A contentious issue for many parents is what school their child attends and it is unsurprising that upon divorce this can be one of the key issues. For parents with children at private school the issue of whether school fees should continue to be paid and, if so, by who is often a hotly contested issue, especially given the recent increase in school fees now VAT at 20% is payable from 1 January 2025. 

Often parents primary concern is ensuring stability for their child during the separation, and remaining at the same school is advantageous. The difficulty is you are trying to create two households now and the financial pressure on the family often increases. 

What did the budget say? 

Rachel Reeves confirmed in the budget on 30 October 2024 “the government will introduce 20% VAT on education and boarding services provided for a charge by private schools from 1 January 2025.” As a result, school fees will be even more expensive and disputes regarding the affordability of them likely to be on the rise. 

"VAT on Private School Fees: Key Considerations for Divorcing Parents" As divorcing parents navigate financial decisions, understanding the implications of VAT on private school fees is critical. This article explores how these costs may impact co-parenting arrangements, financial settlements, and children's education plans, offering practical guidance for families during challenging transitions.

How should I approach the payment of private school fees with my ex

If possible, it is always preferable for separated couples to agree a financial settlement themselves, either through negotiation (directly or with the assistance of solicitors) and/or mediation. This can be quicker and cheaper than going to court. If your child (or children) are old enough, you may wish to consider child-inclusive mediation. This would provide the children with the opportunity to attend mediation to express their own views on their schooling, and how any changes, either to fee- or nonfee-paying education, might affect them. Whilst their comments and views would not be binding on the parents following those discussions, it can be a powerful indicator to parents as to their children’s wishes and feelings in the context of the matter as a whole, which can sometimes crack the case one way or another.

If you are unable to reach an agreement you may wish to explore other out of court options, such as arbitration. Failing this the court has the power to make orders in respect of school fees. 

Can school fees be considered in a divorce financial settlement? 

Continuity in schooling is important for children, especially if they are in key exam years, and a court is likely to accept that. However, they are considered in the realm of the overall financial landscape and if they cannot be afforded the court may not grant a school fees order. 

The courts will consider all the factors under section 25 of the Matrimonial Causes Act 1973 when deciding the outcome in a financial remedy application. This includes the resource available to both parties (including capital and income) and the needs of each party, including any dependent children. Each case will considered on its own facts and whether or not private school fees can be considered a “need” will be considered in the realm of all the circumstances of your case. If there are sufficient financial resources available the court will consider how your child is currently or was expected to be educated in making a decision. 

A school fees order can be made as part of the wider financial settlement. A school fees order should cover who pays the school fees, how they will be paid (from capital or income) and how long they should be paid. You should also consider “extras” to school fees including uniform, activities etc. and who should be responsible for paying these.  

"VAT on Private School Fees: Key Considerations for Divorcing Parents" As divorcing parents navigate financial decisions, understanding the implications of VAT on private school fees is critical. This article explores how these costs may impact co-parenting arrangements, financial settlements, and children's education plans, offering practical guidance for families during challenging transitions.

For parents who already have a final financial order that includes payment of school fees, the imposition of VAT on private school fees could lead to them no longer being affordable. Time will tell if disputes over payment of private school fees will end up before the court, both in circumstances where parents are trying to reach an agreement on divorce now and also where a final order has already been made. 

If you require advice on paying school fees following a divorce, please do not hesitate to contact us.

Speaking exclusively to the Mirror about the likelihood of the footballer’s childhood sweetheart walking away with £13.5m, Kelly Edwards, managing partner of Edwards Family Law, said: “It’s very likely – the starting point in English law is that you share equally what has been made during the marriage, this includes cohabitation and so the fact they were childhood sweethearts (and presumably living together for quite a significant period) means she is entitled to share in those assets.”

