Whilst divorce has invariably led to a leaner lifestyle (at least temporarily) for both parties, the current tough financial climate is leading some divorcing couples inevitably to the bankruptcy courts. Some errant partners are also beginning to use bankruptcy, or the threat of it, as a tactic to reduce payments to their soon-to-be ex-spouses.
A recent casualty is David James, the former England goalkeeper, who, despite earning £20 million over his career, recently filed a debtor’s petition this month. His three million pound divorce was cited as one of the major reasons for his financial difficulties.
From another perspective, Scot Young, a city financier, was jailed last year after refusing to disclose details of his assets to his wife. She accused him of creating a sham bankruptcy to hide his wealth. Mrs Young was awarded £26 million, albeit that she had sued for £300 million. This case has demonstrated that Courts are beginning to take a tough line with people that hide their money and resort to sham bankruptcies as a way of circumventing the rules on equitable distribution of assets in the event of divorce.
Cyrus Medora, a solicitor specialising in both family and insolvency matters at Kidd Rapinet’s Slough office, comments “It is not uncommon for the threat of bankruptcy to be made during the divorce negotiations, although the threat is rarely carried out in practice and the courts are taking a dim view it”.
If you would like assistance in relation to a family matter, call the contact for your local Kidd Rapinet office for further information:
- Aylesbury: Mark Studdart (01296 432541)
- Farnham: Sandra Meakins (01252 713242)
- High Wycombe: Catherine Banks (01494 535321)
- London: Richard Tymkiw (020 7024 8065)
- Maidenhead: Kathryn Coyle (01628 621301)
- Slough: Cyrus Medora (01753 532541)