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THE PROCEDURE IN FINANCIAL PROCEEDINGS ARISING OUT OF DIVORCE, JUDICIAL SEPARATION OR A VARIATION OF AN EXISTING ORDER
Financial proceedings are also referred to as Ancillary Relief Proceedings.
In situations where a couple know each other's financial circumstances and trust each other there is a significant possibility of a settlement being reached without the issue of proceedings. In these relatively rare cases, providing both have had the benefit of independent legal advice and it has been confirmed that the agreement is reasonable then the agreement can be incorporated into a Consent Court Order which can be granted at any time after Decree Nisi.
In most cases, however, the early issue of proceedings will be advisable. If one of the couple does not know fully the financial circumstances of the other or if a very quick negotiated settlement is not reached, then the issue of proceedings is advisable. The rules require a strict timetable once the issue of proceedings has commenced. If negotiations before proceedings collapse, then that time will have been wasted and one essentially has to start from square one. Time will have been lost and unnecessary legal expenses incurred. In most cases, therefore, financial proceedings are issued relatively soon after the issue of divorce or judicial separation proceedings, The same procedure applies for a variation of an order proceedings which I will explain in further detail if the circumstances arise.
Financial proceedings are commenced by the issue of a Form A which sets out the financial matters which the Applicant wishes the Court to consider. Broadly speaking, these fall into four categories - maintenance, payment of a lump sum, property matters and pensions. The fee payable to the Court for issuing such proceedings is £210.
When the Court receives the Form A financial application it sets a timetable and an order detailing the timetable is provided to both the Applicant and the Respondent. This is a strict timetable and it is important that the time limits are complied with.
Upon the filing of the Form A, the Court must list the First Appointment in 12 to 16 weeks time.
The principal financial document which needs to be filed is called a Form E. It is rather a daunting looking form and it is important that this is prepared carefully and thoroughly. It must be filed not less than 35 days before the First Appointment. That means that generally speaking, the Form E must be filed between 7 and 11 weeks from the date of issue of the Form A. The Form E is not perfectly drafted and is complex. I therefore generally ask a client to start completing an initial draft of the Form E. When this provisional draft has been completed I make an appointment with the client at which I can go through the draft Form E carefully with them and indicate what further information etc is required and then prepare a first typed draft of the document.
The Form E is a snapshot of a person's financial circumstances at any given point in time. It is generally preferable to swear the Form E relatively close to the date on which it is required to be lodged at Court. This means that certain aspects of the Form E to include updated bank statements etc will be required before it is actually sworn. The contents of the Form E will never be perfect, but it is important that it be completed as accurately as possible. A frequent problem with the timetable is the delay in obtaining details such as pensions. It is therefore important that pension details are obtained as quickly as possible. In addition to general pension information, specific information is required to be obtained. Therefore, the pension information provided to an employee on an annual basis would not, generally speaking, answer all the questions which are required.
It is usually the case that the Form E will have to be filed on a given day. 21 days later certain documents will have to be filed with the Court and 35 days later would be the First Appointment. It is therefore generally the case that the day of the week for exchange of financial information by way of Form E and also the day of the week when further documentation is required to be filed is the same day of the week as the First Appointment.
In addition to the filing of the Form E on time, it is required that the Form E of both parties be exchanged contemporaneously. If one side has complied with the timetabling and the other has not, then the other does not get to see the Form E until he or she is ready with the other Form E. The reason for this is to prevent either spouse from being able to check through the others Form E and tailor their Form E in the same way or to spot for example assets which are not quoted and of which one spouse is aware but not the other.
As soon as a Form E is received from the other side a copy of it is sent to you and then we can both look through the document and see what gaps there are and what further questions need to be raised. This will usually require another appointment and I will then prepare a draft Questionnaire subject to your approval.
There are other forms as well which need to be completed. The Court requires a brief chronology (history of the marriage in date order) and also a schedule of apparent issues. The latter is an analysis of those aspects of the case which are likely to be in dispute. Finally, there is a form which needs to be completed to indicate whether or not the First Appointment can be treated as a financial dispute resolution hearing. I will deal with this later.
It used to be the case before the new rules came into force that absurdly long and detailed questionnaires would be raised by solicitors, requiring financial information going back years. This was often nothing more than a tactical ploy to wear down the other side. Now one of the main reasons for the First Appointment is for the Court to consider the questionnaires and to rule upon which of these are acceptable and proportionate and which ones are excessive or oppressive.
When these documents have been lodged with the Court and served on the other side, solicitors and their clients attend the First Appointment [except in cases where the First Appointment is treated as a financial dispute resolution hearing (referred to as an FDR) - see below].
The technical purposes of a First Appointment are:-
a) to decide what questions on the questionnaire are to be answered by each party and during what time.
b) what documents need to be produced.
c) which assets should be valued, and how.
d) what further evidence, if any, should be for each party and
e) whether there are any other aspects which need to be addressed to enable full and frank disclosure and for all the evidence to be produced in respect of all the issues so that the matter is in a position to proceed to the final hearing if necessary.
The initial timetabling is the most structured timetabling in the procedure. After the First Appointment the procedure becomes somewhat less prescribed and will depend more on the individual circumstances of the case.
Negotiations are encouraged throughout the proceedings. The First Appointment is the first opportunity of the parties and their legal representatives to meet one another. Discussions will often take place to isolate the issues and on relatively rare occasions a settlement can be reached at this stage.
More usually, however, the Court indicates the evidence which is required to be produced and then lists the case (ie sets a date) for a Financial Dispute Resolution Hearing. The intention of this is to have a negotiation session orchestrated by a District Judge. All the financial cards should be on the table at the time of the FDR. The Judge who has conduct of the FDR will make it clear that he will have nothing further to do with the case after the FDR. He will give all indications as to the sort of order he would make in the circumstances and indicate if he thinks that either party's negotiating position is unrealistic or unreasonable. In most cases, settlement is reached at this stage. The District Judge who will have conduct of the case will have seen all the negotiating correspondence. Because he has seen negotiating paperwork which could not be shown to the Court at the final hearing (at least until the question of costs was addressed) he will, after attempting to broker a settlement between the parties, withdraw and take no further part in the proceedings. Any confidential and negotiating documents are then handed back to the solicitor.
If a negotiated settlement is not reached the Judge managing the FDR hearing will then issue any further directions which may be necessary for a final hearing. It varies from Court to Court, but generally speaking outside of London, an FDR might be expected to be held two months after the First Appointment. The length of time between the FDR and the Final Hearing will depend on the number of matters including the estimated length of the case and the Court involved. This might usually be for the average case four months after the FDR; or eight months in London.
There are a number technical aspects which need to be addressed, but will vary greatly from case to case. This explanation is really a simplified explanation of the structure in the usual case.
If you have any questions generally or as the case progresses, please do not hesitate to ask me, but I will try to explain matters as the case progresses.
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