Family Law Dilemma: Paternalism versus Autonomy

Family Law Dilemma: Paternalism versus Autonomy

Introduction

In recent years, family law has witnessed a growing commitment to principles of individual autonomy, especially in the context of the law surrounding financial settlement upon divorce. There has been a discernible move from paternalistic concerns for welfare, towards embracing and promoting ideas of personal responsibility and economic self-sufficiency.

Both concepts have their own merits and demerits. Paternalism is in its essence, viewed as a harm protection measure, limiting one’s general autonomy to make decisions regarding one’s welfare.  One of the key arguments against paternalism is the claim that individuals are in the best position to judge their own interests and values, and should have the freedom to decide and face, the consequences of their choices.

The challenge comes in balancing the two. Whatever the rights and wrongs of the different concepts, there are notable areas in family law upon divorce where such a move towards autonomy is evidenced. Three notable areas include:

• Increased approval of Consent Order Applications

• Adherence to Nuptial Agreements 

• Emphasis on a Financial Clean-Break.

1) Approval of Consent Orders

The court has an independent duty under Section 25 of the Matrimonial Causes Act 1973 (“MCA 1973”) to inquire whether a draft order represents a fair outcome (Tommey v Tommey [1983] 4 FLR 159, Livesey v Jenkins [1985] AC 424 (“Livesey”) , Pounds v Pounds [1994] 1 FLR 775 and Harris v Manahan [1997] 1 FLR 205.

The court’s approach is set out in Livesey as follows:

• The court’s jurisdiction to make orders for financial relief derives from the MCA 1973.

• The court’s function is the same as when making a contested order.

• Section 25 of the MCA 1973 prescribed a list of matters to 

   which the court must have regard.

• The order must be just and fair.

The case of Lewis v Cunningtons Solicitors [2023] EWHC 822 (KB) (“Lewis”) garnered much publicity in the family law arena with the salutary warning that a financial disclaimer in itself will not absolve a family law practitioner from their duty of care to their client.

The use of financial disclaimers has increased over recent years, particularly with the growth in clients wanting greater flexibility and choice as to the scope of works they would like their practitioner to undertake.  

While there has been much commentary on this case with regards to a solicitor’s duties, and the importance of bespoke retainers and financial disclaimers, there appears to have been little focus on how a settlement that was grossly one sided was ever approved by the Family Court. The judge in Lewis commented, “Any reasonably competent solicitor would have advised the claimant that the proposed settlement order was obviously and exorbitantly one-sided in the husband’s favour, giving the claimant less than 15% of the disclosed matrimonial assets and leaving her with an inadequate financial provision in the future, and particularly in retirement.” How then did a Judge in the Family Court approve such a settlement?

The settlement in Lewis was not within the discretional band of reasonableness that would have been awarded in a contested hearing. It was without doubt manifestly unfair.

There has been a clear move away from the court adopting a paternalistic approach of protecting the weaker party to where, if an order is drafted by competent legal representatives, the court is very likely to approve it. The case law of Sharland v Sharland [2015] UKSC 60 helps shed some light on this shift in approach, where at paragraph 20 Baroness Hale stated that in such circumstances a court will be “heavily influenced by what the parties themselves have agreed”.

In addition to an increased focus on individual autonomy, there may be practical reasons why increasing numbers of financial consent order applications are approved routinely:

• Prior to the introduction of Form D81, there was no standard mechanism by which the court was provided with the parties’ financial and personal circumstances.  Some local courts adopted their own bespoke form, which often only comprised 1 -2 pages in length, combined with a covering letter.  

Nowadays, any consent order application is accompanied by a comprehensive Form D81 comprising almost 20 pages, setting out detailed information as to both spouses’ income, capital, personal circumstances, together with the net effect of making the order and narrative sections to explain why such a settlement has been reached.

• There is also the unfortunate reality that the court system is underfunded and does not have the necessary resources. Court closures and the lack of available Judges mean the system simply doesn’t have the capacity to facilitate additional hearings whereby the parties are invited into court so that the judge can be satisfied that the parties understand the financial settlement they have signed, and the implications.

It is clear that the burden of protecting the client has shifted more on to the family law practitioner. The days of the court stepping in to protect the financially weaker party by refusing to approve a financial settlement because it deems it unfair have passed.

