Separation agreements, for peace of mind in a separation

Year Published: 2013

If you are separating from your spouse or civil partner but have decided not to divorce at this stage, you still need to be careful when resolving finances, even where the position is amicable. There is no guarantee that it will be amicable in the longer term.

It is not uncommon for a separation to be amicable and it may be that neither party wishes to accuse the other of adultery or unreasonable behaviour. In these circumstances, waiting until you have separated for 2 years and then divorcing on the basis of that separation is an option.

Many people enter into a ‘separation agreement’, which if formulated properly and with the benefit of independent legal advice and full disclosure, ought to be legally binding. They are complex legal documents, requiring numerous legal clauses. Home drawn heads of agreement will lack the clauses which establish a binding agreement and will likely be unenforceable.

But what if circumstances change and a separation becomes a divorce? The court in divorce proceedings has a duty to consider any agreement reached in relation to financial matters (via a Consent Order) and will only approve it if it considers it to be reasonable. The court is under a duty to look at the circumstances that exist at the time of the divorce as well as at the time of the deed of separation. There have been many cases where the separation agreement has not been upheld – such as where there has been inadequate provision for one party, lack of legal advice, poor drafting and even where finances have changed, particularly if there are children involved.

However, it is worth bearing in mind that in a recent case, the court has granted a husband’s application that a separation agreement signed by the parties in 1991 should be made an order of court, against the wife’s wishes.

The court heard that a separation agreement was signed by the parties but had never been put before the court for approval. The wife argued the husband had not disclosed his true position, had put her under pressure and that she had been persuaded by her solicitor at the time into entering into the agreement. The court decided that the agreement was of “magnetic importance”. It was properly drafted and conformed with all the requirements needed to establish a concluded agreement.

This case shows that unless you properly conclude matters at the time of separation, there are risks over a potentially long period of time, in this case 22 years before the divorce was finalised.

If the agreement had not been properly drawn up, the husband could have faced considerable claims from his ex-wife.

It is imperative that you seek professional legal advice in dealing with issues of this nature.

For more information, please contact a member of our family team on 01625 442100.

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