The Millionaire’s Defence

the millionaire defence

The Millionaire’s Defence

What Is The “Millionaire’s Defence”?

When a couple get divorced they are both obliged to provided full financial disclosure. The “millionaire’s defence” was a term created following the divorce case of Mr and Mrs Thyssen-Bornemisza in 1985, when the very wealthy husband said that he did not need to provide full financial disclosure in his divorce proceedings as he had sufficient wealth to pay any reasonable sum that a judge ordered him to pay to his wife.

Partner Fiona Wood, who is particularly accomplished at dealing with divorce cases where there are substantial and complex assets, explains further.

What is the benefit of running this defence?

Many wealthy people would prefer not to provide full details of their wealth, which may include significant business assets and interests under family trusts. Successfully running this defence means that these details do not have to be provided. Furthermore, formal valuations are often obtained of business assets in divorce proceedings and not having to provide sufficient information to facilitate this and not having values attributed to these assets in court proceedings, which can be attended by the press, can have its attractions.

In what circumstances can I run this defence?

Firstly, you need to be very wealthy. Secondly, the sharing principle should not apply to your divorce. Since 2000, assets that have been acquired during a marriage are usually subject to the sharing principle when a couple divorce, provided both their needs can be met by doing this. Therefore if you are very wealthy, but much of your wealth was accumulated during the marriage, the Judge will want you and your spouse to provide full disclosure of all your assets and may also want experts to value these assets, if their values cannot be agreed by you and your spouse, as the judge’s starting point, when considering a fair settlement, will be an equal division of these assets.

In the 2013 divorce case of AH v PH, the husband stated that he had assets worth £76 million, which had been gifted to the husband by his very wealthy family before the couple married. The husband’s assets were considered non-matrimonial and therefore not subject to the sharing principle. The judge accepted that full financial disclosure was not required from the husband as the wife should receive a needs based divorce settlement, based upon what she needed to fund the purchase of suitable house and a capital sum to meet her income needs. The wife received £7.775 million.

Is the Millionaire’s Defence relevant to other relationship claims?

If an unmarried couple separate and they have children who are under the age of 18, the parent that the children live with can make a financial claim against the other parent for the provision of a house, a car and other capital needs until the children finish school or university, plus child maintenance. These applications are made under Schedule 1 of the Children Act. Whilst financial disclosure usually has to be provided by both parents in these proceedings, if the paying parent is very wealthy they may be able to rely on the Millionaire’s Defence.

In the case of A (A Child) in 2014, the mother made a Schedule 1 application and the father ran the millionaire’s defence. The father was a member of wealthy ruling family from a middle eastern country. The mother appealed the court’s decision on the basis that the court did not make adequate financial provision because of the father’s failure to provide full financial disclosure. The Court of Appeal rejected the mother’s appeal and confirmed that where there is significant wealth there is no need to examine in close detail the father’s financial resources.

It is fair to say that the Millionaire’s Defence will only be run successfully in a limited number of cases. However, for the very wealthy, who are keen to keep details of their wealth private, it is a defence that they may want to consider using.

If you would like to know more about the issues raised here, please get in touch today. We are here to help.

Home schooling and shared care: how to manage this successfully

home schooling and shared care

Shared care and home schooling

Due to Covid-19, over the past 15 months parenting has for been particularly challenging. And for many separated parents, changes such as lockdowns and schools closures have been thrust upon them, without the chance to discuss shared care arrangements with the other parent.

It might be that you, as parents, have been home schooling your children for many years anyway, but for many this was new, and largely unknown, territory. However now normal life beckons, there’s no disputing the fact that some parents have really taken to home schooling and want to continue. How best to do this, so that all involved are happy with the arrangements, and the children thrive? Associate Melissa Jones explains.

How do I implement the same routine for the children at the other parent’s house?

It is important to remember that despite the urge to set out a clear timetable for the children each day, this might not be practical, depending on the ages and needs of your children and also whether you or the other parent needs to work from home.