Read the full article Here

Divorce can be a turbulent and highly emotive process for anyone, and it is especially so when dealing with a partner who exhibits narcissistic patterns of behaviour. The term “narcissist” is commonly used in society but what does it really mean. There is a saying that all psychopaths are narcissists but not all narcissists are psychopaths.  For anyone who has been in a relationship with a narcissist and is attempting to divorce them, this fact may seem a small mercy.  Unfortunately, many successful people have significant narcissistic traits, therefore, we often deal with spouses in high-net-worth (HNW) and international divorces who are trying to escape a narcissist.

The term narcissist is used a great deal these days.  However, someone with Narcissistic Personality Disorder (NPD) is very different from a person who enjoys posting selfies.  Often charming and personable in public (including the courtroom), someone with NPD can be controlling, superficial, manipulative, and downright dangerous.  Although the UK family law system is geared towards encouraging couples to work out financial settlements and arrangements for children between themselves or through mediation rather than going to Court, a narcissist will thrive on dragging out proceedings as long as possible.  Furthermore, someone with NPD is unlikely to ever admit they did anything wrong and will blame you for the relationship breaking down, meaning reaching an agreement outside of Court extremely difficult, if not impossible.  

To stay strong and sane, you need to instruct an experienced, tough solicitor who will refuse to engage with your spouse’s gameplaying and will tenaciously fight to ensure you and your children’s best interests are protected.

What is Narcissistic Personality Disorder?

NPD is a recognised mental illness.  According to the Diagnostic and Statistical Manual of Mental Disorders (DSM), a guidebook used by mental health professionals, people with NPD have five or more of the below traits:

  • A grandiose sense of self-importance
  • Preoccupation with fantasies of unlimited success, power, brilliance, beauty, or ideal love
  • A belief that one is special and can only be understood by or associate with special people or institutions
  • A need for excessive admiration
  • A sense of entitlement (to special treatment)
  • Exploitation of others
  • A lack of empathy
  • Envy of others or the belief that one is the object of envy
  • Arrogant, haughty behaviour, or attitudes

NPD will usually cause problems in everyday life, such as relationships and work. Identifying narcissistic traits isn’t always straightforward and for some it is only when they leave a relationship with a narcissist, they realise their ex had these traits. The impact NPD has had on them then truly comes to light. 

Like all mental health issues, narcissism is a spectrum.  People such as Bill Gates, Kayne West, Donald Trump, and Mariah Carey have all been accused of displaying narcissistic traits which may make them difficult to be married to.  However, this does not necessarily mean they have full-blown NPD. Regardless, navigating a relationship with a narcissist can be extremely challenging and this is only heightened when legal issues are involved, such as divorce and child arrangements. Characteristics a narcissist may exhibit during legal issues are: 

  • The need to have total power and control; 
  • Unwilling to compromise; 
  • Always trying to “win”; 
  • Minimising their previous behaviour; 
  • Delaying or obfuscating the process; and 
  • Lack of empathy. 

Negotiating financial settlements 

It can be extremely difficult to negotiate the terms of a financial settlement with someone with NPD. Many lack empathy and are unable to put themselves in someone else’s shoes and consider their needs. Furthermore, many narcissists use the divorce process to try and manipulate and control the situation. Although family law solicitors, especially those who are members of Resolution, try to help couples settle without going to Court, such an aim is often nearly impossible if one party is a narcissist.  

It can often be extremely frustrating trying to reach an agreement with a narcissist and you may think it is simply easier to let them have what they want in terms of the financial settlement so you and your children can get out of the situation and find some peace. A narcissist will often try and use financial tactics to leverage control, for example hiding assets, providing inadequate financial disclosure or attempting to prolong the matter. Rather than jeopardise your right to a fair financial settlement, it is possible to put in place safeguards to protect you, such as having all communications regarding your divorce go through your solicitor.  A solicitor experienced in HNW divorce will undoubtedly have come across narcissists many times and will have the emotional detachment and the strategies to sort out the financial settlement efficiently and effectively, regardless of any game-playing by your spouse.

Arrangements for children

Studies show that growing up with a narcissistic parent is incredibly damaging for a child and narcissistic parents can be emotionally distant, self-centred, neglectful and in some cases even abusive. Although narcissists are primarily focused on themselves, they may not hesitate to fight for your children to primarily reside with them in order to exert control or hurt you, and may make false accusations to bolster their narrative, such as alleging parental alienation. 

