MAXWELL MACLAURIN

March 2008

INFORMATION ON CHILD LAW, FINANCIAL PROVISION AND DIVORCE

1. Child Law and Payment of Child Aliment

Child law is principally governed by the Children (Scotland) Act 1995. When parents separate it is necessary to decide which adult the children will live with and how often they will see the other parent. These issues are termed respectively residence and contact. Orders for residence and contact may only be made in respect of children under the age of sixteen years. If the parents are unmarried, the mother of the child has parental responsibilities and rights. If the parents are married, both parties share parental responsibilities and rights with regard to the child. This means that married parents have equal authority regarding any child. They can both decide where the child lives, whom he sees, and important questions regarding his welfare and upbringing such as medical treatment, education etc. In many cases when a married couple separate, they are able to agree what is best for any children of the marriage and continue to do so as time goes by, despite being separated or divorced. Often parents are able to agree where the child will have his primary home and how he will maintain contact with the other parents.

It is only when the parents disagree regarding any fundamental issue concerning the children and are quite enable to reach any agreement or indeed any compromise, that the law becomes involved. In these circumstances, either parent can make an application to the court and ask the court to decide what is best for the child.

For parents who are married it is important for each of them to remember that although a child may eventually have his main home with the other parent, both parents still retain full parental responsibilities and rights. The other parent should be consulted with regard to any matter of importance which arises regarding the child and where a decision is required. This includes every aspect of the child’s life including medical treatment, education and any issue of importance. With regard to education matters, the other parent is entitled in terms of the Education Acts to have sight of the child’s records at school, and to engage with the school in all aspects of the child’s education. Neither the child nor the other parent can interfere with that right.

Financial Support for a Child is called child aliment. Every parent has an obligation to support his child or children in material terms. When the family live together, that happens automatically. However, when parents separate, the parent who no longer lives with the child still has to satisfy the obligation of child aliment. It is therefore common for the parent with whom the child does not live to make a payment to the parent with primary care in order to assist in the cost of looking after the child. Whether child aliment is to be paid, and the amount may be determined by two means. Firstly it is possible for the Child Support Agency to carry out an assessment and calculate the amount which the absent parent should pay. Secondly it is possible for the parents, themselves, to enter into an agreement between themselves.

The starting point when considering child aliment is always the needs of the child or children. The next stage is to look at the means and resources of the parents and decide how the needs of the child can be met by the parents. If the absent parent has resources available, he or she will almost certainly be required to pay aliment for any child. Depending upon the needs of the children, and relative resources of the parents, it can be assessed how much should be paid to support the child. If the Child Support Agency require to make an assessment of the child aliment to be paid, they now employ a simple formula. In general, the absent parent is required to pay 15% of his or her net income per month for a single child, 20% for two children and 25% for three children or more. Those percentages are often used, in real terms, in negotiations as to the amount of child aliment which might be reasonable in any particular case.

Another question which requires to be considered in relation to child aliment is how long that aliment should be paid for. Child aliment requires to be paid until children reach the age of eighteen years, or if they continue in full time education or training, preventing them from earning their own living, child aliment should be paid to an upper limit of 25 years of age. The Child Support Agency can only become involved in relation to child support where the child is eighteen years or under. Once a child reaches nineteen years of age, the Child Support Agency will no longer intervene, and if there is an argument about aliment it is simply decided by the Sheriff Court.

It is not uncommon for children over the age of eighteen years to act on their own against the parent whom they feel is providing them with insufficient support.

One final important point in relation to the Child Support Agency is that, even where separating parents agree the level of child aliment between them, such an agreement can only be binding for one year. This is because it is a peculiarity of the Child Support Agency rules and regulations that either party may apply to the Child Support Agency for an assessment once one year has elapsed since any formal written agreement was entered into. In practical terms, this means that a written agreement between separating parents regarding child aliment is only binding for one year after the agreement is signed, before the matter becomes subject to Child Support Agency assessment.

2. Division of Property and Payment of Spouse Aliment

Special rules apply to “matrimonial property” accumulated by spouses during the course of their marriage. When a married couple separate, the property which they accumulated together is apportioned between them according to the rules contained in the Family Law (Scotland) Act 1985, as amended by the Family Law (Scotland) Act 2006. The first point to bear in mind here is that these rules only apply to spouses. In order for the provisions of the 1985 Act to be effective, the property must be divided either prior to or at the point of divorce, while the couple remain spouses. It is not possible, after divorce to go back to the question of property and seek financial orders from the court at that time.

The principle of the 1985 Act is that matrimonial property should be divided fairly between the spouses. That appears simple, but there is complexity in the definitions of these terms.

“Matrimonial property” is defined as the property accumulated by the spouses between the date of marriage and the date of separation. The date of marriage is obvious. The date of separation can be a question for argument. For example, it is possible that a couple may be separated in the eyes of the law despite the fact that they continue to live under the same roof. To return to the question of matrimonial property, there are three exceptions to the above definition, which are as follows:

(a) Any house acquired prior to the date of marriage but with the intention of it being used as a family home for the parties is included as matrimonial property.

(b) Gifts which have been given to either one of the spouses by a third party during marriage remain the property of the spouse to whom they were given and do not fall within the definition of matrimonial property.

