Family Law
Anyone involved in a divorce will be aware of the financial as well as the emotional cost. The House of Lords on 24th May decided two divorce cases Miller & Macfarlane, both of which involved a spouse, who had given up work and was awarded a large share of their earning spouse’s income. A day later the Court of Appeal reached an important decision on pensions in divorce when awarding.
Lynne Barton a partner at Aldridge Brownlee Solicitors LLP says:
These are important cases as they address respective contributions between partners in a marriage. The courts examined the idea of sacrificing a career to look after children and they explained how over generations or decades, what people and society think is fair in marriage and on divorce will change. In effect a couple could marry under one set of rules and divorce at a later stage when the laws are different. The court maintained the principle that where there is enough money for a clean break with no future support required for the lower earning spouse, this is most desirable. This was the case in one of the divorces. Mr Miller’s wife was awarded £5m for less than 3 years of marriage and Mrs MacFarlane won half the couples’ assets (£1.5m) and £250,000 a year for life.
It was not made clear what the position would have been had the spouses continued to work throughout the marriage but simply happened to earn less than their spouse because the work they were qualified or fit to do was lesser paid. There were also some differences of opinionfrom the various judges in the House of Lords about what constitute assets of a marriage and which business assets might be excluded. However the cases will help advisers in interpreting the law. At present English law does not legally recognise pre-nuptial agreements although the court may choose to examine such an agreement as part of the overall divorce procedure. Scotland has different divorce laws.
It was announced in May that unmarried couples may be given some similar property and inheritance rights to those who are married but the legislation has not yet been drafted so living together may not in due course avoid the impact of divorce law on couples. The breakdown of the new Civil Partnerships between same sex couples has already lead to a need for legal advice in such circumstances.
The decision on pensions held that pensions are different assets from cash or property. In this case the ex husband was awarded £3m from his wealthier wife and the Court of Appeal increased this by £650,000 in May’s ruling in holding that his £900,000 pension fund was not a cash asset in the same way a house or money might be.
It has also emerged that the Government proposes to abolish the Child Support Agency and leave parents to enforce their own maintenance orders except in difficult cases where a new agency will help them recover sums owed by a non-resident parent.
If you need any legal advice in this area call Lynne Barton on 01202 294411
Notes
- Miller and MacFarlane cases were widely reported in the press. The judgments are at http://www.publications.parliament.uk/pa/ld200506/ldjudgmt/jd060524/mill-1.htm and make very interesting reading.
- The proposed change to the law on cohabiting couples is described at http://www.timesonline.co.uk/newspaper/0,,176-2200302,00.html
- CSA abolition http://www.timesonline.co.uk/newspaper/0,,173-2205625,00.html
- The pensions decision is at http://www.timesonline.co.uk/article/0,,200-2196580,00.html
