Divorce-is this normal or reasonable?

[digger123]

The decree nisi came through at the beginning of the year but STBXH is procrastinating over the finance and it's driving me potty!!

We both have solicitors, have sold our house (in January) and are in separated rented accommodation. His solicitor had the funds frozen even though they would have paid for a house each for us. We are at the stage where we have been through financial disclosure (his incomplete) and have made one proposal and one counter proposal.

He has a decent job and pension but no savings. All my assets are inherited and I live off the income (approx a third of his). Because it is so low (I get an NHS certificate for free dental etc) and I have the elderly dog we are in accommodation costing half of his. Basically he wants to keep his pension AND get 90% of the proceeds from our house.

We have 2 DDs, one is 17 and doing A levels, the other 21 and in final year away at uni (I've worked out she spends approx 5 months at home)

So....

1. He has now asked for 50K from the house proceeds. My solicitor has said to let him have it as the court might take a dim view otherwise as he would be due to it anyway. So it has been agreed that I get an equal amount - neither here nor there for me as I can't buy a house with it. His wage should be enough to cover any expenses he has, so, other than solicitor (potential court?) fees I don't know why he would need it. Should I have said no?

1. His solicitor has said he should not count any pension payments before marriage or since separation as matrimonial. We asked him to find out how much that amounted to. He took 5 months to reply, and then only to give us authorisation to find out ourselves. I am now paying my solicitor to do so. Is this normal and could I claim back these costs?

This is despite the fact that my proposal is based on the fact that I keep what's mine and vice versa - i.e. so I wouldn't touch his pension anyway.

1. I am due an inheritance from my Mum when her house is sold which could be anytime in the next 2-3 years. Is this relevant - i.e. if we go to court and it is valued at much higher than probate?

1. DD2 (17) is now on medication for depression/stress. Is this relevant?

Is any of this relevant either now or if it went to court?

If anyone with any knowledge of such matters could shed a light on any of this I'd really appreciate it...

I think care needs to taken not to cross wires if you are talking about a 55:45 split and ring fencing the inheritance and lost dad means a 70:25 split if the inheritance isn't ring fenced.

There is no substitute for legal advice from a family lawyer who has not only completed a degree in law, trained for years and receives training year in year out but also has knowledge and experience gained from dealing with the courts on a day-to-day basis. I don't think family law is so much an art, rather more a case of mathematical probabilities.

Inheritances are a grey area and you cannot rely on ring-fencing. If you research on the internet there is a plethora of old cases about ring-fencing but the reality is each case is dependent on the particular facts. In one Court of Appeal case the judge who was the President of the Family Division said something along the lines inherited wealth forms part of the property and financial resources which a party has, and therefore must be taken into account pursuant to s25(2)(a) MCA1973. It is not therefore to be quarantined.

So have you offered you get 55% NOT including the inheritance which is very different from 55% including the inheritance?

Also can you not force the executors to make the family member leave the house now and get it on the market with an auction in 2 months' time if it has not sold by then? The longer the relative stays in the house the harder it will be to get them out. Also is the relative paying rent to the estate which presumably they ought to?

Yes I know there is no substitute for legal advice and I am realising that inheritances are a grey area. There was something mentioned in a paper released at the beginning of this year about this, but really no clarification as all cases are treated differently.

Tbh I was not intending to so much discuss the split of assets on here (although interesting nonetheless) as try to find out how I can move things along and avoid unnecessary expenses, and find out things like...is it normal for me to have to pay to find out his pension details when he won't? And how long is reasonable to wait for a reply from him when we both have good solicitors?

Oh..and the 55/45 split is with ALL assets being taken into account, inherited or otherwise!

It's a long story re the family member (and young family) in the house but basically we all agreed to it, especially while it was all going through probate which took a long time and we couldn't leave the house empty (therefore uninsured). There will be no problem with that person moving out when the house is sold

You mentioned the big recent legal bills. It can be very expensive because of the amount of time lawyers have to spend on it. I have met men on dates who have spent all the family's spare money on lawyers and been much happier the money went to lawyers not their spouse. I think that is a ridiculous stand point.