(c) If a third party bequeathed a sum of money or an item of property to one of the spouses, that also remains the property of the spouse to whom it was bequeathed and is not matrimonial property.

The question of gifts and bequests becomes somewhat less straightforward if the party to whom the gift or bequest has been made subsequently used the gift or bequest for a joint purpose and used it for the general benefit of the family. For instance, a spouse may receive a bequest of money and then use this for joint purposes such as going on holiday or improving the family home. In those circumstances, the gift or bequest is viewed as having been converted into matrimonial property. Despite this, the spouse to whom the gift or bequest was made does not lose all the benefit. This is further explained below.

Matrimonial property is property of every description comprising houses, land, moveable items such as cars, furniture and so on, investments of every nature, policies and pensions. The starting point is for matrimonial property to be listed and valued. Liabilities, such as mortgages as well as loan balances, credit card balances and other debts such as overdrafts should also be ascertained and subtracted from the assets to arrive at the figure representing net matrimonial property.

A most important point to note is that in Scottish Law, assets and liabilities are determined as at the date when the spouses separated. This rule is peculiar to Scottish Law and leads to a number of misunderstandings. However, there is one exception, in that a current value may be used in respect of property which is to be transferred to one spouse in order to effect fair division of property. This would, for example, allow the court to take account of the increase in value of a house since the date of separation, so that the overall settlement should more accurately reflect a fair division of property.

As described above, the Act states that property should be divided “fairly”. This involves a further complex definition. In the first place, “fairly” generally means equally. However, the Act goes on to describe a number of situations which could justify one party receiving a greater share of the matrimonial property than the other. If one party has derived an economic benefit from the marriage, and the other party has suffered an economic loss, this can be recognised by an unequal division of property. This might apply if one party has given up a career for the marriage and find themselves at the end of the marriage with restricted earning power and reduced pension contributions. If one party has wasted funds, or dissipated funds during the marriage, this may also be taken into account. Where one of the parties will be looking after any children of the marriage following separation, perhaps without substantial financial assistance from the other spouse that too can be taken into account. Finally, if one of the spouses will find themselves facing a very difficult financial future as the result of the separation and is facing a substantial drop in his standard of living, that may also be taken into account. If one party brought a substantial amount of his own property into the marriage, and used it for the benefit of both parties, the law can recognise this and allow this to be taken account of to an extent, when property is divided. This is the “source of funds” argument and is the kind of argument, which might apply if one party has brought a substantial amount of capital or property into the marriage at the commencement of the marriage, or indeed has received a gift, or bequest which has been used for a common purpose as referred to above.

A separate but related issue is that of spouse aliment. Spouse aliment is distinct and separate from child aliment although some of the principles are very similar. One of the consequences of marriage is that spouses must support one another in material terms. This applies even if the spouses separate and it pertains until divorce or death cause the couple to cease to be spouses. With the couple separated, the obligation of material support will sometimes require one spouse to pay aliment to the other spouse. Whether aliment should be paid, and if so, how much, is determined by comparing the needs and resources of the separated spouses. If one of the spouses has outstanding needs that he or she cannot meet, and conversely, the other spouse has resources to spare, then the spouse with the extra resources may require to pay aliment to assist the spouse with outstanding needs.

In certain circumstances where one of the separated spouses is in a particularly difficult financial position, it is possible for a form of financial support called “periodical allowance” to be paid after divorce, usually for no more than three years.

3. Divorce Proceedings

There are now two grounds of divorce in Scotland. Again, the law in this area has been amended by recent legislation. The first ground is that an interim transgender recognition certificate has been issued to one of the spouses. The second ground is that the marriage has broken down irretrievably. In the case of an irretrievable breakdown, the law has outlined four circumstances which can satisfy the court that the marriage has indeed broken down irretrievably. Within the first year of separation, a spouse may apply for divorce based on the other spouse’s adultery or behaviour. In order to establish adultery it is necessary to prove that the other spouse has conducted a sexual relationship with a person of the opposite sex during the course of the marriage. The adultery ground can still be used even if the adultery concerned took place after separation. If the behaviour ground is to be used, the applicant spouse will require to demonstrate that the other spouse behaved in such a way that he or she could not reasonably be expected to live with that spouse.

Once the parties have lived apart for a period of one year, a further ground might be used to establish irretrievable breakdown, namely that the couple have been separated for that period, and the other spouse consents to the divorce. Finally, if a couple have been separated for two years, either of them can apply for divorce on the basis of the length of their separation. In this case the consent of the other spouse is not required.

In many cases, despite separating, the couple find it possible to negotiate in a reasonable manner and agree what should happen for the future. It is common for a “Separation Agreement” to be framed, dealing with division of property, and, if there are children, making arrangements for the children. The Separation Agreement also contains a number of standard clauses to protect the parties. For instance, it is common in a Separation Agreement for the spouses to waive their rights over the other’s estate, and to give guidance on interpretation of the agreement in the event of any dispute in the future. This allows the divorce to proceed immediately following the requisite period of separation without any implication of blame and with a minimum amount of difficulty and expense. In many cases today such a Separation Agreement can be negotiated between the parties if a solution to all of the issues arising from separation can be arrived at without court proceedings. Unfortunately, if there is a breakdown in negotiation, or one party refuses to engage in negotiation, the matter may require to be determined by a court.