Sears Tooth Agreement

[Nickiocat]

Hi - I'm going through a pretty acrimonious financial settlement and divorce. I signed a ST agreement with my solicitor believing that the property I co-own with my ex husband would be sold and therefore legal costs will be paid then. However, it's complicated by the fact the house is in France, it's not looking likely to get sold quickly, and even if a judge orders it to be sold, ex is unlikely to comply and not sure that family court has particular jurisdiction overseas. Additionally, not sure that what is left in the house capital wise would even cover my bills.
My ex had originally threatened to pursue me for spousal maintenance, claim half my pension etc. I had a major mental breakdown in March this year because of continued harrassment and bullying from ex and have quit the high paid job I was doing, and currently working in a minimum wage job.
Recently he has calmed down a fair bit, and has proposed a deal whereby he keeps the house and agrees to not pursue me for future income and pension.
This would be a great option for me, but doesn't address the solicitors bill which is around 40k by now.
I am planning on trying to arrange an IVA to cover the debt with the solicitor, but not sure if I will be in deep water for breaching the ST agreement? Anyone got any experience of this?
Thanks!

To get an IVA, you would need to get the approval of 75% of creditors by value of the debts. That means if more than 25% of the debt is with the solicitor, if they say no then you cannot get an IVA and would have to consider bankruptcy. However, you cannot deliberately be bankrupt; it may be considered that you can borrow enough to pay back and should be working (quitting your high paid job during a divorce has presumably also gone down like a bucket of cold sick with the courts?)

Thanks yes that makes sense. Ha a bucket of cold sick!!! That was mostly unpopular with my ex but I had no choice it was either quit or lose my grip altogether. I’m returning to my better paid job gradually from now. I’ll look into the implications of bankruptcy as I really have no idea how I can pay the solicitors bills if the house is not sold. Tbh I’m worried they didn’t do due diligence and check out properly the value of the house as not sure even if it was sold it would cover my bill

Surely the house was valued in the divorce?

Thanks yes that makes sense. Ha a bucket of cold sick!!! That was mostly unpopular with my ex but I had no choice it was either quit or lose my grip altogether. I’m returning to my better paid job gradually from now.

Call me a cynic, but this is what a lot of higher earners say and do in order to avoid their obligations. I'm not judging you - in fact I sympathise (and think the law urgently needs reform to stop rewarding lower earners and punishing higher earners in civil matters where both parties share fault) - but I still suspect this was tactical!

The trouble is though that this could count against you. Most people think bankruptcy is something that lasts a couple of years and stays on your credit file for six; in most cases they are right. However, a court can impose a bankruptcy restrictions order for up to 15 years if they think your bankruptcy was deliberate. Your actions may be looked upon by the courts as quitting you job during a divorce and then trying to go bankrupt to get a share of the house, all deliberate, avoidable and a red flag about your character. You'll also have no legal representation or means to get legal representation (trust me, solicitors won't want to work for someone who went bankrupt to avoid paying a solicitor!)

So I would exercise extreme caution in your next move.

"Like with anything else, there are some risks associated with using a Sears Tooth Agreement during your divorce. However, the solicitor bears the biggest risk.

As mentioned earlier, the solicitor only gets paid if you win the case and receive a high financial settlement. If your divorce is unsuccessful or you don’t get a favourable settlement, the lawyer doesn’t get anything. Sometimes, the lawyer may even have to pay some of the costs of the failed divorce case." https://austinkemp.co.uk/2022/10/28/what-is-a-sears-tooth-agreement/

This implies that it's similar to a no-win, no fee case. So if your settlement doesn't cover the fees, that is the risk the solicitor takes.

Is the issue that you agreed to pursue the house and are now considering giving that up?

I was subject to considerable bullying harassment and abuse both emotional and physical and simply couldn’t work. This included suicide attempts. So no, it wasn’t tactical. Only in as much as I needed to stop work in order to save my own life. The solicitor is well aware of these circumstances.

Thank you very helpful. I’m considering not asking for the house to be sold. It will protect my future income and pension. The house itself has little capital but has potential to generate a really high income for my ex husband as it’s a huge 6 bedroom house in Provence. I’m not even sure if it was sold whether it would cover my legal bill tbh.