Co-parenting with a narcissist can be extremely difficult and it is important to put in place safeguards to protect both you and your children. This can include putting in place firm boundaries and communicating only through written means, for example through an app where tone of correspondence can be monitored.  

At Edwards Family Law we are well versed in such tactics and will, if required, organise for expert witness reports setting out the impact of the narcissistic parent’s behaviour on your children, especially if it tips over into abuse in terms of coercive and controlling behaviour.

In summary

Divorcing a narcissist is difficult for everyone involved.  More than ever, it is vital that you instruct a solicitor who is not only experienced in HNW divorce but also in managing cases where one spouse exhibits narcissistic traits. 

If you recognise these patterns please contact us so we can guide you through the process and protect you through this extremely difficult period of your life. 
“You will never get the truth out of a Narcissist. The closest you will ever come is a story that either makes them the victim or the hero, but never the villain.”
― Shannon L. Alder

If the parents of a child are married, both parents have the power and duty to register a birth and give the child a name. If they are not married, only the mother has the power and duty to do so. It is therefore easy to see how issues can arise during the birth registration process. Issues can also arise several years later. For example, the parents of a child who was given the father’s surname, might separate and the mother now wants their child to be known by her surname (or the surname to be double barrelled). Equally, there are fathers who were not consulted and who would like the child’s surname to be changed.

To change a child’s name, you need either the agreement of all persons with parental responsibility or a Specific Issue Order. Applications are made under s.8 Children Act 1989 and must address any relevant welfare concerns under section 1 of the Children Act 1989 (the “welfare checklist”).

By agreement

If the parents are agreed, the government has recently updated the forms that need to be completed to change the child’s name by deed poll. You can access the relevant forms here.

You can change any part of the child’s name, add or remove hyphens and change the spelling.  You cannot change their title (e.g. Master or Miss) and you cannot change any capitalisations of the letters in their name. You must complete forms LOC022, LOC023, LOC024 and LOC026. The cost is £49.32.

If the child is adopted, you can change the child’s name during the adoption process.

If there is no agreement

The parent who wants to change the child’s name, must issue an application for a Specific Issue Order.

A legal case in 1999 set out the background and framework for judges to consider when deciding whether a child’s name should be changed. These are:

(a) If parents are married, they both have the power and the duty to register their child’s names.

(b) If they are not married, the mother has the sole duty and power to do so.

(c) After registration of the child’s names, the grant of a residence order (now known as a ‘lives with order’) means any person wishing to change the surname must obtain the permission of the court or the written consent of all those who have parental responsibility for the child.

(d) In the absence of a Lives with Order, the person wishing to change the surname from the registered name should obtain the relevant written consent or the permissionof the court by making an application for a Specific Issue Order.

(e) The welfare of the child is paramount and the judge must have regard to the s 1(3) [of the Children Act 189] criteria [the welfare checklist].

(f) The factors which the court should consider are the registered surname of the child and the reasons for the registration e.g. recognition of the biological link with the child’s father. Registration is always a relevant and an important consideration, but it is not the only thing the court will consider. Other relevant factors will be considered.

(g) Factors to consider includes factors which may arise in the future as well as currently.

(h) Changing the child’s surname because it is not the same as the parent making the application to change it will not usual be successful.

(i) The reasons for an earlier one-sided decision to change a child’s name may be relevant.

(j) Any changes of circumstances of the child since the original registration may be relevant.

(k) In the case of a child whose parents were married to each other, the fact of the marriage is important. There would have to be strong reasons to change the name from the father’s surname if the child was registered with his surname.

(l) If the parents were not married, the mother has control over registration. Therefore, the degree of commitment from the father to the child, the quality of contact (if it occurs) between father and child, the existence or absence of parental responsibility are all relevant factors to take into account by the court.

