We are living through very uncertain times with all of us having to become familiar with new concepts such as observing social distancing and self-isolation.
The impact on families who are separating may be profound with issues surrounding the care of children and the division of the finances. This blog focuses on the financial impact of Coronavirus upon parties who are separating.
We are acutely aware from concerns raised by clients that they feel worried over court closures and maintenance issues as a result of employment uncertainty and the downturn in the financial markets.
What if I can’t pay child maintenance or spousal maintenance?
As difficult as it may sometimes be, always try to communicate with each other regarding this. If it has become apparent, or is likely to become apparent shortly, that you will be in a position where you cannot fund maintenance payments that you have previously paid voluntarily or in accordance with a Court Order, then make your former partner aware of this.
If you have received written communication from your employers saying that your pay or your hours of work will reduce, that you will only get paid for work done or if you have been furloughed for a period of time then show that to your former partner.
If this means that you are unable to meet your maintenance commitments and this cannot be agreed with your former partner then you may need to seek a variation in the level of those payments.
Be transparent about matters as, if your former partner is unaware of what is going on, they may well contact the Child Maintenance Service to seek assistance, which would be likely to increase tension. Your former partner may need to seek Benefits if their income is seriously reduced.
Effect upon Financial Markets
The financial markets have taken a big hit, substantially reducing the level of assets. There are endless ways in which the economic fluctuations can advantage some parties and disadvantage others.
Offers may have been made against the backdrop of an agreed asset schedule which may need to be reduced. Separately, companies which seem to support financial claims may collapse leaving the entire family vulnerable to a reduction in lifestyle.
Against this there may be arguments about how long these fluctuations will be in place, whether the impact will be long lasting and if so for how long? A party may wish to see the transfer of assets presently but that might realise losses. It is possible that there will be applications for adjournments of court hearings for spurious reasons connected to the health aspects of the present pandemic but which may equally relate to financial advantage.
It is also possible that recent financial settlements may be affected if assets have devalued significantly. The reality is that cases in which the Courts would be prepared to reopen financial settlements are likely to be very rare although if you believe that yours may be one of them then take legal advice.
It is highly likely that the Courts will close for all but the most urgent matters.
Presently significant steps have been taken by the Judiciary to ensure that the Justice System can continue to operate.
Remote hearings have already been taking place and the legal profession has moved very quickly to ensure that remote working is both possible and that systems are in place to achieve this using Microsoft teams (formerly Business Skype or Skype). Additionally, a long overdue emphasis has been placed now on Alternative Dispute Resolution such as Arbitration and there are the skills and technology available to assist with this.
Ultimately, whilst in the immediate future, we can anticipate significant changes to the structure and rhythms of our life, if you are going through the emotional turmoil of separation then legal advice and the court system will continue to be available (albeit remotely) to assist and reduce stress and anxiety at an already difficult time.
For further assistance or to speak with one of our family law experts, contact us today:
T: 029 2034 2233
Written by: David James