Personal Relationships: Playing Smart – Lexology

We recently hosted a conference at Twickenham entitled “Beyond the Pitch”, focusing on athlete/player welfare. I had the pleasure of leading a breakout group on the topic of personal relationships and here I share some reflections on that.

Our personal relationships are central to who we are. They can be a source of immense support and stability, giving us a platform to achieve great things. However they may sometimes be a distraction, and particularly if those relationships are breaking down, they can be damaging and detract from the ability to perform. Long drawn out disputes and legal proceedings can be emotionally and financially draining.

During our discussion we considered different types of intimate relationship, particularly those that could lead to legal and financial obligations, and how some forethought and planning together with the right approach at the relevant time could help to avoid some of the more damaging aspects of relationship breakdown.

Living with someone:

Moving in together does not automatically create any legal rights or obligations between a couple. This is commonly misunderstood. Even if you live together for 20 years or more, you do not have any financial claims against each other when the relationship ends. However, it is possible in certain circumstances for one party to acquire an interest in the property, even if their name is not on the legal title. This area of the law is complex and when disputes arise they can be disproportionately expensive to resolve. There can also be arguments around the practicalities of things like dividing up belongings and the vacating of the property.

It is therefore wise to have a binding cohabitation agreement which clearly sets out what the financial arrangements will look like during cohabitation and in the event of separation, how the property should be dealt with, how items will be divided up and dealing with practical arrangements. This can avoid the potential for dispute if the relationship comes to an end and make the process of separation quicker, cheaper and less stressful.

As with any agreement it is far easier to negotiate something constructively when you are communicating well and the situation is less emotionally strained.

Having a child:

This may be the result of a one night stand, a lengthy cohabitation, or anything in between, but if a couple are not married then as parents they both have financial obligations to the child. The parent who primarily cares for the child (typically the mother) can claim not only child maintenance but lump sums to meet needs that the child may have. They can also seek provision of housing for the child. This would typically be held on trust and revert to the providing party when the child reaches majority or finishes their education. If a parent’s income is over £156,000 gross per year, or if one parent lives abroad, then the court (as opposed to the Child Maintenance Service) can assess how much child maintenance they should pay, and this can include a carer’s allowance for the parent who provides most of the child’s care.

It’s not possible to contract out of responsibilities to a child, but it is best to try to resolve any claims or disputes without having a difficult and expensive battle in the courts. There are various methods of dispute resolution such as mediation and collaborative law which promote better ongoing communication, as well as working towards an agreement where both parties retain a level of control rather than a judge imposing a decision. The delays and inflexibility of the Family Court can add to an already stressful situation. If an agreement cannot be reached through negotiation, then arbitration is an option and has the advantages of being private, tailored to the individual needs of the case and highly flexible.

Marriage:

Getting married to someone changes your legal status and creates financial obligations to each other, the consequences of which can be more far-reaching than many people appreciate at the time. In the event that the relationship ends, the courts have very wide powers to divide and distribute assets. All of the assets and resources that each person has will be taken into account, no matter what they are, when they were acquired, where/who they came from and where they are situated. They must all be disclosed. Generally speaking, matrimonial assets that have been accrued during the marriage (and any previous cohabitation) will be divided equally. If an equal share of the matrimonial assets does not meet needs and there are other assets (such as things owned before the marriage or inherited), then the court can order that those other assets can be “invaded”. Needs are generously interpreted in the context of the lifestyle enjoyed during the marriage. If needs require it, a court can also order ongoing maintenance payments in addition to capital awards. The court’s discretion is very wide meaning the ultimate outcome cannot be predicted with absolute certainty and one judge may reach a different conclusion from another.

Dealing with financial arrangements on divorce can take many months and often over a year, especially if this is done through the courts. This is a long time in anyone’s life to have this kind of emotional and financial stress, but for sports people whose careers tend to be short and depend on them performing at their very best, it could be disastrous. The media can attend court where there are financial proceedings on divorce, and although reporting restrictions can be applied for, the courts are generally moving towards greater transparency. Reported judgments will not necessarily be anonymised.

Protection:

Pre-nuptial agreements (entered before marriage) and post nuptial agreements (entered any time after marriage) which are properly drafted and meet the necessary criteria (including providing full disclosure and each party having legal advice) are effective protective tools. The court will generally uphold these agreements unless it would be unfair to do so. In the event of a divorce they can give both parties more certainty, avoid argument, reduce legal costs and the time taken to reach a resolution. They can also provide for matters to remain confidential and require that the parties arbitrate any dispute, therefore reducing the potential for press attention and some of the other draw-backs of the court system.

A prenuptial agreement doesn’t necessarily get you out of paying the other person anything on a divorce, but it can be used to protect particular assets and it can limit the other person’s claims. Their needs must still be met if their own assets are not sufficient (albeit their needs might be less generously interpreted); and if there are children, they must be properly provided for. An agreement that is not fair in this way will not carry weight with a court, although it may still be taken into account. An agreement can enable people to prioritise things that are important to them, for example avoiding the sale of a particular property or business.

Discussions:

The majority of people in the discussion group had not previously been aware of the extent of the potential implications of entering (and ending) personal relationships, and the options available for minimising the fall out. They felt that sports people could be particularly vulnerable to the impact of relationship breakdown given their public profile, short careers and how critical it is for them to be at the top of their game. They felt that there should be more information and education around this at an early stage in their careers, and that people supporting sports people should signpost them to getting advice on the benefits of protecting their position so as to reduce the potential impact.

In summary:

  • Getting a cohabitation/prenuptial/postnuptial agreement (drafted by a specialist lawyer) is highly recommended
  • If an agreement isn’t possible, at least take advice from a family lawyer – the way you live and deal with your assets could make a difference.
  • If the relationship has already ended, get yourself a lawyer who understands your circumstances and will give you good advice that is sensible, commercial and pragmatic; and
  • Consider alternatives to court (the abovementioned lawyer should promote and assist you with this) as this will reduce the opportunity for media attention, should help resolve matters more quickly, with less animosity and at a lower cost both financially and emotionally for everyone involved.

Our personal relationships are central to who we are. They can be a source of immense support and stability, giving us a platform to achieve great things. However they may sometimes be a distraction, and particularly if those relationships are breaking down, they can be damaging and detract from the ability to perform. Long drawn out disputes and legal proceedings can be emotionally and financially draining.

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