Author: Joanna Blakelock

Every January, the press take great pleasure in writing about Divorce Day, which is considered to be the most popular day for divorce petitions to be filed with the court.  It is fair to say that most family lawyers see an uplift in enquiries at the start of the new year, when in many cases couples have stayed together for the sake of their children, spent Christmas together, and then choose to action their separation more formally once the Christmas decorations have been packed away.

However an issue that has possibly also affected and influenced peoples’ decisions to action their formal separation or divorce, are the increased costs that everyone has been faced with in this present cost of living crisis. Potential clients are becoming increasingly reticent and concerned to initiate proceedings, with many taking advice and then telling us that they want to sit tight, believing a divorce or separation to be ‘unaffordable’ at the moment.

Certainly, mortgage costs have increased exponentially, and house values have simultaneously slumped, with the property market on its knees. The prospect of dividing one house into two and of paying a mortgage at current interest rates, is a very real worry for people. It makes it even harder for them to fathom and deal with the situation than it naturally is in a ‘good’ financial climate.

Some people choose to emotionally separate but not formally move apart and deal with their financial arrangements. This arrangement is often something that we would advise against. Whilst some may believe that they would prefer to wait until asset values increase, the family business picks up, or until the house prices go up, this can be a false economy. Certainly, once a couple (or even one party) has made the decision to separate, staying in a marriage or relationship at that stage can be very claustrophobic and stressful, and can also seriously impact the mental health of children involved in the midst.

It is true to say that this arrangement will also only work if there is complete trust between the separating couple. If there is not, and one of the couple has the majority control of the finances, there is every chance that money might be over-spent, moved around, the ownership of assets changed… It is crucial to deal transparently with financial disclosure in the event of a financial separation and divorce, but if one party is intent on making this difficult, and if they have been given even more time to action any such dealings with any delay in formally sorting out the financial separation, it will make it much harder, and much more expensive, to unpick the truth and work out what a true representation of any financial outcome ought to be.

Prolonging the inevitable might not be the best financial decision in the long term, particularly if pensions need to be divided. We have seen drastic fluctuations in pension valuations recently. Whilst that of course affects everyone across the board, formally sharing pensions on divorce sooner rather than later at least provides some certainty to the recipient party that they have full control of their share of what is often the most significant asset of the marriage or partnership, after the family home, even in a volatile market.

The timetabling of the way in which a person chooses to handle their personal life, and the huge decision of ending a relationship with all the emotional difficulty that comes with that, is entirely their decision. As family lawyers, we must be mindful of the potential pitfalls that come with waiting, which we will always discuss with them honestly but mindfully. Divorce is not something that ought to be, nor is it usually rushed in to, especially when children are involved. In the event that we are instructed to assist, when someone decides to press ahead, our aim is to advise pragmatically from the outset to try to preserve a good working relationship with the other party and/or their solicitor, and give advice that is sensible from the outset in terms of preserving your costs position. If, therefore, one of the big concerns is proportionality in dealing with the case sensibly and cost effectively, and that is what is putting a potential client off from formally actioning their separation, we can certainly assist.  At the very least, anyone who is considering divorce and is concerned about the costs or potential outcome, should get legal advice early on to discuss the pros and cons.   

International travel has boomed since the pandemic, with many families planning trips abroad to make up for lost time.  Holidays can be a great opportunity to create fun memories for children in particular, but what happens when one parent wants to take a child on holiday without the consent of the other parent? This article will consider the law in relation to parental rights, the position on taking children abroad following divorce or separation, and provide guidance to help parents navigate the relevant considerations to be made.

Parental responsibility and the law

The rules around taking a child abroad without consent hinge on the concept of parental responsibility. The Children Act 1989, which defines parental responsibility as “all the rights, duties, powers, responsibilities and authority which by law a parent of a child has in relation to the child and his property.” Practically, this means that a person with parental responsibility may make decisions about the child’s upbringing, such as:

  • Where the child goes to school;
  • How to discipline the child;
  • Consenting to the child’s medical treatment; and
  • Choosing, registering or changing the child’s name.

How long does parental responsibility last?

Parental responsibility usually comes to an end when the child reaches the age of 18. The responsibility may however end earlier if:

  • A court makes an order terminating the responsibility; or
  • A child arrangements order ends or is discharged.

Who has parental responsibility?

Parental rights as a mother differ slightly from a fathers’ rights. In England and Wales, a mother automatically has parental responsibility for her child from birth. A parent who is married to or in a civil partnership with the birth mother will also automatically have parental responsibility for the child from birth.

If parents are not married, a father may usually obtain parental responsibility by:

  • Being named on the child’s birth certificate or birth registration (if the child was born after 1 December 2003);
  • Marrying the child’s mother;
  • Entering into a parental responsibility agreement with the child’s birth mother; or
  • Applying to a court for parental responsibility, sometimes known as a ‘parental rights order’.

Other adults may acquire parental responsibility in some circumstances, for example, through adoption.

Can parental responsibility be removed?

Parental responsibility will only be removed in extreme cases where it is in the child’s best interest. For example, for the protection of the child’s physical or emotional health. 

Note that the concept of parental responsibility is distinct from the issue of child custody or child arrangements, which concerns a child’s living arrangements, both in terms of where they live and with whom, and the time they spend with the other non-resident parent.

The rules

In order to take a child abroad for any length of time, consent must first be obtained from every individual with parental responsibility for the child. In the absence of consent being provided, the parent seeking to remove the child from the jurisdiction must apply to the court for permission in good time, and certainly well ahead of any planned trip. However, it is worth noting that if there is a child arrangement order which states that the child lives with you (and spends time with the other parent – what used to be called a ‘residence order’), and there are no court orders preventing you from taking the child abroad, then you may take them abroad for up to 28 days without the requirement to obtain consent from the non-resident parent in advance.