When you co-parent you are reliant, to a certain degree, on flexibility and trust in the other parent. Each parent has their own style of parenting and while you may not agree on everything regarding the children, the ability for your children to experience secure and stable upbringings across two homes is possible.

Home schooling: the Parenting Plan

For co-parents, one handy and almost essential tool is a “Parenting Plan”. In essence, it is a written document that records the day to day and practical arrangements of parenting.  Also, if you are looking to make an application to the family court for a Child Arrangements Order (Section 8 Children Act 1989), in the future, the court will expect you to have looked at a parenting plan.

The Children and Family Court Advisory and Support Service  (CAFCASS) which represents children in family court matters in England, describes the benefits of making a Parenting Plan below:

  • it will help everyone involved know what is expected of them
  • it acts as a valuable reference to go back to
  • it sets out practical decisions about the children, such as living arrangements, education and health care.

You can see more detail here.

How can I include home schooling in a Parenting Plan?

There is a section dedicated to “education” in each parenting plan, so, if you are looking to create a plan for the first time or even if you already have a plan, a good talking point would be home schooling and how you can work together to achieve this. You might find that one parent really likes the idea of planning the day around available resources online, where a number of celebrities are producing content designed to fall in line with the national curriculum. On the other hand, it might be that the other parent is really hands-on and wants to use this time to teach the children practical skills such as woodwork, gardening, baking, and more.

How will I know what the other parent is planning?

For many years now family law practitioners have been encouraging the use of a “communication book” with the idea being that one parent records useful information about their time and activities with the children, and the book is then passed to the other parent, on handover.  One way this could be to send electronic updates or set up a designated “email” just for communication about child arrangements. You could even develop your own form of home work diaries and there are plenty of apps out there that could help you stay connected as a family.

In the end, what’s important is communication – there is no question that no matter what the situation, children always benefit when both parents talk to one another and agree the way forward.

If you are affected by any of the issues outlined here, please do get in touch today. We are here to help.

Separated parents and international travel during Covid restrictions

separated parents and travel during covid

Separated parents and international travel during Covid restrictions

From 17 May, the ‘Stay in the UK’ regulation ceased and international travel was allowed to restart, albeit governed by a new traffic light system.  Half term is coming up for many school children and of course some parents will want to take their children on holiday.  What must you consider? Associate Melissa Jones explains.

Firstly, if one parent wants to take a child abroad, whether permanently or temporarily, the other parent with parental responsibility needs to consent, and secondly, anyone with the benefit of a Child Arrangements Order (for the child to live with them) can remove the child from England and Wales for a period of less than one month without the consent of the other parent with parental responsibility.

What about Covid-19?

Because the situation is relatively fluid, it might be that the parent not going on holiday is nervous at the thought of the children travelling abroad, not least because of the fear that once in the destination country, your ex and your children might face a period of self-isolation upon their return. If you are the one wishing to travel bear in mind the so-called “traffic light system” may change and you could find yourself rushing to the borders to fly back to the UK at very little notice, in order to avoid going into quarantine. And there is the ever-present worry around the risk of the children either contracting the virus or transferring it.

Written consent

If you do wish to travel abroad, the first step is to get written consent from other parent before travelling but even if you do, they may change their mind. Try to have an open discussion with the other parent and understand and alleviate any fears they may have by confirming:

* travel dates and times

* where you will be staying

* how you will be keeping the children safe throughout the holiday

* you are both aware of, and agree to, the rules around quarantine and testing if you’ve been in an amber list country and you both understand the restrictions these rules impose

Compromise and flexibility are key.

What happens if we cannot agree?

You can make an application to the court for a Specific Issue Order and the court will decide the matter. If an agreement cannot be reached and one parent fears the other parent will travel regardless, they can apply to the court for a Prohibited Steps Order.

Will the court hear this matter in time?

