Decline in financial claims on divorce under new ‘no fault’ procedure is a worrying trend

Published on 16.11.22
Published on 16.11.22

The introduction of ‘no fault’ divorce in April this year has led to an increase in the number of divorce applications and a simultaneous decrease in the number of applications for financial relief by divorcing parties. Teena Dhanota-Jones examines the possible reasons for and consequences of this worrying trend.

Since 6 April 2022, divorcing parties have been able to issue divorce applications on the grounds of irretrievable breakdown only (so-called ‘no fault’ divorce). The court no longer requires information that details the reasons for the breakdown.

The biggest change is that divorce applications are now submitted online. For many divorcees, issuing and concluding divorce proceedings is now simply a form-filling exercise. The feedback from my clients is that the procedure is straightforward and simple.

Interestingly, according to the Family Court Statistics Quarterly for April to June 2022 (the report), there has been a 22% increase in divorce applications compared to “the same quarter in 2021… This represents the highest number of applications in a decade.”

Once divorce proceedings are issued, the parties can conclude their financial claims arising from the marriage. This application can be made during or any time after the conclusion of the divorce. The financial claims that need to be dealt with are in relation to the following:

  • Property and other capital
  • Lump sums
  • Pensions
  • Periodical payments – spousal maintenance (and, if relevant, child maintenance claims)

While the number of divorce applications is up, the report notes a downward trend in financial claim applications. These are down 31%, and those that agree financial settlements without a formal application and simply file an agreed order with the court are down 29%.

Based on these trends, one may conclude that many parties are delaying (or, possibly, simply not issuing) their financial claims. Parties that finalise their divorce and do not conclude their financial claims are at risk of financial loss, including in relation to the following:

  1. Pensions: on the death of one spouse, the death in service and/or the widow’s pension will not be paid to an ex-spouse. The pension dies with the deceased.
  2. Death: a financial claim under matrimonial law cannot be brought against a deceased’s ex-spouse.
  3. Insurance policies: some policies refer to a payment to a “spouse” only and no other beneficiaries.
  4. Remarriage: if you remarry before issuing a financial claim, this terminates your financial claims (excluding pensions).
  5. Delay: this may result in a party receiving less and may mean that any post-separation assets acquired may be excluded from the division of assets.

There may be many other reasons why there is a disparity in the number of issued divorce applications and financial applications. If you compare the same periods, it may be that parties are delaying making financial applications in the same period that they issue divorce applications. I believe these trends indicate a delay (not necessarily a decline) in parties concluding their financial claims. Divorcing parties should note the significant loss that can result from this, as set out above.

In conclusion, it may be the current troubling economic climate that is making parties defer (or simply not make) financial applications. A party may well be advised not to obtain their final order in respect of their divorce application until they are ready to commence their financial claims. As ever with issues of this nature, it is wise to obtain advice from a divorce solicitor at the earliest stage.

If you require any further information about divorce, financial settlements on divorce or any other family matter, please contact Teena Dhanota-Jones at [email protected].

Disclaimer: The above is merely general guidance and should not be relied on as formal advice. We suggest you take professional legal advice before taking any action in relation to the issues discussed above.