How to protect your assets in a divorce
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Whether you take steps before you are married, during the relationship or when things start to go wrong, you should do all you can to protect your assets.
Jan Galloway, partner at law firm Moore Barlow, and Katy Barber, senior associate, outlines what to do – and when.
Q: What are the assets of a marriage?
Primarily property and pensions, but they can also include anything that has value: businesses, trusts, investments, shares and expensive chattels. Everything from both parties is looked at when you are getting divorced and it matters very little whose name the assets are in. It all becomes part of the matrimonial pot for division.
Q: What factors are taken into account when dividing up any assets?
It is all about equality and meeting needs, particularly those of any children. Other factors might be housing needs, the length of the marriage, resources, age, contributions to the welfare of the family or if either of the parties has a physical or mental disability. We look at conduct, but this is very rarely taken into account. Furthermore, largely speaking, the reason for the divorce has almost no bearing on the ultimate financial settlement.
Q: What is the best thing to do to protect my assets?
Before you get even get married consider a co-habitation or pre-nuptial agreement as they can save a whole wealth of problems later on. People think they are unromantic, or just for the rich and famous, but they make sense: they can protect your assets and help everyone to understand what their rights are. You might have one if one party purchased the property ahead of the marriage or if a parent wanted to give their child a large sum to buy a property and doesn’t want the money to be split if the house is sold. Post-nuptial agreements can also be made during a relationship – again, if one party receives an inheritance or is given a substantial about of money, perhaps.
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Q: What if I don’t have an agreement and my marriage is breaking down?
Arrange to see a solicitor as soon as possible. It is absolutely imperative to get early advice as this is such a complicated area of the law. There are so many grey areas and a judge would have so much discretion if this ultimately ended up in court. Also, it might colour how you move forward with your separation. For example, the court won’t look kindly on you if it thinks you have tried to hide your assets or mislead it. People also often think that putting their assets into a trust will protect them, but this is not necessarily true. So, taking advice is essential.
Q: My partner has told me I won’t be entitled to anything?
Again, take legal advice because it is highly likely this is untrue. Often there is a perceived disparity in contributions. Typically, one party might be the homemaker and the other the breadwinner. Often the breadwinning spouse might say they have gone out to work and want to keep all their earnings and their pension. But the law looks at contributions equally and the homemaker is given credit for freeing up the breadwinner to concentrate on his or her job.
Q: What should I do if I can’t face a court battle?
Our aim is always to avoid going to court and there are lots of routes towards achieving this. Come and see us at Moore Barlow to find out more – and with no obligation to move forward if you don’t want to. There are lots of collaborative ways of having a good divorce, such as arbitration, mediation or collaboration. These keep the costs down and avoid the stress, uncertainty and lottery of the court. If you can come to a compromise, then at least you have both had input and know the arrangement is something you can live with. If you have children, you are also investing in your future relations to help them through the relationship break-up and allow you both to emerge with more dignity.
For more information visit moorebarlow.com or call 023 8071 8000.