Where consent is required, it is advisable to get written consent in the form of a signed letter from each other individual with parental responsibility towards the child. You may be required to produce this letter at the UK or foreign border, or you may need to rely on it in the case of any dispute. The letter should include contact details for the other person. If you and the child do not share a surname then it is also wise to carry documents which evidence your relationship with the child, such as a birth or adoption certificate, a divorce or marriage certificate, or any change of name deed where relevant.

If you are unable to get consent of other individuals with parental responsibility to take a child abroad, you can apply to the family court for permission. This will involve providing details about the trip, such as the destination, and proposed departure and return dates, as well as details of other people with parental responsibility staying in England and Wales. The court will consdier your application and may then make what is referred to as a ‘specific issue order’, allowing the child to go abroad.

Conversely, if a parent or other adult with parental responsibility wishes to prevent a child being taken abroad, perhaps because of concerns that the child will not be brought back to England or Wales, they may apply to the court for a ‘prohibited steps order’ to stop the child being taken abroad.

In each case, the court will consider the wishes of the parents (or other adults with parental responsibility) and decide what is in the child’s best interests. 

As with all matters relation to children, it is preferable to seek to reach an agreement outside of the courts directly with the other parent in the first instance, using open and honest communication, or other means of dispute resolution, such as mediation, before engaging in court proceedings.

What happens if you don’t get permission?

If you do not have the appropriate permission to take a child out of the jurisdiction of England and Wales, or abroad internationally, and you do so anyway, you could face charges of child abduction. Child abduction is a criminal offense under the Child Abduction Act 1984 and it can carry serious consequences.

How can we help

Whether you are divorced or separated we understand that you want to continue creating memories with your child. This issue of taking a child abroad can be complex where there is disagreement amongst adults with parental responsibility for that child. Our experienced team of family lawyers at Edwards Family Law will help you navigate your parental legal rights, responsibilities, the relevant legal procedures and other considerations to ensure that you are able to reach a solution that is in the child’s best interests. If you have any questions, please get in touch with us at Edwards Family Law.

Child maintenance payments play a key role in ensuring the financial support of children whose parents are no longer in a relationship. This article will explore how maintenance payments are calculated in England and Wales and important points to be aware of.

What is child maintenance?

Child maintenance is a regular payment made by the paying parent to the receiving parent of a child following divorce or separation. It can also be payable even if the parents have never been in a relationship.  The maintenance payments cover the child’s living costs when one of the parents does not live with the child. The person paying child maintenance, the “paying parent”, is the person who does not have the main day-to-day care of the child. The receiving parent is the person who does have the main day-to-day care of the child. 

A child maintenance agreement must be in place if the child is under 16, or under 20 and still in full time education, up to and including A level or equivalent. Child maintenance payments may be agreed privately between parents, or can be put in place more formally by the Child Maintenance service (CMS). The CMS calculates weekly child maintenance payments using a six step process, which takes into account various factors with the aim of arriving at a fair figure. It is possible to use the CMS calculator and use that figure privately and ‘informally’ between parents.

Working out child maintenance

If the CMS is contacted by the parent with the main day-to-day care of the child and is asked to formally assess the amount payable, the following steps are undertaken.

Step 1 – working out income

The CMS will gather information from HM Revenue and Customs (HMRC) to ascertain the paying parent’s annual gross income. The CMS will also check if the paying parent is receiving benefits. Tax credits, student grants and loans will not be counted as income.

Step 2 – looking at factors affecting income

The CMS will check for factors which could increase or decrease the gross income amount, for example, pension payments, and/or other children the paying parent is supporting. 

Either parent may ask for extra income, assets or expenses to be taken into account, such as:

  • Rental income exceeding £2,500 a year;
  • Interest and dividends from savings and investments exceeding £2,500 a year;
  • Any income the paying parent may be diverting to avoid it being included in the calculation (for example, by giving it to someone else); and
  • Assets like shares, stocks, gold or money worth more than £31,250.

As the paying parent, you may ask for the following expenses to be taken into account:

  • Costs of keeping in contact with a child you pay maintenance for (for example, fuel to travel between your home and the child’s home with the other parent);
  • Costs of supporting a child with a disability or long-term illness who lives with you;
  • Repaying debts from a previous relationship;
  • Boarding part of boarding school fees for a child you pay maintenance for; and/or
  • Mortgage, loan or insurance payments for the home you used to share with the receiving parent – if the receiving parent and your child still live there.

The CMS will then convert the yearly gross income into a weekly figure.

Step 3 – applying child maintenance rates

There are 5 different rates and the one that applies will depend on the gross weekly income of the paying parent:

Gross weekly incomeRateWeekly amount
Unknown or not providedDefault£38 for 1 child, £51 for 2 children, £64 for 3 or more children
Below £7Nil£0
£7 – £100, or if the paying parent gets benefitsFlat£7
£100.01 – £199.99ReducedCalculated using a formula
£200 – £3,000BasicCalculated using a formula

If the paying parent’s gross weekly income exceeds £3,000, the receiving parent may apply to the Family Court for extra child maintenance in the form of a ‘top up’ order.

Step 4 – other children

The CMS will take into account how many children the paying parent has to pay maintenance for, whether this has been arranged privately by the parents, or through the CMS.

Step 5 – weekly amount of child maintenance

Using all the gathered information, the CMS will decide the weekly child maintenance amount.