The court is dealing with a significant amount of cases and there is no guarantee that it will be able to deal with an application such as this as quickly as might be necessary. Our advice is to deal with this matter before it becomes an urgent one. There are alternatives to making a court application, such as engaging your solicitor and seeing if the matter can be negotiated or referring to mediation to see if an agreement can be reached.

If you are affected by any of the issues outlined here, please get in touch today. We are here to help you.

The Potanina divorce: the highest-value divorce case in English legal history?

Natalia_Potanina

The Potanina divorce: the highest-value divorce case in English legal history?

The Potanina divorce highlights the issue that those who have divorced abroad can apply to get a better settlement in England. Partner Fiona Wood explains.

Last week the Court of Appeal overturned a decision of the High Court, therefore allowing Natalia Potanina to bring her divorce claim in England. Her husband, Vladimir Potanin is stated to be worth $20 billion and to have a controlling stake in Nornickel, one of the world’s largest producers of nickel and palladium.

Divorce in Russia

The couple married in Russia in 1983 and lived there for most of their marriage. They divorced in Russia in 2014. Natalia received a divorce settlement of $41.5 million from the Russian court but says that she should have received a far greater share of her husband’s fortune. She informed the English High Court that she had “made exhaustive efforts to obtain justice in Russia” but that the sum she was awarded “does not even begin to meet my reasonable needs”.

English law

Couples who have links to the UK but who have divorced overseas and believe they have been treated unfairly can apply for permission to bring their case to be heard by the English courts under Part III of the Matrimonial and Family Proceedings Act 1984. English law is far more generous to the financially weaker spouse, usually the wife, than the law of many other countries, making such an application an attractive option.

Divorce tourism

Natalia has had a house in England since late 2014. Her attempt to bring proceedings in the English courts was blocked by the High Court in 2019 on the basis that the couple had little connection with Britain. A judge said that if her claim went ahead “there is effectively no limit to divorce tourism”.

Court of Appeal

However, last week the Court of Appeal reversed that decision and granted Natalia permission to bring her case in the High Court in London. Lady Justice Eleanor King in her ruling last week noted that the 1984 Act was not just designed for families with “massive or even substantial wealth” to bring cases. She went on to say “No doubt to most people, whether affluent or poor, the sums received by the wife made her a rich woman. Everything is, however, relative. The wife’s settlement represents only a tiny proportion of the vast wealth of this family, all of which has been accumulated during this very long marriage”.

It is not yet known if Vladimir Potanina will appeal this decision to the Supreme Court. Also, if the High Court does adjudicate on their divorce settlement, we do not yet know how generous they will be. However, this case does highlight the fact that those who receive divorce settlements abroad can potentially have a second bite at the cherry and try to obtain a second divorce settlement in England if they have links here.  Furthermore, now that we are no longer part of the EU this claim is also now potentially available to EU nationals.

Enforcing English divorce orders against assets in other countries

It is, however, worth noting that obtaining a second divorce settlement in England can be a pyrrhic victory if the majority of the husband’s assets are outside of the UK. Enforcing English divorce orders against assets in other countries can be extremely difficult. Despite this, I am sure that there are many wealthy ex-wives around the world watching very closely what happens in the Potanina case.

 

If you are affected by any of the issued raised here, please get in touch today. We are here to help.

The Bill and Melinda Gates’ divorce

Bill and Melinda Gates divorce

The Bill and Melinda Gates’ divorce

Our managing partner, Amanda McAlister, offers her expert opinion on the news that Bill and Melinda Gates are to divorce, and looks at some of the issues involved.

I woke this morning to the news that Bill and Melinda Gates were to get divorced. Minutes later my phone starting ringing, as I took one request after another from journalists wanting to cover the story and get my opinion on what a later-in-life divorce involves. It’s no exaggeration to say that almost every media outlet around the world is keen to look closer into why this multi-billionaire couple would want to part after 27 years of a seemingly very successful marriage.

