Do You Need a Financial Order in Divorce or Dissolution?

In England and Wales, divorce and dissolution is the legal ending of a marriage or civil partnership, respectively. The granting of a final order by the Family Court dissolves the marriage or civil partnership. However, a commonly asked question is whether a financial order is also needed as part of that process.

What is a Financial Order?

A financial order in divorce is an order made by the Family Court as part of the legal process. Such an order deals with the division of a divorcing couple’s finances, such as the former matrimonial home, pensions, maintenance, and other assets. As part of a divorce financial settlement, a clean break financial order is usually included (subject to the parties’ circumstances).

A financial order can be entered into by agreement between the parties or ordered by the Court at a final hearing if the proceedings are contested. Only the Court, whether by agreement or contested, can grant a clean break regarding the parties’ finances.

What Is a Clean Break?

A clean break order in divorce means, once ordered by the Court, that no further financial claims can arise between parties following a divorce or dissolution. It therefore also means that the parties’ financial connection to each other is severed.

Why Do I Need a Financial Order and a Clean Break?

If parties do not obtain a financial order with a clean break, the divorce itself does not end the financial links between them. Therefore, it is possible that you may obtain a final order of divorce or dissolution, thereby legally ending your marriage or civil partnership, but you may still have outstanding future financial claims. Only a financial order can bring this certainty.

A risk that can arise, as a result, is that a person can remarry following a divorce without having obtained a financial order regarding that same divorce. This is known as ‘the remarriage trap.’ If this happens, the remarried party will no longer be able to bring any financial claims against their former spouse; however, the former spouse still retains their right to bring a claim. This can cause worry and uncertainty about how the assets of the parties should be dealt with if they are not resolved at the time of the original divorce financial settlement.

What Should I Do?

It is usually advisable to obtain a financial order to prevent future problems and financial claims arising from a divorce. It is always best to speak to a family solicitor who can advise you on your specific circumstances and guide you through obtaining the right order for your case.

Speak to our Family Law team

If you are considering divorce or dissolution, it is important to understand your options regarding a financial order and a clean break. Our family solicitors can provide tailored advice to protect your future.