Agreeing a financial settlement is a huge milestone during the negotiation process of a divorce. It is advised that separating couples obtain a financial order that sets out this settlement, as whilst this is not mandatory, it will make this agreement legally binding.
Some lucky couples can decide on how to divide up their assets, agreeing their financial settlement without the need of going to court. However, to ensure both parties are protected, and the agreement is legally binding, a solicitor can draft a ‘consent order’ that both parties must sign.
This is then sent to the court with a completed Form A (notice of your intention to proceed with an application for a financial order), a Form D81 (statement about the parties’ financial situation to support your application for a consent order), and a £53 fee (administration fee).
However, a lot of couples fail to agree on a divorce financial settlement, which means that the court will have to decide for them.
In most cases, the process will follow the ten steps highlighted below, however, an agreement can be made at any point during this process. If that is the case, then this is agreed and signed in a legally binding court order to confirm all the details.
Providing notice of application – Form A
To kick start the financial settlement process, you will need to send a completed Form A (notice of your intention to proceed with an application for a financial order) to the courts.
This document will outline the kind of financial order you are looking for, at what stage you are at with the divorce or dissolution of a civil partnership proceeding, contact details of the separating couple or legal representatives, and information about the Mediation Information and Assessment Meeting (MIAM).
First Directions Appointment date
Once you have provided your application, the court will then set a date for the First Directions Appointment (FDA). This is the first hearing in relation to your financial dispute arising from your divorce.
This is an opportunity for the judge to consider what information each party needs to provide to create the divorce financial settlement. Both parties are encouraged to reach an agreement if possible. If this cannot be agreed, a second hearing with the FDA will be arranged to allow for further negotiation.
Financial statement – Form E
Form E (Financial Statement) is an important document in the UK divorce process since it acts as the starting point for the financial settlement negotiations.
Both parties send the court a Form E at least five weeks before the FDA hearing. You must also send a copy to each other.
The purpose of this document is to ensure both parties disclose their financial circumstances, including income, assets, liabilities, and projected financial needs.
These documents are filed by both parties two weeks before the FDA:
- A concise statement of issues.
- A chronology of events.
- A questionnaire which is supposed to address the statement of issues.
- A Form G, whereby you tell the court whether the FDA meeting can be used for a Financial Dispute Resolution (FDR) appointment. Typically, the FDR meeting takes place after the FDA meeting.
Costs – Form H
At this stage, each party will send the court a completed Form H just before the FDA meeting, listing any costs they have incurred.
This document sets out all the costs of the financial remedy proceedings, including costs from before and after the application was issued.
FDA meeting at court
The judge will consider both you and your partner’s financial disclosures and establish whether further information is required from either of you.
Many judges are keen to see whether a resolution meeting (skip to the final hearing section) can take place at this stage. If not, a date is set for the FDR meeting.
Both parties will answer questionnaires, prepare evidence, and submit proposals to the court for the divorce financial settlement.
Both sides also submit a second Form H, which lists updated costs.
During this hearing, the judge will focus on encouraging both parties to agree on a financial settlement, through judge-led negotiations.
Most divorcing couples settle at this stage (or soon afterwards). If not, the judge will arrange a final hearing, where both parties will need to make new offers and provide evidence.
The negotiations continue between both parties, including revised proposals for the divorce financial settlement which are sent to the court and to the other party.
This is usually the third and final court hearing within the financial remedy process.
In the absence of any agreement and following the submission of updated costs on a Form H1, a new judge will decide on your financial position and impose a settlement on your behalf.
One of the most important parts of getting a divorce is reaching a financial settlement. Many couples can agree this without the need of going to court however, but a lot of separating partners find difficulty in achieving this.
Perhaps one person is not providing their financial information, or they are not making sensible proposals, in that case, court is advisable.
By following these simple steps and receiving professional advice, you will be on your way to a Fair Result and a happy, brighter future.
Do you require specialist expertise in securing financial settlement? Get in touch with our team today.