Each case will be decided on its own facts and the ‘welfare checklist’ will be the court’s main consideration. Unless there are special circumstances, the courts are in support of the idea that a child’s name should reflect both their maternal and paternal heritage. In a 2002 legal case, the judge said that a child’s surname is of ‘particular significance’ because it ‘denotes the family to which the child belongs’. In another case in 2001, the judge said, “…parents and courts should be much more prepared to contemplate the use of both surnames in an appropriate case, because that is to recognise the importance of both parents”. There have, of course, been many more cases since these in the early two thousands, but these general principles continue to be applied by the courts now and we are unlikely to see a change in this trend.

In Practice

Whilst case law favours the recognition of both parents when deciding on a child’s surname, this will not be appropriate in every case and certainly it will be easier to change a younger child’s name than a child who has more awareness and understanding of their name and its significance. The overall outcome will depend on which judge (or magistrate) is hearing the case and, of course, the specific circumstances of each case. It is therefore very difficult to advise clients on the likely outcome. The expense and uncertainty are inevitably off-putting, but it is the only way to change a child’s name if the parents cannot agree. Before issuing a court application, the court will want to know that the parents have first attempted to resolve the disagreement via mediation. Mediation, if successful, will likely resolve the issue more quickly and at less expense.

Are you supposed to be receiving child maintenance but the paying parent has moved abroad? Or are you being pursued for child maintenance, having moved abroad, and think that the amount is wrong or needs to be revised? If so, you will want to understand how REMO can help you. 

REMO stands for Reciprocal Enforcement of Maintenance Orders and it is essentially an international agreement between countries to help recover or make changes to child maintenance from parents who live in different countries.

REMO can help parents living in England or Wales (when the other parent has moved abroad) and if a parent is living abroad (and the paying parent lives in England or Wales). This is on the strict basis that both countries are participating REMO countries.

Before beginning the REMO process you must first ensure that you have a child maintenance order (or equivalent) that you can enforce. In England or Wales this will involve making an application under Schedule 1 of the Children Act 1989 (via Form A) for an order specifying how much child maintenance the other parent should pay. You can make this application and obtain the court order even if the other parent does not engage with the court proceedings. It is important to take this step first because without it you have no order to enforce via the REMO system. A calculation from the Child Maintenance Service will not suffice. You must have a court order. 

The aim of the REMO system is for reciprocating countries to enforce the child maintenance order you have as if a court in that country had made the order itself.  It sounds straightforward but the REMO system can be complex and slow.

Once you have a court order (confirming the amount of child maintenance to be paid), the first stage in the REMO process is to find out where the ‘Central Authority’ is in the country where you live. All applications must go through this Central Authority. The Central Authority in England is at: The Reciprocal Enforcement of Maintenance Orders Unit (REMO), Victory House, 30-34 Kingsway, London, WC2B 6EX. You can find the list of reciprocating countries and their Central Authority addresses here:  https://www.hcch.net/en/states/authorities

Once you know where your Central Authority is, you need to make an application for ‘registration and enforcement of your order’. The precise form and details you need to provide will vary from country to country.

Your application will need to be supported by documentation i.e. your original court order and details of any steps you have taken to try to obtain payment from the paying parent directly. It will also be helpful for the application to include details of where you think the paying parent lives and works. The more information the better. If any of your documents are not in the language of the court who will be asked to deal with enforcing the decision, you will need to obtain a translation.

Registering and applying to enforce your order is a very important step that must be done correctly. If it is not, the court will not have the power to obtain payment from the other parent. You can make the application yourself in England or Wales (with the assistance of REMO) but you may want to consider instructing a specialist family solicitor to ensure this is done correctly.

Your Central Authority is likely to require you to obtain a ‘Statement of Enforceability’ from the court that made the original order to send with the application. So, contact the court as early as possible about this. You may need to attend in person before a judge to obtain this documentation. Again, you may prefer to instruct a specialist family solicitor to assist with this. 

