26 May 2020
It used to be that prenuptial agreements were something only the very wealthy had, but this is no longer the case. Partner Fiona Wood explains.Read more
As a family lawyer, I am often asked: "can I protect my inheritance?" An inheritance can take many forms, such as personal belongings that hold dear memories, or monies with the hope of easing the financial strain. On divorce an inheritance is usually included within the matrimonial pot available for division. However,there are circumstances in which it is considered appropriate to “ring fence” an inheritance before the matrimonial assets are divided.
Firstly, when was the inheritance received? If the inheritance was received during the marriage and was enjoyed either in part or full by the couple, then it is possible that the court may view this inheritance as a matrimonial asset, as it has benefited the family up until the point of separation. If so, the court has the power to include the inheritance in the matrimonial pot and it will be available for division between the parties. If the inheritance was received during the marriage, but was kept separate and not “intermingled” with the matrimonial assets, for example a sum of money which has always been kept in an account and not used to benefit the couple, this may be ring fenced and not considered to be part of the matrimonial pot for distribution.
If the inheritance was received after separation and thus not enjoyed by the parties, more specifically, not enjoyed by the soon-to-be-ex-spouse, then there is a strong argument that the inheritance should be ring-fenced and therefore not included within the matrimonial pot for division; this would be the starting point. However, the court will only consider ring fencing inherited assets if the assets within the matrimonial pot are sufficient to meet the needs of each party.
When we are either trying to reach a settlement out of court, or when attending court and asking a judge to order a financial settlement, the primary objective is to ensure the needs of each party (and any children) are met. The starting point for division of the matrimonial pot is 50:50, yet if the needs of one party are greater than the other, then the court has the power to depart from this 50:50 split.
What, in this context, is need? A question that can often be personal to each and every one of us; we all have different needs and priorities, therefore surely a need is subjective. But in the eyes of the court, needs fall in to the following categories:
If the needs outlined above can be met by the assets that are within the matrimonial pot, without including the inherited assets, then there is a stronger argument that the inheritance can and should be ring fenced.
Secondly, I am also frequently asked: "is my future inheritance at risk?" Again, another tricky question which too does not have a definitive answer. If the inheritance will be received shortly due to a recent death, then it is possible that the court may be persuaded to award more of the matrimonial pot to one party on the understanding that the other party is expected to receive an inheritance, which will be considered by the court as a financial resource to assist with their needs. It is possible for a court to adjourn proceedings until the inheritance is received; however this tends to be when the inheritance is expected to be a substantial amount which will impact the division of matrimonial assets greatly.
If you are yet to receive your inheritance and your loved ones are fit and healthy, the court should not consider your inheritance when making an order for division of assets, as it is unclear and unknown when you will receive it, how much you will receive and if there are any caveats attached to it.
Inheritance to many of us is personal, and should be managed delicately.
"Inheritance to many of us is personal, and should be managed delicately."
Anna Rooney, assistant solicitor
11 May 2020
As the COVID-19 lockdown continues, some people find themselves forced to socially isolate at home with partners and spouses on a 24/7 basis. In some very difficult instances, this may lead to a situation where they are stuck in a property with an abusive partner. What protections are available?
Under Section 33 and 35 to 38 of the Family Law Act 1996, the court have powers to make a protective order known as an occupation order. Assistant solicitor Aaron Williams explains.Read more
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