Why you need to make a financial remedy order on divorce

Former spouses’ can continue to make financial claims against each other for years after divorce if appropriate legal documentation is not in place. Here, Janine Hutson explores how financial remedy orders can prevent this.

What is a financial remedy order?

It is best to settle your financial arrangements at the time of divorce. These arrangements should be put in a financial remedy order, specifying that neither party will have any claim against the other in the future, aside from the agreed settlement.

Providing this agreement allows each party to move forward after the separation with certainty as to their financial position in years to come.

The dangers of unsettled financial arrangements

Sometimes couples fail to sort their finances at the time of divorce, resulting in potential claims against each other remaining indefinitely. The recent case of Waudby v Aldhouse dealt with this issue. The parties had divorced around 19 years previously with no financial remedy order put in place at the time.

Following the breakdown of the marriage, the wife’s health had deteriorated and as a result she received a sickness pension. However, in 2014, the wife’s sickness pension was reduced which prompted her application to the court for a financial order against her former husband.

Initially, the judge linked her health concerns to the marriage. He claimed that they had been caused, amongst other things, by the former husband’s infidelity and the loss of the family home. The judge ruled that the wife could receive maintenance and a lump sum from her former husband in order to meet these recent shortfalls in her monthly outgoings.

However, on appeal the decision was overturned. The judge found that, after the separation, the wife had succeeded in living a reasonable life and had survived independently, regardless of her health concerns. Therefore, the wife’s reduced financial circumstances had no connection to the marriage 19 years previously.

Although in this case the husband was not required to support his former wife, it highlights the potential dangers of failing to enter into a financial remedy order at the time of divorce.

For additional information on financial remedy orders or for advice on any divorce and family law matter, email Janine Hutson or call on 01772 258321.