The Law Commission has published its latest report on Family Law, recommending that pre-nuptial agreements be treated by the court as binding, provided that they do not lead to unfairness.
The media coverage has not surprisingly focused very much on this part of the report and upon the howls of outrage from those who think that planning for the worst increases the chances of a divorce. Personally, I think that’s a bit like arguing that you shouldn’t buy home insurance because it increases the chances that your house will burn down, but I’m not convinced that this is much of a departure from the decision of the Supreme Court in Radmacher v Granatino a couple of years ago.
What has received much less coverage is the Commission’s recommendations that the government should devise a calculator that will allow couples to calculate how to divide their assets in a divorce or to set maintenance rates without the need to use lawyers.
Lawyers are expensive and lots of people like lawyer bashing. We aren’t a particularly popular profession (and divorce lawyers are probably the least popular). I would of course argue with lawyer-bashers and say that we are unfairly maligned. The vast majority of us do our utmost to provide a good service in return for a reasonable fee. The fees may seem high to you (a client once told me “I wish I took home £195 per hour!” to which I replied “So do I!”) but law firms’ overheads take a very big bite out of the hourly rate. As far as I am concerned one of the best by products of the last recession was that bankers slipped below us on the social scale and compared to them, our public image is great. But I digress…
I can of course see the attraction to the public of keeping legal costs low. The trouble with calculators is that the formulae that they use are very blunt instruments. The child maintenance formula used by the new Child Maintenance Service is a perfect example of this. It works out child support using a rigid formula based on gross income, pension contributions, the number of children and the number of nights the children spend with the paying parent. It ignores all other factors and as such frequently leads to unfairness. There are a number of built-in injustices in the formula, such as:
- it ignores investment income
- it gives the paying parents a discount for overnight stays, but ignores the fact that the parents with care still has to pay the mortgage even when the children are away from the weekend
- it gives the paying parent a discount to reflect his new partner’s children, even if she is receiving child support for them from her ex (and even if she is a multi-millionaire and he is living in the lap of luxury).
- It assumes bonus income is received evenly throughout the year, whereas in fact it is likely to be received in just one month.
No formula is going to be perfect. The current system gives judges and lawyers enormous discretion and as a result couples get bespoke solutions, tailor-made for their circumstances.
However, this may come to pass. So, would a divorce calculator mean an end to divorce lawyers? No, it wouldn’t, for the following reasons:
- Clients will still need legal advice about all sorts of family matters.
- Spouses will continue to fail to disclose their income and assets properly and lawyers will have to be used to pursue them for the evidence.
- Clients will need representation at court and in negotiations about all sorts of other issues.
- Lawyers will continue to train and practice increasingly as mediators.
- Lawyers will still be used to draft complex legal documentation.
Failing that, we’ll all be kept busy with pre-nups.
27 February 2014