New Year has arrived, a series of themes and challenges for practitioners, families and policymakers are predicted to be on the horizon. So, what are they?
- Cost and conduct in litigation
Changes to Family Law in England have been aimed to encourage alternative dispute resolution (ADR) and discourage unreasonable litigation behaviour. The court now has greater power to order one party to pay the other’s legal costs if they unreasonably refuse to consider ADR or engage in litigation misconduct. This includes making unreasonable offers, delaying proceedings, or failing to disclose relevant information. The court will also consider the financial impact of any costs order on the parties. With the new rules now implemented there has been a rise in reported cases where costs and conduct have been reported but will this continue as there is also a trend where ADR is also being weaponised to threaten costs and conduct in circumstances where it is not appropriate for example in domestic abuse cases.
- The impact of domestic abuse in financial remedy claims
Domestic abuse is a serious factor in financial remedy claims, and the courts are increasingly recognizing its impact. The court may consider how the abuse has affected the victim’s financial independence and earning capacity, as well as any financial losses caused by the abuse. The court may also take into account the abuser’s conduct in dividing assets, particularly if it was intended to financially control or isolate the victim. Whilst domestic abuse is looked at in detail in injunction and domestic abuse cases, the Financial Remedy Courts will need to adopt a more forensic approach to testing allegations.
- Standish in the Supreme Courts
The Standish case, currently under appeal to the Supreme Court, revolves around the division of assets in divorce proceedings. The key issue is whether pre-marital assets should be considered “matrimonial” assets subject to the sharing principle (now terms matrimonialised), or if they retain their non-matrimonial status and can be protected. The case is important because it could significantly impact how courts handle the division of assets in divorce cases, particularly in high-net-worth situations where one spouse brings substantial wealth into the marriage. The judgement could influence how families share their wealth and pre-nuptial agreements.
- VAT on school fees and applications to change schools
The 20% VAT adds a substantial financial burden for parents, particularly those with multiple children in private education. This could lead to increased disputes between separated parents regarding who should bear the additional costs or if a child should remain in private school. The court will ultimately prioritize the child’s best interests when making decisions about school fees. This may involve considering alternative, more affordable education options if the increased costs are deemed unsustainable.
- Physical and mental health discrimination
Physical and mental health conditions can significantly impact family law matters; I the context of children cases there needs to be an assessment of how health impacts on a parents ability to meet a child’s needs and in finance cases, a spouses ability to work and earn. In finance cases the physical health needs of a spouse or child are given weight, however less so in respect of mental health where this is seen as more transitional issue during the life of a case and concerns will alleviate post separation. As a society more is said about mental health and so time will tell whether this is put on the same footing in Financial Remedy cases.
- Family Businesses
The Autum 2024 budget has had a significant impact on business who will now have to pay tax with the net effect being that profits may be impacted – for the family business that is the subject of a financial remedy claim, the new tax regime may mean that business valuations have to be reviewed.
