The importance of obtaining a Consent Order when resolving finances amicably on Divorce
On the breakdown of a marriage, separating couples can resolve their financial arrangements in various ways such as through Mediation, negotiations through Solicitors or usually as a last resort, through the court process by applying for what is known as a financial remedy Order.
In some cases, couples divorce and may give no consideration to resolving their finances especially if there are no significant assets or at least none that they are aware of. Many of my clients are often unaware that the divorce process is entirely separate from the resolution of their finances.
However, even after a divorce, the parties will still retain a financial tie and it remains open to either party to apply to the court for a financial remedy Order and seek a share of the other’s assets. There is no time limit to make such an application following a divorce.
The merits of such an application will be for the court to determine especially after a long period of time and some claims cannot be made following a remarriage.
However, it is prudent to sever all financial ties with a spouse/former spouse on divorce by obtaining a Court Order. As part of that process, it is also important that there is transparency and that both parties provide financial disclosure so that they are both fully aware of the extent of each other’s assets and any financial claims they may be giving up.
The usual method of providing financial disclosure on divorce is by both parties completing a document known as a form E and providing documentary evidence in support. This is a detailed form and each party must also sign a statement of truth confirming that the financial disclosure given is full and accurate.
If matters are resolved amicably, then it is important that the agreement is set out in what is known as a Consent Order. This is a legal document which should be drafted by a Solicitor as in addition to this being a technical document, the court also requires Orders to be in a specific format.
It may even be that in a case where there are little to no assets, that both parties agree that there should be a “clean break” ie that neither of them will make a financial claim against the other’s assets.
To ensure the agreement can be enforced and that all financial ties are indeed severed, it is also important that such an agreement is recorded in a Consent Order and lodged with the court. Failure to do so could mean that one of the parties may change their mind and decide to seek a share of the other’s assets in the future. As any previous agreement was not embodied in a Court Order, a financial remedy Order application can still be made to the court.
Where the parties agree a clean break, the Consent Order should also dismiss all claims both parties could have against each other’s estate on death.
As this is a legal document, both parties should obtain legal advice on the Consent Order before signing it.
The court will scrutunise whether the agreement embodied in the Consent Order represents a fair outcome.
To this end, the parties will also need to complete a document known as a statement of information which sets out their assets in summary form as well as other matters such as the length of the marriage and details of any children.
This will assist the Judge to ascertain the extent of the parties’ assets and whether the agreement is fair. The parties will not usually need to attend court under this procedure.
Once the Consent Order has been approved, it will be sealed by the court.
If you would like advice on resolving your finances on divorce or advice regarding obtaining a Consent Order to set out any agreement reached on your finances on divorce, please contact Tayo Taylor at firstname.lastname@example.org or on 020 3667 4783