Inspiring separating couples to make their own informed decisions

The Old Senate Chamber during the US Supreme C...

This week Lawyers working within the family law sector have waited with bated breath  for the outcome of the Supreme Court’s decision on the land mark case Prest v Petrodel Resources Ltd and Others [2013] UKSC 34.

This relates to an extraordinary case about an oil tycoon, Mr Prest worth about £48 million who attempted to evade his responsibilities to his wife upon Divorce by using legal arguments in relation to commercial law and corporate structures. This is known  by family Solicitors as the ‘cheats charter’.

Effectively, where one spouse has set up a Limited Company, this has a legal entity in its own right unless there is evidence of impropriety by the Director(s) , the Company cannot be Ordered to take any steps or action by the Court.

Whilst the Supreme Court voted unanimously for the Divorce Courts to be at liberty to redistribute assets that were held upon trust for the sole beneficial interest of Mr Prest by the Company (consisting of a multi million pound property portfolio); the Court made it clear that this was not a case whereby the ‘corporate veil‘ could be lifted.The Company was directed to transfer the property portfolio worth £17.5 million to the wife.

So in effect, the decision upon strict interpretation of the case, can be said to have strengthened the cheats charter, allowing those in business to consult further with their advisors to tighten up their corporate structures to make sure that there is no evidence of a link between the owner and the Company to avoid the outcome in this case.

That said, there is no doubt that the decision of the Supreme Court will be of huge benefit to spouses  where there are business structures (whether substantial or modest) that have been set up with the intention of defeating (usually the wife’s ) claims for financial remedies under the Matrimonial Causes Act 1973. The Supreme Court Judges have sent a warning shot to scheming, underhand spouses that where ever possible, Justice will be done within the ambit of the  UK law.

Regardless of the extent of your assets and respective financial positions; if you are contemplating Divorce  or separation from your partner or you have already separated, I would recommend that you consider in the first instance, the services of a family mediator to reach your own informed agreements about property, finance and/or children.

Family Mediation (in suitable cases) will prove to be less  stressful and will allow for on going communication between you and your ex partner. It will also limit both the financial and emotional costs of your break up. Please visit my website for more information.

As a result of the legal aid cut backs, family solicitors are now ‘unbundling’ their legal services to meet the demands of the emerging client base that cannot afford to instruct Solicitors on a traditional retainer basis. Please read the update on the Law Society Website here.

For those of you who are going through the traumatic time of a family break up or are contemplating separation/divorce from your partner, the above news will be of help to you if you are worried about securing legal services that is affordable.

Effectively, unbundling allows you to obtain legal services on a pay as you go basis on areas of your case that you feel it is absolutely necessary for you get  legal advice and /or representation without having to instruct your solicitor to have full conduct of your matter on a formal full retainer basis.

There will have to be a clear understanding about what steps your solicitor is instructed to undertake on your behalf e.g. providing initial advice on law and procedure, ad hoc advice to help you represent yourself in Court proceedings or checking and drafting documents.  The case will  be ‘client-led’ as opposed to ‘solicitor-led’. This allows you to stay in control of your case and limits your legal costs moving forwards. So, your solicitor will offer legal services on what is known as a ‘partial retainer’. If you would like to find out more information about how this works in practice please see the Practice Note issued by the Law Society for Solicitors here.

This kind of service will only be suitable for those of you feel confident and competent to take control and charge of your case with bespoke services and support from your Solicitor.

If you are contemplating separation or divorce from your partner or you have already separated, I would suggest that you consider in the first instance, the services of a family mediator to reach your own informed decisions about property, finance and/or children.

Family mediation will prove to be a less  stressful  and a more dignified option to resolving your differences. It will limit both the financial and emotional costs of your break up. For more information visit the Family Mediation pages on my website.

The damming family legal aid cuts are now in force as previously discussed in my post dated 23 November 2012; this is certainly no April fool!

For those of you who are dealing with family break up, it could not come at a worse time – not only are you going through probably one the most difficult and challenging experiences in your lifetime but you are now faced with the real possibility that you will have to deal with this crisis without the benefit of legal help if you are unable to pay for the services of a family solicitor and if you do not qualify for legal aid within the new ‘exceptional circumstances’ criteria as set out in the LASPO Act (Legal Aid,Sentencing and Punishment of Offenders Act 2012).

BBC News has set out useful information in an article on the legal aid changes, answering key questions that will concern most of you who need legal help now or in the near future with matters arising in relation to civil and/or family law issues. Please see the BBC News article here.