Step 6 – shared care

Occasionally the paying parent’s child may stay overnight with the paying parent. Where this is the case, CMS will make a deduction from the weekly child maintenance amount based on the average number of ‘shared care’ nights in a week.

Changes to child maintenance payments

The amount due for child maintenance payments may change as a result of the CMS’ annual review of a case. Each parent may apply for a variation. 

There are certain changes which must be reported to CMS by law, such as:

  • A change in how often the child stays overnight with the other parent;
  • A change of address (CMS must be notified within 7 days of moving);
  • A change in who the child’s main carer is; or
  • A change of bank details. 

Failure to provide requested information or the deliberate provision of false information could result in a fine of up to £1,000.

If a parent is unhappy with the CMS calculation of maintenance payments, they must ask for the decision to be looked at again in a process called ‘Mandatory Reconsideration’, before they will be allowed to submit an appeal to the Social Security and Child Support Tribunal.

How we can help

It is important to reach a child maintenance agreement that is in the best interests of the child, and fair to both parents. Whether you need support in reaching a child maintenance agreement privately, or you would prefer to use the CMS process, our experienced team of family lawyers at Edwards Family Law will help you navigate your options and help you reach a suitable solution.

The meaning of “real need”, as interpreted by English courts in post-Radmacher divorce cases, is analysed by Joanna Blakelock and Kate Pooler, a partner and an associate solicitor at Edwards Family Law.

The Supreme Court case of Radmacher v Granatino [2010] 2 FLR 1900 still leads the pack for the validity of nuptial agreements. Upon divorce, the starting point is that all marital assets are shared equally, otherwise known as the “sharing principle”. Generally, the aim of a nuptial agreement is to “contract out” of the sharing principle and restrict financial claims on divorce to “needs-based” claims only.  

Suffice to say, the English court is not bound to uphold nuptial agreements as a “contract”. However, Radmacher established the presumption that the terms of a pre-nup will be upheld and approved by a court. It therefore falls to the party who does not want to be bound by the agreement to argue why its terms should not be followed.

So, what is “real need”?

Radmacher decided that if a nuptial agreement left a former spouse in a “predicament of real need” then it would probably be unfair to hold the parties to that agreement. “Real need” was interpreted at a very low level in Radmacher and only required that a spouse was not left “destitute”.

Since Radmacher there has been relatively little guidance from the courts about the meaning of the phrase “predicament of real need” and where there has been guidance, judges have taken a range of views in this discretionary area.

One view: Fairness will not equate to near destitution…

In the 2016 case of WW v HW (Prenuptial agreement: Needs: Conduct), the couple’s pre-nup stated that neither party would have any claim to the other’s pre-marital, gifted or inherited property on divorce. Their relationship lasted 12 years and they had two children. The only joint asset was the former marital home which was worth GBP4.5 million, to which the wife had contributed 86% of the purchase price. The wife had inherited assets of circa GBP27 million.

“Radmacher requires the court to consider the pre-nup’s fairness in all the circumstances of the case at the time of the divorce.”

The judge made clear that the husband’s claim was limited to needs (on account of the pre-nup) but was concerned the husband would be left in a “predicament of real need” if the terms of the agreement were upheld.

The judge questioned whether the husband’s needs should be interpreted as “the minimum amount that is required to keep him from destitution” and whilst he judged that the presence of the pre-nup itself reduced the parameters of a needs award, this was not to the point of only saving the husband from destitution. He awarded him a housing fund of GBP1.7 million on a lifetime basis (with 45% of this sum reverting to the wife in 2027); a capitalised income fund of GBP215,000; and child maintenance payments of GBP18,000 per child, per annum.

Normal “reasonableness” considerations are still relevant

In the 2018 case of KA and MA (Prenuptial Agreement – Needs), the wife advanced a needs-based claim for GBP6 million (the pre-nup would have resulted in an award of only GBP1.6 million). In total, the judge awarded her GBP 2.95 million.

The judge said that Radmacher requires the court to consider the pre-nup’s fairness in all the circumstances of the case at the time of the divorce, which included the wife’s contributions to the marriage, the standard of living the family enjoyed, and which the husband (and the children whilst with him) would continue to enjoy. The judge was very careful to avoid too great a discrepancy between the children’s standard of living with each parent. These are the kind of “needs” considerations that would be taken into account in a divorce in the absence of a pre-nup. The judge awarded the wife a capitalised income fund for life at a rate of GBP100,000 a year (albeit with a 25% step down when the parties’ child reached the age of 21 or completed tertiary education). It is noted that she would have ordered GBP150,000 a year had the pre-nup not existed, demonstrating the role of a pre-nup in constraining a “needs based” claim.    

Another view: a nuptial agreement should not markedly reduce a normal “needs” assessment… 

In the more recent 2019 case of Ipekçi v McConnell another judge took another view. The couple had a pre-nup which, if upheld, would not have left the financially weaker party (the husband) “destitute” on divorce, but would have meant that his financial situation would be seriously strained.

The wife was an heiress with beneficial interests in trusts in the United States worth around USD65 million. The judge went beyond Radmacher, stating that he did not think that a valid pre-nup should result in a needs assessment that is “markedly less than needs assessed in ordinary circumstances. If you have reasonable needs which you cannot meet from your own resources, then you are in a predicament.” In any event, the judge deemed that the pre-nup fell short of compliance with the Radmacher principles and decided not to hold the couple to its terms. The husband was awarded a lump sum of GBP1,333,500.

The law is still uncertain; protect yourself

There remains uncertainty and inconsistency in the exercise of judicial discretion when it comes to the interpretation of Radmacher.

