DIY divorces to cut lawyers' bills

By  John Bingham, Social Affairs Editor

Married couples will be able to draft their own DIY divorce settlements using an officially-approved financial formula without having to fight over details in court under plans put before ministers today. 

Under proposals put forward by the Government’s legal reviewer, prenuptial agreements would become legally binding in England and Wales for the first time. 

The Law Commission is also urging the Government to consider devising a specific numerical formula which separating couples could use to calculate how to divide their assets. 

The introduction of a Government-approved divorce 'calculator’ would allow couples to work out how much each should receive without as much involvement from lawyers. 

The Commission has asked a panel of judges and lawyers to prepare guidelines on issues such as maintenance payments to enable couples and people without legal qualifications to draft financial settlements which could then be approved by a court. 

It suggests a system similar to that in Canada – where couples can use online divorce calculators to work out how much maintenance one spouse should pay to the other depending on matters such as how long they have been together – as a possible model. 

Sources last night said ministers broadly welcomed the suggestions which could reduce acrimony in divorces and cut costs for couples. 

Experts said the planned new system would be "put the process into the hands of clients". But religious groups voiced concern, warning that the reforms could encourage divorce. 

It follows remarks by the Roman Catholic Bishop of Shrewsbury, the Rt Rev Mark Davies, that inviting couples to plan for divorce even before they have walked down the aisle could empty the marriage vows of their meaning. 

The report describes the current system as “inaccessible” to the public and says there is evidence of inconsistency in settlements between courts, amounting to a postcode lottery. 

It concludes that a system devised in the late 1960s when most divorcing couples saw a judge is no longer “acceptable” in an era when the vast majority of separations are already agreed out of court under the eyes of lawyers. 

The removal of legal aid in most family cases last year has also led to a large increase in the number of people attempting to represent themselves in divorce proceedings. 

Lawyers said the package of measures could herald a “revolution” in family law, reducing the role of judges and giving couples greater power to reach “kitchen table” settlements. 

So-called prenups or postnups – agreements about assets made during the course of a marriage – are already legally enforceable in several countries overseas as well as in the Scottish courts. 

Since a landmark Supreme Court ruling in favour of the German heiress Katrin Radmacher in 2010, judges in England and Wales can take these arrangements into account. However, financial settlements are still made by a court order after an assessment of whether the terms are fair. 

The Commission has drafted a bill which, if implemented, would create a new type of contract similar to prenups or postnups known as “qualifying nuptial agreements”. 

They would enable couples, either engaged or married, to decide how to divide their property in the event of divorce or to exclude some assets from any settlement. 

As long as legal conditions are met, they would be binding and not subject to judicial scrutiny over fairness. 

Crucially, the contracts would only apply once it is clear that the basic needs of both spouses to an income and housing are met. They also could not determine childcare arrangements. 

The Commission has also asked the Family Justice Council, a panel chaired by the President of the Family Court, to draw up guidelines to give couples greater certainty as they negotiate divorce and end the inconsistencies. 

“The lack of clear law is problematic,” it remarks. 

“For the law to say, in effect, 'it is up to the judge’ may be acceptable if everyone gets to see a judge; but now that is the exception rather than the rule. 

“There is a need for clearer and more transparent law so as to give people an indication of the sort of financial settlement that they ought to reach, as well as more certainty so that they can have confidence in the arrangements they have made.” 

It also urges the Government to commission a study into whether a numerical formula similar to that used in Canada could be applied in Britain. 

“For individuals without access to legal advice who need to know whether, for example, one should be supporting the other for five years or ten years, or whether the proceeds of sale of their house should be split 50/50 or 40/60, guidance in the form of figures as well as words could be invaluable," the report says. 

“A formula would have to take into account, among other factors, the age of the parties and the length of their relationship, the age of their children and the length of time for which the joint responsibilities of the relationship (in particular the care of the children) were going to continue and to impact on the ability of either or both parties to support themselves. 

“These are all factors that a judge will take into account in making orders at present, and are all factors incorporated into the calculations that have been developed in some jurisdictions.” 

Andrew Newbury, head of personal legal services at Slater and Gordon, said that the move towards divorce calculators and DIY divorce could prove even more significant than the nuptial contracts. 

“To me the common thread to a lot of this is to put the process into the hands of clients to enable them to do a lot of it themselves rather than in court,” he said. 

He said the experience of the long economic downturn coupled with the growth of Internet, with large amounts of material already available online, had brought about a “profound change” in how couples approach divorce. 

“I think this will catapult it into the next phase if the proposals are accepted by the Government,” he said. 

“For the first time couples will be able to contract to exclude the power of the divorce court – that is a big step. 

“The risk is that it goes into the long grass on the basis that family law is not necessarily a vote winner. 

“That would be a crying shame because this could be a significant revolution in the area of family law.” 

Simon Hughes, the justice minister, said the Coalition would now consider the recommendations. The Government now has a year to decide what to do, which could take it to within months of a general election. 

“The Government is committed to improving the family justice system so divorcing couples can achieve the best possible outcomes for themselves and their families, using the courts only where necessary,” he said. 

Marilyn Stowe, senior partner at Stowe Family Law, said: “Because of the economic situation and the Government’s demolition of family law legal aid, fewer people are able to access professional legal advice. 

“As a result, confusion abounds and it is now necessary to provide additional information and “simplify” the current system.” 

Andrea Williams, chief executive, of the Christian Legal Centre, said: “In the past when we have simplified the law to make it easier to divorce all that has happened is that we have had more divorce. 

“This is a fundamental undermining of what marriage is which is a commitment for life for richer for poorer, for better for worse, in sickness, in health until death us do part.”  /Telegraph