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Last Updated: Wednesday, 14 July, 2004, 03:39 GMT 04:39 UK
Beneath the Parlour divorce hype
MONEY TALK
By Kim Beatson
Chair, Solicitors Family Law Association

Kim Beatson, chair of the SFLA
Kim Beatson, chair, Solicitors Family Law Association

Arsenal footballer Ray Parlour has been ordered to pay his ex-wife Karen a third of his future earnings in a landmark divorce settlement, which has sparked a national debate about marriage.

A lawyer unpacks the hype - and explains what it means to you.

When the London Evening Standard quoted a "friend" of Karen Parlour saying that her spending habits were "more Romford than Bond Street", they hit on one of the central points of the court decision on the former footballer's wife's maintenance.

Despite the hype - and the huge sums of money involved - the award is actually intended to encourage thriftiness.

Contrary to some of the more flamboyant reports, the Parlour case does not say that a wife is entitled to a share of all a former husband's future earning for the rest of her life.

A central part of the thinking was that she should not now go on an up-market spending spree
Kim Beatson

One of the main points to come out of the judges' decision is that the concept of the "clean break" remains alive and well.

It is very important for divorcing couples to end their financial inter-dependence as early as possible, to allow them to get on with their lives.

The significance of this case is its flexible approach to maintenance to achieve a clean break.

In the Parlours' unusual circumstances the judges felt that by awarding Mrs Parlour more in maintenance than she needed to meet her "requirements", she could accumulate capital which would help to achieve a clean break.

A central part of the thinking was that she should not now go on an upmarket spending spree - rather the opposite. She has an obligation to use the excess income to invest for her future so that she can become financially independent over a relatively short period of time.

Cheaper option

Interestingly, the overall settlement may have been more expensive for Mr Parlour if, instead of allowing Mrs Parlour to accumulate her own funds, he simply paid ongoing maintenance to cover her needs for the rest of her life.

MS PARLOUR'S SETTLEMENT
Two mortgage-free houses worth more than 1m
250,000 lump sum
444,000 a year

In arriving at this decision, the judges were keen to point out that they were dealing with a relatively novel situation - where earnings could be vast at the peak of a footballer's career but this time of "feast" could rapidly turn to "famine".

If the couple remained together, Mr Parlour would be well advised to invest some of his earnings for the family's future while his income is high.

Presumably he will continue to do this for himself after his divorce. The additional maintenance award will allow Mrs Parlour to invest for her future also.

Since the case of a farming family, Mr and Mrs White, in 2000 the courts have been clear that the very different contributions made to family life of the typical income-generating husband and child-raising wife were of equal value.

This point was re-emphasised in the Parlour case. The court must look at each spouse's contributions and needs (and a number of other factors also) and then decide how to achieve fairness.

What is fair will depend on the size of the "pot" to be shared in each case.

The implications for other cases remain to be seen. These circumstances are drastically different to those of most ordinary families.

For many couples, the resources available on divorce are barely enough to meet their needs. The courts will, in most cases, continue to look at the resources available and consider how they can be used for the priorities of providing a home for any children and support for a non-earning spouse.

The opinions expressed are those of the author and are not held by the BBC unless specifically stated. The material is for general information only and does not constitute investment, tax, legal or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.


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