Coronavirus and Financial Agreements on Divorce: When finality may not be final
7 August 2020
At times it is hard to remember what life was like before the Coronavirus epidemic and before the Country was "locked down" on 23 March.
Since the epidemic first took hold, property prices have fallen, the values of pension funds are no longer what they were, incomes have reduced, more people are facing redundancy and financial uncertainty and indebtedness grows.
Against that background, when, if ever, will it be possible to re-open a financial agreement, embodied in a Court Order or an Order made by a Judge when agreement was not possible?
Whilst maintenance both for ex-spouses and for children can be varied from time to time depending on changes of circumstances, claims in relation to property, capital and pensions are normally "once and for all". English law is based upon the need to achieve finality and to allow divorcing couples to move on in their lives.
Judges have made it clear that inevitably there are bound to be changes in financial fortunes as a result of the economy and the property market and financial markets generally. Prices of property will rise and fall; the same applies to values of shares and pensions.
Where there has been fraud, dishonesty or non-disclosure, financial orders may be overturned.
Otherwise, there is no automatic "second bite of the cherry".
Against that background will it ever be possible for a financial Order to be reopened as a result of the consequences of the Covid-19 pandemic?
Judges are going to need a lot of persuasion that once a Court Order has been made, by agreement or not, it should be reopened and overturned.
Whilst every case is different, Judges will only allow Court Orders to be overturned if there has been a new unforeseeable event which undermines the basis upon which those Orders were made.
It is quite likely that Judges will take the view that they will permit only those agreements and those Orders made shortly before "lockdown" or possibly those which had not been implemented before the pandemic hit to be re-visited. This will have to be on the basis that when those Orders were made, Coronavirus did not exist or that there was little or no understanding of what the consequences of the Coronavirus and lockdown would be.
If anyone is thinking of making an application to the Court to reopen a financial agreement then it is absolutely vital to obtain advice from a specialist family solicitor as quickly as possible. Delay could be fatal to the prospects of success.
If on the other hand the financial issues have not yet been resolved, it is vital to "take a rain check" on the best way forward and to obtain not only specialist legal advice but specialist financial wealth advice as well. Wilsons has considerable experience of working in tandem with financial and wealth advisors.
What is clear is that if financial issues are resolved now with full knowledge of the financial consequences of the Coronavirus so far it is going to be even more difficult to reopen agreements reached and Court Orders made.