Most people will no longer qualify for legal aid unless there are grave issues about child welfare and/or domestic violence/forced marriage and if the applicant for legal aid is within scope on the basis of the new financial test, covering both income and capital resourses.To see if you qualify for legal aid under the new scheme,please check out your position on the online eligibility calculator here.

If you do not qualify for legal aid and you cannot afford to pay for legal services, you may be able to get a ‘Legal Services Order’ from the Court. This new statutory provision, provides for an Order or Orders requiring one party to the marriage to pay the other (‘the applicant’) an amount for the purpose of enabling the applicant to get legal services for the benefit of the proceedings. To obtain such an Order you must satisfy the Court that you cannot secure a loan to pay for the help of a Solicitor and your Solicitor will not agree to postpone payment for their services until the end of the case from settlement funds i.e. by way of a ‘legal charge’ over the settlement funds.

In light of the legal aid cuts and the possibility of having to represent yourself in proceedings about your relationship break up, whether it be in relation to children arrangements or financial matters, it is now even more important that you give serious consideration to resolving your disputes via dispute resolution services like family mediation, where legal aid will still be in place for those who qualify under the new financial test.

For more helpful information please visit my ‘useful Links‘ page. The links will prove to be an invaluable resource to anyone who is forced to represent themselves in Court proceedings or negotiations with a Solicitor acting for the other party.

English: Gulfport, Miss., September 15, 2005 -...

H.M. King George VI and Queen Elizabeth in the...

There are a lot of Bills that do not become law but the Children & Families Bill is one that is very likely to be given Royal Assent soon, no doubt with a number of recommended amendments after it has been scrutinised by both the House of Commons and House of Lords. To have a better understanding of how Bills become law, please visit the Parliament Website.

The Bill sets out to make provision for vulnerable children and support for strong families. It will reform the current systems for Adoption, Family Justice, children with special educational needs (SEN) and looked after children.

Of particular importance to separating parents is the reforms proposed to the Family Justice System to help deliver better outcomes for families and children facing family break up or where children may have to be taken in to the care of the local authority.

The proposals are made as a direct result of the Family Justice Review to improve our Family Justice System. The key areas that will concern you if you are contemplating separation or you have already separated and you have dependant children are:

  1. The Bill proposes to replace the current ‘residence and contact orders’ with a new ‘child arrangements order’. This means that the Court will be asked to regulate arrangements for the child/ren and make decisions on whom the child should live, spend time or have other types of contact with if you cannot reach your own agreements either directly, via family mediation or other forms of dispute resolution. This should encourage both separating parents and the Court to focus on the content of any agreements/Orders, rather than the title/labels given to the arrangements.
  2. There will be a presumption of joint parental involvement (shared parenting) unless such involvement will put the child/ren at risk of suffering harm. It is hoped that this proposed amendment will reinforce the principle that both parents should play a key role in their child’s life/upbringing after separation subject to it being safe and consistent with the child’s welfare.
  3. Making it a mandatory requirement to attend a mediation information and assessment meeting (MIAM) with a regulated family mediator to find out about family mediation and other out of Court options to resolve disagreements about the child/ren’s arrangements before going to Court. Research studies have shown that family disputes resolved via mediation are less acrimonious than those that are settled through the Court system. Also, decisions made by agreement are more likely to be kept as opposed to Court imposed Orders.
  4. Introduction of a 26 week limit for cases to be concluded when an application has been made by a local authority to take a child/ren into its care. This to avoid the current unacceptable delays in such cases.

Please read the fact sheet provided on the Department of Education website for more information on the proposed changes. It is intended that this Bill will become law by April 2014.

Marriage Day

Breaking up is never easy…but there is a better way…

 

There has been much debate about the unfair property laws that affect separating unmarried couples in the UK.

Not withstanding a call for reform from lead bodies and Judges that work within the family law sector, the Government has resisted implementing proposed changes that would make the system fairer for separating cohabitees.

Cohabitation or Living Together Agreements are becoming increasingly popular in the UK as a result of the injustice  that the current laws are causing. 

It is a well known fact that marriage rates are falling and people are choosing to live together instead. However, as the law stands now, there is very little legal protection for cohabitees who suffer a relationship breakup and need to resolve disputes that may have arisen in respect of property and/or children.

You will often hear the term “common law husband and wife.” It is a mistake to think that if you live with someone for a period of time you acquire the same rights as a husband and wife. This is not true. Cohabitees cannot rely on the Family Court to determine an appropriate financial settlement for them as Divorcees can. The law relating to unmarried couples and property rights is very complex and can lead to harsh outcomes because the Judge’s hands are tied by the existing laws. Please read related article below.

