Divorce proceedings — whose bonus is it anyway?
By Victoria Myerson
Writing out a cheque in settlement of an ex-spouse’s claim in divorce proceedings can be an unedifying experience at the best of times, ameliorated only by the certainty that it’s the last instalment. However, in cases where the capital assets are insufficient to permit the parties to go their separate financial ways, the court may consider it appropriate to make an order that provides for part of an ex-spouse’s ongoing maintenance to be paid from a percentage of the breadwinner’s future bonus payments.
Bonus payments in the finance and banking sectors are usually contingent not only upon market factors but also work-related performance. Consequently, it may seem inherently unfair that a proportion of such bonuses may be ordered to be paid to a former spouse who is no longer making any contribution to the home life of the breadwinner.
It is important to remember that the court will only take account of future bonus payments where there is insufficient capital in the ‘matrimonial pot’ for a ‘clean break’ to be ordered. A clean break divides the existing capital and ends further financial claims between former spouses. This is often the desired solution but where capital is more limited recourse may be had to future income to fund spousal maintenance payments by one party to the other either for a fixed term or during their joint lives (i.e. until one of them dies)…
Click on the link below to read the rest of the Appleby briefing.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Appleby
News from The Lawyer
Briefings from Appleby
Bermuda’s legal framework facilitates the creation of flexible and economically viable co-investment vehicles within a stable and business-friendly jurisdiction.
Feltham v Bouskell provides a cautionary tale for lawyers regarding the need to act quickly upon the receipt of instructions from elderly or ill clients.
Analysis from The Lawyer
Offshore law firms have long supplemented their legal offerings with fiduciary business, but will that model last?
Business is booming in the Isle of Man, a small jurisdiction that thinks big