When a marriage irretrievably breaks down, deciding how to divide assets can be one of the most challenging issues for spouses. Under Section 25 of the Matrimonial Causes Act 1973, courts in England and Wales assess a range of factors to determine what division of financial assets is fair. Whilst contested court proceedings are always an option, the Family Court asks spouses to consider whether forms of non-court dispute resolution (NCDR) may be appropriate. NCDR can lessen legal costs and reduce conflict during a difficult and sometimes emotionally challenging time. However, NCDR will not be appropriate in all circumstances, including where there has been domestic abuse.
If your marriage has irretrievably broken down, you may be assisted by seeking early independent legal advice to assist, to pave the way toward a more amicable, cost-effective agreement or to take an informed view as to the most appropriate approach, including where contested financial remedy court proceedings are necessary.
Section 25: the legal framework
Section 25 outlines the key factors courts must consider when making or approving financial orders, whether embodying an agreement reached by consent or in proceedings as follow:-
- Income, earning capacity, property and financial resources—both current and future.
- Financial needs, obligations and responsibilities—such as housing, childcare, and liabilities.
- Standard of living enjoyed during the marriage.
- Age and duration of the marriage.
- Physical or mental disability of either party.
- Contributions to the family welfare—both financial and non-financial (e.g., caring and homemaking).
- Conduct—if it’s unfair to ignore, though this is rarely the deciding factor.
- Loss of pension rights or benefits due to the marriage ending.
- Welfare of any children under 18, which must be the court’s first consideration.
Understanding and being aware of these factors can help spouses to identify their priorities, reasonable needs, and take an informed view on protecting their position and rights. Early legal advice can also help spouses be prepared to consider the financial landscape and range of realistic and fair proposals for a matrimonial financial settlement.
Non-Court Dispute Resolution: a more amicable path
Since April 2024, spouses are required by the Family Procedure Rules to consider other routes to resolution prior to issuing contested court proceedings. Whilst NCDR will not be appropriate in all circumstances and every situation is unique, the main NCDR options include:
- Mediation – A neutral mediator guides conversations to reach mutual agreement on finances and property. This can be a lawyer or a non-lawyer.
- Collaborative Law – Both parties and their solicitors commit to negotiate without court.
- Arbitration – A private, binding decision made by an independent arbitrator
- Private Financial Dispute Resolution Hearing – a private, non-binding indication by an independent trained legal professional sitting as a Judge
- Early Neutral Evaluation (ENE) – A neutral evaluator offers an early assessment and recommendations
Where appropriate, these non-court methods may save time, reduce legal fees, reduce hostility, and maintain confidentiality to enable spouses to look forward and try to move on with their lives.
If NCDR is unsuccessful or inappropriate in the circumstances, a contested financial remedy court application can be made on Form A. The application fee is currently £313.00.
Why early independent legal advice matters
Seeking independent legal advice at the outset can help you to:
- Understand your rights arising from your marriage and the factors considered by the Court under Section 25.
- Work towards an appropriate structure for full and frank financial disclosure and formulating sensible and fair settlement proposals for resolution, either in or out of court proceeding.
- Navigate the process of reaching a financial settlement timeframes for implementation of any agreement with confidence.
- Endeavour to avoid time-consuming and costly court proceedings by narrowing and resolving issues
Early independent legal advice can also strengthen your negotiating position and help keep focus on promoting a fair and reasonable approach in line with the legal principles. In some circumstances, this may assist in reducing conflict and encouraging spouses to consider their realistic shorter and longer term needs, including those of any children under the age of 18, is typically to the benefit of both spouses, especially when future co-parenting is involved.
Where communication has broken down between spouses, having early independent legal advice and / or legal support throughout the process can assist in moving matters forward and help take a step back from any difficult emotions which may arise.
What Non-Court Dispute Resolution can include
A well-managed non‑court dispute resolution process, where appropriate in the circumstances, may involve:
- Each spouse seeking independent legal advice, either as a one-off or on an ongoing basis
- Each spouse attending a Mediation Information and Assessment Meeting (MIAM), where appropriate. This is also a required step prior to any contested court application for which you will be issued with a MIAM certificate, save for where an exemption applies.
- Meetings to review finances and any outstanding issues and queries as to the financial landscape
- Input from financial advisors or pension specialists to assist in financial settlement options
- Drafting draft court papers embodying any agreement reached into a financial consent order and statement of information form, turning agreements into an enforceable and binding court order.
Spouses are entitled to seek independent legal advice prior to agreeing or negotiating any financial settlement agreement. The Section 25 legal factors guiding division of assets upon divorce includes consideration of fairness and future security. However, the appropriate method for approaching resolution to matrimonial financial matters in your individual circumstances can be an important part of the process and must be carefully considered along with the outcome reached, including where applying to Court is necessary.
How FJG can help
At Fisher Jones Greenwood, our Family Solicitors take pride on delivering bespoke and empathetic legal advice tailored to your unique circumstances and specialise in financial settlements, offering early legal advice and support, including through non-court dispute resolution or contested court proceedings.
Ellie Maynard is a Solicitor in our Family Law Team.
Our family law team offers clear advice and strong support throughout this process. If you have any queries or would like an appointment to discuss matrimonial finances and division of assets on divorce, please contact one of our team in our Colchester, Clacton or Chelmsford offices on 0845 543 5700, or via our online enquiry form.