Divorce is a sad and unfortunate reality for many people in today’s society, including those in the veterinary industry. According to the Office for National Statistics, 42% of marriages end in divorce. Naturally, no couple enters into a marriage expecting to divorce, but it’s important to consider what the financial implications may be and the best way to mitigate against those.
Divorce is, in fact, straightforward – since April 2022 separating couples can now divorce without finding fault in the other party – this is referred to as ‘no-fault divorce’. It makes the formal step of legally ending the marriage easier and, importantly, more amicable.
It’s in stark contrast to the old fault-based divorce system, where one party would have to find fault – such as adultery or unreasonable behaviour – to divorce straight away. Reference to these sensitive issues is no longer required, so private lives can be kept private.
A common misconception is that by divorcing and obtaining a final order, any financial claims arising from the marriage are severed. Such an assumption is incorrect. Financial claims arising from a marriage remain live until an order detailing the terms of financial settlement have been filed and approved online by the court, save for a few exceptions – this is normally referred to as a consent order.
This is especially important for those who work in the veterinary industry to ensure no future claims can be brought against their hard-earned income, any pension they accrue or have accrued, or against any share of the veterinary partnership they may own, alongside other issues.
It’s often possible to negotiate the terms of a consent order without involving the court. However, where an agreement reached immediately between the parties is not possible, it’s important to consider the various options available. Court is often a last resort for many and you may wish to consider the use of mediation or other forms of alternative dispute resolution.
There are other steps which can be taken to avoid a protracted dispute at court, which is particularly important if you own a share of a veterinary practice or have brought significant wealth to a marriage – for example, you may have accrued a large pension before meeting your current partner.
As divorce is now so common, many couples choose to enter in to a nuptial agreement before they marry. This is essential in helping to protect a range of assets and to determine the financial split that would occur if you divorce.
Most notably, a nuptial agreement – referred to as a pre-nup if entered into prior to marriage or a post-nup if entered in to after – can protect shares in a veterinary practice. This provides certainty not only for the individual who owns shares in the practice, but also for any employees who may be adversely affected by such a claim, for instance if a sale of shares in the practice is ordered by the court.
It’s important to take prompt legal advice in order to negotiate the terms of a pre-nuptial agreement which should be signed at least 28 days before marriage.
Whilst divorce rates have risen in recent years, so have the number of couples who choose not to marry and instead choose to cohabit. Although there may be a review of the laws to protect cohabiting couples in the future, those that do choose to cohabit at present can only bring far more limited claims – normally only relating to property. Thus, those cohabiting have less to worry about upon separation insofar as pension, income and shares in a business such as a veterinary practice are concerned.