This article proposes formulae for calculating capital distribution and spousal maintenance on divorce. It does not seek to replace or reform the law. It seeks to help some couples and lawyers make better progress to a settlement and provide more certainty and predictability. The formulae are relatively easy to operate and can be adapted to IT Web based resources.
The family law profession waits for the Law Commission proposals on financial provision on divorce to become law, if that occurs. Yet meanwhile the higher courts continue to give uncertain and sometimes contradictory judgments and guidance. Accordingly, it is incumbent on the profession to fill the vacuum in practice to create certainty and predictability for our clients and to encourage out of court resolution.
One way forward, and a way increasingly used around the world, is via formula calculations. They are not to replace the law or lawyers and we should not have binding outcomes by formula alone. They are to help cases along the road to a settlement, to put the case law and higher court judgments into a logical and systematic context and to help more clients do more of the resolution process themselves.
I accept many will run scared and horrified from such an approach, in part for jurisprudential reasons, in part from the fear of all things ‘techie’ and mathematical and in part because of the bad experience from the CSA formula. But in IT, and the calculations behind web-based solutions, is where many in our society now expect to find their answers.
In Charman (2006) in the High Court, Mr Justice Coleridge stated that “Extraordinary energy, extraordinary entrepreneurial or other wealth generating skill, combined with the sheer size of fortune” have “a tendency to overwhelm the s25 exercise however carefully performed”, he concluded: “Tariffs are a bit crude and purists would protest that this is an incursion into the hallowed s25 exercise but are they, in the end, likely to produce a less fair result than any other unscientific exercise of judicial discretion? And they have the advantage of increased certainty. Of course they are non-binding and only guidance. S25 would continue to prevail. I forbear from suggesting one at this stage in this case lest it be thought I have applied it to arrive at my decision. I have not. But a tariff of percentage bands which decreased as the size of these extraordinary fortunes increased might prove to be helpful guidance and, ultimately no less fair than the current expensive uncertainty.”
Reference to tariffs is perhaps not so far from formulae. Perhaps perversely by not giving us a practical and clear blueprint for family finance resolution, the higher courts created a debate on another way of getting to a fair resolution according to clear, discernable family law principles. Formulae and tariffs must be one obvious starting point. These formulae are based on what is probably present case law in England and/or frequent practice in reading out of court settlements.