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Divorce and financial settlements – a cautionary tale

To many couples contemplating divorce there are several apparent cheaper alternatives to solicitors available to get a divorce – through the internet, DIY divorce packs or even contacting the Court directly. However saving money in the short term may prove to be a very expensive oversight in the long term.

It is vital that any divorcing couple is aware that the divorce itself does not automatically deal with financial matters arising out of the breakdown of the marriage.  An amicable agreement to divide financial assets or pay maintenance must be incorporated in a Court Order which can be applied for after the first Divorce Order has been pronounced.

In the absence of any such agreement it is open to either party to bring a financial claim against the other at any time even if the divorce has long since gone through.  The only bar to doing so is if the party bringing the claim has already remarried.

Such was the lesson learned by Nigel Page joint winner of over £56 million on the Euro-millions Lottery in 2010.  He was separated from his ex-wife 10 years before the win and had long since been divorced.  He had bought out his ex-wife’s share in the family home and agreed to pay maintenance for their daughter.

Unfortunately for him the agreement had never been recorded and approved in a Court Order so 10 years later his ex-wife was legally entitled to claim a share of his lottery win.

Initially Mr Page offered his ex-wife £1 million pounds whereas she sought to claim £8 million.  In the end a compromise of £2 million was agreed.

This is a stark warning that it is essential to ensure the family finances are dealt with when a couple get divorced.  Although the odds of winning the Lottery are always going to be fantastic the same lesson applies in relation to any future financial windfall such as inheritance, compensation or redundancy payments.

To ensure that you protect your present and future financial arrangements please contact our expert family team to discuss your requirements.