It is important to understand that there is no legal definition of fairness, however it is determined on a balance scale. The starting point for division of matrimonial assets is 50/50, however there is the potential to depart from equality in certain cases depending on the circumstances of the matter. The Matrimonial Causes Act 1973 (MCA) provides that the Court must have regard to all circumstances of the case, with the first consideration being given to the welfare of any children of the family and taking into account the eight Section 25 factors.
The Section 25 Factors include the income and earning capacity of each party, any property held either individually or as a partnership, and other financial resources such as pension payments, the financial “needs, obligations and responsibilities which each of the parties to the marriage has, or is likely to have in the foreseeable future”, any physical or mental disability, and the parties’ respective contributions. If the parties cannot agree a fair settlement between them, an application will be made to Court where a Judge will review the assets of the marriage (including savings, pensions, property) as well as taking into account the contributions made by both parties, their current finances, and any future financial resources. A Judge then has the option to make a Final Order based on what he deems is fair and reasonable to both parties.
As part of the financial settlement, many factors are considered, one being the pension provisions for each party. Oftentimes one party will have accumulated a larger pension than the other, often due to leave from work being taken to raise children which results in lower or zero pension contributions for a period. Consideration is given to any imbalance in pension provisions as part of the overall financial assessment and, if it’s deemed necessary, a judge may order that a percentage of one party’s pension be transferred to the other party. This is known as a pension sharing order.
One of the Section 25 factors in divorce states that the “financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future” must be properly considered. As a rule the starting point assumes a 50:50 split of finances and financial assets. Once the ‘financial needs’ have been properly assessed, any deviation from the 50:50 split can be appropriately measured and, in the case of the matter being taken to court, allows a judge to order what the financial split must be.
In summary, the eight factors which a Judge would take into account when considering what might be a fair outcome in divorce are:
The income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future, including in the case of earning capacity any increase in that capacity which it would in the opinion of the court be reasonable to expect a party to the marriage to take steps to acquire;
The financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future;
The standard of living enjoyed by the family before the breakdown of the marriage;
The age of each party to the marriage and the duration of the marriage;
Any physical or mental disability of either of the parties to the marriage;
The contributions which each of the parties has made or is likely in the foreseeable future to make to the welfare of the family, including any contribution by looking after the home or caring for the family;
The conduct of each of the parties, if that conduct is such that it would in the opinion of the court be inequitable to disregard it;
In the case of proceedings for divorce or nullity of marriage, the value to each of the parties to the marriage of any benefit which, by reason of the dissolution or annulment of the marriage, that party will lose the chance of acquiring.
Want to know more about Divorce, Separation, Mediation, and Collaborative Law?
If you are thinking of separating or requesting a divorce, be sure to read our other Blogs for more information.
- If I were to separate or divorce what would I be entitled to?
- If I were to separate or divorce what will happen with the children?
- I want a divorce. What should I do?
- When I divorce will I have to sell the house?
- When we divorce I only want what is fair
Here at Thornton Jones Solicitors our skilled and experienced Family Law team can guide you through the process of separation and divorce. If you would like advice regarding separation, divorce, finances, or children’s matters, please contact one of our offices to arrange an appointment.
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About Jane Auty
Jane is one of our most experienced solicitors here at Thornton Jones Solicitors having qualified as a solicitor in 1997 and has specialised in Family Law since qualification and is known for providing practical and robust advice in all aspects of matrimonial finance.
She has extensive experience in guiding clients through all aspects of family law breakdown. Jane has a strong reputation for dealing with complex high net worth financial cases frequently where there is an overseas element, business assets, pensions, trusts or a farming element. Jane also deals with pre/post nuptial settlements.
Jane is a trained and trusted collaborative lawyer, from 2006 has assisted clients in navigating their divorce or separation outside the court process. She is committed to dealing with all issues cooperatively and constructively, with a view to reaching a resolution by agreement without the uncertainty, cost and delay of the court process. Jane is a member of collaborative law groups in Leeds and Wakefield.
She is a member of Resolution, which is a body of family lawyers committed to adopting a non-confrontational and conciliatory approach.
Outside of work Jane suffers the ups and downs of being a season ticket holder at Leeds United, is still in love with Bielsa, and is hoping for a swift return to the Premier League. Jane loves attending live music – preferable rock/indie – (nothing mainstream) and can be daily found pounding the swimming pool in an effort to remain fit despite her advancing years.
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