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CASE STUDY: The importance of a financial clean break in separation or divorce

case study

What Happened:

Divorce solicitor, Clare Kerrigan, was instructed to act on behalf of a woman who had been separated from her husband for more than ten years.

After the parties separated the husband had issued divorce proceedings and a decree absolute of divorce was pronounced over ten years ago. At the time neither the wife nor the husband applied to resolve financial matters within the divorce proceedings.

The wife remained living in the family home with the three children of the family who, when the decree absolute was pronounced, were all under the age of eighteen. The family home was at the time in negative equity (the mortgage outstanding on the property was higher than its value).

In the ten years that had elapsed since the decree absolute the value of the property had increased by £100,000 and the children of the family were all over the age of eighteen and therefore no longer dependents.

Therefore, ten years after the divorce the ex-husband applied for a financial settlement, i.e. a claim on the equity in the family home.


As neither party had obtained a clean break financial order within matrimonial proceedings, the husband had a financial claim over the equity in the family home that was still jointly owned by the parties.

Had the wife sought legal advice at the time of the divorce proceedings and obtained a final clean break, as there was at the time no equity in the property, it is highly unlikely that the husband would have been successful in obtaining a lump sum order in relation to the property.

However, as at the time of the financial application the property had increased in value by £100,000 over the ten year period, this meant that based on a starting point of equality the husband was potentially entitled to a lump sum equivalent to 50% of the equity in the property which still remained in the joint names of the parties.

How Morecrofts helped:

The wife instructed Clare Kerrigan of Morecrofts Solicitors to represent her in respect of a financial application within the matrimonial proceedings. The husband claimed 50% of the equity in the property which was approximately £50,000 and sought an order either that the property be sold with the net sale proceeds being divided equally between the parties, or alternatively that the wife pay the husband a lump sum of £50,000 upon the property being transferred into her sole name.

The result:

Clare Kerrigan of Morecrofts Solicitors was successful in negotiating a reduced lump sum payment of £25,000 upon the husband transferring the property into the wife’s name on a clean break. As this was an agreement negotiated via solicitors Clare Kerrigan not only potentially saved the wife £25,000 but also avoided the additional legal costs that would have been incurred had the matter proceeded to a final hearing. However, had the wife sought legal advice at the time of the divorce it is highly unlikely she would have had to make any lump sum payment to the husband.

This case demonstrates why it is so important to obtain legal advice on obtaining a financial clean break order within divorce proceedings to prevent your former spouse from submitting a financial application potentially many years after the divorce has been finalised.