Money matters: Financial worries force couples to delay divorce

September 2, 2011

Around two-thirds of divorces in the South West are being put on hold due to the tough financial climate, according to a new survey from accountants and business advisers Grant Thornton.

The firm’s annual matrimonial survey reveals that a lack of value or liquidity of assets has caused 67% of divorces to be delayed in the region – against a national average of 54%.

And the economic downturn means more couples in the South West are reaching a financial settlement with their partner rather than beginning divorce proceedings – 73% compared to 63% across the country.

However, the research found less evidence in this region of a growing trend elsewhere in the country – that of concealing assets.

In the wake of high profile cases such as Michelle and Scot Young, and following on from the landmark Imerman v Tchenguiz ruling, many lawyers questioned in the survey believed that in future more people will conceal assets during divorce proceedings. Nationally, 18% of matrimonial lawyers said they had not dealt with any cases of concealment, against a figure of 27% in the South West.

The South West is also seeing a higher proportion of cases using mediation, with only 7% of lawyers saying they had not undertaken a single case, compared to 23% nationally. Regionally, lawyers were against compulsory mediation but the feeling was not as strong as the national picture.

The latest national figures available from the Office for National Statistics show the divorce rate in 2009 at its lowest level since 1977, with 10.5 people getting divorced per 1,000 of those married. The divorce rate has been falling year on year since it reached a high in 2003.  

“Whilst the economy has officially been out of recession for over a year, there are still clear indicators that financial concerns are one of the driving factors in both the timing of divorces and the settlements that have been awarded,” said Geoff Mesher, head of forensic and investigation services  at Grant Thornton in Bristol.

“With cuts in public spending and the economy continuing to falter, it would be unsurprising to see a continuation of this trend as asset values and income levels remain unpredictable.”

The ruling on Vivian Imerman v Lisa Tchenguiz effectively established that documents relating to a spouse’s financial position which are obtained secretly, even when under the belief that information is being concealed, are inadmissible.

“There is widespread concern that these recent developments could unfairly strengthen the position of any spouse wishing to conceal assets which in turn could lead to settlements that are unfair,” added Geoff Mesher.

“We have of course seen recent high profile cases such as that of Scot and Michelle Young, where Mrs Young alleges that her husband is hiding his assets with his celebrity friends, however it is worth bearing in mind this is not an issue that solely threatens the big money disputes, but also the everyday cases.”

The survey also uncovered a shift in the reasons for divorce. For the past seven years of the survey, extra-marital affairs have been the top reason cited for couples divorcing. This year however it has dropped to its lowest level ever (25%) and been overtaken by people who cited that they had simply grown apart or fallen out of love (27%).

“The shift in the reasons for divorce is difficult to explain. One potential influence could be the rise in the number of celebrities putting up with alleged affairs in their marriage or relationship, with Abbey Clancy staying with Peter Crouch, and Cheryl Cole looking all set to go back to Ashley.

“Whatever the cause, it is interesting to note that more relationships than ever, affected by infidelity, could be surviving.”


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