Why you need a clean break order to protect your finance in a divorce

 

Many couples are still under the wrong impression that if they get a divorce and obtain a Decree Absolute, not only does their marriage come to an end but it also automatically ends their financial obligations against each other. This is a misconception.

The couple’s financial obligations can only be ended by them filing an agreed Consent Order/Clean Break Order in Court and setting out their financial circumstances for a Judge to approve the division of financial assets (financial remedy application). Where the couple cannot agree how their assets are to be divided then a Financial Application is issued in Court for a Judge to determine the financial division.

So whether you think you have assets or not, it is very important that you consider severing those financial ties at the same time as the divorce by formally obtaining a Clean Break order. The value of a Clean Break Order is that neither the husband or the wife can make a financial claim against each other now or in the future.

Ask Mr Vince the importance of a clean break order. His ex spouse Ms Wyatt is now attempting to bring a financial claim against Mr Vince nearly 18 years after the Decree Absolute. The case came before the Supreme Court earlier this year as, Wyatt v Vince [2015] UKSC 14.

At the time of separation the married couple did not have any substantial money and so did not deal with the finances arising from their marriage when they obtained their Decree Absolute. However, In 2011 Ms Vince brought a financial claim against Mr Wyatt after he had started a successful wind energy business and became rich. When Mr Wyatt asked the Court to dismiss her claim as the marriage had ended 18 years ago, The Supreme Court ruled that time itself is no bar to a financial claim in relation to the marriage.

Whilst it is unlikely that Ms Wyatt will be awarded a significant proportion of Mr Vince’s assets for various other reasons, the key message here is to obtain your consent order at the same as your divorce, otherwise there is potential for an ex-spouse to pop up to make a claim against your assets in the future.

If you have any doubts, whether your financial claims were settled in full upon divorce or wish to obtain a financial order, please contact our Matrimonial Team on 0113 457 3500 or email shakeel.bi@needlepartners.com.