The Importance of Obtaining a Financial Order following Divorce

There is often a misunderstanding that divorce also deals with financial matters. Securing a divorce alone is the legal ending of a marriage and finalising financial matters is an entirely separate matter. This means that even long after divorcing, financial claims remain open.

What is a Financial Order?  

A Financial Order is an order made by the court setting out the financial arrangements that determine how assets, property, finances, pensions and ongoing financial obligations will be divided between divorcing parties. An agreement can be reached between the parties themselves, through mediation, negotiations through solicitors or as a last resort through court proceedings. Whilst an agreement between the parties is always encouraged ultimately if agreement cannot be reached then the court will order a financial settlement.

What is the Importance of a Financial Order?

A Financial Order removes the risk of your former spouse bringing an application against you in years to come as financial claims remain open indefinitely if not addressed at the time of divorce and this is highlighted in the following cases.

Wyatt v Vince [2015] UKSC 14.

The UK Supreme Court ruled that Mrs Wyatt could pursue a financial claim against her ex-husband, Mr Vince, even though their marriage had ended over two decades earlier and Mr Vince had since become wealthy. The court determined that there was no statutory time limit for making such claims, highlighting the importance of formally settling financial matters during divorce proceedings.

HAT v LAT [2023] EWFC

The couple married in 1984 and divorced in 1993 and had initially agreed on a financial settlement through a deed of separation. This agreement included a lump sum payment to the wife and a clean break clause intending to sever financial ties. However, the deed was never converted into a sealed Financial Order by the court.

Over 25 years later, the wife sought spousal maintenance and payment of her legal fees. Lord Justice Peel ruled that the lengthy delay did not automatically prevent the wife from making a financial claim. While the delay was a factor to be considered, it did not prevent the application for financial relief.

Both cases highlight the importance of obtaining a Financial Order following divorce. If you are going through a divorce or have already divorced without securing a Financial Order, it is imperative to seek legal advice to protect your financial future and for peace of mind post-divorce. Contact our experienced family law team today on 01204 527777 (Bolton) or 01254 268790 (Blackburn) or at enquiries@kbl.co.uk.

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