about the possibilities for change, the paper can be found on the Law Commission’s website.
Ed HeatonFamily Law AssociateLeeds