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The pressure put on families when one of them suffers a brain injury is enormous; people’s characters can become drastically altered, and the strain of caring for an injured loved one is sometimes too much to bear.
Understanding how the courts deal with the distribution of assets during a divorce is hugely important whenever a damage settlement is involved, whether it’s awarded to your spouse or a child.
Here, we give an outline of how the courts deal with brain injury damages during a divorce, and how you can put plans in place to protect your settlement.
Firstly, UK law seeks to divide a couple’s assets evenly between spouses during a divorce.
This includes “matrimonial assets” which have been accrued throughout the marriage period, according to Section 25 of the Matrimonial Causes Act 1973. These assets are then distributed according to the three principles of compensation, sharing and need.
Damage settlements acquired from a brain injury can be treated as part of these assets, but courts will not simply divide the couple’s assets in half if this would compromise an injured person’s ongoing medical treatment – many brain damage settlements incorporate regular future payments to ensure future quality of life.
However, there are circumstances in which damages can be distributed between separating spouses.
Damages which become Matrimonial Assets
In divorce law, a couple’s matrimonial assets are taken to be the material wealth (and debts) they have accrued during their marriage period, including property, savings, income and other assets.
Depending upon the “heads of loss” in the settlement (the categories in which damages are paid), some damages may be regarded as matrimonial assets; for example, a wife who looks after the family home while the husband is building up their business is entitled to a share of her husband’s future earnings upon divorce.
Should he be injured and receive compensation for loss of earnings, then she is also entitled to a share of these in exactly the same way.
Likewise, damages sometimes include a “gratuitous care” payment, which compensates a spouse for the time they spend caring for their injured partner. In the event of a divorce, the sum for gratuitous care is regarded as the caregiver’s asset and the onus is on the injured party to prove that they require this money for continued care.
If damages have been used to invest in shared assets, they are likely to be seen as matrimonial assets and thus become more susceptible to distribution.
Therefore, damages that have been used to modify the couple’s home for easier access may well be treated as a divisible asset, rather than as an independent asset.
Ring-fencing your Settlement
Couples can decide how they’d like damage settlements to be handled by signing a marital agreement, either before or after getting married (commonly known as pre or postnuptial agreements).
Though these are not legally binding documents, courts are likely to abide by them if they’re written to ring-fence funds for a specific purpose – to guarantee ongoing therapy, or to ensure that a new house can be adequately modified.
Marital agreements which are too open-ended and guard against vague future developments are likely to be ignored, as the overriding concern of the court is to determine the demonstrable needs of the injured party.
Therefore it’s vitally important to maintain accurate records of correspondence and medical treatment to prove the treatment that’s required, and you must be sure to seek expert legal advice when drawing up a marital agreement.
What this means for you
The bottom line is that courts will attempt to divide a married couple’s assets exactly in half as closely as possible, and damages from brain injury will be taken into consideration as an asset.
However, the courts will always hold medical needs to be more important than even distribution, so while an injured party’s quality of life won’t be compromised, they may lose a portion of their settlement.
A couple’s wishes can be made clear through the use of a marital agreement, but this should seek to address proven medical needs to avoid being ignored by the courts.
About Malcolm
Malcolm Underhill is a solicitor with IBB Claims, specialising in brain injury claims. For more information, find them on Facebook and Twitter.