For this reason, more people are turning to Cohabitation Agreements to record the financial arrangements that are to apply in respect of their cohabitation and what should happen in the event that the relationship fails. Living Together Agreements are contracts that can include provisions dealing with income, property, children, wills and legacies, ownership of chattels and many other matters that may be relevant to you and your partner.

It is in your best interest to take legal advice on having a Cohabitation Agreement drawn up.  With out a doubt, this will save you and your partner a lot of heart ache and costs of litigation in the event that your relationship comes to an end.

Also, if you are buying a property together than consider having a declaration of trust drawn up or making it clear on your purchase documents how you both intend to hold the beneficial interest (capital) in the property. The Land Registry has devised a new Form JO to make it simpler for cohabiting couples to declare their intentions. For more information, see the Land Registry’s public guide to joint ownership here.

If you are contemplating separation from your partner or you have already separated, I would suggest that you consider in the first instance, the services of a family mediator to reach your own informed agreements about property, finance and/or children.

Family Mediation (in suitable cases) will prove to be a less  stressful option to resolving your disputes and will limit both the financial and emotional costs of your break up.

Bedroom

Bedroom Tax (Photo credit: Moyan_Brenn_be_back_on_Jan_20th)

On 12th March 2012 the Welfare Reform Act was given the green light – this will be the biggest changes in the UK Welfare system over the past 60 years.

The key  aim is to make the benefits and tax credit system fairer and simpler to understand and administer. For a more detailed account  of the main elements of the changes,please visit the DWP website.

The changes that may affect you are:

  •  The introduction of Universal Credit, which will give you a single  payment direct into your bank account with a proposed cap of £500.00 per week for a couple or single parent with dependant child/ren and £350.00  per week cap for a single adult person. This will replace :
    • Income-based Jobseeker’s Allowance
    • Income-related Employment and Support Allowance
    • Income Support
    • Child Tax Credit
    • Working Tax Credit
    • Housing Benefit
  • Bedroom tax. The reforms will cut the amount of  Housing Benefit that you can get if you are deemed to have a spare bedroom in your rented home. Separated parents who share the care of their children and who have an extra bedroom to accommodate this  will be unfairly penalised under the new rules as there must be a designated ‘main carer’ for the child/ren who receives the extra benefit. The  cut proposed is 14%  if you are deemed to have one spare bedroom and 25%  if you are deemed to have two or more spare bedrooms. In cash terms this can be on average, a loss of £15.00 per week. For more information, please visit the National Housing Federation website.

If you are contemplating separation be ready for the  impact of the new Welfare Reforms and make sure that consideration is given to how they may affect you and your ex partner and more importantly any children of the family.

Please remember, when considering how to deal with your separation/divorce, it will serve you, your ex partner and any children of the family to give consideration to out of Court settlements via Dispute Resolution options like, family mediation.  Such options are not suitable in every case and in some circumstances, the matter should be placed before for the Court for significant issues to be determined by a Judge/Magistrates.

Research studies have shown that family disputes resolved via mediation (where the case is assessed suitable for mediation) are less acrimonious than those that are settled through the Court system. Further, decisions made by you and your ex partner by agreement are more likely to be kept as opposed to Court imposed Orders.

   

European flag outside the Commission

European flag outside the Commission (Photo credit: Wikipedia)

The Notaries of Europe with the support of the European Commission have launched a very helpful website for separating international/European couples to help them gain access to comprehensive and reliable information on the complex area of law relating to their separation in 21 different languages.

This is a very useful tool to help people to make use of their rights as European Citizens. The website clarifies the different applicable laws on matrimonial property regimes and property consequences of registered partnerships affecting the separating couple in each European Country. Please see the press release on the Notaries for Europe website here for more information.

If you are contemplating separation or Divorce and either or both of you are European Citizens, this website will help you by answering  the following questions for the 27 EU Countries:

• 1 Which law applies?
• 2 Is there a statutory matrimonial property regime and if so, what does it provide?
• 3 How can the spouses arrange their property regime?
• 4 Can or must the matrimonial property regime be registered?
• 5 What are the consequences of Divorce/separation?
• 6 What are the consequences of death?
• 7 Does your national law provide a special matrimonial property regime for multi-national couples?
• 8 What does the law provide for the property of registered and non-registered partners?
• 9 Which is the competent authority to turn to in cases of disputes and other legal issues?

If you are considering separation or Divorce,  please in the first instance, give consideration to the out of Court options to resolving any disagreements that you may have either family mediation or in more complex cases, consideration should be given to the collaborative approach, which allows legal advice during meetings.

