Financial Remedy Orders
When financial issues need to be resolved as part of the divorce process, and the parties are unable to agree, an application can be made for a Financial Remedy Order.
Following the making of an application, a Court will assist the parties in establishing how their property, assets and income will be distributed between them.
What is a Financial Remedy Order?
This is an Order made by the Court to determine the parties financial arrangements. It can include Orders for lump sum payment, Orders regulating ownership or sale of property, division of Pensions and other assets and Orders for ongoing financial support
To instigate an application for a Financial Remedy Order, it is necessary to submit a Form A to the Court.
Early on in the process, parties are required to provide each other with full financial disclosure. This obligation to provide full and frank disclosure continues throughout the Court process and there is a duty to disclose any material changes following provision of initial disclosure.
Once an application is submitted, the Court will timetable the case. Typical directions will include the following provisions:-
1. Financial disclosure by exchange of Financial Statements (Form E).
2. Request for Further Information and Documents arising from exchange of Form E’s.
3. Valuation of the family home and any other properties.
4. Mortgage Capacity Reports.
5. Provision of information relating to housing needs.
The First Appointment
An application will be listed for First Appointment which will take place after initial directions have been complied with. The main purpose of the First Appointment is to enable the Judge to identify the issues that need to be resolved and also ascertain whether any additional information is required from either party or whether any expert reports (e.g. from a Pension Actuary) are required.
If the parties are unable to reach settlement at the First Appointment, the Judge will set a date for a Financial Dispute Resolution Hearing (FDR).
Financial Dispute Resolution Hearing
By the time the parties reach this stage, it is anticipated that each will have provided the other with all relevant information and any experts reports and valuations will be available. Both parties are obliged to set out their proposals for settlement prior to the FDR and the Court should be aware of those proposals.
The main purpose of an FDR is to assist the parties in reaching settlement. To this end, the Judge will usually give an indication as to what they believe to be a reasonable outcome. The
Judge is not able to impose an Order at this time unless an agreement is reached in which case the Judge can approve that agreement and a legally binding Order can be made.
If an agreement is not reached at the FDR, further directions will be made for the case to be prepared for a Final Hearing.
If an agreement cannot be reached between FDR and Final Hearing, a Judge will make a decision following a full Hearing during which a Judge will hear evidence from both parties and any experts if appropriate.
The Judge will make several Orders which could include:-
- The sale of any property.
- A transfer of any property.
- A Lump Sum Order.
- A Pension Sharing Order.
- A Maintenance Order.
The Judge will also consider whether it is appropriate for a Clean Break Order to be made. A Clean Break Order essentially prohibits either party from making any future claims against each other’s property, assets or income or against each other’s estate upon death. In making their decision, a Judge will have reference to the factors contained in Section 25 of the Matrimonial Causes Act 1973. Any children’s needs will be considered first and foremost. It is essential that children’s housing and financial needs are met by any Orders that are made by the Court. Other factors that the Court may take into consideration are the parties respective ages, length of the marriage, any health issues, earning capacity, needs and requirements and the standard of living that the parties had during the marriage.
Divorce is a stressful time and the process involves making a number of important decisions when you and your family are already under a great deal of stress.
If you are going through the divorce process and need to arrange property and finances, particularly if issues are contentious, it is essential to engage a Solicitor to ensure that your interests are properly represented. At Seatons we are able to offer the expert services of a highly skilled and experienced family team.