Financial support laws getting a long-awaited overhaul?
The UK government has said that it intends to review current financial support laws in divorce in England and Wales. The government is set to commission a review of the current laws that govern financial support in divorce proceedings – updating legislation that has been in place for over 50 years. The Matrimonial Causes Act 1973 has been subject to criticism in recent years, and is seen as out of date, forcing many couples into litigation to decide on what happens to the family finances.
Lord Christopher Bellamy, justice minister, announced plans to ask the Law Commission to look at whether the act needs updating, saying that the government is in close consultation with the Law Commission, who are best placed to establish what the existing law and practice is and where the problems lie.
This could be very good news for divorcing couples – and also for the majority of family law practitioners, who are working with financial support laws that are hopelessly outdated. According to Baroness Fiona Shackleton, who has represented clients including King Charles and Paul McCartney, “Divorce practitioners like me make a fortune in arguing, because the guidelines are 50 years out of date.” Most people would agree that society has changed a lot since the legislation was first introduced back in 1973, when the vast majority of women didn’t work after they’d had children and divorce wasn’t common.
England’s financial support laws can favour rich ex-wives
The English legal system also tends to divide divorcing spouses’ joint wealth equally even if only one partner is the breadwinner, which has led to London courts becoming popular with wealthy couples due to their generosity towards ex-wives in financial awards.
It’s also true that the current rules are open to interpretation, a fact that leads to a common complaint from lawyers that if the same couple put the same set of facts in front of five different judges, they would quite likely end up with five different decisions!
What about a prenup?
There is always the option of a prenuptial agreement, which can go some way towards making things clearer, but prenups aren’t yet binding according to English and Welsh law and can be overruled by a judge if they are deemed to be unfair or if the parties’ circumstances have changed since the agreement was made.
Having said that, the chances of parties being held to what they agreed before they married has improved since the case of Radmacher v Granatino in 2010. In this case, the court found that fairly contracted prenuptial agreements had decisive weight in English divorce law, where previously they were seen as disadvantaging women because historically, women weren’t seen to be able to bargain on equal terms.
Most couples who got married before 2010 won’t have a prenuptial agreement, and the current financial support laws make it difficult for family law practitioners to give advice about what could happen in a financial dispute, so it would be good if a new, updated approach to sharing family assets could be put in place. Legislation that recognises the contributions of both parties and gives them some certainty about what the outcome might be of any financial dispute would be welcome as well as some clarity around how to fairly agree the amount and type of maintenance payments, who should pay them and for how long. We eagerly await further developments.