How To Reach A Settlement

How to reach a financial settlement

For most separating couples, the divorce itself is straightforward, but the financial settlement is the most complex issue. 

Most couples are able to agree arrangements in respect of their children, but occasionally significant disputes or problems can arise.  The approaches set out below apply equally to disputes in respect of financial matters as they do to disagreements over children.

Likewise, the different routes available apply to couples going through a divorce or separation as well as unmarried couples and civil partners.

For couples with limited means and straightforward circumstances, they should be able to reach an agreement with relatively modest involvement from solicitors.  By contrast, those with complex financial arrangements will often benefit from the structure of the court process.

The options are as follows:

'Kitchen table agreement'

Young couples with simple financial affairs can often reach an agreement face to face.  Before sitting down together, it is essential to receive advice beforehand from a specialist family solicitor.

Do you know your legal entitlements?
If you do wish to negotiate direct with your partner/spouse, before doing so, you need to know your legal entitlements upon divorce or separation.  For example, do you have an entitlement to ongoing maintenance or a share of their pension?  An initial meeting with one of our specialist family lawyers will provide you with all of the information you require to discuss an amicable settlement with your partner or spouse. See our page on keeping divorce costs to a minimum.

If you are going through a divorce or dissolution of a civil partnership, you should however be aware that any agreement you reach with your partner will only be made final and binding once it has been made into an order of the court as part of the legal process.  We can promptly draft court orders based upon agreements reached by couples.  By contrast, if you are unmarried, then any such agreement should be recorded in a formal deed of separation which we can prepare on your behalf.

Mediation

Mediation entails you and your partner attending a series of meetings with an independent person called a mediator.  They will assist you in agreeing a financial settlement or arrangements for your children.  The role of the mediator is to take an objective view and assist you in reaching a constructive agreement.

The number of mediation sessions required will depend upon how quickly you can reach an agreement, although many couples are able to resolve disputes after three or four sessions.  Once an agreement has been made, then you need to contact us to turn any financial settlement into an order of the court.

Even though we would not attend mediation sessions with you, we are still able to advise between meetings.  You would therefore have our full support, whilst at the same time engaging in constructive face to face discussions with your partner.

Mediation is not however suitable for all people. Some feel that they are unable to negotiate or discuss matters from a position of strength as they may feel bullied or intimidated by their partner.  At an initial meeting with us, we would be able to assess your own circumstances and advise you upon whether we feel mediation is suitable for you.

Collaborative law

For more details on the collaborative process, please see our separation section on collaborative law.

Negotiations through solicitors

Many couples say that they want to negotiate a settlement "out of court".  This is perhaps the most common and traditional method in which to reach financial settlements upon divorce, the ending of a civil partnership or a cohabiting relationship.  It can also be used to agree future arrangements for your children.

Using this traditional method, the provision of financial disclosure will take place through solicitors.  Both you and your partner will provide full details of your financial affairs and, if necessary, experts can be instructed to provide valuations of assets, such as the family home or, if appropriate, the family business.  Once that financial information has been provided and the valuations obtained, then negotiations can take place through solicitors.

Such negotiations will usually take place by way of letters between solicitors or sometimes over the telephone.  On occasions, a "round table meeting" may take place to resolve any outstanding issues.

In any event, once an agreement is reached regarding financial issues, then that will be made into an order of the court so that it is final and binding.

Court proceedings

An application may be made to the court to timetable the financial aspects of the divorce.  This is known as an 'application for a financial remedy'.  There are various reasons why an application may be made, but the following are the most common:

• your spouse or partner is refusing to provide details of their financial affairs.  If so, as part of the court process, your partner will be compelled to provide full details and evidence of their financial affairs in accordance with the strict court timetable
• your spouse or partner has put forward completely unrealistic proposals for settlement.  For example, you may be entitled to half of the assets of the marriage, yet your husband has offered you a small fraction of that
• your financial affairs may be complex and you may therefore benefit from the structure of a court timetable.  A tight court timetable will regulate the provision of financial information and the instruction of experts to value assets.  Without a tight court timetable the provision of information on a voluntary basis can be slow and sometimes an agreed timetable may drift

If a financial settlement cannot be agreed during the court timetable, then ultimately the application will lead to a final contested hearing before a Judge.  That Judge will then impose a decision upon you and your spouse/partner.  It is however extremely rare for applications to go all the way to final hearing and most couples are usually able to agree a settlement before then.

An important part of the court process is the Financial Dispute Resolution hearing (known as the FDR) which is an opportunity to attend at court and negotiate an agreed settlement with the input and benefit of the judge and legal advisers.

The court process can be used in respect of disputes over children.  Although most couples are able to agree arrangements for children without the involvement of the court, an application may still be required if there is a fundamental dispute that cannot be resolved.  For example, if your spouse or partner is preventing your children from seeing you, then an application to the court must be made.  Likewise, there may be a fundamental dispute about with which parent the children will live in the future, or there may be a dispute over the part of the country where the children may live in the future.

The appropriate route for you will depend upon your own circumstances.  For example, although mediation is perfect for some couples, it is wholly unsuitable for other clients.  With our many years of experience as specialist family lawyers, we will be able to advise you upon the best option for you at an initial meeting with us.

To arrange a discussion with a family law solicitor click here or call us on 0800 840 4929. We are available to take your call twenty four hours a day, seven days a week.