Divorce is a challenging and often emotionally charged process, involving a myriad of legal, financial, and personal complexities. One of the most significant aspects of finalising a divorce in Wales and England is securing a clear and legally binding arrangement regarding finances. This is where a “clean break financial order” becomes invaluable.
Understanding a Clean Break Financial Order
A clean break financial order, as recognized by the Courts of England and Wales, is an agreement between divorcing spouses that formally ends any financial obligations to each other after the divorce is completed. This order can cover aspects such as property, savings, investments, and any other shared financial assets.
Once a clean break is in place, neither party can make future financial claims against the other. It essentially acts as a protective barrier, ensuring that both individuals can move forward without financial entanglements that might resurface years later.
Legal Background
In Wales and England, while divorce legally ends a marriage, it does not automatically sever financial obligations between ex-spouses. This distinction is often misunderstood, with many people believing that divorce alone is enough to settle financial matters. However, unless a financial order is made and approved by the court, either party can make a claim against the other’s future assets, even years after the marriage has been dissolved. This scenario was famously highlighted in the case of Wyatt v Vince (2015), where the Supreme Court ruled that an ex-wife could make a financial claim against her ex-husband nearly 20 years after their divorce, because no clean break order had been put in place.
Benefits of a Clean Break Financial Order
- Clarity and Finality: One of the main advantages of a clean break financial order is the certainty it brings. The process of divorce is stressful enough, and the last thing anyone wants is the fear that an ex-spouse might pursue further financial claims long after the legal separation. A clean break ensures that both parties know where they stand and can plan their futures accordingly, free from the shadow of potential future disputes.
- Protection of Future Assets: Without a clean break, any financial windfall, such as lottery winnings, inheritance, or increased income, could potentially be subject to claims from an ex-spouse. The clean break financial order legally precludes such claims, giving both parties peace of mind that they are protected from any future financial surprises.
- Avoiding Litigation: Contested financial claims can lead to lengthy, stressful, and expensive legal battles. By securing a clean break order at the time of divorce, both parties avoid the possibility of future litigation. This saves time, money, and emotional energy, which can be better spent on rebuilding life after divorce.
- Focus on Independence: A clean break promotes financial independence. It encourages both parties to make a fresh start, fostering personal growth and financial responsibility without reliance on one another. This independence can be crucial in ensuring that both individuals work toward rebuilding their lives and developing new financial strategies that best suit their changed circumstances.
Consequences of Not Having a Clean Break
Failure to secure a clean break financial order can leave individuals vulnerable to future financial claims. As demonstrated in high-profile cases, even years after a divorce is finalized, the absence of a formal financial agreement can result in a court awarding a share of one party’s post-divorce assets to the other.
This not only disrupts personal financial stability but can also create emotional strain and prolonged conflict.
Additionally, if one party were to experience financial difficulties in the future, they could seek support from their ex-spouse in the absence of a clean break, placing an unexpected financial burden on the latter.
This unpredictability underscores the importance of settling financial matters comprehensively and conclusively.
How to Obtain a Clean Break Order
Securing a clean break financial order involves negotiation between both parties and their legal representatives to reach an agreement that satisfies both sides. Once agreed upon, the order is submitted to the court for approval. The court’s role is to ensure that the terms are fair and reasonable, protecting the rights of both parties.
It’s advisable for individuals to seek guidance from solicitors who specialize in family law to navigate this process effectively.
Hains & Lewis
Chris Taylor of Hains & Lewis is an Advanced Family Law Society panel accredited solicitor and Head of the firm’s Private Family and Disputes department who has in excess of 25 years experience specialising in matrimonial law and finances.
Contact can be made by telephoning 0345 4080125 or emailing [email protected] for an appointment.