In our case we negotiated together (not easy, not nice) but with our own solicitors in the background - I paid both sets of solicitors as I was the one with higher assets/earnings.

In our case we both knew everything about the finances of the other. How could a couple not know that? it really puzzles me. We always opened each other's post, all accounts were joint, any pensions decisions we took together and I did both of our tax returns so no disclosure was needed of finances because we knew it. We decided our pensions were worth about the same so each kept our own. We did not need a paid for valuation to work that out - it was dead easy. Also pensions are never cash on divorce. You can go for a pension splitting order if you have to or work out what they are worth. Eg each £100k in the pension fund probably yields £5k a year income on retirement so £400k fund might be £20k of income which would mean £10k a year each on a pension sharing order (very roughly). It would never be regarded as he has got £400k cash in his pension so that is equivalent to £400k cash she has in the bank as cash. It is however often the biggest asset couples have.

Eg on the pensions if you know where he worked, what tyope of pension and how long he contributed into it you could have a rough guess at what it is worth and then use that to base an offer to him on. It is all rough and ready anyway. my lawyer said if we went to court (we had no hearings at all) he might get between 70% and 39% of our joint assets. I was not going to spend £200k finding out at what end of the spectrum we might be and we settled at 59% to him and a clean break , each keeping own pensions.

You could split the difference between his offer and yours and be done with it although until that inherited property is sold it is all a bit up in the air as to what you each have. I would get on with selling that in the next month or two if the executors are prepared to speed it up.

At the moment a valuation is entirely voluntary but if you do go to court the judge can make directions for one to be carried out. Actuary valuations of pension funds can be solely or jointly instructed and paid for.

BTW the problem with the pension Cash Equivalent Valuations is they may undervalue a pension by as much as a third particularly if the pension is a final salary one. So the true value of a pension with a CEV of say £300k could be worth £450k.

Because pensions can't be turned into ready cash they aren't deemed as valuable as liquid assets so if pension is offset against other assets there can be some discounting. For example if the CEV of £300k was discounted say by 25% the value of pension to offset against other assets would be just £225 whereas 25% off £450k would be £388k. For that reason it may be in your interests for a valuation to be carried out and it is often a false economy not to pay for one.

yes, that is sensible. In our case we know how much cash was in my pension fund SIPP. We knew roughly what his teachers pension was worth and number of years contributing and just decided they were roughly worth the same particularly as we had 25 years tog o to retirement anyway to accumulate more in pensions if we chose so did not bother with valuations and each kept our own pension. That will not be the right decision for other couples.

Sorry I've spotted a typo in my last post. That should read £255k of course

Third attempt! Or even £225k

Greengrow - solicitors fees...I have spent just under 10K in 1 year including divorce costs, seeing a barrister and having to find out his pension details when he at first refused to divulge them. in 1 year we have got as far as decree nisi (down to me), disclosure and one proposal each.

He did come up with an exact pension figure (and yes his pension income will be 5K per 100K as you suggested), but then his proposal stated he did not want to count as matrimonial one third of his pension as it was paid in before and after marriage. Surely this is not right when he is including in the pot my assets given to me in the 1980s well before marriage? He also has another small pension from before marriage which he has not included despite my requesting details (although my very small pension made paid up pre marriage IS included)

Yes I do know all his finance details as I used to do all the bill/finance paperwork and statement reconciling. I also used to do his tax returns, which although very simple, I stopped doing after he wouldn't give me his P60 & P11D until after the due date and I was having to also do all the working out of what he owed. As he only ever owed less than £100 in extra tax it was a lot of extra work for nothing. As a result, and to show his mindset in such matters, he didn't do them for several years and ran up, i think, £6K in fines!

It is amazing though, I agree, how many couples do not know each other's finances.

Re selling the house, it is complicated and none of the beneficiaries want to sell it at this moment in time with the market etc.