Nonetheless, if the effect of the proposed terms is designed to satisfy the financially weaker party’s housing and income needs, taking account of a reasonable standard of living, then the terms are likely to be considered “fair” and will be upheld by the court. Put another way, if the pre-nup inadequately provides for the financially weaker party, the agreement is unlikely to be worth the paper that it is written on and could lead to costly litigation, which undoes precisely the certainty that is initially sought. It is important to get the balance right.

Nuptial agreements certainly have a place in today’s family law climate, serving an important function of certainty and security for both parties. It is crucial to take early legal advice on the personal circumstances of individual cases. Enough time should be left for sufficient disclosure to be produced and shared, for adequate advice to be provided to the financially weaker party, and for negotiations to take place.

One of the most contentious issues in high net worth (HNW) divorce cases is the continuing payment of school fees. Often this is because when a couple divorces, the income of both parties reduces, making it much more difficult to cover private school fees. In the recent case of de Renner v Galbraith-Marten [2022] EWFC 118, The Hon. Mr Justice Mostyn ruled that a King’s Council did not have to pay for his daughter to attend private school. The father’s other two children attended state school, as he himself had done as a child, and the court accepted that the father could not afford private school fees for all three children. Furthermore, the father had never intended for any of his children to be educated privately.

The Hon. Mr Justice Mostyn concluded:

“The mother has emphasised to me repeatedly that the father was deprived of parental responsibility in Australia (but not here) and that accordingly, in her opinion, hers is the only parental voice that should be heard on the question of education. The father should have no say or other input, according to her, other than to pay. In my judgment to force him to do so would be a gross injustice which I am not prepared to contemplate.”

The issue of who pays for private school fees following a divorce is a serious one when considering the welfare of the child. For example, if they are already in a private school, being removed and enrolled in a state school adds to the instability already generated by the divorce itself. On the other hand, the older and more settled the child is at their private school, the greater the scope for potential harm.

Is private schooling a ‘need’ in terms of a divorce financial settlement?

As we have previously mentioned, the court must consider all the factors under section 25 of the Matrimonial Causes Act 1973 when deciding the outcome in a financial remedy application in the event of a divorce or dissolution. These factors are:

The resources available to the parties, both capital and income, being both extant or reasonably foreseeable;

The financial needs of each party, considering the needs of dependent children and any disabilities; The duration of the marriage and the age of the parties;
The conduct of the parties (but only in exceptional circumstances);
The standard of living enjoyed by the parties;

Any benefit either party will lose as a result of the divorce; and
The contributions of each party to the marriage (both financial and non-financial).

Although, in an ideal world, it would preferable to be able to say more categorically whether or not private schooling is viewed by the court as a ‘need’, it is simply not possible to do so. This is because the court will look at all the facts relating to the matter, for example, the financial situation of both parties now and in the future, both in terms of income and capital, the intentions of both parents regarding private education and the age of the child (or children) and how settled they are at their existing school.

How can I ensure that my ex-spouse pays all or part of the private school fees?

If possible, it is always preferable for couples to work out a financial settlement following divorce between themselves. This can be done through negotiation between themselves or with the assistance of solicitors, and can be assisted alongside by the process of mediation. This can be much quicker and cheaper than going to court. Another great advantage of keeping the matter between the parties and out of court is that alternative dispute resolution methods are confidential, thereby safeguarding your child’s privacy.

If your child (or children) are old enough, you may wish to consider child-inclusive mediation. This would provide the children with the opportunity to attend mediation to express their own views on their schooling, and how any

changes, either to fee- or nonfee-paying education, might affect them. Whilst their comments and views would not be binding on the parents following those discussions, it can be a powerful indicator to parents as to their children’s wishes and feelings in the context of the matter as a whole, which can sometimes crack the case one way or another.

As members of Resolution, we are committed to helping HNW couples resolve their family law disputes in a respectful, non-confrontational manner. Mediation and other alternative dispute resolution methods provide a way to communicate effectively on important matters, such as your child’s education, and reach an agreement that is beneficial for the entire family in the midst of what is often a very difficult period in the family’s life.

Once an agreement is reached, our family law solicitors can present it to the court and have what you have agreed made legally binding in the form of a Consent Order.

If you require advice on paying school fees following a divorce, please do not hesitate to contact us.

Edwards Family Law is a niche London-based firm specialising in high-net-worth divorce, separation, and international family law matters. To find out more about divorce and financial settlements, please telephone +44 (0)20 3 983 1818 or email contact@edwardsfamilylaw.co.uk. All enquiries are treated in the strictest confidence.

In a social climate which sees fewer and fewer couples deciding to get married, or enter into civil partnerships, the subsequent separation of cohabiting parties is causing increasing difficulty in circumstances where they are simply not afforded the same financial rights on separation as divorcing couples or in the dissolution of partnerships.

Despite considerable pressure from family law solicitors, barristers, and judges, and family law groups such as Resolution, there is still reluctance amongst politicians to change the law in England and Wales so that it recognises the legal rights of cohabiting couples.

For unmarried parents who require financial provision to provide for their children following the end of a relationship with a high net worth (HNW) person, there is some light at the end of the tunnel.

Alongside an application for child maintenance to the Child Maintenance Service (CMS), an application for financial provision for the benefit of the child(ren) of the family can be made under Schedule 1 to the Children Act 1989.

What does Schedule 1 to the Children Act 1989 say?

Schedule 1 provides the Court with limited powers to make financial provision available for the benefit of the child(ren) of a relationship, where the parents were not married and have subsequently separated.

Needless to say, Schedule 1 also comes into play in circumstances where a child has been born to a mother, even after a very brief or fleeting relationship with the father.

