Senior Family Law Executive at Jones Myers
4:31 AM 22nd June 2020
Is Now The Right Time To Get Divorced And Divide Your Assets?
Making decisions when you are in the midst of life changing events isn’t easy - especially when there is so much other upheaval going on with the current pandemic.
Physically separating is one thing - but when is the best time to divide your assets?
Questions around your financial settlement are not over until you have the security of a final order from the Court. It sets out what your obligations are, what you will keep and, in most cases, will put an end to any claims you might have against each other.
But what happens if your assets increase or decrease in value after you have separated but while you are still in the middle of attempting to reach a settlement? Any decisions on “who gets what” will not be based on the value of assets at the time of the separation but on the current value.
The uncertainty over school closures and the impact on the wider economy will undoubtedly affect couples’ thinking about how dividing their finances. One possibility is to agree a two part division with liquid assets such as savings dealt with at the time of settlement but illiquid assets such as property and pensions are agreed when the market is more stable.
Whilst many couples may conclude there are too many unknown factors to consider making significant life-changing decisions now; others may decide that the economic uncertainty gives them a backdrop against which to separate because financial awards might be lower than they would otherwise be in “normal” economic times.
However, even if you were to decide today, any financial settlement may not be based on the value of the assets as they currently stand, in particular if a lengthy court process is involved.
Fully contested financial proceedings are likely to take around 9-12 months - when the economic landscape will look different from now - to get to a final hearing.
Couples are therefore advised to consider alternative dispute resolutions which are likely to conclude more quickly.
Mediation can help couples resolve their differences and find solutions to enable them to move forward positively. An impartial third party, “the mediator” helps them to discuss issues confidentially and find workable agreements which can be reached more swiftly and cheaply than by using the court process or in solicitors’ correspondence.
Ongoing communication also limits the emotional damage which follows in the wake of an acrimonious battle.
Collaborative Law also avoids Court proceedings and other adversarial approaches to settlement. A “no court” agreement is signed at the outset so that there is a shared commitment to finding an agreed resolution. This process can be particularly beneficial in higher value or complex situations.
In family Arbitration, couples appoint an arbitrator who makes decisions for them, enabling them to resolve disputes in a more flexible and less formal setting.
There is also the benefit of having the same Arbitrator through the process which will not happen at Court with Judges - and the knowledge that your Arbitrator is an expert in financial remedy proceedings. This isn’t always the case with a Judge at Court as they may have backgrounds in other areas of law.