Apr 23

50 years on: a review of the law of finances on divorce

Written by Ellie Foster
Legal Director

DDI: 01423 726621
M: 07548 213132
E: ellie.foster@raworths.co.uk

Following the very welcome introduction of ‘no fault divorce’ in April 2022, the government has now asked the Law Commission to review the legislation that governs how a couple’s financial relationship is resolved on divorce, to see whether the law is working effectively and whether it delivers fair and consistent outcomes for divorcing couples.

The current law dates back 50 years to the Matrimonial Causes Act 1973 (as mirrored in the Civil Partnership Act 2004 for civil partners).  This provides for a discretionary approach with a judge considering a number of statutory factors to decide the appropriate settlement. These factors include the financial resources of each party, the standard of living they have enjoyed, their ages, health and the length of the marriage, contributions and (determinatively in many cases) their respective needs.  First consideration is always given to the welfare of any minor children. Therefore, the guidelines are open to interpretation; in many cases there is a range of possible outcomes.

Critics of the current discretionary system argue that it is overly complicated, is antiquated and antagonistic, promoting conflict (and therefore costs) and creating uncertainty, particularly for those who are unrepresented. Others argue that this very discretion allows the parties (or a judge) the flexibility to craft a settlement that is bespoke to a family’s individual circumstances.

What is clear, though, is that since 1973 there have been seismic changes in societal attitudes, practices and the form of family units.  1973 was a very different world to 2023.  A review of the existing legislation is therefore very welcome.

In addition to assessing the effectiveness of the current discretionary approach, the Law Commission will consider whether there is scope for reform of a number of key areas that often cause dispute or can be overlooked, including:

• how any maintenance should be calculated
• how the courts should treat the behaviour of separating couples when making financial orders
• orders relating to pensions
• whether there should be wider powers to make orders for the benefit of children over 18

A scoping paper is expected in September 2024.

For more information please contact a member of the Family team.

Published on 11 April 2023