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Divorce? You may regret it if you don't ask for legal advice

Date:9 MAR 2018
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Yedina v Yedin and another [2017] EWHC 3319 (Ch) was an interesting case which highlighted the importance of seeking advice from a family lawyer when planning to divorce.

A couple married in Ukraine in 1986 and had two children. In 1998, the wife moved to the UK and became resident there. The couple's relationship subsequently broke down. The couple came to an arrangement between them and neither of them took legal advice. They agreed that:

  • selected properties would be transferred to the wife's ownership;
  • the husband would continue to pay for the mortgage on two of those properties; and
  • the husband would pay maintenance of £220,000 a year.
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However, the wife later claimed that the husband had gone back on their arrangement and she took him to court to claim damages. The husband stated in his defence that his poor mental health meant he did not fully understand the arrangement and the impact that it would have. He also argued that he signed the arrangement under pressure.

Mr Justice Mann tried the case. He found that the husband did in fact fully understand the agreement and that there was no evidence that mental impairment was a discounting factor. The judge commented that the husband was 'not the sort of person to sign anything without understanding what he was being asked to sign'. Mann J also found that there were no 'acts of improper pressure or coercion'.

Ultimately the arrangement between them was found to be fair and reasonable and therefore valid. The judge awarded the wife over £2m in damages. A counterclaim made by the husband against her was also dismissed.

The financial decisions of divorce

If the couple had sought legal advice from the outset, it is unlikely that the court case would have been necessary. They both would have received advice about the money and property they shared and the subsequent arrangements for their separate living would have been clear and sound.

When it comes to divorce, the financial decisions usually come down to two main items: dividing any assets and deciding what to do with the family home. In this case, the couple were clearly very wealthy with plenty of assets. However, this basic advice stands whether the couple are millionaires or just getting by:

  • Be honest about finances.
  • Consider how to manage the division of the home. This depends on several factors including how much equity is in the property, what each person’s mortgage borrowing capacity is and whether or not the couple have children. One spouse may decide to buy the other out or the couple may decide that to sell up completely. When children are involved, it is usual for the settlement to enable them to have a family home with each parent. So at least a two bedroom property for each parent.
  • In regard to other assets, decisions must be made about what can be divided up, what each person wishes to retain, and if there any fees for cashing something in early.
  • Try to deal in net figures, as the court would. So for example with a property, deduct 3% of the notional sale costs. With incomes deal with net (but include any bonuses).

If either spouse finds these discussions difficult, they could try mediation. Using a family lawyer as mediator is recommended.

Above all get a family lawyer's advice

If the case above tells you anything it should be this: even if a couple can make an agreement between themselves, they should also ask a family lawyer for advice once they have made their decisions. Ideally though, they should get some advice and at least have a solicitor in the background to call as and when needed.

There are many ways a family lawyer can help:

  • Even if mediation is used, the mediator is not in a position to give advice. A lawyer is required.
  • Collaborative law involves both partners having lawyers present who can then advise their clients on achieving equitable outcomes.
  • Family lawyers can take charge of negotiations around finances and other divorce arrangements.
  • Ideally it is better all round to avoid going to court. However it may be necessary in particular circumstances, such as in the case of domestic violence, if a partner is withholding financial information, if a divorcing couple cannot come to a fair and equitable arrangement regarding their finances, or if they are being put under too much pressure.