Deed of Separation, Do I Need One?

Separation can be one of the most difficult periods in anyone’s lives, particularly when there are joint assets and or children concerned. Divorce or dissolution is not necessarily the first option for married couples or those in civil partnerships who wish to deal with their financial affairs. Those who are not in one of the former relationships and have chosen to cohabit instead cannot turn to the family court to resolve financial disputes arising from the breakdown of that relationship and would need to rely on the civil courts to deal with any financial disputes, the powers available to these courts are limited.

Our private family team can assist clients with preparing deeds of separation, commonly referred to as separation agreements. These agreements can deal with the distribution of any assets to include property, savings, investments, businesses or inheritance owned prior to or during the relationship.

These agreements are most entered into by couples who are separating but do not wish to commence legal proceedings and are able to agree what happens to their assets. A deed of separation offers clients the certainty of a written agreement reflecting the intentions of both parties at the time of separation. It is usual for parties who then wish to later divorce or dissolve their civil partnership and deal with their matrimonial finances to have the deed of separation converted into a consent order reflecting the terms previously agreed, which would then be filed with the court for approval.

Do I need one?

An agreement may be beneficial in instances where either you or your former partner wish to protect certain assets owned prior the relationship or that the other has not finically contributed towards, such as a property or pensions.

How could I negotiate the terms of the agreement?

There are many ways you could decide on the content of the agreement, you could reach an agreement through a discussion with your former partner without the assistance of a lawyer or third party. If you are unable to agree, you may want to participate in the mediation process or commence negotiations with the help of your legal representative.

You should always consider exchanging full and frank financial disclosure with your former partner before agreeing any terms of an agreement.

Here at Jordans, we will work with you and find the process most suitable for you.

Is it legally binding?

An important consideration to note is that a deed of separation is not legally binding in England and Wales. However, in the event of any future disagreement, the deed of separation can be used to provide the court with evidence of what both parties had agreed would happen with their assets upon separation if there was later a dispute. Further, it is important to note despite the agreement not being legally binding, you should not enter into any agreement unless you intend to be bound by its terms.

What factors will point to the fairness of the agreement? 

It is vital that both parties share a common understanding of the financial assets and liabilities involved; this means both parties would undertake the process of financial disclosure, a schedule of assets and liabilities will also be annexed to the agreement.

Both parties have taken independent legal advice, this means impartial legal advice from two separate solicitors; this commonly involves one solicitor drafting the agreement and another reviewing the agreement and suggesting any necessary amendments.

The terms of the agreement are substantially fair, allowing for each parties basic needs to be met in the event of a divorce.

Neither party being placed under any pressure or duress to enter into the agreement, and there are no false misrepresentations made by either party.

The contractual legal requirements being followed correctly when the agreement was entered into including the execution of the agreement as a deed. This includes having independent witnesses to the signing of the agreement.

Possible review clauses in the agreement, to ensure the agreement is updated after significant events, for example the birth or adoption of children, the acquiring of any further assets or a change in financial circumstances.