It is possible to apply for the following orders:

  • Periodical monthly maintenance payments for yourself on the child’s behalf (or to an adult child directly, where applicable);
  • Secured periodical payments for yourself on the child’s behalf (or to an adult child directly, where applicable);
  • Lump sum for yourself on the child’s behalf (or to an adult child directly, if applicable);
  • Settlement of property for the benefit of the child, reverting to the paying party at the end of a specified term; and/or
  • A transfer of property outright to you on the child’s behalf (often held on trust for them) (or to an adult child directly), but this is only likely to happen in very specific and limited circumstances.

Who can make an application under Schedule 1 of the Children Act 1989?

The Court can make a periodic payment order in respect of:

  • Topping up the CMS maximum assessment amount, if the non-resident parent’s income is greater than £156,000 gross per annum. The Court will need to be satisfied that the circumstances of the case make it fair and reasonable for a top up order to be made;
  • A regular payment for school fees or vocational training; and/or
  • Meeting any reasonably foreseeable recurring expenses associated with the child’s disability (if they have one).

When would a Schedule 1 lump sum order be made?

Lump sum orders can be made by the court for the purposes of enabling liabilities and expenses already incurred in connection with the child to be met. These can even include the costs of their birth in some circumstances, or costs more generally which have been incurred in maintaining the child, even where those expenses were incurred prior to the application (as long as the application is made without unreasonable delay).

Specific future expenses and foreseeable liabilities can also be claimed. Whilst the court’s discretion is wide, the welfare of the child is paramount. Provision might be made, for example, for furniture for a new home purchased for the benefit of the child, a car to transport the child, or indeed a sum to be invested for future school fees. Lump sums are not, however, designed to be maintenance ‘by the back door’ for the resident parent.

How does the Court decide whether an order should be made?

The welfare of the child is a paramount consideration of the court in deciding these cases, and the standard of living enjoyed by both of the parties to the proceedings will also be considered. If, for example, the non-resident paying party is very wealthy and enjoys a luxurious standard of living, incredible accommodation, designer clothes and numerous international holidays each year, the court is likely to want to see the child’s standard of living when they are with the resident parent to be comparable, and will look at their suggested ‘reasonable needs’ in light of this.

The Court will also consider very similar factors to those listed under section 25 of the Matrimonial Causes Act 1973, namely:

  • The child’s financial requirements;
  • Any physical or mental disabilities relating to the child;
  • The current and future income, earning capacity, and financial needs and obligations of the parents;
  • How long the child is expected to be in education or vocational training;
  • The income, earning capacity, and property of the child; and
  • The way the child was being or is expected to be educated.

How long do Schedule 1 orders last?

Unless the child is attending further education or vocational training, or has a disability, periodic payments will usually end when the child turns 18 years. If the paying party dies during the term of payment, the direct payments will of course stop, but whilst an existing order is in place, and if the child remains a dependent of the paying party, an application can be made under the Inheritance Act 1975 for a claim against the deceased’s estate.

If property has been settled or transferred, it will normally be returned to the financially stronger party once the child turns 18 or finishes their secondary education, but will sometimes only revert once the youngest child finishes their tertiary education. If special circumstances apply, such as an adult child with a continuing disability, the term might be even longer still.

Where does this leave us?

Applications for orders under Schedule 1 of the Children Act 1989 are normally extraordinarily complex and require the advice and representation of a family law solicitor experienced in HNW separation.

At a high level, these types of cases tend to involve people in the public eye where privacy is also a significant issue to weigh and manage. It is vital to instruct a law firm that understands the need for strict confidentiality and can manage media enquiries. Edwards Family Law can also support you through private processes of dispute resolution, outside of the more public court proceedings, with processes such as mediation, Early Neutral Evaluation, private FDR hearings, and Arbitration.

To discuss any points mentioned in this article, please contact our office.

Edwards Family Law is a niche London-based firm specialising in high-net-worth divorce and international family law. To find out more about Schedule 1 application, please phone +44 (0)20 3983 1818 or email contact@edwardsfamilylaw.co.uk. All enquiries are treated in the strictest confidence.

Many people believe that unmarried couples who live together (known as cohabitees) enjoy the same legal rights and protections as those that are married, but they are mistaken.

There is no such thing as a ‘common law’ marriage under English law and despite cohabitation being the fastest growing family type in England and Wales, if the relationship breaks down, cohabitees have to rely on complex property and trust law principles. Unmarried couples also have no automatic right to inherit under the rules of intestacy.

Last month, the Women’s and Equalities Committee (WEC) published a report on the rights of cohabitees. WEC made clear that the current law did not reflect the reality of the many diverse types of family structures in 21st century Britain and identified the need for urgent reform.

What were the main findings of the WEC Rights of Cohabitee’s Report?

The WEC received 380 written submissions from the general public, legal academics, legal practitioners, and campaign groups. The report’s key findings include:

A 2019 British Social Attitudes Survey showed almost half (46%) of the total England and Wales population wrongly assumed cohabitants living together form a ‘common law marriage’. This false belief leaves many cohabitees in shock when they discover how little legal protection is provided to unmarried couples who live together.

Unmarried couples have no automatic right to ownership of each other’s property if their relationship breaks down. Because they are forced to rely on property, trust, and contract law, the outcomes of court decisions are uncertain and case specific. Generous outright capital provisions that can occur in financial settlements upon divorce are not readily available to cohabiting couples. There are also very specific costs consequences in such cases.

As the general law prioritises financial contributions over domestic contributions, most witnesses called by the WEC argued that the financially weaker partner in a cohabiting relationship often ends up with nothing following a relationship breakdown.

