Who gets the house in a divorce?

There is one ground for divorce in England and Wales and that is the irretrievable breakdown of the marriage.

Recent legislation has simplified the process of applying for a divorce in an attempt to reduce the stress and acrimony that can occur.

The introduction of so-called ‘no-fault divorce’ means it is no longer necessary for either party to accuse the other of wrongdoing. Instead, either individual can simply state that the marriage has irretrievably broken down.

This is the agreement between a divorcing couple over how their assets will be divided up.

It is advisable to begin discussions on the agreement as soon as divorce proceedings start as any dispute could cause a delay to the final order of divorce (previously the decree absolute) being granted.

If a settlement cannot be agreed then one of the options could be to make an application for the court to determine financial matters.

An increasing number of couples are now addressing the issue of finances prior to the marriage itself. In such cases, a couple can agree what would happen in the event the marriage breaks down for example, what happens with the house.

Any agreement can be recorded in a pre-nuptial agreement (or “pre-nup”) and provided the agreement is fair, and the necessary formalities are complied with, a court is likely to uphold any such agreement on divorce.

There is no hard and fast rule about how a house is divided upon divorce in England and Wales. Any outcome must be fair and reasonable when taking into account the relevant circumstances of any given case.

At Wilson Browne, we have a successful track record of advising people on all aspects of divorce – including how the house will be divided.

Disagreements can cause delays to the divorce process, leading to ill feelings and costly court hearings. Many clients have saved time, money, and stress, by drawing on our knowledge and experience at an early stage.

No set of circumstances are the same and the court has a wide discretion when it comes to deciding how a couple’s assets (including their home) should be divided.

The family home will nearly always be considered a matrimonial asset and the case law would suggest that the starting point in dealing with matrimonial assets will be an equal split, as equality and fairness go hand in hand.

That being said, there may be other circumstances in the case that would mean an equal division of the house may not in fact be a fair outcome.

It is preferable for the couple to reach an agreement over who gets the house without the need for a court hearing, as by doing so they are likely to reduce the stress and cost of the divorce.

We have seen above how the court has a wide discretion when dealing with finances on divorce.

The role of the court is to achieve a fair and reasonable outcome, measured against the yardstick of equality. In determining what is fair and reasonable, the court will first consider the needs of any child of the family, as well as the factors listed at s.25 of the Matrimonial Causes Act 1973, namely:

1. the income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future, including in the case of earning capacity any increase in that capacity which it would in the opinion of the court be reasonable to expect a party to the marriage to take steps to acquire;
2. the financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future;
3. the standard of living enjoyed by the family before the breakdown of the marriage;
4. the age of each party to the marriage and the duration of the marriage;
5. any physical or mental disability of either of the parties to the marriage;
6. the contributions which each of the parties has made or is likely in the foreseeable future to make to the welfare of the family, including any contribution by looking after the home or caring for the family;
7. the conduct of each of the parties, if that conduct is such that it would in the opinion of the court be inequitable to disregard it;
8. in the case of proceedings for divorce or nullity of marriage, the value to each of the parties to the marriage of any benefit which, by reason of the dissolution or annulment of the marriage, that party will lose the chance of acquiring.

If possible, the court will look to achieve a clean break and ensure that both parties can be suitably rehoused.

These factors are considered in more detail below.

The court’s first consideration will be to ensure that the housing needs of any children of the family can be met.

In more limited asset cases, it may be that the resources of the parties do not stretch beyond being able to meet the needs of the primary carer.

Sometimes, the court will direct that one party is to remain in the home until the youngest child turns 18 at which point, the property would be sold and the proceeds split accordingly.

The court will look at the financial position of both parties to include assets, liabilities, and income.

Looking at this in the context of a home, there may be situations where one party earns significantly more than the other or holds significant savings/investments.

This may be because they have a more well paid job, or it may be because one party works part time or stays at home to look after children.

In the above scenarios, there may be justification for one party receiving more than half the equity in the home.

Other financial issues that many affect the split include cohabitation with a new partner, remarriage, ability to obtain a mortgage, availability of suitable alternative housing and childcare arrangements.

The subject of contributions is one often raised by clients. The law recognises that parties can contribute to a marriage in different ways.

One party may make a greater contribution financially, whereas one party may make a greater contribution to looking after the home and family. Case law makes it clear that there is to be no discrimination against someone who has taken the traditional role of homemaker and contributed less financially.

This means that in a long marriage, contributions may be of little relevance in terms of determining a fair outcome.

However, in the case of a short, childless marriage, there may be minimal assets that are matrimonial in nature and the needs generated by the marriage may be very different to those generated by a long marriage.

In such a scenario, financial contributions could become more of a relevant factor in assisting the court as to a fair and reasonable outcome.

The court will seek to minimise any reduction in the standard of living during the marriage.

Separating will often inevitably result in some fall in the standard of living as separation, by its very nature, is a process of turning one household into two.

That being said, where one party is making needs based claims, perhaps for maintenance, alternative housing, a vehicle or otherwise, the standard of living enjoyed during the marriage can be a useful reference point.

What might be a reasonable need in one marriage, may be completely unreasonable in another.

In general terms, the longer a couple has been married, the more likely that all assets, including the home, are going to be matrimonial in nature and subject to equal sharing.

In the case of short marriages, it is more likely that a greater proportion of the assets will be non-matrimonial and any award based on needs, rather than equal sharing.

It is worth noting that a court will likely take into account seamless pre-marital cohabitation when considering fairness.

For example, if a couple cohabit for 20 years before marrying, then separate after 2 years of marriage, the court are likely to treat it the same as a 22 year marriage.

Age can become a relevant factor in certain situations when considering needs.

In the context of the home and rehousing, if there is a significant age gap and one party is approaching retirement, they may have a vastly reduced ability to obtain a mortgage meaning that they need a greater sum than the other to rehouse (ie a bigger deposit).

If the home is jointly owned then it cannot be sold without each party’s consent, unless by order of the court.

Where the home is owned in the sole name of one spouse, it is important that legal advice is obtained by the other party in order to protect their interest.

If appropriate steps are not taken, the owning party could remortgage or even sell the property, creating potentially significant issues.