How will Lockdown and the Covid restrictions impact on future divorces?

Partners, Fiona Turner and Noel Ferry from Weightmans talk about how delays in weddings and divorces due to Covid can potentially impact on the financial settlement if there is a divorce.

Attention is currently focussed on the Government’s policy for weddings as we ease out of covid restrictions, the wedding industry having taken a huge hit since March 2020. It is estimated by www.bridemagazine.co.uk that over a quarter of a million UK weddings were postponed during 2020 alone, with even more affected during 2021.

It is also estimated that many people postponed a divorce until lockdown began to ease, being forced to continue living under the same roof and unwilling to trigger a divorce in that situation.

How could this possibly impact on future divorces? Weightmans’ family team in both England and Scotland explore the issues.

Date of marriage

England**: In England, the court has a statutory duty to factor in the length of the marriage when exploring the scope of a fair and reasonable financial settlement. A delayed wedding means a shorter marriage, and possibly a lower financial settlement depending on the facts of the case.

However, it is not quite as clear cut as that, as English law often ‘adds’ a period of cohabitation to the length of the marriage if it is ‘seamless’ and so the parties transition from living together to marriage without a break.

Many couples who have delayed their wedding may have chosen to cohabit, or continue cohabitation, in which case the impact of a postponed wedding is likely to be limited.

Although arguable in some cases that assets accrued pre-marriage should be treated in a different way to assets generated during a marriage, in England all resources held by both parties at the time of a divorce, whenever accrued by them, are put on the table and subject to analysis by a court when assessing what a fair settlement might look like.

Scotland: The date of the wedding has a much greater impact in Scotland. The matrimonial property available for a fair financial settlement is limited to those resources acquired by the parties during the course of the marriage.

Any assets acquired before the marriage would not be considered ‘matrimonial property’ and would continue to belong to the party who acquired them before the marriage.

(There is an exception to this last rule in that any property or its contents acquired before the marriage which the parties use as a family home or contents/plenishings would be deemed to be matrimonial property and available for division on divorce.)

As such, wealth generated by the parties whilst they wait for their wedding date to take place is likely to be unavailable for division on a future divorce in Scotland.

Date of Separation

England: When assessing the scope of a financial settlement, the English court will assess all resources, whenever accrued, although in some cases assets generated post-separation might be treated in a different way.

Scotland: Once again, the date of separation has a much greater significance over the border.

The matrimonial property available for a fair financial settlement is limited to those resources acquired by the parties during the course of the marriage up to the ‘relevant date’. This is usually the date that they separate but it could be the date of service of the summons in the action for divorce.

For example, if a party won the lottery, or received a significant inheritance, the week after separation the other spouse would not have any entitlement to a share of the same on divorce.

If a decision to separate was delayed, assets accrued to the ‘relevant date’ will be available for division on divorce.

Pre Nuptial Agreements

Finally, a word of warning to those parties who properly prepared their pre nuptial agreements in good time, ahead of their planned weddings, only for the wedding to then be postponed.

It can be common for a pre nup to contain a clause that the pre nup ‘expires’ if a wedding takes place later than anticipated. The rationale is that if there is a significant time lag between the pre nup being prepared and a wedding, this will avoid the pre nup becoming stale or out of date.

Do check the wording of any pre nup to ensure that you do not fall foul of such a clause. If you do, take immediate action to refresh the pre nup with your legal team.

References
*when referring to divorce, we also include reference to civil partnership dissolution
** when referring to England, we also include Wales, as the legal jurisdiction comprises of both England and Wales