You do not have to use a lawyer to access the REMO system, but the application process can be complex and confusing. Even if you do not instruct a lawyer to assist you with the application, it is advisable to instruct a specialist lawyer in the country where the court will hear your application (where the paying parent lives) to ensure that you are best represented at any court hearings.

Once your court order has been registered in the reciprocating REMO country (this can take many months), you can proceed as if that country made the order in the first place i.e. apply to enforce it. 

The REMO process also allows for the original court order to be modified or reconsidered in certain circumstances i.e. the amount due to be paid can be changed by the foreign court dealing with it. This is useful if you find yourself on the receiving end of a REMO application.

In England or Wales, an application to enforce a family court order and deal with any arrears is likely to involve 3 separate court hearings. The first two will be preliminary ‘directions’ hearings at which the court determines what further evidence is needed from the parties – for example disclosure of P60s, tax returns or witness statements. The last hearing is a Final Hearing – at which you may need to give evidence in the witness box. At the end of the Final Hearing a judge will determine whether money is owed and, if so, how much. The court may also use its powers to ensure payment is made. For example, in England and Wales the court has the power to put a charge on someone’s property or make an ‘attachment of earnings order’ (where the court can obtain payment directly from someone’s employer). The power the court has to obtain funds for you will depend on which country is dealing with your REMO application.  

If you are successful in enforcing your court order and you incurred legal costs in doing so, it would be advisable to request a cost order against the other parent. Whether you can obtain a cost order at the end of a REMO case will depend on the specific rules of the country enforcing the order and the specific circumstances of your case, but it is always something to request.

You may have heard of a pre-nuptial agreement, or “pre-nup”, but you might not have heard of a post-nuptial agreementor “post-nup”. These agreements seek to do the same thing that a pre-nup does – to agree the financial outcome of any future divorce between you and your spouse – but the difference is that the agreement is entered into after marriage rather than before it.

A post-nuptial agreement has the same legal effect as a pre-nuptial agreement: provided that it has been done properly (both parties have had independent legal advice, they are entering into it freely, and are fully aware of its implications), and it would not be unduly unfair to apply its terms at the time of divorce, then it will be upheld in the event of any future divorce. The court tend to give them more weight than a pre-nup because the fact they have been entered into demonstrates an even clearer intention to be held to it (i.e. there is no impending wedding day which does place pressure on parties to sign pre-nups)

Some post-nuptial agreements are entered into very soon after the marriage, because the couple had been engaged in discussions regarding a pre-nup but had not managed to sign the pre-nup before the wedding.  If a pre-nup is signed very close in time to the wedding, it is best practice to reinforce and confirm the parties’ agreement with a brief post-nup in exactly the same terms, so that neither party can claim later that the pre-nup should not be relied upon due to it being signed late.

If you already have a pre-nup, you might choose to review the terms of your pre-nup years into the marriage, and your revised agreement would be a post-nuptial agreement. A review might be conducted to ensure that the terms of your pre-nup are still appropriate and fair, in the context of your married life now. If your financial or personal circumstances change considerably, for example you have moved country, or your health or your children’s health has become a factor to consider, you should take legal advice to “sense-check” the terms of your pre-nup.

Many couples enter into a post-nuptial agreement without ever having had a pre-nup. Scenarios in which a post-nup might be the best approach include:

  • you are due to receive a large inheritance or gift, and you want to make sure that it would remain ring-fenced in the event of your divorce in future;
  • you have set up a business during the marriage, or a business that you already owned prior to the marriage has increased significantly in value, and you do not want the future and continuity of that business to be affected by any divorce;
  • you are about to buy a property, and you and your spouse are contributing unevenly to its purchase price, and you wish to record that in a divorce your respective interests in that property would be reflective of your contributions rather than 50% each; or
  • you are being named as the beneficiary of a trust, or you intend to set up a trust, and you want to be clear about how that trust (or your beneficial interest in that trust) should be treated in the event of a divorce.  

