Living Under the Same Roof During Divorce

07-Oct-2011 Family lawyers have always recognised that the situation of each divorcing client is unique but more often than not, our advice is generally the same. However, the current economic climate has had a significant impact upon our advice during the last few years predominantly as a result of a lack of liquidity in terms of property sales and difficulties with borrowing and income pay freezes. Long gone are the days when the former matrimonial home would sell relatively quickly and an increasing number of clients find themselves in a situation where the family home is not selling quickly and they are forced to continue to live together until funds are available to move forward with separate lives.

If couples remain under the same roof before divorcing it may be prudent to consider the appropriateness of an agreement that regulates the living space and finances.

Such agreements have been referred to as “Mid-Nuptial Agreements” in that they seek to regulate financial and practical arrangements on an interim basis to include:-

1. Financial support one party might require from the other in an attempt to lead separate lives under the same roof.

2. The practical arrangements with regard to contact with children , for example, taking it in turns to spend time away from the property to enable the other parent to spend time with the children at the weekend.

3. Arrangements for payment of general household outgoings.

4. Arrangements for the storage of confidential documents for example, solicitors correspondence.

5. There needs to be a clear agreement with regard to friends and relatives who come to stay, particularly during Christmas etc.

6. Discussions with inevitably take place as to whether it would be sensible to try to make the property more attractive to a buyer. An agreement would need to be reached as to how the cost of any renovation / cosmetic works to the property are to be funded and how those costs are to be reimbursed to the funding party ie does this give them a greater share of the net proceeds of sale?

7. One important point to consider is the issue of tax. If one joint owner moves out of the family home and the property does not sell for 36 months, there may be capital gains tax implications. Concessions are available for divorcing couples where a disposal after 36 months is part of a final financial settlement but it may also be sensible to consider a without-prejudice transfer if the 36 month deadline is imminent.

 

For more information about this topic of any issue relation to family law contact Lisa Kemp

 

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