One of the most common myths among clients is that, because the Decree Absolute has been pronounced in their divorce proceedings, their spouse may no longer bring financial claims against them.
This article is part of a series of articles that aim to debunk the top 10 myths and misconceptions around divorce and finances that we have come across with our clients.
This myth can lead to one of the most common problems for parties in divorce proceedings – finding that many years after getting divorced, a former spouse has returned to make a financial claim against the assets that have been built up in that time.
To tackle this issue, we need to first establish what a Decree Absolute is and the impact it has, before looking at the reality of severing financial claims.
What is a Decree Absolute?
A Decree Absolute is the final order in divorce proceedings and confirms the date on which your marriage was legally dissolved.
The pronouncement of a Decree Absolute has several consequences for inheritance. For example, if you have a Will, on your death it will take now take effect as though your former spouse had died during your lifetime. The Decree Absolute may also affect your ability to claim a widow/widower’s pension from your former spouse. However, the facts of your individual matter will determine the exact impact of the Decree Absolute and independent legal advice should be obtained on this point.
How do I protect myself against future financial claims following a Decree Absolute?
To dismiss the financial claims that a former spouse may have against you, you will need to have a financial order approved by the Court. This usually comes in the form of a Consent Order and until approved by the Court, there is not a full, final and binding clean break concerning your financial arrangements.
Unless a financial order is approved by the Court, both you and your former spouse will be able to bring financial claims against one another and could remain exposed to that risk for the rest of your lives. The submission of a financial order stops that from happening and protects your position.
It is especially important to be aware of this if your financial position has changed since the divorce, as any assets that have increased in value or new assets that you have acquired since the divorce could be open to a claim from your ex-spouse for financial provision.
Finally, you must also be aware of the “re-marriage trap”. Following the pronouncement of Decree Absolute, if you decide to re-marry without having an approved financial agreement, then you will be prevented from applying for a lump sum, property adjustment (such as a sale or transfer of property) or spousal maintenance against your previous spouse.
To see the full series of our Top 10 divorce finance myths, please click here.