Key takeaways from the Law Commission’s scoping report on Financial Remedies on Divorce and Dissolution

in December 2024, the Law Commission of England and Wales released a scoping report addressing the need for reform in the law governing financial remedies in divorce proceedings. While the report does not make any firm recommendations, it highlights significant issues within the current legal framework and discusses the implications of reform in this area of practice. 

The Current Legal Landscape

The existing law surrounding divorce and financial proceedings is primarily governed by the Matrimonial Causes Act 1973. Despite the evolution of case law over the past fifty years, the statute itself has remained unchanged. The lack of updates has led to ambiguity and confusion regarding key concepts and the distinction between matrimonial and non-matrimonial property, which are not explicitly defined in the statute.

Critics argue that the broad discretion afforded to judges under the current law creates uncertainty for divorcing couples. Different judges may arrive at vastly different outcomes based on the same set of circumstances, which can complicate negotiations and potentially escalate costs. As society has evolved significantly since the 1970s, many believe that reform is overdue to align the statute with contemporary values and expectations.

Key Findings of the Scoping Report

The scoping report concludes that the current law requires reform and places the onus on the government to determine the direction of these changes. It outlines four potential models for future reform:

1. Codification: This model involves minimal changes to existing law, with key concepts from case law codified into a single statute. While this would enhance accessibility, it would not significantly reduce judicial discretion.
2. Codification-Plus: Building on the codification model, this approach would include additional reforms to address unsettled areas of law while still allowing for judicial discretion, albeit with some limitations.
3. Guided Discretion: This model would introduce a set of principles and objectives to guide judicial discretion, providing a more structured approach to decision-making.
4. Default Regime: This model would establish a matrimonial property regime, offering couples clarity on how property will be divided upon divorce. This approach is common in several European countries and would significantly reduce judicial discretion.

Areas in Need of Reform

The scoping report identifies several areas where reform is particularly necessary:

• Nuptial Agreements

The Law Commission’s 2014 report recommended that couples should be able to enter into binding agreements, but the government has yet to act on this. Since the landmark case of Radmacher v Granatino, nuptial agreements which are being increasingly upheld, provided that they meet certain criteria and that the effect of the same will meet need.

Nuptial agreements are becoming increasingly popular, and the courts are placing more weight upon them now than ever before. The Law Commission are considering whether to produce a standardized nuptial agreements, which engaged couples can utilise in order to safeguard their assets in the event of divorce. 

• Spousal Maintenance

The current law allows for spousal maintenance to meet need and support a spouse’s transition to financial independence. However, there are calls to limit maintenance to a specific duration, raising concerns about the potential vulnerability of ex-partners. Often, the court and Family Law practitioners try to avoid ongoing maintenance and achieve a clean break, in order to limit any future dispute or issues between the parties, for example if the person who is paying maintenance is no longer able to do so.

• Conduct

The absence of a statutory definition of conduct has led to inconsistencies in how personal misconduct is treated in divorce proceedings. Reform could clarify what constitutes conduct and its relevance in financial settlements.

• Financial Support for Children Aged 18 and Over

The current statute generally ceases financial support for children at 18, despite societal norms where parents often continue to provide support. Calls for reform suggest extending this support to the age of 21. In practice, it is common for children in their early to mid-20s to continue to live with their parents, despite legally being adults. This often means that a parent is still financially responsible for a child, even if the court considers them to be an adult and therefore not relevant to financial proceedings.

How Manak Solicitors can support you 

While the Law Commission’s scoping report advocates for reform, it does not specify a method for implementing changes, leaving the decision to the government. The current system, which relies on both statute and case law, provides judges with considerable discretion to achieve fair outcomes. Any proposed reforms must balance the need for certainty with the necessity of fairness in financial settlements.

If you are considering divorce or need assistance with financial settlements or pre-nuptial agreements, don’t hesitate to reach out to Manak Solicitors. Our team of divorce solicitors can help you with: 

Financial Settlements

Our solicitors work diligently to secure a fair financial settlement that meets both parties’ needs, as well as taking into account other factors such as contributions. We understand the complexities involved in asset division, including the need to account for property, savings, and pensions. Our goal is to ensure that your financial future is safeguarded, allowing you to move forward with confidence.

Child Arrangements

Our team advocates for a child’s best interests in determining who a child is to live with and the frequency and duration of their time with the other parent. We will work collaboratively with you to establish arrangements that promote stability and security for your children, whether through shared care or an alternative arrangement.

Prenuptial and Postnuptial Agreements

Our solicitors are experienced in drafting, reviewing, and negotiating pre- and post-nuptial agreements. These agreements can provide peace of mind by safeguarding your assets and will also limit future disputes in the event of a divorce. 

Domestic Violence and Abuse

If you are facing domestic violence or abuse, our team is committed to your safety and wellbeing. If required, we can assist you with applying for various injunctions, such as non-molestation orders. We provide compassionate support and guidance in securing protection orders and addressing related divorce issues. 

Find out more about our divorce services and book a consultation with Manak Solicitors today.