Legal Insights: Financial Arrangements in Divorce and Property Distribution

Legal Insights: Financial Arrangements in Divorce and Property Distribution

Context
Shula Biros and her spouse were married on July 5, 2005, in Marylebone. They resided in an apartment purchased by Shula a couple of years before. The couple is now residing in a four-bedroom mansion valued at €250,000. The home was purchased jointly by the husband and wife, with a total of 120,000 euros contributed: 100,000 euros from savings and 20,000 euros from earnings earned by Shula Biros from her owned apartment. Shula's parents further provided 10,000 euros for the acquisition of the apartment. Jeff has given a total of 80,000 upon the receipt of his inheritance funds. They also secured a mortgage of 130,000 with Hatfield Building Society. The couple have three sons: Miles, born on October 23, 2009, and twins Lewis and Ronan, born on March 1, 2014. Miles is in Year 8 at a senior school in St Albans, just a few miles from the family residence, while Lewis and Ronan attend the nearby primary school. Shula seeks a divorce from her husband and has consulted us for financial help. The primary basis for the divorce sought by Shula Biros is her husband's increasing domineering behavior over the years. Regarding finances, she consistently monitors the bank accounts and her expenditures, interrogating her about any purchases made for herself and her children. Shula also said that she was diagnosed with multiple sclerosis a few of years ago, which was a significant shock to her. Her illness has necessitated the use of several medications. The client has indicated that she has not received any assistance from her spouse, prompting her to seek a divorce. Shula has said that her husband's actions has rendered her a burden to him.

Shula is now employed at the bank on the local main street in St Albans, where she formerly worked three days a week from 9 AM to 3 PM. This provides assistance for her and her children as well. Previously, she was employed at HSBC in Canary Wharf on a management program and had a substantial salary; but, upon having children, her husband suggested that she resign to focus on family and household responsibilities. Jeff has received a significant promotion and is now the advertising director of the same firm. Jeff's yearly earnings around 100,000 euros, resulting in a net monthly income of about 5,200 euros. After giving birth to twins, she resumed part-time employment. When Shula informed her husband of her desire for a divorce and her intention for the children to reside with her. She furthermore said that Jeff may visit the youngsters at his discretion. Shula also want to remain in their family home. Jeff said that if she wanted to remain in the family residence, she must get full-time employment, assume all responsibilities for the children's care, and cover the mortgage payments. He thereafter requested his portion of the property and the inheritance sum he had paid. She is now concerned, having expressed that her husband is financially motivated and likely to instigate a disagreement over monetary matters due to his obsession with wealth. She is also concerned about the implications of her diagnosis of multiple sclerosis on her future employment and financial situation. Consequently, she has sought our counsel on the legal financial arrangements.

Monetary Allocation
The court has asserted that the property should be equally distributed, with each party receiving a portion that equals half of the total property. This was also articulated in a comparable case of Miller v. McFarlane [2006].In the particular situation, the property was purchased jointly at Hatfield Building Society for 130,000 Euros. The equal proportion should be apportioned, but the mortgage that Jeff requests Shula to pay must also be allocated accordingly. The concept of equity asserts that the needs of children must be addressed, hence necessitating that the parent responsible for the children get a larger portion.  The principle of equity encompasses three elements: the financial needs of the party, compensation for economic disadvantage resulting from the parties' marital conduct, such as a wife relinquishing her career to care for the children, and sharing, as articulated in the principle established in White.

Section 25 of the Matrimonial Causes Act, 1973 stipulates that the court must consider the above factors when addressing applications for pecuniary relief. In Cordle v Cordle [2002], it was determined that the mother's home needs take precedence, since the residence is the fundamental need for the children. Additionally, when the court issues orders, important factors that must be examined include income and resources, needs, quality of living, age and length of marriage, handicap, contributions, behavior, and loss of a benefit. In the current example, Shula is employed part-time, and her salary is inadequate to support the children and manage household responsibilities. In Juffali v Juffali [2016], the court said that the judge will provide a judgment based on the children's requirements and the level of life, as well as the available resources. In the current example, Jeff has sufficient finances to support the children; nevertheless, his wife Shula need further financial assistance to fulfill her parental responsibilities, particularly since she is afflicted by a medical condition, resulting in increased expenditures. In White v White [2001], it was asserted that assets should be divided equally, since marriage is a partnership of equals. The notion of discriminating was presented here as well.