STIDW - I don't know much about CEVs except that they exist. As I said I do not particularly want to touch his pension, even though it could be beneficial to me to do so.

I think that either we will have to have fill disclosure and include everything in the pot, or if he wants to exclude everything "non matrimonial" i.e. paid in pre & post marriage/gifted/inherited, then that's fine with me too...that's everything I have except the matrimonial home we sold!

It is probably he has to throw in his pension even when contributed before the marriage, but that is not cash so may not be that helpful to you terms of helping you keep more of your saving and inheritance. it depends how big that third he wants to exclude is . You either have a pension sharing order eg half his pension in a sense becomes yours now or else he trades off keeping his pension against you getting more cash assets now.

I do nto know how much your share of the house/inheritance is but at the lsat the relative in the house should be paying rent to the estate which should count as part of your income in terms of the divorce. Also those relatives who do not want to sell could remortgage and give you hour share and the rest of them keep the house.

The third he doesn't want to include is worth way more than 100K so quite relevant in the scheme of things whether cash or not.

As I said, we have sent a proposal which includes absolutely all assets (not including some smaller ones not as yet disclosed by him) and gives me 55% and doesn't touch his pension. To my mind this is fair, but I don't think he will agree and it will go on and on...

As far as selling the house goes, we would hope to sell it for a higher price in a better market, which is why we don't want to sell it atm. The relative living there is paying all the bills inc building insurance, and also maintaining the property, which we are happy with for the moment. I don't want to be pushed into selling my share and I don't believe it would be beneficial to me

I don't know about the legal side, but from a negotiation perspective, what I understand is that he is asking for £50K immediately.

You would like to have the whole thing settled quickly, in which case you - and he - would most likely receive over £250K immediately.

I think these are the two things you have to try to trade off. Rather than granting him and you 50K each immediatly, tell him that the whole of his settlement will be his if he stops dragging his feet.

If you allow him to take 50K now without settling, he has no incentive to settle quickly, which is leaving you trapped in rented accommodation in an area you don't like. He then has more incentive to drag his feet.

Regarding the house that you will inherit (or part of it), the actual amount and when it will be yours is very uncertain. The property market could even fall (unlikely, I know, but still, it does mean the amount is uncertain). The longer this goes on, the more likely there would be some certainty to the amount and date, which most likely work in his favour, not yours.

If you don't want to touch his pension, and you don't want him to meddle in your house and force you to sell it early, then these two things can also be traded off: he keeps his pension and you keep your share of your family house.

If you allow him to take 50K before the final settlement, what happens if he spends it rather than invests it? When the totalling is done some time in the future, you would have 50K in the bank and he might have nothing left.

imo, you are being reasonable to not agree to each of you taking 50K, but to insist that if the settlement can happen soon, he will have the 50K that he wants and more.

I was advised that if did not let him have the 50K, then if it went to court a dim view would be taken on the fact I was not allowing him access to something what would be his anyway. This has been agreed on the basis that i get an equivalent amount and that it forms part of the final settlement whether he spends it or not.

I don'y know why he needs it as his pay more than meets his reasonable needs. I can only imagine he is somehow exceeding those needs and possibly his solicitor's bills are a contributing factor. Plus he will needs extra funds if it goes to court...

Yes I wanted to go on the basis that if he got his finger out so we could settle it all then he would have access to all that would due to him sooner. However this is not the way his mind works, and the longer he can keep control, and however much money is spent, is the way he operates, and at the end of it, it will be either my fault, or his solicitor's, depending on how it pans out.

I feel that along with the above I am being forced into things which are just costing me money - as in being given authorisation re his pension which I don't want anyway. I told my solicitor it wasn't up to me to have to pay to find out details on it but he has still gone ahead with it, which I don't understand.

Re the house, we will have to agree a valuation. i already have one from an estate agent. He is arguing it is worth substantially more - off the top of his head. I think here it is up to him to prove it...at his expense of course!

Although my solicitor is supposed to be good, I just don't know how they really operate, how much they tell each other etc. I feel like I need a solicitor to advise on my solicitor!!!