The first working day back in the New Year is classed as ‘Divorce Day’ by most lawyers. Usually after the festive season those couples who have kept it together for the sake of their children or simply to avoid the stress of a breakup during what should be happy times, make the decision that something needs to be done to end the façade and on going struggles/misery by taking formal steps to end their relationship.

It takes a lot of courage and a strong person to take this bold step but with the right advice and support unhappy couples can make the right decisions about where their relationship is going. Unhappy relationships don’t have to end in Divorce/separation – sometimes all that is needed is  time apart to allow you and your partner the time and space to reflect upon what the real issues are in your relationship. Can they be resolved with professional help and support? Visit the useful links  page for information an agencies such as Relate that may be able to help.

If there is no third-party involvement by either party and no serious issues about the safety or welfare of either party or any child/ren of the family then in some cases the answer maybe to have counselling, therapy, coaching through professionals trained to help couples in such circumstances – to help you get back on track to re-kindle your love and admiration for each other. There are no quick fixes and both you and your partner would have to be committed to this process to have a good chance of succeeding in a reconciliation.

However, sadly in a lot cases you and your partner will have reached the point of no return and therefore serious consideration will need to be given to formalising your separation. The Government is encouraging separating couples to consider family mediation as their first port of call to avoid protracted Court proceedings and the added stress and costs of the traditional Court based approach. Read the related articles below.

Where a case is suitable for mediation, I would strongly recommend that you and your partner at least keep an open mind about the out of Court option and give family mediation a fair go. You have nothing to lose and everything to gain.

Having to go through separation/divorce can be classed as one of the most stressful experiences in your lifetime.

Some would say that it is far more difficult to cope with than the bereavement of a close family member or friend – it is a ‘living bereavement’.

Whilst there are grave concerns about the impact of the cuts to family legal aid that come into force in April 2013, thankfully there is help at hand for those of you who will not qualify for family legal aid as a result of the cutbacks and cannot afford the services of a solicitor.

The Government has launched an online application/website  for separating couples to give you much needed help, support and guidance. It covers the following topics with useful contact information, tools, videos and links to help you make informed decisions after a break-up:

  • Children &  Parenting
  • Health
  • Housing
  • Legal
  • Money & Finance
  • Relationships & Conflicts
  • Work & Benefits

By answering a series of questions, the web app will give you a personalised action plan. Click here to check out the new sorting out separation web app.

However, where  you are unsure about your respective rights and responsibilities or where there are complex issues arising out of your separation, a word of caution, it is always sensible to get specialist legal advice. Many solicitors offer an initial fixed fee service, which can prove to be invaluable.

To help you and your ex-partner have a dignified and amicable separation allowing for future co-operative parenting, family mediation, when suitable, can be a better way of reaching out of court agreements.

Related articles

 

The Government has introduced a new scheme for the calculation and enforcement  of child maintenance that will be managed by a new organisation, called the ‘Child maintenance Service’ (CMS). This service will in time replace the current or old system that we have all become familiar with, the Child Support Agency (CSA).

The scheme will be phased in over the next few years with the aim of converting all cases into a single system by 2015.

The calculation under the new scheme will based on the non-resident parent’s gross income as opposed to net income (as per the CSA scheme) to make the calculation simpler. There is in turn, changes to the percentages to be applied.

For a gross annual income of up to £41,600 (or £800 per week) the percentages applied will be:

  • 12% for one child;
  • 16% for two children; and
  • 19% for three or more children.

However, any excess of income over £41,600 per annum will be subject to the following extra rates:

  • 9% for one child;
  • 12% for two children; and
  • 15% for three or more children.

Gross income above £3,000 per week (£156,000 per annum) will be outside of the jurisdiction of the CMS and in these high income cases you will  need to seek Court intervention in the event that you cannot reach your own agreements.

If you are unable to agree terms of voluntary child maintenance then you may have to invoke the services of the CMS. The Government plans to introduce fees for using this service for calculating the assessment and requesting payment through the service/enforcement. For more information please click here.

The idea behind the new scheme is to encourage separating parents to agree their own arrangements outside of the statutory system by entering in to ‘Family Based Arrangements’ (FBA’s).  Most parents who are able to communicate and agree arrangements think this is a better option as it allows for flexibility, remains private and no one else gets involved. FBA’s are quicker and easier to set up, with no other costs. For for more information please click here.

Parents are encouraged to use family mediation services to reach agreement on all issues relating to the breakdown of their relationship/marriage and often mediators can help separating couples reach  agreements on child maintenance issues avoiding the bureaucracy of statutory systems, delays and costs.

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