Financial Settlement Mediation
The most important fact that most divorcing couples do not realise is that the divorce process in itself DOES NOT deal with the financial settlement, i.e. how the assets & debts of the marriage – property, savings, investments, pensions, loans etc – are going to be shared between you. Nor does divorce automatically deal with child arrangements.
The mediation involves working with both parties to reach agreement on:
- Property, mortgages and other shared assets
- Savings, pensions and investments
- Outstanding debts and loans
- Spousal maintenance
- Child maintenance
- Interim arrangements while matters are being settled
Divorce mediation is not relationship counselling
When engaging in mediation, the couple have accepted that there is no possibility of reconciliation and accept the need to resolve the practical issues of the split as quickly and painlessly as possible.
Sometimes agreement comes easily. Sometimes it does not. That is when the mediator's role matters most — keeping the lines of communication open, encouraging empathy and keeping both parties on the issues at hand rather than off at a tangent.
Once instructed, we work for both parties and will bring you both to a fair resolution as quickly and as cost effectively as possible.
By using The Divorce Negotiator you avoid the need for each party to instruct their own solicitor and incur the associated expenses.
How the process works
1. Free initial call
With each party separately, to explain the process
2. Individual calls
About an hour with each party to gather information relating to the assets and debts of the marriage.
3. Joint session
By video conference, to discuss the terms of the settlement.
4. Written agreement
Drafted, then approved and signed by both parties
5. Consent order
Application drawn up and submitted to the court for approval
Fees
Two fixed fees are quoted at the outset: one for the mediation and one for the financial consent order application.
Fees are quoted per couple rather than per person and typically total under £2,000 for the mediation and the consent order combined. Payment may be made by either party or divided between them as agreed.
Why that matters
Other mediation providers conventionally charge per person, per hour or per session. Two parties attending a two-hour session are therefore charged four hours between them. The cost rises with every further session.
Our process is defined in advance. So is the fee. Both parties know before they begin what the mediation involves and what it will cost.
The alternative
Where parties are unable to reach agreement, the matter may proceed through the courts. Costs of £20,000 to £30,000 for each party are not uncommon and resolution can take months or in some cases years.
Common questions
Is the agreement legally binding?
It becomes binding once the terms are set out in a financial consent order and approved by the court.
Do both parties need a solicitor?
No. We work for both parties. Some people choose to take independent legal advice before signing, which is a matter for them.
How long does it take?
The mediation itself usually takes a few weeks. Where a pension is being shared, the timing depends on the provider issuing a cash equivalent transfer value (CETV). Providers generally have up to three months, or six weeks if told the request is for divorce and financial remedy proceedings. This is the most common cause of delay so it is worth requesting the CETV early.
Can pensions be shared through mediation?
How the pension is to be divided can be agreed in mediation. The sharing itself takes effect through the financial consent order and pension sharing annex, which we also draw up.
Financial Consent Order
Once the financial settlement has been agreed in mediation, we draw up the financial consent order application documents.
What we prepare includes:
- The draft consent order setting out the agreed terms
- The statement of financial information required by the court
- The pension sharing annex where a pension is being shared
The application is submitted to the court and considered by a Judge, so there are usually no hearings to attend. Once approved, the order is legally binding on both parties.
Unmarried Couples
There is no such thing as common law marriage - however long two people have lived together. Couples who were never married do not have the same financial claims as married couples, which changes what a separation involves.
What is usually in dispute
- The house, particularly where it is in one name but both contributed
- Who paid the deposit and in what proportion
- Mortgage payments, improvements and outgoings over the years
- Other jointly held assets, savings or debts
- Arrangements for the children's costs
There is no equivalent of the matrimonial claims available on divorce. That makes what each party actually put in, far more significant than it would be for a married couple.
What we do
We negotiate these settlements the same way we handle divorce finances. One negotiator working for both parties rather than each instructing a solicitor. Fixed fees quoted before you start.
Both parties set out their position, the contributions are established and we work towards terms both can accept. The outcome is a written mediated agreement recording what has been agreed.
What that agreement does
For many couples it is enough on its own. If the agreement is to put the house on the market and divide the proceeds equally, both parties can get that started.
It also carries weight. A signed written agreement is no longer without prejudice and may be taken into account in any court proceedings that follow. That is a considerable difference from an understanding reached over the kitchen table.
Where something more formal is needed
Where the arrangement is deferred rather than immediate — one party staying in the house until a future date, or a share to be paid at some later point for example— the parties may want that formalised in a Declaration of Trust.
Children
Maintenance for the children can be written into the agreement, in the same way as for a divorcing couple.
Whether or not the parents were married, both have the fallback of the Child Maintenance Service (CMS) if an child maintenance agreement is not reached or does not hold.