Gates, 65, the fourth richest man in the world, founded Microsoft in 1975 and met his future wife Melinda in 1987, the year he became the world’s youngest billionaire. In 2000 they established the Bill and Melinda Gates Foundation. 

They have three children – Jennifer, 25, Rory, 21, and Phoebe, 18 – and in the message announcing their divorce, they wrote:

“After a great deal of thought and a lot of work, we have made the decision to end our marriage.

“Over the last 27 years, we have raised three incredible children and built a foundation that works all over the world to enable all people to lead healthy, productive lives. We continue to share a belief in that mission and will continue to work together at the foundation, but we no longer believe we can grow together as a couple in this next phase of our lives. We ask for space and privacy for our family as we begin to navigate this new life.”

Prenups and separation agreements

Court documents reveal that the couple do not have a prenuptial agreement. We’re told Melinda, 56, filed for divorce at a court in Washington state, saying “this marriage is irretrievably broken” when asked to explain the split, also revealing there was no prenuptial agreement when they wed on a Hawaiian golf course in 1994.

However, famously Bill used a pro and con list on a whiteboard to decide to whether or not to ask Melinda to marry him, so I suspect the couple may well have approached the ending of their marriage in the same carefully thought-out manner.

Indeed, the document, filed Monday in King County Superior Court in Seattle, notes that the pair has a “separation agreement.” A separation agreement is usually signed at the end of a marriage and lays out the terms of the split – it will, apparently, dictate how the couple will divide up their assets, which include the family home, a $125million compound overlooking Lake Washington on the outskirts of Seattle, a mansion in San Diego, a Santa Fe ranch, a countryside retreat in Wellington, Florida, a lakeside lodge in Wyoming which used to be home to Buffalo Bill and a garage full of Porsches, Ferraris and Lamborghinis. In fact, the Gates fortune is estimated at well over $100 billion, so I’m not surprised Melinda has not requested spousal support, according to the filing.

Divorcing after a long marriage

It’s interesting to note that there has been a significant increase in the number of couples filing for divorce who have been married for more than 20 years. I think it’s significant that the Gates’ youngest child recently turned 18: it’s reasonable to assume the couple wanted to wait for all their children to reach adulthood before they announced their formal separation, and I would also say it takes guts to do this after such a long marriage – perhaps even more so when your relationship, and your life, is so public.

How would this divorce be treated here?

Technically, separation agreements aren’t legally enforceable under UK law. But if both parties have been open and honest about their finances and taken independent legal advice about the agreement, then it’s entirely likely the court will decide you should stick to it.

However, under our jurisdiction there is also what’s known as the “millionaire defence”. This is a term created following the case of Thyssen-Bornemisza v Thyssen-Bornemisza (No) [1985] FLR 1069 where a wealthy party put forward a defence to providing full disclosure, on the basis that he had sufficient wealth to pay a lump sum or maintenance to the financially dependent party. In other words, why should the court go to the trouble, time and expense of investigating the millionaire’s means, when it is clear that he/she can meet whatever reasonable order the court is likely to make?

This defence causes some controversy as the court has an obligation to consider the parties’ financial resources properly. Furthermore, in order for the court to conclude that an order is fair and reasonable, it must consider the full and frank disclosure of all material facts, documents and other material. Nevertheless, it remains a viable option for the very wealthy, who are hopeful of keeping the precise details of their finances entirely private.

Keep it respectful

When Amazon founder Jeff Bezos and his wife MacKenzie announced their split after 25 years of marriage, they emphasised that the decision was mutual. But even when a couple part on amicable terms, the financial untangling is likely to be complex, simply because the sums involved, and the assets held, are so huge. However, neither party has said anything derogatory in public about the other, and both have moved on: MacKenzie married again two years after the divorce, her ex-husband Jeff has been with his girlfriend for two years.

