Divorce Agreement Not Enforceable Says Court


With money problems being a frequent source of marital discord, it is not surprising that a fairly common problem in dealing with the financial settlements on divorce is when one of the spouses is insolvent.
In a recent case, an ex-wife ‘s appeal against a ruling that a 75 per cent share of the sale proceeds of the former matrimonial home should be hers should be invalid was rejected.
The issue turned on the fact that the ‘uplift’ in her share from 50 per cent to 75 per cent was the result of negotiations between her and her ex-husband’s respective lawyers and that contracts for the sale of the house were exchanged the day before bankruptcy proceedings against her ex-husband were commenced.
In the view of the court, although the agreement to vary her share was made in the course of ancillary relief proceedings (the financial settlement on divorce), it was not enforceable against the trustee in bankruptcy.

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