Financial Implications of Divorce

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Financial Implications of Divorce

The resolution of the financial matters on divorce can be a complex and daunting process. Whether you are able to resolve matters independently or require the Court’s assistance, it is important that you take legal advice to ensure that the final Order is fair and reasonable in all the circumstances.

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Financial consent orders

Before commencing financial proceedings you should consider whether matters can be settled by agreement. Agreement can be reached through solicitor negotiations, mediation or otherwise (please see the separate section on mediation ).

Dealing with the financial consequences of a divorce can be difficult.

Watch our short video for a simple, step-by-step guide to the process.

Once agreement has been reached it will need to be recorded in a Consent Order and filed at Court to be sealed, together with a form setting out your financial position. The Court retains the jurisdiction to raise questions in the event that the Consent Order is considered unfair. The Consent Order will not be enforceable until such time as Decree Absolute as been pronounced (see the separate section on divorce).


On receipt of an application for a Financial Order the Court will list the First Directions Appointment. In preparing for this hearing both parties will be subject to Court deadlines for the exchange of full financial disclosure. If agreement cannot be reached at the hearing, the Judge will set down a timetable to the Financial Dispute Resolution (“FDR”).

The FDR is an opportunity for the parties to negotiate on a without prejudice basis with the assistance of a Judge who will not hear the Final Hearing. The Judge will provide an indication of how, in his view, matters should be settled.

Interim financial arrangements

It is usual for the resolution of financial matters to take between 6–9 months; it can take a couple of years in the most complex and contentious of cases. For this reason, it is important that interim arrangements are made early in the process. If these cannot be agreed, the financially supported spouse will be able to make an application for an interim order.

What if I can’t afford a solicitor?

There are several options available to you:

  1. Your spouse meets your legal fees;
  2. seek a loan from family or a friend;
  3. enter into an agreement known as a Sears Tooth agreement with your solicitor;
  4. obtain a litigation loan for a specialist commercial lender (we can provide you with details); or
  5. if none of the above are possible, you may be able to make an application to the Court for an Order that your spouse meets your legal fees.

There are a various points to consider with each option and your individual circumstances will dictate which is the most appropriate option for you.

What will the Court consider?

The Court has a very wide discretion and the outcome of each matter will depend on the particular facts. The Court will seek to be “fair”. The law is set out in the Matrimonial Causes Act 1973, which provides a list of factors to be considered (“the Section 25 factors”), and further guidance can be taken from previous cases.

As a general principle, though it will depend on the length of the marriage, the starting point will be an equal division of the matrimonial assets. Any departure from equality must be justified on the basis of needs, sharing or compensation (though compensation is only applicable in a small number of cases), applying the Section 25 factors.

Section 25 factors

  1. Welfare of children – The Court’s first consideration will always be the needs of any  dependent children. In practice this means that the child, together with the parent providing   the day-to-day care, must be suitably housed.
  2. Financial needs, obligations and responsibilities which each of the parties to the marriage had or is likely to have in the foreseeable future – The Court will always strive to provide for the needs of both parties. Needs are generously interpreted in larger asset/income cases and will depend on the standard of living enjoyed during that marriage and assets in the case.
  3. 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.
  4. The standard of living enjoyed by the family before the breakdown of the marriage.
  5. The age of each party to the marriage and the duration of the marriage.
  6. Any physical or mental disability of either of the parties to the marriage.
  7. The contribution 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 income or caring for the family – the contribution of the ‘home-maker’ is considered equally as valuable as that of the ‘bread-winner’.
  8. The value to each of the parties to the marriage of any benefit which by reason of the dissolution of the marriage that party will lose any chance of acquiring. This is typically pension entitlements.
  9. The conduct of each of the parties if that conduct is such that in the opinion of the Court it would be inequitable to disregard it – conduct is very rarely a consideration. Examples of what would constitute such conduct include attempted murder and child abuse.

Clean Break

Where possible, the Court will seek to achieve a clean break or delayed clean break. This means that, following the implementation of the Financial Order (or a fixed period of maintenance in the case of a delayed clean break) the parties are no longer financially linked. This is not always possible in cases involving dependent children unless there are significant assets.

How long will it take?

If you manage to reach agreement, a Consent Order can be drawn up and sent to the Court for approval which would take about 6 – 8 weeks. If you cannot reach agreement and you need the Court to decide, it is likely to take at least 12 months to get to a Final Hearing.


There is an alternative to asking the Court to decide the matter for you. If you and your spouse agree, you can elect to have the matter dealt with by Arbitration. The advantage is that you get to choose who hears your case and when, which can mean the matter is dealt with more quickly and sometimes more efficiently.

Talk to IBB Law about finances and divorce today.

Looking for expert financial advice on your divorce? Whether you want to contest what you’re being awarded in the process, make a pre or post-nuptial agreement or just want to know more about your rights, we can help. Call us today on 03456 381381 or email us at

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