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Why is a clean break settlement important?

A clean break settlement means that those involved in the divorce will have no financial ties once it has been agreed or ruled upon by a Court. If one party’s financial situation was to improve dramatically, the other party would not be able to claim retrospectively, regardless of how much time has elapsed since the divorce.

The long-awaited outcome of the case regarding Ecotricity farmer Dale Vince and his new age traveller ex-wife, Kathleen Wyatt, has now been determined.

Currently in matrimonial financial proceedings, unlike other civil proceedings, there is no time limit following the date upon which a divorce is concluded to issue an application regarding finances. This means that a financial claim may potentially remain live for many years after Decree Absolute has been pronounced.

In the above case, Ms Wyatt issued a financial application more than 20 years following their divorce. The Supreme Court approved an agreement reached between the parties providing Ms Wyatt with the sum of £300,000, which was awarded in addition to a total of £325,000 towards her legal costs. The Honourable Mr Justice Cobb commented in the case that ‘the lump sum payment agreed between the parties fairly represents, in my view, a realistic and balanced appraisal of the unusual circumstances of the case.’ Although this sum is a proportion of what was originally sought, this case will be relevant to other individuals who did not resolve financial matters upon divorce.

Opinions are divided as to whether or not this case will open the ‘floodgates’ to similar applications. However, what is clear is that this case highlights the importance of obtaining sound independent legal advice upon separation, particularly in relation to obtaining a clean break order following a divorce.

In the majority of cases, a clean break will be included in an order of the Court which is approved by the Judge, and will cut all future financial ties between the parties allowing them both to move forward.

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