Financial provision when a relationship ends

Division of assets on divorce or dissolution of civil partnership

A couple may agree between themselves how to divide their assets. Their agreement may be embodied in a consent order approved by the court which makes it legally binding and enforceable.

When agreement is not possible, the court may decide an application for financial provision. In deciding an application, the court is required by statute to have regard to “all the circumstances of the case, first consideration being given to the welfare while a minor of any child of the family who has not attained the age of eighteen”. Therefore, each case is dealt with on an individual basis according to its facts.

Case law

Case law has established that, in trying to achieve fairness in the division of property in any given case, the court should be guided by the principles of the needs of the parties; compensation; and equal sharing. The Law Commission has commented (PDF) that the sharing principle is relevant only in a minority of cases because of the overriding problem of meeting needs.

Application to court

Couples must attend a Mediation Information and Assessment Meeting (MIAM) before issuing an application to court for a financial remedy (with some exceptions). In March 2023, the Government and the Family Procedure Rule Committee consulted separately on proposals intended to strengthen the existing provisions around attendance at MIAMs and to encourage more people to attend mediation or other forms of non-court dispute resolution.

A party to divorce proceedings, who remarries before they have made any application for a financial order, generally loses the ability to apply to court. This is a matter on which it would be necessary to seek legal advice.

Guidance

The Coalition Government asked the Family Justice Council to take forward a Law Commission recommendation for guidance to clarify the meaning of ‘financial needs’. In April 2016, the Family Justice Council published a guide, intended to help litigants in person, Sorting out Finances on Divorce (PDF). Separate guidance has been published for the judiciary.

Calls for reform

Private Members Bills have been introduced with the intention of reforming the law relating to financial provision on divorce. To date, no such bill has completed its passage through Parliament.

Review of the law

In April 2023, the Law Commission announced it was to review whether the law which determines how finances are divided on divorce or dissolution is working effectively and delivering fair and consistent outcomes for divorcing couples. The Commission intends to publish a scoping report in September 2024, which could provide the basis for a full review and future financial remedies reform.

The Law Commission has also conducted projects on the enforcement of family financial orders and on matrimonial property, needs and agreements.

Pre-nuptial agreements

Some couples enter into a pre-nuptial or post-nuptial agreement which sets out how they would wish their property and income to be divided in the event of divorce or dissolution. These agreements are not automatically enforceable. However, following a landmark ruling in the Supreme Court, some pre‑nuptial agreements will now have effect in the absence of circumstances which would make this unfair.

Cohabitation

Cohabiting couples do not have the same rights to financial provision on relationship breakdown as married couples or civil partners.