I am going to try and unravel some of the mysteries and misconceptions about a consent order (or sometimes called a financial order). Many people ask, what is the difference between a consent order and a clean break order.
Some call it a ‘consent order’. Some call it a ‘clean break’. Those imposed by the court are ‘financial remedy’ orders.
So what is the difference?
A clean break is a consent order that basically orders a “clean break” between the parties. It means there are no ongoing commitments between the parties. This may include the maintenance or an order in regards to a property being sold etc.
A consent order is a legal document that defines how your financial assets and childcare are to be divided. It should be set before the decree absolute is finalised. Without a consent order, your spouse can come back at a later date and make a financial claim against you.
Consent order means you are both agreeing to make a clean break. You will not make any further claims on each other’s finances now or in the future.
A consent order is not the same as a clean break
People can get confused and think a consent order is the same as a clean break. It isn’t. The consent order is an application to the court.
The clean break is where neither party can return to the court to have the order varied.
Not everyone can have a clean break and so going back to court in the future will always be an option. This is what scares people and what they do to try and avoid it. You can have a Partial clean break. This is usually when young children are involved, where you expect financial arrangements will change in the future.
There are different financial headings that need taking into account
- Maintenance for children
- Maintenance for spouse
So, if you have sold the house, split the savings and there is no need for maintenance. you are going to share the joint pensions. You would have a full ‘clean break’
Can you see, you have divided everything now. Neither of you would have a cause to go back to have it varied.
But if your house is not sold for another 5 years because the children are young. Or because the market is not good right now, then you have an order that can be varied.
Imagine a spouse is paying £200 spousal maintenance for 10 years. Gets made redundant 2 years after the order comes into force. That person has to go back to ask to have the maintenance payment adjusted. With no income, one cannot expect to be paying the same as when they were working.
One thing people are not made aware of is the terms around the child maintenance. So let me explain. The order will stipulate the payment and for how long. It will also take into consideration any increase year on year. But what is ordered actually only has a life of one year ‘should’ the circumstances change. You don’t go back to court for a variation, you have it assessed by the CMS. The courts could not handle the number of variations it would receive. Life does not stand still and neither do the costs of our children’s upbringing.
The arguments I hear about what the child maintenance is for is amazing. Some parents agree that they are responsible for all the costs. Including school trips and extracurricular activities. Others, only want to pay the least they are by law required to. So the child will either miss out or, the parent will go the extra mile. Ensuring the child can carry on with the activity.
What one feels is wrong another feels is acceptable. The art is to accept what you cannot change. In doing so it allows the children to escape the arguments the parents may have on the subject.
Spousal maintenance is a topic that fuels many people. It is calculated similarly to that of a Government benefit claim.
Imagine this. The wife keeps the house which has £100,000 equity with no mortgage. The husband is about to retire and can cash his pension getting 25% tax-free. This particular pension is worth £1.2 million. The wife has not worked for the past 25 years. The husband is about to start a new consultancy job earning £7000 PCM. How could the wife survive if there was no spousal maintenance? The answer is, she could not. And a Judge would not allow any proposal if there was no mention of spousal maintenance. I hope you can see it would be unfair.
But a financial remedy is where you have failed to come to an agreement with your spouse and apply to the court. There are usually 3 dates to attend court. This may be cut down to 2 and if you still cannot agree. The Judge will then impose the decision.
Don’t let a complete stranger called a Judge, decide what is going to happen to your money. Give me a call to discuss your financial settlement on 0800 177 7702 or complete the Online Enquiry Form.