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Financial Orders Notes

LPC Law Notes > Family Notes

This is an extract of our Financial Orders document, which we sell as part of our Family Notes collection written by the top tier of Cambridge And Oxilp And College Of Law students.

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Financial orders - The package 1) Compile a Schedule of Assets and Liabilities

Where can the financial information be found?

a) The scenario

b) The two parties' Form E's

Assets Property 1) Former matrimonial home

*
Value of Property

*
Less Mortgage

*
Less Costs of Sale

*
Equals Net Equity

Former Husband

2) Other property

*
Value of Property

*
Less Mortgage

*
Less Costs of Sale

*
Equals Net Equity

2)

Bank Accounts All bank accounts owned by both parties/
jointly Other assets 1) Shares 2) Chattels 3) Cars 4) Pensions Total Assets Liabilities 1) Credit cards 2) Loans Total Liabilities

1)

Former Wife

Jointly Owned

Overall value
PS210,000

*

*

*

*

PS200,000 - (PS50,000) - (PS10,000) =
PS140,000 Net Equity

*

*

*

*

PS100,000 - (PS20,000) - (PS10,000) =
PS70,000 Net Equity

PS5,000

PS5,000

PS10,000

PS20,000

1) PS10,000 2) PS10,000 3) PS10,000 4) PS20,000
PS265,000

3) PS10,000

1) PS10,000

PS70,000

PS15,000

PS20,000

PS300,000

1) (PS10,000)

2) PS10,000)

(PS20,000)

(PS10,000)

(PS10,000)

(PS20,000)

Total Net Assets

PS280,000

2) Compile a Schedule of Income and Outgoings

Where can the financial information be found?

a) The scenario

b) The two parties' Form E's

Party receiving maintenance (Wife)

Party paying maintenance (Husband)

Income per annum

Income per annum

Net Salary - PS10,000 Maintenance (currently) - PS3,000 Child Benefit - PS2,000 Total - PS15,000

Salary (Net) - PS50,000 Shares - PS5,000 Beneficiary under a trust - PS5,000 Total - PS60,000

Outgoings per annum Needs (including child) - PS20,000 Total - PS20,000

Outgoings per annum Needs (including child) - PS17,000 Maintenance (currently) - PS3,000 Rent (for own property) - PS5,000 Mortgage (for FMH) - PS5,000 Total - PS30,000

Net Income (Income - Outgoings)
PS15,000 - PS20,000 = (PS5,000)

Net Income (Income - Outgoings)
PS60,000 - PS30,000 = PS30,000

3) The factors the court will consider to decide an appropriate package

1) All the circumstances of the case

The court must have regard to all the circumstances of the case - s.25(1) Matrimonial Causes Act (MCA) 1973

2) The first consideration - Welfare of the child

The court will consider all the circumstances but the first consideration should be the welfare of any child of the family under the age of 18 - s.25(1) MCA 1973

3) s.25(2) MCA 1973 Factors

1) Income, earning capacity, property (assets) and resources of both parties - s.25(2)(a) MCA 1973

a) Use both the Schedule of Assets and Liabilities and the Schedule of Income and Outgoings to establish the 'matrimonial point' irrespective of which partner holds the legal tile

b) Court may divide the assets up into 'matrimonial' and 'non-matrimonial' assets, however most LNW cases are needs driven which will not be satisfied until all assets are included within the matrimonial pot

Matrimonial ? Personal assets acquired during the course of the marriage

Non-Matrimonial ? Assets acquired or inherited before the marriage c) Business assets will be included in the 'matrimonial pot'

d) Earning / outgoings changes due to a new partner / new family will be considered by the court

2) Needs, obligations and responsibilities - s.25(2) (b) MCA 1973

a) First consideration is the welfare of the children - s.25(1) MCA 1973

*
Ensuring the children and their carer have a home

*
Ensuring the other partner has a home which is suitable for the children to come and stay (depending on contact arrangements)

b) Needs due to the outgoings of both parties

a) Basic things such as rent, utilities and food

b) Luxuries such as holidays, gym and socialising

c) Costs in respect of child such as clothes and school fees

c) Needs changes due to a new partner / new family will be considered by the court

b) May add to the financial need by having a second family to pay for

*
A party's obligations to his second family should be a consideration but not a priority - Vaughan v Vaughan

3) Standard of living prior to the marriage breakdown - s.25(2)(c) MCA 1973

a) The court will try to maintain the same standard of living prior to the marriage breakdown

b) If there is to be a drop in the standard of living, the court will ensure it is an equal drop for both parties

4) Age of the parties and duration of the marriage - s.25(2)(d) MCA 1973

Age of the parties

a) If the parties are young and the marriage has been short and childless, there will be an argument for a clean break

b) If the parties have young children, the career's earning is diminished and a clean break may not be available

Duration of the marriage

a) If it has been a long marriage: i) The more entwined the parties' finances will be and the more dependent they will be on one another, and a clean break may not be available ii) The less likely that assets acquired prior to the marriage / inherited are classed as non-matrimonial

b) If it has been a short marriage: i) The less entwined the parties' finances will be and the less dependent they will be on one another, and a clean break may be available ii) The more likely that assets acquired prior to the marriage / inherited are classed as non-matrimonial

5) Physical or mental disability of either party - s.25(2)(e) MCA 1973

If one party suffers a disability their reduced earning capacity may mean they require a greater share of the financial resources and income to meet their needs

6) Past, present and future contributions to the welfare of the family - s.25(2)(f) MCA 1973

This will include non-financial contributions so where one spouse is home make and the other is breadwinner, the court will not discriminate between their respective contributions - White v White

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