Three’s a crowd – The financial implications of being in a throuple

Posted on 30th March 2023 by McAlister Family Law

Three’s a crowd – The financial implications of being in a throuple

There has been a recent celebrity trend for being in a throuple, with familiar names such as David Haye, Brooklyn Beckham, and Selena Gomez all partaking in the trend. Here, Lisa Brown looks at what it means to be in a throuple and what it means from a financial perspective.

So, what is a throuple?

A throuple is, put simply, a romantic relationship between three people. It can take various forms. Each party may be equally involved or there may be a primary relationship between two of them.

What does it mean legally?

Polyamourous relationships are not recognised legally in the England and Wales. You can only marry or enter into a civil partnership with one person at a time. If you were to marry more than one person outside of the England and Wales, then this would be considered void and can be annulled.

This means that in the eyes of the law, a throuple either lives as cohabiting partners, or two members of the throuple are married or in a civil partnership in a more formal legal relationship compared to the third party of the throuple.

What is the difference from a financial perspective?

Cohabiting couples in England and Wales do not currently have any special protection or rights against each other. Despite popular belief there is no such thing as a “common law marriage” and this remains the case no matter how long the relationship lasts.

What this means is that somebody could be in a 20-year relationship with an extremely wealthy person (or persons) and still exit with nothing.

The starting point for a cohabiting relationship is that you each simply retain what is legally in your name when the relationship ends.

Whilst exiting with what you brought in might seem fair for Una Healey when leaving a relatively short relationship with David Haye and Sian Osbourne, it does very much depend on the circumstances.

With marriage and civil partnerships not an option for all three people at the same time, the only other option for them to consider would be a cohabitation agreement to set out the intention should the relationship/s break down. Cohabitation agreements can be very useful tools although they are not 100% legally binding.

What if two people in the couple get married or enter into a civil partnership?

Should two parties of the throuple decide to legally marry or enter a civil partnership, it would significantly alter the legal relationship between those two individuals, and they would each have potential financial claims against the other for property to be transferred, lump sums to be paid, pensions to be shared and spousal maintenance.

Within a throuple this would mean that the person not in the marriage is in a significantly different position to the other two. This could be a big disadvantage but, in certain circumstances, it may also be an advantage. For example, if the member not in the marriage were significantly wealthier than the other two, they may not want to be exposed to the potential claims that being married brings.

What about children?

Where there are children in a relationship there is also a possibility of one parent making a financial claim on their behalf against the other parent under Schedule 1 of the Children Act 1989.

These types of claims are limited to needs of the child and can include provision of a home (usually until child is 18 or 21), lump sums to meet specific needs and maintenance.

Whether a claim under Schedule 1 is worth making will be dependent on the circumstances including the financial resources of the parents and the care arrangements for the child or children.

If you or somebody you know wants to understand their legal position better whether they are in a couple, throuple, cohabiting, thinking about cohabiting, engaged or married they should contact one of our specialist family lawyers today.

If you need advice on this topic, or any other matters concerning divorce or family law, please get in touch with our team at McAlister Family Law.

Do people go into marriage with their eyes wide open?

Posted on 9th March 2023 by McAlister Family Law

Do people go into marriage with their eyes wide open?

When people get married, it’s a whirlwind of romance, excitement and planning the big day. The average modern wedding takes about 11 months to plan, over 528 hours (22 whole days). But how much do the to-be-weds understand about the legal and financial implications of marriage? Here, Frances Bentley looks at how couples can go into marriage with their eyes wide open.

Being in the process of planning my own wedding, I can certainly believe the amount of time that goes into it. It is hard not to get swept up in planning the actual wedding day, and sometimes there is a much lesser focus on what marriage actually means after the big day.

As a divorce lawyer, when clients come to me, they say that they did not understand or appreciate the legal and financial implications of marriage when going into it. It begs the question as to whether there should be more education about it before people get married.

It might seem obvious that marriage means a sharing of each other’s lives, hopefully forever, so maybe it isn’t needed. However, if things don’t work out, a lot of people don’t often understand what would actually happen to their finances on divorce. Maybe it isn’t the most romantic thing to think or talk about before you get married, but actually understanding and knowing the implications might mean that people are going into marriage with their eyes open.

I think it is really healthy to have that conversation and so people know where they stand. In my view, it doesn’t undermine the fact that the plan is to stay together forever, and of course that is what the aim is. I actually think it is a bit of a red flag if your future spouse reacts badly to that conversation.

