The Family Justice Council published the Guidance on Financial Needs on Divorce in June 2016 but is it really going to help?
This is my third blog in relation to the Guidance.
So what are needs and how can they be met?
According to the Report needs are ‘A very broad concept with no single definition in family law’. OK so that’s not that helpful, but the Report refers to housing and income as typical needs, including income in retirement. Needs are measured by assessing financial resources and standard of living (including a reduction in that standard of living). Both parties will be expected to present detailed budgets to assess needs.
How can Needs be met?
All the available assets, including non-matrimonial resources should be considered to meet needs. The needs of both parties will be considered. The court will consider what proportion of the payer’s resources should fairly go to the other spouse. The court will strive to stretch resources to provide a home for the children with each parent or at the very least with the primary carer. The court will also consider the impact of requiring one party to remain on the mortgage of the other’s home for an indefinite period. If there is a sacrifice to an entitlement to capital, then the sacrificing party should be reimbursed through a Mesher Order. What’s a Mesher Order? Well this is where a property is sold at a later date (usually when one of the triggering events kicks in) and the proceeds are divided in accordance with the percentages agreed at the time.
Essentially all factors and available resources must be looked at when considering needs and how they can be met. Often this means producing a financial information and documents. Factors such as the lifestyle enjoyed during the marriage, the length of the marriage, any children of the family and the choices made as to the care of the children are all relevant in needs cases.
Needs cases account for the majority of divorce matters and can be highly fact-specific. It is always advisable to seek legal advice first as decisions made now will have medium and long term future implications for you and your family.
In the next blog we will look at the duration of the provision for needs and the transition to independence.
Anthony Jones is Head of Family and is a Resolution Accredited Specialist. For more information, please contact him on 0161 641 4555 or email email@example.com