My Ex-spouse and I Have Reached an Agreement in Relation to our Finances
Do We Need to do Anything Else?
Whilst the courts are keen to see parties reach an agreement without the assistance of the court where possible, it is strongly advisable to ensure that the terms of an agreement are reflected into a Court Order. Without this, the agreement is not binding and either of you could make an application to the court for ‘financial remedies’ (which can include maintenance, transfer of properties, lump sums and pension transfers) at a later date. By that point, your financial position could have significantly improved and your ex-spouse could be entitled to a share of your assets at that point, irrespective of what was previously agreed.
This situation was considered by the Supreme Court earlier this year. Mrs Wyatt and Mr Vince married in 1981, separated in 1984, and divorced ‘at some point in the 1990s’. They had one child, who was born in 1979. There was no evidence that a financial settlement had been reached following the breakdown of the marriage.
During the marriage, Mrs Wyatt and Mr Vince had very limited financial resources, but following the divorce, Mr Vince had started a wind power business which is now worth many millions of pounds.
In 2011, Mrs Wyatt made an application to the court for financial remedies. The Supreme Court found that, in spite of the amount of time that had passed, Mrs Wyatt was still entitled to make a financial claim against her former husband, as no Court Order setting out a financial settlement had ever been made. The Supreme Court did not decide what Mrs Wyatt should receive, and that will fall to be determined by the lower Courts unless Mrs Wyatt and Mr Vince are able to reach a voluntary agreement.
This case serves as a cautionary tale to ensure that, even if a couple have managed to reach a financial agreement, it is in their interests to ensure that it is confirmed in a Court Order to ensure that it is binding upon them and that the other will not seek a share of their assets and/or income in future.