So how can you protect yourself financially if you are getting married?

One way that couples that are to be married can protect their financial position in the event of a future separation is to enter into a pre-nuptial agreement (or a post nuptial agreement if they are already married).

Nuptial agreements can detail what is going to happen with finances in the event of future divorce and whether, for example, one person’s inheritance, or assets brought into the marriage are to be “ringfenced” from any future division of assets on divorce. It allows both people entering into the marriage with knowledge of the other’s financial position and some clarity.

Whilst nuptial agreements are not technically legally binding in England and Wales, they are being upheld much more by the courts and are persuasive, as long as they have been entered into procedurally correctly, both parties have taken legal advice, and are considered to be “fair” to both parties. They can also be reviewed throughout the marriage to take into account any changes in circumstances and ensure that they remain to be “fair”.

On a divorce, the starting point legally or finances is a 50/50 division of all assets. The court would then look at whether or not that is fair, and whether there should be a departure from that starting point, taking into account a number of factors. The factors include what the parties or any children “need” financially, what contributions have been made prior to, during and after the marriage, the standard of living enjoyed amongst other factors, one being whether there has been any pre-nuptial agreement entered into and whether that should be upheld.

The court will look at what is fair and reasonable, in all of the circumstances of the case, and if, the pre-nuptial agreement remains to be fair and reasonable, it is very likely to be upheld and assets brought into the marriage are likely to be protected. It does therefore offer protection and clarity and an understanding of the other person’s financial position before the marriage.

If you need advice on this topic, or any other matters concerning divorce or family law, please get in touch with our team at McAlister Family Law.

What will I stand to get out of the matrimonial assets?

Posted on 15th December 2022 by McAlister Family Law

What will I stand to get out of the matrimonial assets?

With the United Kingdom on the cusp of a cost-of-living crisis and inflation at record highs, divorcing couples will likely face concerns now more than ever as to how finances are to be treated upon divorce. The biggest question on the minds of divorcing couples is often, ‘what will I stand to get out of the matrimonial assets?’ Here, Aaron Williams looks at what the court considers when looking at how to divide assets on divorce and how they aim to meet the ‘needs’ of each party involved.

So, what does the Court consider when looking at how to divide assets on divorce?

As with many things, there is no one size fits all answer to separating matrimonial assets. The principal aim of the court is to ensure that there is ‘fairness’. Unfortunately, fairness has a broad horizon in the context of family law, and it is largely left to the discretion of the judge as to the outcome of the matter.

The court has a duty to consider all circumstances of a case, this is done so using the principal piece of legislation in divorce; that of the Matrimonial Causes Act 1973, in particular the factors listed in section 25(2)(a) – (h) which can be found here: – https://www.legislation.gov.uk/ukpga/1973/18/section/25

The phrase ‘needs trumps all’ is often cited when assets are limited assets in matrimonial finance cases. The starting point in any matrimonial finance case is to consider an equal division of what has been built up by the parties during the marriage; however, an equal division of assets is not always appropriate in every case to achieve fairness.

So where does that leave separating couples? Well matters largely come down to the circumstances of the parties, the standard of living and the resources available to meet needs. What was enough to meet the needs of one household may not necessarily be enough to meet two.

When settling the matrimonial assets, there is no discrimination between separating couples regarding their respective roles in the relationship. For example, where one party has typically taken the breadwinner role, whilst the other party is the home maker, their roles are to be regarded as equal irrespective of what they have contributed financially.

So, how does the court implement section 25 of the matrimonial causes act?

When assessing how to separate who should have what proportion of the assets of the marriage, the first consideration of the court is that of the needs of any children.

The court then look to meeting the needs of both parties, principally looking to ensure that each person’s housing needs, and income needs are met.

Looking at the matter holistically the court will principally consider the financial needs, obligations, and responsibilities which each of the parties to the marriage have or is likely to have in the foreseeable future (s.25(2)(b) MCA 1973). The court will look at the general resources of the parties and will broadly separate the needs of parties into capital needs and income needs. Capital needs, is often that of significant single capital outlays, purchasing a property, furnishings, replacement car etc. Income needs is that of the day-to-day costs that parties require on a monthly basis to live.