Aggregate payment directives Section 23(1)(c) addresses financial provisions related to divorce proceedings, stipulating that if a couple seeks divorce or separation, the court may mandate one party to pay a lump sum amount based on the needs of the other party. The wife needs the financial support more urgently, since she is responsible for caring for the children while also working full-time to cover expenditures, all while contending with a debilitating illness that threatens her health. This would incur additional costs since she must manage her medical bills as well. Section 24 of the Matrimonial Causes Act, 1973 stipulates that a property adjustment order may be issued in divorce proceedings, addressing the disputed property based on the requirements of the parties involved. According to article (1)(b), the demands of the party must be taken into account, particularly regarding the responsibilities associated with children. Additionally, Shula has her own obligations, since her medical bills are rising daily. The property transfer should be only in the name of one spouse; thus, in this scenario, Shula should get the property, since she has more duties. The ruling stipulates that one party must remit a lump sum payment to the other; hence, the husband is obligated to pay the lump sum to the wife due to her greater responsibilities, and the division of assets must be executed. The issue at hand is to the partition of marital residences. If a lump amount cannot be obtained, the transfer may be contingent upon the transferor retaining a charge on the property. The shared live maintenance idea was elucidated in the case of Parlour v Parlour [2004]. Additionally, it has been said that the equitable distribution of blame must be considered in cases involving children. Shula is responsible for the children, household bills, and her medical costs.

Considerations to be Taken into Account
The optimal arrangement for the client is that husband Jeff must provide for both the children and the wife.  The woman is seeking a divorce from her husband and wants custody of the children. If the children remain with her, she will bear several responsibilities; moreover, she is in poor health due to a diagnosed illness. This sickness will gradually deteriorate her body, hence increasing the strain on Shula. The court should evaluate the requirements of the parties involved in the dispute about the marital residence and thereafter determine the distribution of property based on those needs. Shula need more financial resources and assets due to her increased responsibilities related to children and bills. Jeff, the husband, is required to pay a lump sum to Shula for her and her children's maintenance. Although she will be employed, managing all expenses alongside the mortgage will be challenging for her. Given that Jeff has a higher income and savings than Shula, he should cover the mortgage, as the savings deposited are jointly owned by both spouses.

Final Assessment

Shula and Jeff are married and have two children. Both individuals are minors and need the care and supervision of their mother. Her motivation for pursuing divorce stems from her assertion that her spouse has increasingly become domineering over time. She wished to remain at her marital residence, where they had cohabited, but after expressing that she and her children would live together, she stipulated that he might see the children on weekends. It has also been reported that she has been diagnosed with multiple sclerosis, which is a contributing cause to her husband Jeff's lack of support. He questions her whenever she spends more money on herself or their children. She was employed part-time, but after her divorce, she would need to work full-time and fulfill all obligations and duties related to the children with whom she resides. The optimal choice for the marriage is for the husband to remit a lump sum payment to the wife, given his higher earnings and accumulated savings. The woman lacks funds, and her requirements exceed those of the husband due to her greater responsibilities. She must care for her children while also covering her medical expenditures. This sickness will gradually deteriorate her body, hence increasing the strain on Shula. The court should evaluate the requirements of the parties involved in the dispute about the marital residence, and the partition of property should be determined accordingly. Shula need more financial resources and assets due to her increased responsibilities related to children and bills. Consequently, she has sought our counsel on the legal financial arrangements.

References

Primary sources

Legislation

Matriminial Causes Act 1973, https://www.legislation.gov.uk/ukpga/1973/18/section/24 

Matrimonial Causes Act, 1973, https://www.legislation.gov.uk/ukpga/1973/18/section/23 

Secondary sources

Cases

Cordle v Cordle [2002] 1 FCR 97

Juffali v Juffali [2016] EWHC 1684

Parlour v Parlour [2004]

White v White [2001] 1AC 596

White v White [2001] 1AC 596