I hope Bill and Melinda Gates both go forward in positivity and enjoy a fulfilling and happy future, and in particular I applaud their decision to continue to work together on their charitable foundation – showing respect for one’s ex is vital if they are to be a couple who, instead of being known for how wrong they got their divorce, are known for getting it right.

 

If you would like to consult one of our expert family lawyers about any aspect of divorce or separation, please do get in touch today. We are here to help you. 

More love and marriage…

Sarah Jessica Parker

More love and marriage…

We had such a great response to our recent Love and Marriage blog that we thought we’d add some more quotes to our special selection of celebrity words of wisdom about love, relationships and marriage.

Because there’s no doubt that on this topic everyone has their own opinion: some have their own personal deal-breakers, some know for certain the one thing that will melt their heart – and a lot of people will tell you it takes hard work and commitment.

See if you agree!

Katharine-Hepburn

“I often wonder whether men and women really suit each other. Perhaps they should live next door and just visit now and then.” Katharine Hepburn

 

Albert Einstein

“Men marry women with the hope they will never change. Women marry men with the hope they will change. Invariably, they are both disappointed.” Albert Einstein

 

Justin Timberlake and Jessica Biel

“We have a couple of rules in our relationship. The first rule is that I make her feel like she’s getting everything. The second rule is that I actually do let her have her way in everything. And, so far, it’s working.” Justin Timberlake

 

Anne Bancroft

“The best way to get most husbands to do something is to suggest that perhaps they’re too old to do it.” Anne Bancroft

 

Prince Philip and Queen Elizabeth,

“I think the main lesson we have learnt is that tolerance is the one essential ingredient in any happy marriage.” Prince Philip, Duke of Edinburgh

 

Rita Rudner

“I think men who have a pierced ear are better prepared for marriage. They’ve experienced pain, and bought jewellery.” Rita Rudner

 

Sarah Jessica Parker

 

“It seems so silly, but I think you’re very lucky if you like the person. I still just really like him.” Sarah Jessica Parker

10 top tips for business owners facing divorce

top 10 tips for divorcing business people

10 top tips for business owners facing divorce

Divorce is never easy, but it can be more complicated when you’re a business owner. Partner Fiona Wood, who is particularly accomplished at dealing with divorce cases where there are substantial and complex assets, offers her advice.

1 Don’t panic! The divorce process is NOT designed to damage a business so that it is no longer viable. The income produced by the business will often be the business owner’s main source of income both before and after divorce. This income may also need to fund child maintenance payments and sometimes spousal maintenance payments after a divorce, so damaging the business would be counter- productive.

2 Your business, along with your and your spouse’s other assets, will be considered a relevant asset within the divorce proceedings. You will need to provide information relating to the business, even if you are not the sole owner. If there are other business owners you should inform them of your divorce, if you have not already done so.

3 Your business is likely to be valued by an independent accountant, instructed jointly by you and your spouse, within the divorce. They will look at the value of your shares, how much money, if any, you can raise through the business to assist with the divorce settlement and the sustainable income that can be taken from the company going forward.

4 It is the net value of your shareholding that will be taken into account, after notional costs of sale and tax have been deducted. Whilst you may not be selling your shareholding, your shares will be valued on the basis that you are selling them.

5 Valuing a business is an art not a science, so different accountants have different approaches, which results in some accountants providing more optimistic valuations than others. It is therefore important to take advice on which accountants would be most suitable for your situation.

6 If your spouse also has shares in the company, it is unlikely that you will both remain shareholders in the company after your divorce. A few divorcing couples agree to continue running their business together and to both remain shareholders after they divorce. However, in the majority of divorces one spouse transfers their shares to the other as part of the divorce settlement.

7 The date of separation may be relevant if one spouse is to transfer their shares in the company to the other. If shares are transferred from one spouse to another in the tax year of separation, the Capital Gains Tax liability that arises on the transfer is paid by the spouse who receives the shares as and when they sell the shares in the future. If the shares are transferred from one spouse to another after the tax year of separation, the spouse who is transferring the shares will have to pay any Capital Gains Tax liability that arises on the transfer shortly after the transfer.

