We are often asked by our clients: what does a clean break in divorce mean? This blog will answer just this.
A clean break settlement essentially means that the parties will have no financial ties to one another once the financial order has been made. It allows the parties of the marriage/ civil partnership to move forward financially independent of one another.
In practical terms, a clean break settlement will generally ensure all joint assets have been sold, and the sale proceeds divided between the parties as appropriate, or, transferred to one party of the relationship. It will mean that any assets in one party’s sole name are sold, transferred to the other party, or retained. This ensures a settlement of the parties’ capital position. Crucially, it also means that there is no ongoing spousal maintenance order in place.
Note however, in a relationship involving children a clean break does not mean that the non-resident parent escapes their potential obligation to pay ongoing child maintenance. You cannot clean break financial responsibilities for children. If the parties can agree on child maintenance then this can be included as part of any financial settlement, or alternatively one party is still able to apply to the Child Maintenance Service (CMS), or if the CMS does not have jurisdiction, to the Court, at any point before or after a financial remedy order has been made.
Most simply, it allows each party to go their separate ways without the possibility that the other party will make a claim against them in the future. By way of example, if a spousal maintenance order exists, either party could potentially bring an application further on down the line to vary the term or quantum of the order. Whilst the success of their application will be dependent on a number of factors, in particular their respective needs at that time, it is yet further hassle for both parties to have to reach further agreement, or go to court once more. Also, pursuant to the Matrimonial Causes Act 1973, section 25A, the court has a statutory duty to consider if a clean break is appropriate. It is generally acknowledged that both financially and emotionally it is better for everyone if a clean break can be achieved where this is affordable.
In order to achieve a clean break it is common for the financially weaker party to receive a greater share of the capital assets. Any spousal maintenance that would be payable could be capitalised (generally as a lump sum payment, or transfer of a capital asset), in order to ensure there are no ongoing monthly payments.
A clean break is not always possible, however desirable it may be. If there is insufficient capital and a need for spousal maintenance to be paid, it may be that there must to be continuing payments from one party to another.
Whether a clean break is appropriate or not in your case will be a matter for the barrister providing advice to you to consider. Barristers at The Divorce Surgery will talk you through options for settlement that may include a clean break, and give you a clear understanding of whether one may be appropriate or achievable in the circumstances of your case.