What sort of financial orders can the court make in a divorce action?

There are a number of different orders which a court can make. The most common are:

Capital Sum

Apart from actually dissolving the marriage, the court can grant an order for a capital sum to be paid by one party to the other. This is usually meant as a "clean break" single payment, to allow the recipient to have a “nest egg” for the future so that they can live without their partner's support. It can also be awarded as compensation for losing ownership of a house previously owned jointly between both parties. In other words, one person gets the house and the other gets paid cash instead.

Transfer of Property

The court can order a house to be transferred from one party's name into the other - either transferring complete ownership from one to the other or awarding one party's joint share to the other, creating one single owner. In practical terms, this is often desirable when the person getting the house is also looking after the children of the marriage, who the court may not wish to require to move house and therefore possibly schools, neighbourhoods and social routines. Of course, sometimes the parties themselves will agree this in advance anyway and financial disputes may be in other areas.

Pension Rights

A pension can be transferred by the court in whole or part, or may be ordered by the court to be shared in whole or part between the parties. This is often a very valuable asset and particularly good pensions are possibly more lucrative assets than houses.

A spouse can claim a share of their spouse's pension based on the value of that pension from the date of marriage to the date of separation. Accordingly, even if a pension was started up before a marriage, it can still be subject to a claim based on the value of the pension accrued during the marriage. Clearly, couples who know that one of them has a particularly good and secure pension may not choose to save money as prudently as they might have done and so when there is a split the person who does not personally own that pension needs to seriously consider making a claim on a share of the pension. Even if the pension is years away from being paid out, the court can still make orders requiring a cash payment to be made by the pension holder to their spouse in recognition of the value of the pension or can order the pension administrator to split the pension and pay out . The court can also make a pension sharing order, requiring part of the pension payments to be made to the spouse when the pension actually starts to pay out.

Aliment

The court can also award aliment, often referred to as alimony (much to the annoyance of Scots lawyers, who fight off the terminology of American courtroom dramas and English legal news stories on a daily basis!) Aliment is basically a maintenance payment designed to provide the spouse with a lower income with a reasonable standard of living. Such awards are typically made right at the beginning of a divorce action or even long before that in a separate action, so that the lower earning spouse can have some income stability until the final settlement has been agreed or imposed by the court.

Periodical Allowance

Aliment generally stops once divorce has actually been granted. If a court wishes to make a post-divorce award for maintenance to allow one spouse to "get back on their feet" following a severance of financial support from their ex-spouse, the court may award periodical allowance for up to three years after the divorce. This is thought appropriate when one spouse has given up a career to look after children.

There is some division of opinion as to whether or not periodical allowance has a place in the 21st century, as it is hard to avoid the conclusion that it is really a "housewife's remedy". Many judges tend to decide against it and instead rely on capital sum payments to create the much sought after "clean break". Aliment and periodical allowance are payable by the other spouse and the court has to take into account the financial resources and requirements of the paying spouse as well as consider whether the spouse claiming aliment or periodical allowance has taken reasonable steps to manage their own expenditure and maximise their own independent income.

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