When a married couple decide to separate permanently, but don’t feel ready for a divorce, they often wish to sort out their finances at the same time. Where there is a jointly owned matrimonial home, often one party will wish to remain there, whilst the other moves out. There are then issues concerning the occupation of the property, payment of the mortgage or other bills, joint bank accounts and so forth, which need to be resolved. There may also be the question of maintenance for one of the parties either for themselves, or for any children.

Only a “ Clean Break Order ” after divorce proceedings can give a true Clean Break. However, in many cases, the parties involved want to provide for a Clean Break so that they can move on with their lives without worrying about a later financial claim against them.

An agreement to separate and divide property, money and contents can be drawn up by the parties themselves, and just signed. It will not bind a Court into following it, but it is good evidence of an agreement reached. However, one party could claim that he or she was bullied into agreeing or signing it, or say that it is forged.

The next best option would be to set out the agreement in correspondence between solicitors – this helps to show that the agreement has been reached freely and with legal advice. Again, it will not bind a Court, but the party seeking to change the agreement would have to show that there are good reasons for the alterations.

After this, the next best option before a divorce Clean Break Order is a Deed of Separation, or Separation Deed.

This is a legally binding document that is signed as a Deed by both parties before an independent witness. It is usually, but not essentially, drawn up and approved by solicitors, and includes details of the parties’ financial position at the date of the Deed.

It is a legally enforceable contract between the parties, although again it will not bind the matrimonial courts completely when a divorce is finally sought. However, in order to deviate from the terms of the Deed, there would need to be a significant and relevant difference in the parties’ circumstances between the date of the Deed and divorce proceedings. Windfalls, inheritances and/or lottery wins might be protected using a Separation Deed, but this cannot be guaranteed. Only a Clean Break Order after divorce proceedings, where there has been full disclosure of both parties’ finances, can give full protection.

There are no Court fees for a Deed of Separation, and the eventual legal costs will depend on the amount of time spent negotiating and drafting the terms of the Deed. As an indication, costs start at around £400 for a straightforward Deed. However, a best costs estimate is given in each case, once all the circumstances are known.

© Karen O’Neill & Co., Family Law Solicitors   2004