When trying to determine whether the parties have the means to meet these needs, the court will consider 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. Commonly referred to as the financial disclosure process, the parties are expected to provide ‘full and frank’ financial disclosure. This includes determining through the assistance of expert evidence or agreeing by consent, the value of any assets owned by the parties, including property, businesses, trust assets, chattels, and pensions. The court will also need to ascertain the parties’ respective incomes, whether they have to capacity to increase their income, receive a bonus etc. The process ultimately aims to ensure that no stone is left unturned.

With all this in consideration the court has a great deal of flexibility to in their approach to financial settlement, which in turn allows the court to ensure (as far as possible) that an outcome reached is fair to both parties, and that neither party nor dependent children are left in need. However, this level of flexibility also carries its own disadvantages as it can be difficult for parties to envisage how a judge may determine the respective parties’ needs.

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

After we’ve divorced, who gets the dog?

Posted on 30th November 2022 by McAlister Family Law

After we’ve divorced, who gets the dog?

From puppies to parakeets, cats to chameleons and everything in between; we are a nation of animal lovers and often the family pet is a valued and beloved member of that family. But what happens to your pets after divorce? Here, Brigid O’Malley looks at PetNups and what the court could decide.

PDSA’s 2022 findings show that 52% of UK adults own a pet. There is an estimated population of 10.2 million pet dogs and 11.1 million pet cats[1] in the UK! So, what happens when your relationship or marriage breaks down… who gets the dog?

Despite millions of us owning pets and them likely being an extremely loved and important part of the family, a pet, in the eyes of the law in England and Wales, is treated in the same way as your jewellery, TV, car and sofas! They are personal belongings – “Chattels”.

This can be a really difficult issue to advise about as animals are a significant part of family life and today’s society. They are often adored by adults and children making disputes over their ownership a sensitive subject.

We can’t agree who keeps the pets – what do we do?

Like with other issues following your separation it is sensible to try and agree with your ex-partner who keeps specific items, pets included. This can, of course, be hard and at times confrontational, but at the end of the day if an agreement can be reached between you it will likely save you the stress, time and legal costs later down the line.

If you can’t agree between yourselves then you could attend mediation to engage in discussions with your ex-partner in a safe and controlled environment, with a qualified mediator to assist you.

Court proceedings are a last resort, but they remain an option. If an agreement cannot be reached it is possible to make a court application for financial remedy as part of your divorce. The Court will consider a set of factors (from s25 of the Matrimonial Causes Act 1973) to determine a fair division of matrimonial assets. The Court can be requested to determine ownership of pets within that but, in practice, this is rare unless the animal has a high monetary valuable such as a thoroughbred racehorse or a pedigree Crufts prize winning dog. Of course, if your pets are very valuable then their value may be considered in the asset pot for division.

The Court can order the transfer of ownership of a pet as part of the proceedings, even if they have no monetary value. The close bond between the parties, any children and their pet would be relevant if the Court was invited to determine the issue of ownership.

If you are not married, then it is likely the pet(s) will stay with whoever is the registered legal owner but it may be possible to make an application to determine ownership through the Small Claims Court – this would be a civil dispute rather than a family one.

When makings its decision, the Court is likely to consider factors such as who is the registered legal owner, who is named on the insurance policy, who is registered with the vet and who generally pays for the care of the animal. Courts in other countries are moving towards an approach where the animal’s welfare is at the heart of the decision making. The Courts in England & Wales may take this into account, but the best interest of the pet is not the primary factor here, the animal is treated as a chattel.

I’ve heard of a “PetNup” – Can I get one of those?

A “PetNup” is an agreement regarding the ownership of a pet and can detail who the pet will live with if the relationship breaks down. It can also cover things like who will pay the costs associated with the animal such as vets’ bills and insurance premiums. A PetNup is not legally binding in the Courts of England and Wales but its contents, if well drafted, carefully considered and entered into without duress could carry significant weight if there was a dispute later down the line.

It would be sensible to consider entering into a prenuptial agreement prior to marriage or a cohabitation agreement when you move in with someone to ensure the ownership of your pets has been discussed and agreed in the event of the relationship coming to an end. A prenuptial agreement or cohabitation agreement can also set out the arrangements for the family finances and child arrangements so it can be a really useful document.

If you are facing a dispute about your cherished pet and want some advice, then contact our team of family experts who can advise you further.

[1] https://www.pdsa.org.uk/what-we-do/pdsa-animal-wellbeing-report/uk-pet-populations-of-dogs-cats-and-rabbits#:~:text=Our%202022%20findings%20showed%20that,of%2010.2%20million%20pet%20dogs