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Divorce rates likely to rise following Coronavirus outbreak

Service Area: Divorce and Matrimonial Matters

Member: Roger Isaacs

With thousands of married couples and civil partners forced to spend more time with each other, without the ability to go out and see friends and family, divorce rates are likely to rise in the coming weeks and months according to a leading family practitioner.

Baroness Shackleton of Belgravia told peers in the House of Lords, before its shutdown and the introduction of the stricter ‘Stay at Home’ guidance, that it “is very likely that the divorce rate will rise”.

The experienced family lawyer, whose previous clients include the Prince of Wales, Madonna and Sir Paul McCartney, explained to peers that “peak times” for divorce typically followed “long exposure during the summer holidays and over Christmas”.

She added: “One only has to imagine what it’s going to be like when families are sealed in a property for a long period of time.”

Evidence is already coming out of the worst-hit areas of China which suggests that separations and divorces are on the rise in response to the country’s own lockdown.

China publishes nationwide statistics on divorce annually, which are yet to come out, but media reports from several cities show that separations and divorces spiked in March due to Government-mandated lockdowns intended to stop the spread of COVID-19.

For example, the cities of Xian and Dazhou have both reported record-high numbers of divorce filings in early March.

While the majority of divorces do not require evidence from forensic accountants, the exception are those involving complex tax issues and those in which one of the spouses has an interest in a family business..

Roger Isaacs, Forensic Partner at Milsted Langdon, said: “All but a few businesses have been dramatically and adversely affected by the COVID-19 Lockdown which means that today they might well have very little value. However, many are expected to make a fully recovery.

“In divorce cases I am already being asked to opine on not only the value of family companies immediately preceding the onset of the Lockdown but also their prospects of surviving it and the likely long term effects of the crisis on profitability.

“Such issues are very difficult to determine definitively but many separating couples are loathed to put their divorces on hold for an indefinite period and would prefer to finalise their financial affairs sooner rather than later despite the inherent uncertainty.

“By contrast, many other couples are likely to put their divorces “on hold”, which is another reason why there may well be a spike in numbers when the world starts to return to some semblance of normality.

“There may also be tensions between business-owners who perceive that pushing ahead with a divorce in the current economic climate may be to their advantage if they can achieve a settlement on the basis of a depressed business valuation and their non-business owner spouses who would rather wait for a settlement to be agreed at a time when underlying asset values have recovered.”

Author: Roger Isaacs
6 April 2020