Current law does not allow for caring and non-financial contributions to be considered by the court, prohibiting judges from crafting more effective remedies.

Although there is the option of creating a cohabitation agreement, this can be “emotionally and practically difficult”. Dr Charlotte Bendall, Lecturer in Law at Birmingham Law School, provided evidence

showing that when couples were seeking to make decisions as to finances there was “little to suggest that people are acting on the basis of a knowledge of the law, or even that they are aware of what the law is”.

Did the WEC provide any recommendations?

Suggestions for improving the law to protect unmarried couples who live together include:

The law must recognise the “social reality of modern families” and provide legal protection whether couples choose to marry, enter into a civil partnership, or live together. However, marriage should still be

recognised as holding important social and religious status in England and Wales. Therefore, the Law Commission’s 2007 proposals for an opt-out cohabitation scheme provides a sensible approach to reforming cohabitation law.

There needs to be a public information campaign aimed at educating people on the fact that ‘common law marriage’ does not exist. The public needs clarification on the legal distinctions between marriage,

civil partnership, and cohabitation, and the risks of wedding ceremonies that do not meet legal formalities.

The Law Commission’s 2011 recommendations concerning intestacy and family provision claims for cohabiting partners should be immediately implemented.

At present, financial settlement solutions such as spousal maintenance, pension sharing or off-setting, and the requirement for the court to consider all the factors under section 25 of the Matrimonial Causes Act 1974 are not available to couples that live together, unless they have specifically made provisions in a legally binding cohabitation agreement and taken independent legal advice.

High-net-worth cohabitee relationship breakdowns often result in one partner being left financially vulnerable. If you and your partner have, or are considering separating, it is vital that you obtain legal advice from a specialist and experienced family law practitioner.

As Resolution members, we remain constantly alive to changes in family law and will keep you updated as to the uptake of the WEC’s recommendations.

Edwards Family Law is a niche London-based firm specialising in high-net-worth divorce and international family law. To find out more about cohabitation law, please phone +44 (0)20 3983 1818 or email contact@edwardsfamilylaw.co.uk. All enquiries are treated in the strictest confidence.

The Family Court In England and Wales has come under fire for being a “desert island” in the justice system, shrouded in secrecy and making its decisions behind closed doors. In October 2021 the then president of the Family Division, Sir Andrew Macfarlane, acknowledged that “justice taking place in private…is bound to lead to a loss of public confidence”. He called for the Family Court’s rules on transparency and reporting to be scrutinised and set up the Transparency Implementation Group (TIG).

Mr Justice Mostyn’s Campaign for Greater Transparency

Senior judges in the Financial Remedy Court (FRC) are not in agreement as to how to strike the right balance between transparency and privacy in matters such as who can attend hearings, what documents should be provided to reporters, and retaining parties’ anonymity. Mr Justice Mostyn has made waves by unequivocally asserting in a series of judgments since late 2021 that the FRC has been getting the law wrong for decades. Mostyn J’s position is that, whilst Family Court proceedings sit in “private” (as opposed to “open” court, like the majority of court divisions), that does not in and of itself require reporting restrictions or that the parties be anonymised when the judgment is published on a public database. He has made statements such as:

  • “Had a member of the press or a legal blogger attended I consider that they could have reported everything that they heard during the proceedings” (Aylward-Davies v Chesterman [2022]);
  • “The correct question is not: ‘Why is it in the public interest that the parties should be named?’ but rather: ‘Why is it in the public interest that the parties should be anonymous?’” (Xanthopoulos v Rakshina [2022]); and
  • “if very rich businessmen are in court fighting at vast expense with their ex-spouses over millions, then the public has the right to know who they are and what they are fighting about. The judgment should therefore name names. Redactions can be made of commercially sensitive information, but…the redactions should never obscure the way the court has decided the case” (Gallagher v Gallagher (No. 1) (Reporting Restrictions) [2022]).
“Is it fair that one party’s poor behaviour could result in the other party’s identification?”

You might notice something that the above three cases have in common: you can read the names of the parties. That is because Mostyn J did not anonymise his judgments. The vast majority of financial remedy judgments heard by judges other than Mostyn J, however, continue to be anonymised. The lead FRC judge, Mr Justice Peel, has been the most prolific publisher of judgments since November 2021 and all have been anonymised. Since parties have no control over which judge hears their case, they face a bit of a lottery as to the publication protections they might be afforded.

The TIG Report 

TIG has just reported its findings on all issues of transparency as they relate to the FRC. Acknowledging Mostyn J’s judgments, it states “it is not for this report to set out what we consider the law to be on any particular, controversial, point. That must be a matter for the Court of Appeal. We acknowledge that there are different approaches to certain issues by different judges at High Court level and that this is far from ideal…it will be for others to decide whether the conclusions we reach should be implemented”.

The TIG report’s most critical recommendations can be summarised as follows:

Attendance at hearings

Cases should continue to be heard in private – ie, the only individuals permitted to attend are the parties, their representatives, and accredited journalists. Efforts should be made to better inform practitioners and judges on what to do if a reporter attends their hearing.

Reporting 

Reporters attending hearings currently cannot see any case documents without specific permission of the Court, meaning that the hearing is often impossible for them to follow. The report recommends that, when a reporter attends, a standard Reporting Order be made by the judge which:

  • permits reporting of what the reporter witnesses, subject to anonymisation and protection against intrusive and personal identification; and
  • entitles the reporter to see the parties’ position statements, together with the “ES1” (a brief case summary document) – reporters cannot publish any information that would breach the Reporting Order, even if it appears in a provided document.