The only difficulty with post-nuptial agreements is that there can be limited incentive for the financially weaker party to enter into them. Therefore their negotiation needs to be handled sensitively. Of course, in order for the post-nup to be fair at the time of the divorce, and therefore for it to be upheld, it will need to ensure that the fundamental financial needs of the financially weaker party are met. You can therefore assure your spouse that the agreement will not leave them “high and dry” and instead it is being entered into for a specific reason. Your lawyers can guide you through how best to discuss the post-nup with your spouse and will ensure that the messaging between solicitors aligns with that.    

A consent order is a court order (agreed by consent) that details the financial agreement reached between you and your spouse on divorce. You and your spouse agree the terms between you, usually with the help of your lawyers. This is then sent to court and reviewed by a judge. If the judge is satisfied that the terms of the agreement are fair and reasonable then they approve it; it is then a binding and enforceable court order. 

It is common practice to finalise a consent order and have it approved by the court before you finalise the divorce itself. This is because there are certain benefits to you remaining as someone’s spouse until the consent order is finalised i.e. receiving pension rights or property if your spouse were to die.

If you finalise your divorce but you do not have a consent order, the financial claims you can each make against the other (as a result of having been married) remain active. So, even though you are divorced (i.e. the court granting a Decree Absolute or Final Order) it is still possible for you (or your ex-spouse) to make financial claims against the other until this is terminated by the formalities of a consent order.

The recent judgment in HAT v LAT [2023] EWFC 162 illustrates the pitfalls of not finalising a consent order. In this case, the husband and wife married in 1984 and divorced in 1993. They had been divorced for over 25 years when the wife issued an application for spousal maintenance and payment of her legal fees.

The parties had a high standard of living during their marriage and did not have any children. The husband had a successful career and had founded a company in the 1990s that was subsequently sold for £314 million. In 1994, the parties entered into a Deed of Separation (which purported to conclude all financial matters). The agreement was that the husband would pay the wife £702,000 and that there would be a ‘clean break’ i.e. no maintenance paid. Whilst the husband recalled the agreement being drawn up into a consent order, he had no evidence of this. The court therefore had to proceed on the basis no consent order existed. In those circumstances, the wife was entitled to make her application for maintenance.

Despite the payment of £702,000 and the terms of the Deed of Separation, the husband also provided a loan of £2.1 million to the wife in 2009 to help her buy a property in London. The husband also provided other financial support to the wife over the course of the next 10 years – paying for utilities, a car, educational courses, BUPA cover and a monthly allowance. 

In 2022, the husband told the wife he would cease all payments and that the London property should be sold. He reduced the monthly allowance considerably and then eventually stopped paying all together. The husband’s position was that the wife should be held to the terms of the Deed of Separation and receive no further financial provision.

The judgment was only an interim decision (meaning the final outcome of the case is still to be determined). However, in was made clear that whilst it was highly unusual for a claim to be made so long after the divorce (29 years in this case), this was mitigated by the Deed of Separation and that the husband had continued to provide financial support to the wife after their divorce. The judge ultimately concluded that a delay of this length was not a bar to making a claim and it would not automatically prevent an application for financial relief. It would, however, be a factor the court takes into consideration.

Whilst the facts of this case are quite unusual, the judgment highlights that until financial claims are extinguished by a court order then it remains possible to makes claims against an ex-spouse irrespective of how long you have been divorced. It is therefore common sense to have a consent order drawn up in every case to protect yourself from claims many years down the line.  

If you are divorced and do not have a consent order or need some advice about how to put one in place contact our family law specialists for a free 45-minute consultation.

What happens when the magical once upon a time, does not end happily ever after?

Before the Family Law Act 1981 came into effect, the happy announcement of an engagement was considered to be a legally binding contract. If the engagement was called off without any lawful justification, the person responsible for withdrawing could be sued for damages for breach of promise. 

Whilst this is no longer the law, there are still many issues resulting from the breakdown of such a relationship. It is important to note that whilst engaged couples do not enjoy the same rights as married couples, even though the concerns and issues resulting from the fallout can be similar, they are afforded some unique enhanced protection, as simply compared to cohabiting couples.

Who keeps the ring?

