Financial Remedies Application: What Happens If There Aren't Enough Assets To Meet Needs?

• Published date: 03 October 2022
• Subject Matter: Finance and Banking, Family and Matrimonial, Financial Services, Family Law, Divorce
• Law Firm: Ian Walker Family Law and Mediation Solicitors
• Author: Mr Paul Jacobs

Financial remedies application: what if there aren't enough assets to meet needs?

On a financial remedies application one of the most important factors for the court to consider when deciding what order to make, and often the decisive factor, is the needs of the parties and any dependent children.

And the primary need of the parties and children in most cases is of course for suitable accommodation. The court will therefore want to ensure that the settlement meets that need.

But what if the available assets are insufficient to meet the needs? How does the court approach the case then?

A recent judgment of the Financial Remedies Court sitting at Brighton gave the answer. The judgment is unusual in that most published judgments involve couples who are either wealthy or extremely wealthy, which may obviously not be that instructive for couples of more modest means.

But this judgment did not involve individuals of great wealth.

Assets and debts

The case concerned a wife's financial remedies application. The parties had married in 2013 and have a seven year old child. The wife also had three children from her previous marriage.

The former matrimonial home was purchased in the husband's sole name, in 2013.

The parties separated in 2019, when the wife left the home, and went to live in rented accommodation, with the four children.

The husband then commenced divorce proceedings, and obtained Decree Absolute in the spring of 2020.

The financial circumstances of the parties was roughly as follows.

The capital assets totalled some '410,000, comprising the former matrimonial home which had an equity of about '250,000, the wife's '90,000 interest in her former matrimonial home that she still owned with her first husband (realisable when the children of that marriage grow up), and other assets of the husband, worth some '70,000.

The wife earned '35,143 gross per annum. She was also in receipt of Universal Credit in the sum of approximately '1,300 every 4 weeks, Child Benefit of '140.60 every 4 weeks, and child maintenance from the husband. She had various debts, totalling about '70,000. She and the children continued to live in rented accommodation.

The husband earned '70,400 per annum. He had about '11,000 debts. He continued to live in the former matrimonial home.

Best in the circumstances

Deciding the case His...