Wealth, property and division of assets on divorce

8th March 2015 by

 

In many financial settlement disputes, the divorcing parties contest the extent of their wealth and property. If agreement cannot be reached the case may well end up in a family court where a judge will decide on the division of assets and consequently order a suitable ancillary relief package.

When a marriage or civil partnership breaks down, particularly if there is significant wealth bound up in the relationship, it is important to seek the advice of an experienced divorce solicitor so that all aspects can be uncovered to ensure that both parties, and any dependants, receive a fair share.

Some couples, especially those who have not made pre-nuptial, post-nuptial or any marital property agreements, may argue about the division of assets and dispute what constitutes marital and non-marital assets.

Marital and non-marital assets on divorce

Deciding what constitutes marital and non-marital assets in a relationship can be complex. Each divorce case will be different to the next and handled by the family law court based on its individual merits. However, there are some fundamental rules of property which can be taken as guidance.

For instance, when a potential spouse inherits wealth before a marriage or civil partnership, this is considered a non-marital asset. But, if the spouse then uses some of that wealth to buy a marital home for the couple this becomes a marital asset and could be subject to equal division on divorce.

An heirloom, such as a piece of jewellery given by a family member to a potential spouse, will remain a non-marital asset as long as it can be proved that it was given solely to one member of the couple alone. If the piece of jewellery is subsequently sold during the marriage, it becomes a liquidated asset. If the proceeds of the sale are kept in the spouse’s sole account, it can still be classed as a non-marital asset. However, if the proceeds are put into a joint account with a husband, wife or civil partner, or put towards joint property for the couple, it will become a marital asset.

Put simply – the tenet of “what is mine is mine” applies as long as you keep the asset separate from any family investments or joint accounts. Keep proof of ownership or inheritance if you want to be able to show a court that the asset was intended solely for you.

Protecting your assets

As the use of pre-nuptial agreements becomes more widespread, it is possibly easier than ever to protect marital assets providing a couple gets good legal advice from a family lawyer. For some, even the thought of such an agreement seems cynical and pessimistic, but it should really be seen as sound financial planning.

When entering into a legal union such as marriage or civil partnership, particularly if there is significant property and wealth at stake, it is important to take stock of the assets beforehand and to maintain at least some knowledge of ownership and levels of wealth throughout the life of the relationship.

If the worst should happen, and the relationship breaks down, spouses will then have a sound schedule of assets which will be invaluable when entering into negotiations for a financial settlement on divorce.

Healys’ divorce solicitors can offer best advice on division of assets

At Healys we believe the best way to achieve fair financial remedy is to ensure all necessary financial information, such as schedules of investments and information regarding marital and non-marital assets, is gathered as efficiently as possible.

Our experienced divorce solicitors, based in offices in London and Brighton, can help you negotiate a suitable financial settlement on divorce by advising on all aspects of the ancillary relief application and all areas of the further negotiations.

For more information on the service we provide, please contact Catherine Taylor on 01273 669 124 or email catherine.taylor@healys.com for Brighton. For London enquiries  please contact Jane Sanders on 020 7822 4107 or email jane.sanders@healys.com