The law is clear on who keeps the ring. S3(2) of the Law Reform (Miscellaneous Provisions) Act 1970, confirms that an engagement ring should be regarded as an absolute gift, unless there is clear evidence to show that it was agreed to be returned in the event of the relationship ending. 

If the ring is a treasured family heirloom, a court may be more likely to be persuaded that there was an implied intention that it be returned if the relationship ended, but this is by no means guaranteed. Therefore, it is always prudent to record this in writing at the outset, however unromantic it may seem.

Engagement gifts from third parties

There is a presumption that any gifts provided to the happily engaged couple are gifted jointly, absent any evidence to the contrary. In circumstances where the couple unfortunately don’t make it down the aisle, it is unlikely that they will have friends and family banging on their door demanding the return of an air fryer or decorative throw for what was to be the new family home. However, there may be circumstances where family members have gifted substantial financial contributions towards proposed renovations to the new home, or perhaps indeed towards a deposit for a new home. In such a situation, that third party may be able to seek financial remedy through the court. 

Costs associated with the wedding

Depending on how advanced wedding plans were and how close the couple were to the big day, in many cases it is likely that significant sums may have been incurred. The wedding venue, the catering, the photographer/videographer, the band, the dress, the makeup artist, the suits, the cake, the honeymoon; the list goes on and it certainly all adds up. 

For a couple who have met each of these expenses jointly, their only likely recourse is to read the fine print of the contracts with the various suppliers to assess whether there is any chance of a percentage refund of the costs already incurred. 

In circumstances where one party has footed the majority of the deposits and bills, the paying party may struggle to recover the sums incurred from the other aggrieved party, especially in the absence of any clearly documented agreement. The same applies in more traditional settings where the bride’s family may have paid for various expenses towards the wedding and are now seeking compensation from the groom’s side. 

What happens to the house we have bought together?

There is no such thing as a “common law marriage”. Whether the couple have been together for five months, five years or fifty years. 

Unmarried couples often rely on the Trusts of Land and Appointment of Trustees Act 1996 (“TOLATA”) should any property dispute arise. This allows a person with a potential beneficial interest in a property to have the nature and extent of their interest assessed and determined by a court, which may result in a number of orders, including an order for sale.  TOLATA proceedings can be both time consuming and costly and largely turn on the veracity of the evidence provided by the parties. 

Importantly, whilst engaged couples do not enjoy the same legal protections as married couples, many are not aware that they do have some enhanced protection as compared to non-engaged cohabiting couples:

  • S37 of the Matrimonial Proceedings and Property Act 1970

A formerly engaged party may make a claim for an interest in a property where there has been:

  • a contribution in money or money’s worth (i.e. paying a builder or undertaking such work yourself);
  • to the improvement of a “substantial nature” to real or personal property;
  • provided such contribution can be seen to have enlarged both parties’ shares.

However, this claim would be subject to any agreement advanced by the other to the contrary, either express or implied. 

  • The Law Reform (Miscellaneous Provisions) Act 1970 and the Married Women’s Property Act 1882

Most of The Married Women’s Property Act has been repealed. However, S2(2) of the Law Reform (Miscellaneous Provisions) Act 1970 affirms the application of S17 of the Married Women’s Property Act 1882 to formally engaged couples, providing declaratory relief for ownership of property and personal possessions (such as cars, jewellery etc). Crucially, any claim must also be brought within three years of the engagement ending. 

Protection and prevention

Where engaged couples own significant assets together or gifts have been made in the anticipation of the future happy couples’ big day, they may consider it sensible to enter into a pre-nuptial agreement. Whilst many liken pre-nuptial agreements as an insurance policy for divorce, the agreement may also make provision for what will happen to such property and gifts, as well as wedding expenses, should the wedding not go ahead. 

Similarly, if the couple envisage a longer engagement period, they may consider entering into a cohabitation agreement; again, to record how the assets will be dealt with both during the relationship and, more importantly, upon any breakdown of the relationship. 

