Financial Provision on Divorce: Section 25 Guidelines for Financial Division, Schemes and Mind Maps of English

Download Financial Provision on Divorce: Section 25 Guidelines for Financial Division and more Schemes and Mind Maps English in PDF only on Docsity! Financial Provision on Divorce When parties to a marriage decide to end their relationship, it is important to remember that simply obtaining a Decree Absolute will not address the financial considerations that invariably arise on the breakdown of a marriage. In dealing with the financial issues that arise on divorce, there are guidelines that are applied by the Courts. This leaflet aims to summarise the main principles relevant to that financial division on divorce. Decisions of the English Courts are based primarily on statutory guidelines but also on the common law, that is decisions handed down in previously decided cases. The most relevant statutory guidelines are known as the “Section 25 Criteria” and are set out in the Section 25 of the Matrimonial Causes Act 1973 (Section 25). It must be remembered these are guidelines which the judges may follow but may deviate from. Summary of the Section 25 Guidelines 1. Circumstances of the Case Each individual case will depend on its own facts but the starting point will always be the statutory criteria laid out in S25. A duty is imposed on the Courts to have regard to all the circumstances of the case whether the past, present or future. 2. The Welfare of the Children The first consideration of the Court will be the welfare of any minor children of the family under the age of eighteen including stepchildren. 3. No one factor to be more important than the other No one factor should outweigh the importance of the others when considering the division of matrimonial assets. However, it will often be the case that one factor (for example the respective earning capacities of the parties) will occupy more of the Court’s time and be more important than other factors in that particular case. 4. Financial Resources When deciding on financial matters the Court must have regard to the income, earning capacity, property and other financial resources that each of the parties has or is likely to have in the foreseeable future. 4(a) Income and Earning Capacity The court will look not only at what the parties are earning currently but also at what they could reasonably expect to earn in the future. The Court will draw negative inferences if one party chooses not to work when he or she could do so. 4 (b) Earning Potential This should be distinguished from earning capacity. Earning potential is any increase in earning capacity which a party would reasonably expect to achieve given their circumstances. 4 (c) Property This will include land, any beneficial interest held under trust, money, partnership assets, business stock, jewellery, other personal possessions, shares in private or public companies and pensions. 4 (d) Expectations The Court will consider any income or property that a party currently has or is likely to have in the foreseeable future e.g. this may include inheritance prospects. 5. Financial Needs, Obligations and Responsibilities The Court must also have regard to the financial needs, obligations and responsibilities which each of the parties of the marriage has or is likely to have in the foreseeable future. 6. Standard of Living during the Marriage The Court must also have regard to the standard of living enjoyed by the family prior to the breakdown of the marriage. 7. Age of Parties The age of the parties is most relevant to the question of their earning capacity. Where the needs of young children are involved, a young wife will normally be presumed to have an earning potential. The considerations will, however, be different for a woman aged over fifty who has not worked for many years. 8. Duration of Marriage With a short marriage contributions are likely to be more relevant. However, the duration of any marriage and in particular short marriages will not be considered on its own: other relevant factors will include contributions (or lack thereof), children and the