8 Do not be tempted to transfer your shares in the company to a third party, in an attempt to reduce your spouse’s claims on divorce. Any disposals of assets that are at an undervalue can be set aside by a divorce judge, and if the disposal took place within the 3 years prior to the divorce the onus is on the spouse who “got rid” of the asset to prove that it was not at an undervalue.

9 Just because you have a business does not mean that your divorce settlement will end up being argued about in court. Once you have an appropriate valuation report a financial agreement can then be negotiated, without the need for a judge’s input.

10 Make sure that you obtain legal advice from an expert family solicitor who regularly deals with divorce cases where there are businesses.

If you are concerned about any of the issued raised here, please get in touch today. We are here to help.

Robert De Niro’s paying…

De Niro

Robert De Niro’s paying…

Robert De Niro and Grace Hightower are engaged in a tortuous divorce battle; recently the couple clashed in a virtual hearing over Ms Hightower’s spending habits. Partner Liz Cowell takes a closer look at the issues involved in the split.

The facts

Robert De Niro was married to his wife Grace Hightower in 1997.  Their relationship would be classified as a long marriage in our jurisdiction; this is despite the fact that they separated in 1999 and started divorce proceedings, because the divorce never went through, and they renewed their vows in 2004.

When the couple renewed those vows, they also entered into some sort of nuptial agreement.

The agreement would provide Ms Hightower with a $4.7m house and a further lump sum equivalent to approximately half a million dollars, plus an income of $1m per annum, providing that De Niro was earning at least $15m a year.

Now that the couple have separated again and divorced in 2018, Ms Hightower is seeking 50% of De Niro’s total wealth, which she estimates to be $500m.

Defending his position, De Niro claims that his ex-wife is a spendthrift and he has been forced to continue acting and taking part in films which he describes as “dreadful” to maintain the parties’ lifestyles.  He also claims that he has substantial indebtedness for unpaid taxes which he intends to pay off using the income earned from his next two films.

The matter has reached a preliminary stage in which the judge has pointed out to both parties that their expenses are extraordinary, which is an early indication that Ms Hightower’s demands to maintain her lifestyle spending circa $375,000.00 per month is unlikely to be supported by the court.

What would happen here?

Would Ms Hightower be bound by the nuptial settlement entered into when the parties renewed their vows?

In this jurisdiction there have been a series of decisions by the High Court that where the parties have given full disclosure of their financial position and have had proper legal advice, whilst not binding the court such an agreement will be used as evidence and will influence how the court approaches its duty of fairness.

From the information available in the media, it appears that Ms Hightower is now protesting that she was misled as to the extend of her husband’s wealth at the time of the agreement.  Given her status and financial acumen, such protestations would be easily rebutted if she was given full legal advice at the time, particularly as she had already been living with De Niro for several years and was unlikely at that stage to be ignorant of her husband’s earnings and wealth.

The matter of the extent to which the nuptial settlement should be considered would probably be dealt with at a preliminary hearing.

Division of assets

That said, after a long marriage the starting point for the division of assets is 50/50, taking into account pre-acquired wealth and after the deduction of each parties’ debts, which means that any financial settlement would be derived from the amount De Niro would have after his tax bills were paid.

It seems that De Niro’s legal team are complaining that he is being ordered to provide disclosure – however, in our jurisdiction disclosure is mandatory for all parties going back at least 12 months, and he would be required to provide the same, as would Ms Hightower.  Ms Hightower has been accused of hiding the purchase of expensive jewellery: this would have to be disclosed and valued.

Allegations

Sadly, it would seem that unpleasant allegations are being made about Ms Hightower who is accused of being a spendthrift, one who had started life as a waitress from a poor background.  It is implied that she married De Niro simply for his earning capacity.

Would this be relevant in our jurisdiction?

