Successful outcome for a homemaker wife in financial settlement
Mr and Mrs Z were married for 9 years and had an 8 year old son. Mr Z was a successful businessman and had incorporated and was managing several companies. Our client, Mrs Z was shareholder in one of his businesses. The couple were paid dividends and a salary from the company for a number of years.
From the onset of the relationship, it had been agreed that Mrs Z would not work and look after the parties son and home. Our client used to work for the Council prior to being married to Mr Z but had given up her job at the insistence of her husband.
The couple and their child were accustomed to a good standard of living with a large, comfortable family home, their son in private education and the family having numerous holidays abroad each year.
The matrimonial home of the couple was in our client’s husband’s name. During the marriage Mr Z was responsible for the mortgage and household bills and our client would use her dividends for their son and his private education. When the parties separated Mr Z left the matrimonial home and refused to pay the household expenses and mortgage.At the same time, the Company stopped paying her dividends at the instruction of her husband.
In these circumstances, our client was not able to fund her child’s private education and the household expenses. She was in a situation our divorce lawyers unfortunately see all too often, in particular with wives who have chosen to stay at home and care for their families. Her husband had cut her off financially, to exert undue pressure in an attempt to get her to agree to a settlement that would have not been in the best interest of her child or herself.
How to cope with a divorce? Maintenance pending suit
When Mrs Z approached our team of divorce lawyers, she was anxious about her and her son’s future and completely disheartened. She was worried that since her husband had the control of the family finances, she had no resources to fight back and obtain her rightful share from the family assets.
As a first step, Rakhi Singal and her team immediately assessed the client’s financial circumstances and advised her in respect of her option to make an application to the courts for maintenance pending suit. This, in essence is an application whereby the financially weak party is asking for the courts to order the other party to make financial contribution towards their living expenses while the case for asset separation is still ongoing. This is not suitable for all cases and such applications should be made only if there are strong reasons for making an application. In most cases, an arrangement can be agreed with the other side and would not necessitate turning to the courts. In this case, however Mr Z was refusing to engage in any constructive negotiations, leaving no other option but to seek the court’s intervention.
Our divorce team therefore acted for Mrs Z in obtaining Maintenance from Mr Z while the Divorce and financial proceedings were ongoing. Thanks to this successful application, our client was able to have her expenses covered during the divorce process and was freed from financial pressure that was threatening to see her agree to a very detrimental settlement.
We also reinstated her dividend payments from the Company, as she was entitled to them as a shareholder, irrespective of the divorce proceedings.
With this aspect resolved, the next step was to achieve a good overall outcome for our client.
Who gets what in a divorce?
The starting point in all financial proceedings in the UK is that both parties are entitled to an equal share from the matrimonial assets. It is an important principle that the parties are not entitled to a bigger share simply because they were the main financial contributor to the family assets and the party who has dedicated their time to raising the couple’s child and maintaining the home has had an equal contribution. This is an important principle that protects people like our client.
While it all sounds pretty simple in principle, in practice things are often get complicated. Parties try to hide assets and do not offer full and frank disclosures, they disagree on what constitutes matrimonial asset, they disagree over the value or how each asset needs to be split.
Our divorce team proceeded with what any good divorce lawyer should undertake when embarking on a new asset separation matter: understand the client’s objectives and assess what realistically can be achieved, before putting together a strategy for the case.
Mrs Z’s main objective was to obtain financial security for herself and her son after she had put her career on hold and was now the main carer for the parties son.
Things were complicated by the fact that Mr Z refused to give full financial disclosure, attempting to frustrate our teams efforts in respect of finding out the true extent of the matrimonial assets. Our client also knew only very little of the business: what the business was in fact making or the future projections.
Our team of divorce lawyers are exceptionally well trained in dealing with complex financial matters. Rakhi Singal headed the teams efforts in uncovering the full extent of family’s assets. By meticulously going through both the business accounts and Mr Z’s personal accounts we were able to find clues that eventually led to establishing Mr Z’s true financial position.
Due to Mr Z’s unreasonable approach to these divorce proceedings, all attempts to settle this through negotiations failed, as Mr Z was refusing to understand that he no longer had the upper hand.
Despite Mr Z’s aggressive approach towards our client during the divorce and financial proceedings, our Divorce team was able to get an excellent result for the client. She obtained ongoing maintenance from her ex-husband. Mr Z was further rrequired to continue to pay the mortgage of the matrimonial home while Mrs L maintained the use of it with the parties son. Our client had no interest in remaining in the business and as a result of leaving it, she was also provided with a lump sum payment equivalent to the value of her shares.