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When is a separation agreement useful?

There are some situations when a separation agreement may be helpful.  Firstly, where a cohabiting couple separate and secondly where a married couple separate.  The law is very different depending on which situation you are in.

Cohabiting couples

In the case of a cohabiting couple then there is currently no law setting out how any jointly owned assets or property should be divided.  Therefore it is sensible to enter into a formal cohabitation agreement when you first move in together in order to set out clearly what your intentions are and what would happen if the relationship breaks down.  Provided this is done properly with you each getting separate legal advice this would be upheld like any other contract.

When you separate, it is also sensible to have a formal separation agreement setting out how your jointly owned assets or property should be dealt with.  Again, this would be enforced in the civil courts like a civil contract.

The concept of ‘common law’ husband and wife is a myth that still exists today.   There are no such ‘common law’ rights and therefore it is important to protect your interests with formal agreements.

Divorcing couples

There are occasions when it may be useful and appropriate to use a separation agreement.  Where the parties are not getting divorced for example, for religious or other reasons, then a separation agreement may be used.

Also, because a financial consent order cannot be approved until Conditional Order stage (which takes place more than 20 weeks after issuing the divorce)- there may be circumstances where a separation agreement could be used in the meantime to settle some financial matters that cannot wait.  For example- buying one out of a jointly owned property or selling the family home.

In those circumstances it may be helpful to rely on a separation agreement pending a final financial order (consent order) being approved by the court.

In order to give the agreement as much weight as possible it would need to be properly drafted by solicitors and it is important that you both have separate legal advice on this and that you deal with financial disclosure before entering into this agreement.

Even then there is still a risk.  The court retains its power to make a different order at the point that the financial order comes before a judge- therefore if circumstances have dramatically changed between the separation agreement being signed and a final financial order being submitted to court for approval a judge may suggest a different order.  Also, it is not the job of the judge approving a final financial order to simply ‘rubber stamp’ the order- they have to be satisfied that it is fair and so there are occasions when the judge may query an agreement reached between the parties. If this has already been implemented then this could lead to difficulties.

Every case is different and every situation will depend on its individual facts- whether a separation agreement is right in your circumstances will depend on your situation but it is very important that you both have independent legal advice before entering into any binding agreement.  This is to protect both parties and to ensure that the agreement is fair and if it is, to give it sufficient weight that it should be upheld.

Even if you have a separation agreement in place it is very important that you do finalise financial matters with a final financial order (a ‘consent order’).  The financial order is approved by the court and ensures that future claims are dismissed- without it then even if you have your final divorce order it is possible for either to make claims against assets in the future up until the point of remarriage.

What can be included in a Separation Agreement?

A separation agreement is quite flexible and can address a host of issues including:

  • Who pays the rent or mortgage and utilities at the family home pending any sale or transfer
  • How the property is going to be sold and the proceeds divided- this can even include directions about which estate agent is to be instructed, what price the property will be marketed at and which conveyancing solicitors to use to avoid any future disputes
  • How contents are to be divided
  • What child maintenance is to be paid
  • How savings are to be divided

Each case is different and depends on its own circumstances and facts so do get in touch for specialist advice. Tel: 01619806099

 

Nicholls Solicitors | Family Law Solicitors in Altrincham