The answer to allegations about Ms Hightower’s background is that it would be utterly irrelevant, albeit the court would look at Mr De Niro’s pre-acquired wealth as well.

The allegations regarding her spending habits are relevant however; not because she is a spendthrift, but because the court needs to look at the parties’ resources, status quo and what are her reasonable needs.

Our courts would be minded of the fact that Mr De Niro is already 77 years old and cannot be expected to continue working indefinitely.

A challenge for the court brokering a financial settlement between the parties either here, or in the United States, is to try and achieve fairness and that is done here in England by applying a yardstick of equality. It is also mandatory upon the courts in England to achieve a fair, clean break where possible, and this can be done by dividing capital and working out how much income would be available from the capital to meet needs and if there was a shortfall, adding a further capital sum.

The court would be using the facts available to look at the nuptial settlement and maybe capitalise the maintenance payable, but given Mr De Niro’s age it is unlikely he would be expected to continue working for more than two or three years.

If Mr De Niro was before the English courts he would need to be more generous if he wanted settle matters, and he would be encouraged to stop making allegations about his wife, who is the mother of his child and to whom he has been married for more than 20 years. At the same time, Ms Hightower clearly needs to curtail her spending and put forward a reasonable proposal for settlement.

 

If you are are considering separation or divorce and require specialist legal advice, please get in touch today.  We are here to help you.

Variation applications – what do you need to know?

variation order

Variation applications – what do you need to know?

Covid-19 has had an impact on most people’s financial position and for many, the impact has not been positive. When times get tough, people start to audit their finances. Can we afford to keep the subscription to the magazine that usually goes unread, the direct debit to a streaming service that we don’t even remember the password for, or – more significantly- a spousal maintenance standing order? Conversely, we also look at our monthly income and wonder if there is a way we can eke out a little more. Can we up our hours at work, sell some clothes online, or other money-saving measures?

In these times of continuing economic upheaval, it is to be expected that variation applications are on the rise.  Solicitor Heather Lucy explains.

What can the court do?

The court has the power to increase, decrease, suspend, terminate, extend (in certain circumstances), or capitalise the spousal maintenance payments. Capitalising payments simply means that a lump sum is calculated based on the term and quantum of the order, which is then paid and the ongoing obligation ends. This is good for the payee as they have the certainty of having the cash in their bank account and also good for the payer as they do not need to look over their shoulder with regard to a potential application for an upward variation of maintenance if they get a promotion, for example. The issue with capitalisation, however, is usually affordability.

The key thing to remember with spousal maintenance is that it is based on the needs, as agreed or determined by the court, of the parties. It is by showing that those needs, or your ability to meet your own needs, have changed that may give rise to a variation of spousal maintenance.

How do I do it?

The first port of call should be to speak to your ex-partner. Explain the situation to them and see if you can come to an agreement. You can invite them to come to mediation with you to see if the input of a neutral third party assists. If you do not seem to be making progress, you can instruct a solicitor to put the request to them more formally and see if you can come to a resolution outside of the court arena.

If it does not work, you will need to consider making an application to the court. It is crucial to understand the potential cost implications before applying. The usual family law rules, where parties meet their own costs save for exceptional circumstances, are suspended in variation applications. The successful party (be that the party applying for or defending the application) may claim their costs from the unsuccessful party. For this reason, it is sensible to reach an agreement without issuing proceedings wherever possible.

What happens in the court proceedings?

If you have a spousal maintenance order in place, there is a good chance that you have been through court proceedings or negotiations via solicitors. This means that the process of financial disclosure will be familiar to you. The courts need to know about each party’s assets, liabilities, income, and outgoings before they can make a decision. The first step, therefore, is financial disclosure which is usually done by way of Form E1. The court will then be in a position to decide whether it would be fair to vary the original order.

What do the courts consider?