In the merriment of a new engagement and the excitement of wedding planning, unromantic practicalities are usually, understandably, not at the top of the priority list. However, where there are assets to protect, prevention is always better than cure.

https://thoughtleaders4.com/images/uploads/news/TL4_HNW_Divorce_Issue_16_-_February_2024.pdf

Sarah Hogarth
Senior Associate at Edwards Family Law

When a couple is getting divorced and dealing with how to separate their finances, who receive the bonus, or even a share of it, can often create problems.  Naturally, the party due to receive the bonus may seek to ‘ringfence’ the award, while the opposing party will argue that it should be part of the overall matrimonial pot and be distributed accordingly.

Issues such as this, which frequently occur and cause arguments, invariably produce a litany of case law, which needs to be considered by both legal advisors and the court in determining a fair financial outcome. To ascertain whether a spouse will be eligible for any degree of a parties’ bonus post separation, one must first explore the law in relation to bonuses received during the marriage.

During marriage

Generally, bonuses awarded while the parties are together are considered matrimonial assets. These are assets acquired during the marriage, or during the period of cohabitation before marriage. Upon reaching a financial settlement, the starting point for a division of the matrimonial assets is a 50/50 split. This can be altered based on each parties’ respective needs. For example, a party who is the primary carer of the children in the marriage, and who possibly has a lower earning capacity, would likely have a greater entitlement to capital from the matrimonial assets if their ‘need’ warranted such a claim. This would include any bonuses accumulated during the marriage.

Post marriage

The situation in relation to bonuses which are obtained post separation is less cut and dry, and usually depends on the circumstances of each case. For example, if there is a maintenance order in favour of the party earning less, it is possible for this individual to be awarded a portion of the payer’s future bonuses. This was explored in the case of H v W [2013] EWHC 4105 where it was originally determined that a wife was to receive maintenance of £3,750 per month plus 25% of the husband’s net annual bonus for the rest of their lives. Given his bonusses were typically circa £250,000, this was not an insignificant amount. Upon appeal, this was drastically reduced and capped at £20,000 per year, although the judge still held that it was necessary for the husband to share his bonus, in order to meet the wife’s future income needs in a fair and proportionate way.

Nevertheless, this case is now over 10 years old. I In recent years courts have taken a less generous approach to sharing bonuses post separation. For example, in the case of Waggot v Waggot [2018] EWCA Civ 727, , the wife’s attempt to have 35% of the husband’s net bonuses for a limited period was rejected. During this case, Lord Justice Moylan stated that, ‘Any extension of the sharing principle to post-separation earnings would fundamentally undermine the court’s ability to effect a clean break.’ The court being required to try and achieve this in every case, if it can. 

In such cases, all bonuses received after a clean break would remain with the spouse receiving the bonus and subsequently, they are not to be shared. This is only relevant to circumstances where there is no spousal maintenance. If such an order is necessary, then bonuses can be used to meet future financial needs, as illustrated above in H v W [2013] EWCH 4105.

Perhaps the most difficult issue to determine when deciding to share bonuses is the timing of when they have been received. During a clean break case, if a party receives a bonus post separation, they may be entitled to believe that it ought not to be shared. However, as the case of O’Dwyer v O’Dwyer [2019] EWCH 1838 demonstrates, if a bonus is earned during the marriage but not paid out until after the marriage has ended, then there is every reason to treat it as matrimonial property in its truest sense. Again, in the case of Rossi v Rossi [2006] EWCH 1482,  MrJustice Mostyn suggested that he ‘would not allow a post-separation bonus to be classed as non-matrimonial unless it related to a period which commenced at least 12 months after the separation’. This would seemingly give risk to the party receiving the bonus that it may still be added to the matrimonial pot, even if earned up to a year following separation.

It is therefore important that a party take legal advice, if they believe that they are either entitled to receive a bonus during their separation, or that their partner is. Here at Edwards Family Law, we are best place to guide you through your potential options and advise you in relation to an outcome which best protects your interests, either in relation to bonuses specifically, or in the broader context of your financial circumstances on divorce.