If your solicitor is not eplaining things to your satisfaction, which they appear not to be, then change them.

She has inheritance already - The death has occurred so it is not like in future she might inherit which is the difference here. The value of the share in the house may not be clear but the inheritance has in that sense crystallised. Is the approximate value of the inheritance included in the offer to him that you get55% of the assets or is the inheritance on top of that?

Also remember the pension fund value is no way treated like cash. If he has a pension fund say of £500k that is probably the equivalent roughly of £75k - £100 in divorce negotiation so you might prefer just to divide cash and instead have a pension sharing order. He cannot be forced to have his pension fund treated as a cash equivalent whilst you get more of the cash assets.

Can you look at nethouseprices.com or zoopla to see what "sold" prices not advertised for sale prices show for recent sales of similar properties in the same street? That is often just as good as valuations to give you things to negotiate over.

You need to lookat your worst case- he gets 50% of everythig including the inheritance, lok at what you have offered (him 45% either including or not including inheritance), what he has offered. Then look at the difference between your offer and his and what a court might decide, Then come up with a compromise figure which you feel is not enough and he feels is not enough for him and that figure might well be worth accepting to be done with it rather than paying not just the existing £10k to lawyers but £20k even if it goes to a final hearing. Better he has more money than wasting it on lawyers really. If he really will not accept an offer between yours and his assuming yours and his are both within the boundaries of what a court might award then you might have no choice but to get on with a court hearing if the difference between the two positions justifies (i) the legal costs and (ii) the risks the court will side with him and decide on an equal division of all assets including pension sharing order and dividion of the inheritance as the children are older and you may be able to get some kind of job.

I have just checked all the paperwork I was sent. The pension figure used was the Cash Equivalent Transfer Value, so that is the figure to use, right? And yes ALL the assets are included, so I have offered him 45% of everything including the inheritance.

The house is a one off - no exact comparisons to be made. This is why we will have to come to some sort of agreement re value. Houses in general have not moved either way in this area since it was valued, (in that respect Zoopla is useful) and of course it will only sell at what someone is willing to pay. Of course there will also be CGT to pay on any uplift in value as it is not my PPR

As I said above the CEV can undervalue a pension and it is necessary to have an expert valuation to establish the true value. IF the true value isn't known no one will know what is a "fair" settlement i.e. one that complies with the law.

To answer your original question it is in your interests, and perfectly normal and reasonable for an expert to carry out a valuation. In fact your solicitor could be deemed negligent if he didn't advise you to instruct an expert.

In fact you might want a pension sharing order rather than using the pension value to offset capital claims or he may insist. you cannot force him to treat his pension as cash. it also might be sensible of you have a pension sharing order so have that pension provision in future.

So you have offered him 45% of the joint asset including inheritance but based on the pension value which might be a bit less than his pension is worth (hence possible need to get pension valued). He wants what percentage of all that? I am just trying to find out how far apart you both are and where the compromise middle ground might be.

I take on board what you say about the CEV undervaluing the pension and ask my solicitor.

Re my offer of 45% of total assets to him, I think this totally reasonable on many points that a court would take into account, (according to S25 of the above-mentioned Act) including

1. My reduced earning capacity compared to his
2. The fact that his reasonable needs can be met without resorting to more of, what is in fact, non matrimonial property
3. That I have school and university costs among others to pay

Re his proposal, the amounts are incorrect in many areas...

1. He has only included 2/3 of the total CEV of his pension, saying the other 1/3 is non matrimonial. Yet he has included all of my pension that was paid up before marriage and all of my pre marital assets

1. He has put a higher, unsubstantiated, value on the house yet to sell (my inheritance)

1. He has not made allowance for costs I would incur in selling any assets, yet includes them for those currently in his name.

On this basis, he is asking for only slightly higher than 50% for himself, which sounds good, but then the figures are incorrect and unfairly in his favour.

Btw his pension is not a final salary one, and he has contributed the same amount every year for the past 10 years. Does that make things easier?