Anonymity in published judgments

This is at the centre of Mostyn J’s standpoint and is arguably the most controversial issue. The report considers that “the default position should be one of anonymity”, but “there will be cases in which the presumption of anonymity will not be upheld”, which is a matter for the judge to decide on a case-by-case basis. Examples might include “situations of poor behaviour, either within the proceedings (by way of litigation conduct) or outside the proceedings in appropriate cases”, or where the public interest in identification outweighs the privacy justifications. The report also strongly encourages judges at all levels, not just High Court, to publish their judgments, to reset the imbalanced focus on “big money” cases heard by the High Court. 

The TIG report’s recommendations, if implemented, would undoubtedly provide greater clarity as to what parties to FRC proceedings can expect from a transparency and privacy perspective. The idea, however, that a party’s conduct could lead to a loss of their anonymity leaves much room for judicial discretion. What sort of behaviour outside of proceedings should this cover, what is the threshold for “poor behaviour”, and is it fair that one party’s poor behaviour could result in the other party’s identification? The question of transparency is by no means answered and we eagerly await a Court of Appeal case on the topic. In the meanwhile we will report back on the extent to which the TIG report recommendations are implemented by the Family Division.

In a social climate which sees fewer and fewer couples deciding to get married, or enter into civil partnerships, the subsequent separation of cohabiting parties is causing increasing difficulty in circumstances where they are simply not afforded the same financial rights on separation as divorcing couples or in the dissolution of partnerships.

Despite considerable pressure from family law solicitors, barristers, and judges, and family law groups such as Resolution, there is still reluctance amongst politicians to change the law in England and Wales so that it recognises the legal rights of cohabiting couples.

For unmarried parents who require financial provision to provide for their children following the end of a relationship with a high net worth (HNW) person, there is some light at the end of the tunnel.

Alongside an application for child maintenance to the Child Maintenance Service (CMS), an application for financial provision for the benefit of the child(ren) of the family can be made under Schedule 1 to the Children Act 1989.

What does Schedule 1 to the Children Act 1989 say?

Schedule 1 provides the Court with limited powers to make financial provision available for the benefit of the child(ren) of a relationship, where the parents were not married and have subsequently separated.

Needless to say, Schedule 1 also comes into play in circumstances where a child has been born to a mother, even after a very brief or fleeting relationship with the father.

It is possible to apply for the following orders:

  • Periodical monthly maintenance payments for yourself on the child’s behalf (or to an adult child directly, where applicable);
  • Secured periodical payments for yourself on the child’s behalf (or to an adult child directly, where applicable);
  • Lump sum for yourself on the child’s behalf (or to an adult child directly, if applicable);
  • Settlement of property for the benefit of the child, reverting to the paying party at the end of a specified term; and/or
  • A transfer of property outright to you on the child’s behalf (often held on trust for them) (or to an adult child directly), but this is only likely to happen in very specific and limited circumstances.

Who can make an application under Schedule 1 of the Children Act 1989?

The Court can make a periodic payment order in respect of:

  • Topping up the CMS maximum assessment amount, if the non-resident parent’s income is greater than £156,000 gross per annum. The Court will need to be satisfied that the circumstances of the case make it fair and reasonable for a top up order to be made;
  • A regular payment for school fees or vocational training; and/or
  • Meeting any reasonably foreseeable recurring expenses associated with the child’s disability (if they have one).

When would a Schedule 1 lump sum order be made?

Lump sum orders can be made by the court for the purposes of enabling liabilities and expenses already incurred in connection with the child to be met. These can even include the costs of their birth in some circumstances, or costs more generally which have been incurred in maintaining the child, even where those expenses were incurred prior to the application (as long as the application is made without unreasonable delay).

Specific future expenses and foreseeable liabilities can also be claimed. Whilst the court’s discretion is wide, the welfare of the child is paramount. Provision might be made, for example, for furniture for a new home purchased for the benefit of the child, a car to transport the child, or indeed a sum to be invested for future school fees. Lump sums are not, however, designed to be maintenance ‘by the back door’ for the resident parent.

How does the Court decide whether an order should be made?

The welfare of the child is a paramount consideration of the court in deciding these cases, and the standard of living enjoyed by both of the parties to the proceedings will also be considered. If, for example, the non-resident paying party is very wealthy and enjoys a luxurious standard of living, incredible accommodation, designer clothes and numerous international holidays each year, the court is likely to want to see the child’s standard of living when they are with the resident parent to be comparable, and will look at their suggested ‘reasonable needs’ in light of this.

The Court will also consider very similar factors to those listed under section 25 of the Matrimonial Causes Act 1973, namely:

  • The child’s financial requirements;
  • Any physical or mental disabilities relating to the child;
  • The current and future income, earning capacity, and financial needs and obligations of the parents;
  • How long the child is expected to be in education or vocational training;
  • The income, earning capacity, and property of the child; and
  • The way the child was being or is expected to be educated.

How long do Schedule 1 orders last?

Unless the child is attending further education or vocational training, or has a disability, periodic payments will usually end when the child turns 18 years. If the paying party dies during the term of payment, the direct payments will of course stop, but whilst an existing order is in place, and if the child remains a dependent of the paying party, an application can be made under the Inheritance Act 1975 for a claim against the deceased’s estate.

If property has been settled or transferred, it will normally be returned to the financially stronger party once the child turns 18 or finishes their secondary education, but will sometimes only revert once the youngest child finishes their tertiary education. If special circumstances apply, such as an adult child with a continuing disability, the term might be even longer still.

Where does this leave us?

Applications for orders under Schedule 1 of the Children Act 1989 are normally extraordinarily complex and require the advice and representation of a family law solicitor experienced in HNW separation.