The court’s primary consideration will be the welfare of any children. It has a broad discretion in terms of the orders it can make, as set out above, but they will need to focus on any changes in circumstance since the original order was made. This is important to consider as it will be very difficult to persuade the court to vary the order if nothing material has changed. This means you should be very specific about why you are asking the court to change the current order, for example, are you being paid £100 less a week and need your ex-partner to top up the order by that amount to meet your needs? Are you being paid £100 less a week and therefore need to reduce your spousal maintenance obligation?

The order may not be as straightforward as these two examples, but they are the kind of questions you need to ask yourself.

What’s the bottom line?

If your financial circumstances change, you may be able to vary a spousal maintenance order. Good communication is key and you should start by having a discussion with your ex-partner. This is crucial due to the potential cost implications of bringing an application to the court. Both parties will need to be aware of this and it can encourage negotiation.

It is difficult to provide broad-brush advice on variation as cases will turn on their specific facts. You may wish to take some advice from a solicitor before approaching your ex-partner directly or you might have reached a point where it is clear matters will not be resolved amicably; either way, McAlister Family Law’s team of expert lawyers can advise you.

If you are affected by any of the issues raised here, please get in touch today.  We are here to help you.

How can I enforce a Children Act Order?

how can I enforce a Children Act Order?

How can I enforce a Children Act Order?

“They’re ill.”

“You were late by five minutes.”

“They don’t want to see you.”

“It isn’t on this week, you have your dates wrong.”

Above are just a handful of reasons that a parent might hear as to why a Child Arrangements Order cannot be complied with. But is this right and does this ultimately trump a court order? Associate Melissa Jones explains.

How can you enforce a Children Act Order? If you have been involved in Children Act Proceedings and obtained a final court order, there are consequences if a party breaches an order, as follows:

(a) They may be held in contempt of court and be committed to prison or fined; and/or

(b) The court may make an order requiring them to undertake unpaid work (an enforcement order) and/or an order that they pay financial compensation.

How does this really work in practice?

Essentially, the court makes the order and expects parents to ensure it works on the ground. There may be times though when a child is ill, or there is an emergency, for example , which might mean that the child arrangements cannot go ahead on occasion. However, this should not happen repeatedly and if it does then unless the other parent has “reasonable excuse” for not allowing the contact, then they would appear to be in breach of the order.

What is the enforcement court process?

There  is still an expectation that you take steps to resolve matters before applying to the court. As you may have heard before, the court is a last resort. It is best practice, before an application is made, to address the issue with the other party and inform them of the implications of not doing so.   If the matter is not resolved, then you may have little choice but to apply to the court for enforcement.

What happens when I make my application?

You can make an application to enforce the order if you feel that it has  not been complied with. At the first hearing the court can be asked to consider the facts of the alleged breach and, in some cases, if these breaches are not agreed, list a hearing to determine those facts. The court can also decide, if after listening to the reason(s) for non-compliance, if CAFCASS or Social Services need to get involved.

The court process usually follows the same process as your last case (the one where you obtained your final order), that is:

* First Hearing Dispute Resolution Appointment (FHDRA)- the purpose of the hearing is to try and agree matters as much as possible

* Review hearing- this will be listed if matters cannot be resolved at the first hearing and the non-compliance issue remains live. It might have been that a report was ordered at the FHDRA for CAFCASS or Social Services to complete, for review at this hearing

* Final hearing- where the court will make an order after listening to evidence from the parties

The bottom line in these types of cases is, that there is an order in force, and it should be adhered to. If a parent is not able to comply with an order, they are able to make an application to ‘vary’ the order to ensure that they do not indirectly continue to breach an order.

If the court finds that a party has not complied with the order it can take a number of steps as detailed above, but one of lesser known options, and quite a rarity, is to order a transfer of residence, with the child going to live with the other parent. The latter happened in the following case: Re C (A Child) [2018] EWHC 557 (Fam)

Given the implications of not adhering to an order and the court’s robust approach, it is best to get advice as early as possible.

If you are affected by any of the issues raised here, please get in touch today.  We are here to help you.

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