When a marriage breaks down and you are dealing with the impact of separation, it may be tempting to leave financial matters for the time being – particularly if you and your spouse remain amicable and it feels like both parties’ needs are met.
However, although many people think that once the divorce is finalised a former spouse ceases to have the right to make financial claims against the other, this is not the case. As a general rule your right to make financial claims against your spouse, or ex-spouse, and their right to make claims against you continues until these rights are dismissed by a court order. The matrimonial jurisdiction has no statute of limitation which means that if you do not resolve your financial matters, both your and your spouse’s claims will remain open against each other.
It is often preferable to resolve financial matters at the time of the divorce for financial certainty and your own peace of mind. You do not know what your or your spouse’s financial future holds, and the strength of your claims will often decrease over time. Even where financial arrangements are entirely agreed, it is important to take legal advice to understand whether an arrangement is in your best interest and in any event to have a consent order drawn up recording your agreement for the Court’s approval. An agreement reached between two parties that has not been formalised by a Court order and where the parties have not taken legal advice may carry very little weight with a Court, if any, should a dispute arise.
Failing to take legal advice and to resolve financial issues early on can also store up problems for the future. The Court’s approach to financial claims made after a period of delay may vary depending on the specific facts of the case, but whilst in principle there is no limitation on your financial claims, the Court may be unsympathetic to an applicant who applies for financial relief many years after the parties’ divorce or separation.
It should not be forgotten that if you remarry without having applied for a financial order you may have lost the right to make financial claims against your former spouse, but provided that they have not remarried they will still have the same right to make a financial claim against you. Remarriage however does not dismiss the child maintenance claims of the resident-parent of the children of the family and there are limited circumstances in which financial claims may still be available to you.
This is a complex area and if you are in the process of divorcing or are already divorced but would like to resolve financial claims with your former spouse, you should take legal advice to discuss your personal circumstances and potential outcomes.