Thursday, August 03, 2006
Divorce - Consent Order
WHAT IS A CONSENT ORDER?
A Consent Order is the legal document by which financial matters are finalised on divorce. Without this, you are vulnerable to your partner making a financial claim years later.
A Consent Order is like the contraceptive pill, it is 99.9% reliable. It can only be overturned if there has been fraud or mistake or an "intervening event". To qualify as an intervening event the event must be :
1. Soon after the Consent Order has been sealed by the Court (normally within 12 months).
2. Not contemplated and considered at the time of divorce.
3. Sufficiently large to undermine the terms of the Consent Order. That is, if the event had been known about at the drafting stage of the Consent Order then the terms of the Consent Order would have been altered.
1. The Application to set aside must be made promptly.
2. There must be no disadvantage to third parties, who have acquired the relevant property in good faith and for valuable consideration.
WHAT IS INCLUDED IN A CONSENT ORDER
The Consent Order will deal with all the financial aspects which the Court has jurisdiction over.
1. The Former Matrimonial Home.
Will it be sold or retained by one of the parties? If it is retained by one spouse (normally the parent with care of the children, will the other party have a charge over the property? Will the owner indemnify the other spouse on the mortgage?).
2. Other Assets.
How will they be distributed?
Shares, property, family business, share options, endowment insurance policies etc,etc.
All assets of the marriage will be dealt with.
3. Personal Property and Furniture.
Each party normally retains their own goods (unless needs dictate that valuable goods should be sold or transferred to the other spouse).
There is a standard clause which states that the goods are retained by the person in whose possession they are in at the time of the Consent Order, and couples should be encouraged to agree direct the division of their CD collection etc, as it is disproportionate cost wise to involve solicitors. This can be a source of amusement for your friends years later. One of my friends refused to hand over her ex husband's mountain bike and another had huge debates over an ashtray collection (they were nice ashtrays, from The Ritz, Annabels etc).
4. Pension Sharing.
Pension sharing, or offsetting the pension against other assets maybe appropriate if there is sufficient pension provision accumulated during the course of the marriage.
5. Periodic Payments, Maintenance.
Maintenance from one party to the other. If so for how long, two years? Until retirement? Until death or remarriage of the receiving spouse?
The Courts must always consider the option of a clean break and encourage the parties to be independent financially, but they will not order this if one party cannot afford to do so. If there are young children of the marriage the courts will normally make a nominal maintenance order for the parent with care of the children rather than a clean break.
6. Child Maintenance.
Normally the Child Support Agency has jurisdiction for Child Maintenance (see previous post Children - Maintenance 14th July 2006). However, the Courts can make an Order for Child Maintenance, but either party can apply to the CSA for an Assessment after 12 months. The Government is seriously considering removing this facility because the CSA cannot cope with its workload, this should be kept in mind if you consider the option to revert to the CSA, or its replacement, in years to come useful. If so, do not include Child Support within your Consent Order.
7. Private Health Care, Insurance Cover Premiums, School Fees.
It is best to list all expenses, especially if one party receives benefits via his/her employment.
8. No claims bonus on car.
Often, the wife is younger than the husband, the husband has a car when the parties marry, then gets a company car, and the wife then drives on the husband's insurance for 20 years. It is important to get this transferred at the time of divorce as insurance companies may refuse to do so later. Plus, once the divorce is finalised, your ex husband may refuse to transfer the no claims bonus, despite it having been accumulated via your careful driving!
Who will take on the responsibility of any debts of the marriage? If they are joint, will the paying party indemnify their ex spouse?
10. Neither party to have any claim on the other's estate when their ex-spouse dies.
Who keeps them?
Each Consent Order is individual and it is essential to obtain legal advice relevant to your personal circumstances. It is also important to ensure that the document is properly drafted and you understand what you are agreeing to. For example, what are the implications of a nominal maintenance order? What happens if my ex spouse cohabits? The Consent Order says we each keep our personal possessions but my ex wife won't give me my bike back!!!!!!!!!!!!!!