Financial claims for the benefit of children

26/10/2021

When couples who are not married and have no cohabitation agreement separate, there are very limited financial claims that either party can make against the other for financial relief or support as a result of the breakdown in their relationship.

There is no such thing as a ‘common law’ husband or wife despite many people believing to the contrary.

Property claims

There may be limited circumstances whereby one party can make a claim a share of the value of a property owned by the other under property law, but it is very difficult for an individual to prove that they have a financial interest in a property solely owned by another person, irrespective of how long the claiming party has lived there

Children claims

Where there are children of an unmarried family however, an application can be made by one parent, typically the parent with whom the child or children spend more time living with (‘the applying parent’), against the other parent (‘the paying parent’) for financial provision for the benefit of the child or children involved.Such claims are for capital or property rather than child maintenance. Child maintenance is dealt with by the Child Maintenance Service (‘CMS’). In most cases, the CMS will deal with the issue of child maintenance except where the paying party lives abroad and is working for an employer located outside England & Wales. If the paying party earns more than £3,000 per week before deduction of Income Tax and National Insurance, the Court can make a ‘top up’ order, requiring the paying parent to pay a sum from their gross income earned in excess of £3,000 per week, which will typically be worked out using the CMS formula.

Schedule 1 Children Act 1989

Under Schedule 1 of the Children Act 1989 the court has quite a wide discretion to order the paying party to make capital payments to the applying parent for the benefit of the child or children of the family. This does not mean that an order will be made, and the starting point is that there is no legal obligation on the paying parent to make capital available.It is important to realise that in Schedule 1 claims the court has to consider a different and more limited set of criteria to those considered in divorce.

Typically, such applications are made for provision for housing although it can be for any item in theory, as long as the Court is satisfied that it is affordable to the paying party and benefits the child or children. Examples include money for a car, a computer, payment of debts, cost of re-decoration of a property, school fees or for purchase of furniture or even the costs of re-locating.

The Courts have commented that the phrase “for the benefit of the child” “should be given a wide construction”. Claims can be for past, present and future capital requirements.

Repeated applications can be made by a parent under Schedule 1 of the Children Act 1989 except in respect of an application for property when only one application can ever be made. It is therefore important that an applying parent seeking to obtain use of a property considers the child or children’s long-term needs in cases where the child or children are very young.

If an order is made that the paying parent provide an existing property, or money to buy a property for the benefit of the child or children that property will still be owned by the paying party and it will revert to him or her on the youngest child reaching the age of majority (18).

The Future

Although the courts have over time become more generous in their interpretation of what qualifies as being ‘for the benefit of the child’, it is unlikely that there will be be any major changes to the law in the near future. This means that applying parents will still only be able to make one application in respect of property and that property will revert to the paying parent when the child reaches 18.Periodically the possibility of the introduction of unmarried cohabitants rights is considered by the Law Commission. However, a change in the law will require new legislation to passed through the Houses of Parliament and presently there is no new legislation being proposed.

More information

For more information contact our family team here.   

This article was written by Michael Sheville, Partner. The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. Specific legal advice should be taken on each individual matter. This article is based on the law as of October 2021.

26/10/2021

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