If your marriage has recently ended, and you are considering seeking a divorce, one of the priority concerns you are likely to have is around how the assets you acquired whilst married will be divided. Here we answer the most frequently asked questions posed to our family law team on this topic.
What are considered assets in a divorce?
Irish courts will consider all property and resources acquired during the marriage as assets, such as the family home, rental properties or holiday homes, bank accounts, pensions, investments, vehicles, and personal belongings. Business interests and any other financial resources, like life insurance policies, are also considered.
How are assets documented in the divorce process?
When seeking a divorce in Ireland, one of the first things you must do is prepare an Affidavit of Means. This is a is a legal document used to detail your financial situation, including income, assets, debts, and expenses. Furthermore, if there are children in your marriage, you will need to prepare an Affidavit of Welfare. This legal document details your children’s educational, health, and childcare needs. The first document provides the court with a clear picture of the marital assets, whilst the second document plays an important role in determining how the assets will be divided. Courts will always prioritise the needs of dependents and children when determining how to divide what you own.
Will I get 50% of everything we own?
It’s very unlikely you will get exactly 50% of the value of all assets within the marriage. There are complex factors at play that determine how assets are divided, including your contribution to the marriage (for example in your capacity as homemaker or parent), the duration of the marriage, the requirements of any dependents, and consideration to any formal agreements entered into such a pre-nuptial agreement. The role of the court is to determine a fair and equitable distribution of assets but equitable does not necessarily mean equal.
Why is equitable not equal in asset division?
Equitable means a fair and just distribution based on various factors like each spouse’s financial needs, contributions to the marriage, and future earning capacity. The goal is to reach a division that is fair in the context of the marriage’s specific circumstances, which might result in an unequal but equitable distribution of assets.
What are the key factors considered when determining how to divide assets?
A key factor in divorce proceedings is the presence of dependent children, particularly young school children up to the age of 18, as well as those in full-time education up to the age of 23. This often leads to the primary caregiver receiving a larger share of the property for accommodation needs. Additionally, if one partner is dependent due to health issues or inability to work, this can affect asset division and may lead to orders for financial support. The court may also consider uneven contributions to marital assets by each party. While pre-nuptial agreements are not legally recognised in Ireland, their contents and the couple’s initial intentions can still influence court decisions.
What will happen to the family home following my divorce?
The fate of the home depends on various factors, including your unique circumstances and the needs of any children. Irish courts prioritise the welfare of children, so if children are involved, the court might decide to grant the family home to the parent who retains primary custody to minimise disruption in their lives.
However, this isn’t a hard-and-fast rule. The courts have wide discretion and consider many factors, such as each spouse’s needs and financial resources, the home’s value, and your overall financial situation. In some cases, the home may be sold, with the proceeds divided between you, or your spouse may buy out your share. In certain situations, the court might order a deferred sale, allowing your children to stay in the home until they reach a certain age.
The approach is to achieve fairness and equity, considering both spouses’ rights and any children’s welfare. The final decision is made on a case-by-case basis, reflecting the unique situation of your marriage and children.
What about any pensions?
The Family Law (Divorce) Act 1996 in Ireland introduced provisions for the treatment of pensions in divorce cases. It allows courts to make Pension Adjustment Orders, directing that a portion of one spouse’s pension benefits be paid to the other spouse. This ensures that pensions, often significant marital assets, are considered in the equitable distribution of property. The Act recognises pensions as an important element of financial provision in divorce settlements, acknowledging their value in ensuring financial security post-divorce.
In some cases, the value of the pension can be offset against other assets, meaning one spouse might retain their pension in exchange for relinquishing claims on other marital assets. It’s important to note that the treatment of pensions in divorce is complex, and the specific details vary from case to case. You will need to consult with an experienced family law solicitor for further guidance.
What will happen to my car?
If you have a prized personal possession such as a car or an expensive jewellery collection, you may be worried about what will happen to it following your divorce. In Ireland, the division of assets, including cars and jewellery, is determined based on what is deemed fair and equitable by the court. So, for example, if you bought your car before you entered the marriage, and use of the car was exclusive to you, then it’s likely a court will allow you to keep it by offsetting its value against other assets within the marriage. Ideally, you should try to negotiate a settlement with your spouse without a court judge deciding the outcome for you. If you are going through a contested divorce, our divorce lawyers at McCarthy + Co can help you in the negotiation process with your spouse.
What happens to my business?
Again, this depends on various factors such as whether you set the business up together, whether your spouse played a role in developing the business, whether the profits from the business are the main source of income for your households, and how much the business is worth. In some circumstances, the whole business may be valued for the financial settlement. If you find you cannot reach an agreement on the division of the business with your spouse, the last resort could be to either sell the business or let the courts decide. You can potentially avoid these scenarios by speaking to an experienced divorce lawyer and following their advice regarding negotiations and mediation.
Require assistance with dividing assets following a divorce?
If you are considering taking divorce proceedings but you are worried about what will happen to your assets following the process, the family law team at McCarthy + Co will be happy to assist you with any further questions you may have. Arrange a consultation with us using our confidential online form and a member of our team will be in touch to schedule a time for your appointment.