As legal practitioners we must therefore make it abundantly clear to a client when a financial settlement is unfair, advise as to what we broadly anticipate would be a court ordered settlement, and tailor our retainers and disclaimers to cover the individual circumstances before us. In particular, where we have a vulnerable client, it would be best practice to ensure we have signposted them to complementary professionals such as counsellors, GPs, and life coaches, and as far as possible, give them additional time to reflect on a proposed settlement.

2) Nuptial Agreements

“Nuptial agreements” refers to both pre-nuptial agreements (“pre-nups”) and post-nuptial agreements (“post-nups”) and their civil partnership counterparts. A pre-nup is a legal agreement made between two individuals before their marriage has taken place. A post-nup is a legal agreement between individuals who are already married.

Nuptial agreements allow spouses to determine their respective financial obligations in the event of a future divorce.  An oversimplification, but essentially, they enable parties to contract out of the statutory redistribution scheme under the Matrimonial Causes Act 1973 that would ordinarily apply upon divorce. Pre-nups for example often exclude certain identified property from the pot to be divided (often where there is pre-acquired wealth).

Historically, prenups were treated with disapproval in English law, dismissed as an attempt to oust the court’s jurisdiction (Hyman v Hyman [1929] AC 601). They were regarded as undermining the sanctity of marriage and once described as “of very limited significance” ( F v F (Ancillary Relief:  Substantial Assets) [1995] 2 FLR 45, 66 Thorpe J).

There was a gradual softening by the courts, before the landmark case of Radmacher v Granatino [2010] UKSC 42, [2011] 1 AC 534, where it was held that the terms of a pre-nup that had been freely entered into by the parties should be implemented by the court “unless in the circumstances prevailing it would not be fair to hold the parties to their agreement”.  The reasoning behind this was to respect individual autonomy.

The judiciary’s approach was endorsed by the Law Commission in 2014, with its report entitled “Matrimonial, Property, Needs and Arrangements”, in which it was recommended that pre-nups be put on a statutory footing and be regarded as legally enforceable contracts. The Government’s response is still outstanding on this point.

3) Clean Break 

The clean break refers to the termination of financial obligations between the parties upon divorce, either immediately or deferred to a future date.  The court’s duty to consider whether a clean break would be appropriate was introduced by the Matrimonial and Family Proceedings Act 1984 (Section 3 inserting Matrimonial Causes Act 1973, s,25B).

The court will order a clean break unless it can be clearly shown that one of the parties is unable to adjust without undue hardship (Matthews v Matthews [2013] EWCA Civ 1874, 2014 2 FLR 1259, SS v NS (Spousal Maintenance) [2014] EWHC 4183 (Fam), [2015] 2 FLR 1124.

The desirability of the clean break is rooted in liberal ideas of individual autonomy, signalling a clear expectation that parties become self-sufficient as soon as possible after divorce.

Approximately a decade ago it was commonplace, where there was a fairly significant income differential between the divorcing spouses, for there not only to be provision for child maintenance, but also an order for spousal maintenance until the youngest child of the family reached 18 or finished full time secondary education (if not tertiary).  Sometimes spousal maintenance would even continue until either party’s death. Whereas now, joint lives orders, are almost extinct.

While the clean break principle does reflect a change in society, where typically now both spouses are or have been in the workforce, it does not necessarily take into account the fact that it is relatively common for the main carer’s income to bear little resemblance to the other parent’s.

Conclusion

The changes in approach to the approval of consent order applications, the importance to be placed on nuptial agreements, and the significance placed upon achieving a financial clean break, illustrate the sea-change in the family court from a paternalistic approach to a greater respect for individual autonomy. This puts an increasing obligation on the advising solicitors to make it abundantly clear where a proposed settlement is manifestly unfair.  

There are practical merits behind such changes in that they provide couples with more certainty upon divorce, but there will also be those cases whereby unfair advantage is gained, and the weaker financial party is left financial exposed.  One size does not fit all.

It highlights the careful balancing act to be played between autonomy and paternalism and certainty  and flexibility. 

Helen Cort

Partner

Dutton Gregory Solicitors