Relationships are always a gamble, which is why law firms are seeing more couples turning to them for advice on prenuptial and, increasingly, cohabitation agreements.
The use of prenuptial agreements is becoming increasingly popular in Scotland with both parties commonly seeking to “ring-fence” certain assets, protecting them in the event of separation or divorce.
“Prenuptial agreements continue to increase because it is becoming known that they are enforceable in Scotland,” says Alasdair Loudon, partner and head of divorce and family law at Turcan Connell.
“There has long been an urban myth that they are not enforceable in Scotland but people are realising that that’s not actually the case.”
Legislation enacted in 2006, in response to the increasing popularity of cohabitation in Scotland, provides limited rights to cohabiting couples when a relationship ends. Couples living together “as if they were husband and wife” do not have the same rights as married couples in that they are only entitled to make a claim for assets.
In the event of a divorce, the husband or wife has the right to a share of the matrimonial property which has been built up over the course of the marriage.
“We are definitely noticing an increase in the number of clients who are seeking advice in relation to the possible breakdown of cohabitation relationships, both same sex and conventional,” says Shaun George, partner and head of family law at Brodies.
“The reason for that is, I think, the uncertainty as to how the law would apply. It’s still very difficult in practice to advise clients as to the likely outcome of a litigated cohabitation case.
“Cohabitation law is something that the English do not deal with in the same way.
“We are finding more and more that when people enter into a cohabiting relationship later in life they are seeking advice.
“If one or both parties have been through a divorce or relationship breakdown in the past, they wish to enter into an agreement to provide financial certainty.”
Applications to move children outwith Scotland is another area which George highlights as being active for the Brodies team.
“We are finding that if job changes occur at the same time as a relationship breakdown then that leads to a tension over where the children are going to stay,” he says.
“Those situations do not lend themselves easily to a compromise so we are seeing an upturn in the number of those cases being disputed before the courts.”
A recent case which highlighted the challenging nature of child relocation decisions is AF v FF 2016, the decision in which was published by Sheriff Davidson sitting at Fort William Sheriff Court earlier this year.
In this case, the mother sought a specific issue to allow her to relocate from Scotland to her native Australia with her two young children – a move to which the father was opposed.
Sheriff Davidson was satisfied that the move to Australia was in the children’s best interests.
In the North-east, the Brodies team has seen a number of clients revisiting agreements which were made when their income in the oil and gas industry was at a certain level.
“Many are finding the rates they are being paid have been cut and they can no longer adhere to commitments with former partners,” says George.
He also points to collaborative practice as an area that continues to grow, with clients looking to that model for reasons of speed, confidentiality, co-operation and keeping cases out of the courts.
“There’s an increase in the number of clients who would like to work with their former spouse or partner to be constructive in the way they settle a case and to bring in external experts such as pensions specialists to work with them,” says George.
“The interests of their children are prioritised.”
Family law arbitration is something which has not taken off in Scotland to as great an extent as in other jurisdictions, however both George and Loudon see potential for its increased use in the sector.
Loudon says: “Both myself and my partner, Gillian Crandles, are fully trained arbitrators.
“There is still a reluctance on the part of practitioners to advise their clients to use arbitration rather than going down the court route.
“There is certainly potential there for greater use of arbitration, particularly as the court system becomes less efficient with the changes which are being introduced in the court structure.”
Looking to the year ahead, Loudon predicts a steady flow of high-value family law work: “Ultimately, separation and divorce is a family law solicitor’s bread and butter and that’s mainly what’s going to keep us busy.”
Briefing: Wills, by Simon Mackintosh
Change is constant so it’s important to keep your will up to date. Your family and commitments to them may change from one year to the next – new additions to the family, you might get married, separate or divorce.
Your assets change – you might have inherited. How best to deal with these new assets? Do you want to help charities you have supported during your lifetime? If you are living with someone, do you understand what rights they might have if you died?
The law is constantly changing too – largely technical amendments to Scots succession law were made in the Succession (Scotland) Act 2016, but there is the possibility of more fundamental rewriting of some rules to come.
One of the changes in the 2016 act is that divorce now revokes, in most cases, those parts of a will which give benefit to the former spouse, by treating them as having failed to survive the person making the will. If the drafting of a will has gone wrong, there is a new power to have this rectified.
While a well drafted will gives a degree of flexibility, you should always check that your will reflects your current circumstances – your responsibilities and commitments to others, and your current assets.
Simon Mackintosh is chairman at Turcan Connell.
Briefing: Powers of attorney, by Elspeth Paget
Recent statistics from the Office of the Public Guardian Scotland illustrate the numbers of powers of attorney are increasing substantially each year, for example in 2015 they totalled 61,184 due to heightened awareness. This was an increase of 18 per cent on 2014.
I have always advocated the wisdom of clients of all ages granting powers of attorney whilst still having capacity.
Weight has been added to my view after a recent Edinburgh Sheriff Court case where an assistant solicitor, acting for a client who had lost capacity, with no family willing to apply to the court, applied to have a solicitor, with relevant experience, appointed as financial guardian.
Somewhat surprisingly, the sheriff rejected the application on the grounds that the solicitor could not “claim an interest” in the adult’s financial affairs, a decision upheld on appeal to the sheriff principal.
The implication is that where there is no relative to act, a solicitor may not instigate the action.
In this case the local authority had to do so.
This may mean already stretched local authorities having to undertake more work and more cases where the proposed guardian is not previously known by the client.
The crusade for powers of attorney, timeously granted, continues.
Elspeth Paget is a partner at Gillespie Macandrew.
The Scotsman’s annual legal review looks at some of the most active areas of legal practice in Scotland. Informed by comprehensive data published by Chambers and Partners and Legal 500, the articles give exclusive insight into the work of more than 11,000 practising solicitors and over 460 practising advocates.