The divorce process in England & Wales has recently gone through a radical transformation. The introduction of the no-fault divorce process in April 2022 allows couples to divorce without needing to cast blame on the other party for wishing to separate. However, where does this leave personal and financial conduct, or ‘bad behaviour’, and the potential repercussions in financial settlement proceedings?
What constitutes ‘Bad Behaviour’ in a divorce?
After 2022, there is no requirement to prove wrongdoing when applying for a divorce. Instead, a simple statement as to the irretrievable breakdown of the marriage is sufficient to initiate the process. Nonetheless, the court may still consider financial and litigation misconduct when making a judgement on the finances during a divorce.
Conduct is a specific factor taken into account if the behaviour is such that it would be unjust to disregard. In OG v AG [2020] the court has gone further to state that conduct should be taken into account, not just where it is unjust, but also where the impact is financially measurable. The court has provided a threshold of what type of conduct may arise in financial settlement proceedings;
- The gross and obvious behaviour of one partner against the other during the marriage, including the mismanagement of finances which has affected the family’s asset;
- Where one partner wantonly transfers or runs through assets in an effort to prevent the other partner’s rightful share to them;
- Litigation misconduct where one partner makes baseless applications has been untruthful during proceedings or has caused significant delay to the proceedings; and
- Where one partner does not give complete and transparent disclosure of their assets, and as such the court has to deduce the existence of assets.
In Tsvetkov v Khayrova [2023] the court also emphasises that an allegation of conduct must prove the facts of the financial misconduct, which meets the threshold and has a negative financial impact on assets. The court also says that any partner alleging the misconduct of the other partner must report it at the earliest chance, usually during financial disclosure.
What are the Potential Financial Repercussions of Bad Behaviour?
The court may examine bad behaviour if it has had a direct negative impact on the family’s finances. It is worth noting that the extent of these repercussions will vary and depend on the facts of the case.
Spousal maintenance is a form of financial support designed to assist the economically weaker partner. If the court finds that the misconduct of one partner led to a financial loss to the other or reduced their earning capacity, the court might be inclined to award a higher spousal maintenance to redress the imbalance. However, this is rare because the financial needs of both parties remain the primary concern of the court when deciding on spousal maintenance.
Bad behaviour can affect the division of assets if one party’s actions negatively affect the marital assets. If one partner has squandered or hidden assets in an attempt to reduce the marital assets, the court may adjust the division percentage to compensate the wronged partner. However, the focus is on ensuring both parties’ needs are met. If the court believes both parties’ needs are met and there remains an assets surplus to meet such needs, the court may ‘add-back’ assets to the wronged party.
The best interest and welfare of the child remain the paramount concern of the court when determining child maintenance. The bad behaviour of a parent can indirectly affect child maintenance where one parent is the primary carer and the conduct of the other parent leads to significant financial loss. The court may consider a parent’s misconduct if it negatively impacts the primary carers’ ability to provide a stable, nurturing environment for a child, affecting the child’s living conditions or emotional state.
Fines and Penalties
In some cases of litigation misconduct, the court has the power to impose fines and penalties, especially when it involves breaching court orders or causing unnecessary delays in the court process.
A costs order requires the offending partner to pay the legal fees of the wronged party to prevent further financial burden from the misconduct.
Additionally, the court can also issue injunctions or restraining orders to prevent further misconduct.
However, such orders are typically used in exceptional circumstances, and the court exercises its wide discretionary powers when making such decisions.
Legal and Court Considerations when Presenting Evidence
It is important to follow the proper legal procedures and guidelines when presenting evidence related to bad behaviour. The evidence needs to be relevant, admissible, legally obtained and able to withstand scrutiny. It is crucial to maintain a record of relevant documents such as financial records, witness statements, or police reports.
The guidelines surrounding the evidence of financial and litigation misconduct are very technical and complex. Accordingly, it is highly recommended to seek legal advice to determine which documents are directly relevant to the financial aspects of your divorce.
When making a decision, the court will consider all the relevant factors including the income and financial needs of both parties, the age of both parties, the length of the marriage, the assets involved, contributions made during the marriage and the welfare of the children.
However, certain behaviours within the marriage and during proceedings can still play a role in financial settlement. It is not common that conduct will become relevant within financial proceedings but it is encouraged that details of clear financial misconduct are drawn to the court’s attention
While the introduction of the no-fault divorce process aims to reduce acrimony, the financial implications and repercussions of bad behaviour during the process should not be underestimated.
Legal Advice
It is essential for parties to consult with experienced family law solicitors who can provide guidance on how to navigate the complex legal complexities of a divorce and financial settlement, ensuring that their rights and interests are protected throughout the process.
At Rayden Solicitors, we can provide tailored legal advice, support the collection of relevant evidence, and advocate for our client’s position during court proceedings.
If you require legal advice in relation to financial remedy proceedings, please do not hesitate to get in touch with one of our specialist solicitors.