At a high level, these types of cases tend to involve people in the public eye where privacy is also a significant issue to weigh and manage. It is vital to instruct a law firm that understands the need for strict confidentiality and can manage media enquiries. Edwards Family Law can also support you through private processes of dispute resolution, outside of the more public court proceedings, with processes such as mediation, Early Neutral Evaluation, private FDR hearings, and Arbitration.

To discuss any points mentioned in this article, please contact our office.

Edwards Family Law is a niche London-based firm specialising in high-net-worth divorce and international family law. To find out more about Schedule 1 application, please phone +44 (0)20 3983 1818 or email contact@edwardsfamilylaw.co.uk. All enquiries are treated in the strictest confidence.

Forty percent of people are relying on potential inheritances to fund their retirement, according to research conducted for Hargreaves Lansdown. Although this is a risky strategy, the reality of the astronomical rise in property prices over the past 30-odd years has meant many of the baby boomer generation now have million-pound plus legacies to hand down to their children and grandchildren, who are struggling to put away money for retirement or purchase a home of their own.

Given the above reality, when it comes to negotiating a financial settlement following divorce, those who have or expect to inherit considerable wealth will naturally attempt to ensure that it is classed as non-matrimonial, and separated out of the asset pot to be divided.

Is an inheritance classed as matrimonial property?

In the absence of a Pre or Post-Nuptial Agreement, assets acquired during a marriage or civil partnership are likely to be considered matrimonial property and notionally added to the pot that will be divided up between a couple upon divorce or dissolution. However, inheritances are treated differently in that they are not automatically deemed matrimonial property, but this does not mean that they will not be included, if certain criteria are met.

The separation of inherited wealth from matrimonial property was confirmed in the landmark family law case of White v White [2000] UKHL 54; [2000] 3 WLR 1571. Lord Nicholls examined the issue of property acquired during the marriage by one spouse by gift or succession or as a beneficiary under a trust (which he deemed ‘inherited property’ for the sake of brevity).

“This distinction [between inherited property and property acquired before the marriage, and matrimonial property] is a recognition of the view, widely but not universally held, that property owned by one spouse before the marriage, and inherited property whenever acquired, stand on a different footing from what may be loosely called matrimonial property. According to this view, on a breakdown of the marriage these two classes of property should not necessarily be treated in the same way. Property acquired before marriage and inherited property acquired during marriage come from a source wholly external to the marriage. In fairness, where this property still exists, the spouse to whom it was given should be allowed to keep it. Conversely, the other spouse has a weaker claim to such property than he or she may have regarding matrimonial property”.

Does that mean my inheritance is safe from the divorce financial settlement?

Not necessarily. The Court must consider all the factors under section 25 of the Matrimonial Causes Act 1973, namely:

  • the income, earning capacity, property, and other financial resources each party has access to now and in the reasonably foreseeable future;
  • the financial needs, obligations, and responsibilities of each of the parties now and in the reasonably foreseeable future;
  • the standard of living enjoyed by the family before the breakdown of the marriage;
  • the age of each party to the marriage and the duration of the marriage;
  • any physical or mental disability of either of the parties to the marriage;
  • the contributions that each of the parties has made or is likely to make in the reasonably foreseeable future concerning caring for any children of the marriage;
  • the conduct of each of the parties, if that conduct is such that it would, in the opinion of the court, be inequitable to disregard it; and
  • the value of any benefit one party will fail to acquire due to the divorce.

The brutal reality is that if the needs of both parties cannot be met by sharing the matrimonial resources available to them both, without recourse to all or part of the inheritance then it is likely that the inherited assets will be included in the matrimonial pot to be divided between the couple.

What other factors could lead to my inheritance becoming matrimonial property?

Several factors could lead to the Court finding that an inheritance is likely to be considered to be matrimonial property rather than separate property, including:

  • The length of the marriage and intermingling of assets. The longer that you and your spouse have been together, the more likely the inheritance has intermingled with the matrimonial property, to the point where it is impossible to separate it out. For example, often an inheritance is used to make improvements to the family property, which is difficult to separate from the overall value of the home. However, if funds from the inheritance was used to purchase a buy-to-let property and only the inheriting spouse had their name on the title deeds, then it is much easier to declare that the buy-to-let sits outside the matrimonial property pot, if the matrimonial pot is sufficient when divided to meet their needs.
  • Matrimonial home. If an inheritance is used to purchase the family home itself the Court is more likely to view it as matrimonial rather than separate property.

There are no overarching rules as to whether an inheritance will be treated differently to matrimonial property. Everything will depend on whether, after consideration of the section 25 factors, a fair settlement can be achieved without recourse to the inherited assets or funds. Fundamentally, if the needs of the parties cannot be met by dividing the matrimonial property and assets, then inheritance will almost certainly be added to the matrimonial pot, especially if there are young children involved whose needs will be considered a priority.

Final words

Drafting a Pre or Post Nuptial Agreement will provide an opportunity to protect your inheritance from becoming part of any financial settlement following a divorce. Although not legally binding, if certain safeguards are in place, the agreement is fair and reasonable, and both parties have had the opportunity to take full and independent legal advice involving disclosure on both sides, the Court will give the contents of a Nuptial Agreement considerable weight and are more than likely to uphold its content.

To discuss any points mentioned in this article, including Pre or Post Nuptial Agreements, please contact our office.

Edwards Family Law is a niche London-based firm specialising in high-net-worth divorce and international family law. To find out more about divorce and financial settlements, please telephone +44 (0)20 3983 1818 or email contact@edwardsfamilylaw.co.uk. All enquiries are treated in the strictest confidence.