When making financial orders on divorce, the case of Duxbury v Duxbury ( Fam 62n, CA) introduced a calculation which provided a means to achieve a lump sum as an alternative to ongoing periodical payments (maintenance) between ex-spouses. This calculation enables couples to achieve a clean break (i.e. no ongoing financial ties after divorce), so that a lump sum is invested to provide a continuing annual income. In my recent Child and Family Law Quarterly article, on which this blog is based (‘Reconsidering the Duxbury Default’  CFLQ 275), I explore the Duxbury calculation in greater depth, presenting findings from an analysis of reported cases over the past 10 years and exploring why the courts appear reluctant to move away from it. However, in this blog, I want to focus on a practical concern arising from the continued use of Duxbury – the failure to provide for any allowance for costs incurred in setting up and running the invested funds and why this is important for those individuals who are required to invest a Duxbury lump sum to provide for future income.
By the ‘Fair Shares’ Project Team: Emma Hitchings, Caroline Bryson, Gillian Douglas, Susan Purdon and Donna Crowe-Urbaniak
Fair Shares – Sorting out money and property on divorce is a new study, funded by the Nuffield Foundation, which will explore the arrangements couples reach relating to their finances and property when they divorce. Using a large-scale survey and in-depth interviews, it will examine what arrangements they make, how they arrive at them and how well they think they have met their expectations. The aim is to provide hard data for law reformers seeking to update the law, and insights for judges, practitioners and divorcing couples themselves on ‘what works’ best. (more…)
In more ‘normal times’, the start of each new year marks the arrival of media coverage of the ‘divorce season’. Newspapers publish feature articles reporting that the stresses of Christmas prompt many couples to decide that enough is enough, and to make a new year’s resolution to get out of their marriage. Family solicitors duly issue press releases to advertise their services to assist them, both with getting the divorce itself and with sorting out the financial, property and child arrangements that will need to be made to deal with life going forward. In reality, this New Year ‘spike’ in divorce applications may not be much more than an urban myth. The divorce statistics show that in the years from 2011 up to and including 2019, there have only been three years when the first quarter of the year – January to March – has recorded the highest number of petitions (applications for a divorce) filed across the year. Rather, there tends to be a consistent flow of petitions across the year.
By Dr Emma Hitchings, Senior Lecturer in Law (University of Bristol Law School).
Mills v Mills  UKSC 38 is an example of a rare ‘everyday’ financial remedies case on divorce that has been decided at the highest appellate level – the Supreme Court. It was handed down in the middle of July. Costs, time, energy and a host of other factors involved in taking a case to an adjudicated final hearing, mean that over 90% of financial remedies cases settle before reaching this stage (Family Court Statistics Quarterly, January – March 2018) and it is only a tiny minority that end up being appealed, let alone appealed to the highest level. That one of those rare appellate cases is an ‘everyday’ case where the assets and finances involved are pretty ordinary, is particularly note-worthy. The usual wealthy entrepreneurs or celebrities are absent, and instead, the Mills case involves a couple, who on divorce in 2002, agreed a capital settlement of £230,000 to the wife, £23,000 to the husband, and ongoing monthly spousal periodical payments of £1,100 a month from the husband to the wife. This is not a case about millionaires or billionaires, but an ‘everyday’ couple, where the financial needs of the parties dominate.
Guidance provided from the higher courts has, to date, focused on the larger-money case and the associated issues relevant to those wealthy individuals who can afford to litigate on issues such as the nature of their ‘special contribution’ and whether this should result in an unequal division of the family assets due to one spouse’s exceptional skill or acumen in the business or entrepreneurial world. It was therefore to be hoped that the Supreme Court would seize this rare opportunity and provide some much-needed broader guidance for family lawyers on ‘needs-based’ cases – the usual ‘run-of-the mill’ case, which although does not usually make headlines, takes up the vast majority of Family Court financial remedy business up and down the country. (more…)