Agreements on Financial Provision

Orders of the Day — Family Law (Scotland) Bill [Lords] – in the House of Commons at 10:45 pm on 3rd June 1985.

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Photo of Mr Peter Fraser Mr Peter Fraser , Angus East 10:45 pm, 3rd June 1985

I beg to move amendment No. 7, in page 13, line 32 at end insert— (2A) Without prejudice to subsections (1) and (2) above, where the parties to a marriage have entered into an agreement as to financial provision to be made on divorce and—

  • (a) the estate of the party by whom any periodical allowance is payable under the agreement has, since the date when the agreement was entered into, been sequesrated, the award of sequestration has not been recalled and the party has not been discharged;
  • (b) an analogous remedy within the meaning of section 10(5) of the Bankruptcy (Scotland) Act 1985 has, since that date, come into force and remains in force in respect of that party's estate; or
  • (c) That party's estate is being administered by a trustee acting under a voluntary trust deed granted since that date by the party for the benefit of his creditors generally or is subject to an analogous arrangement.
the court may, on or at any time after granting decree of divorce, making an order setting aside or varying any term of the agreement relating to the periodical allowance.'•

Mr. Deputy Speaker:

With this it will be convenient to take Government amendment No. 8.

Photo of Mr Peter Fraser Mr Peter Fraser , Angus East

These amendments are intended to ensure that where a periodical allowance on divorce is payable under a voluntary agreement, it will always be possible for a payer who is bankrupt to apply to the court to vary or set aside the provision for the periodical allowance as may be appropriate in the circumstances. Where a person becomes bankrupt, the trustee in bankruptcy will take possession of almost all his assets and probably a fair proportion of his income. In these new circumstances, the amount of periodical allowance payable by the bankrupt person to his divorced spouse may be quite unrealistic. Where the periodical allowance is payable under a court order, the bankrupt person could apply for the order to be varied or set aside as appropriate under clause 13(4). Where it is payable under agreement, and the agreement provides for variation, he could apply for periodical allowance to be varied or set aside as appropriate under clause 16(1).

It is only in those cases—probably very few—where the agreement does not provide for variation that difficulty could arise. The bankrupt person could find himself liable to an obligation which is already unrealistic in the circumstances, which he has no means of paying and which the other spouse cannot in practice enforce. That is not satisfactory for anyone. It is to allow variation in those few cases that the amendment is proposed.

The additional power to vary would last only — I emphasise this — while the bankruptcy itself lasted. I stress that the amendment merely gives the court a discretion to vary or set aside a periodical allowance. It would not be obliged to do so.

Amendment No. 8 would have the effect of extending clause 16(3) to the new subsection (2A) so that any term of an agreement that purported to exclude the right to apply to the court in circumstances set out in subsection (2A) would be void.

As I have explained, the amendments deal with a problem that should seldom arise, but could cause considerable difficulties if it did. I therefore ask the House to accept them.

Amendment agreed to.

Amendment made: No. 8, in page 13, line 34, after '(1)(b)' insert 'or (2A)'—[The Solicitor-General for Scotland.]

Photo of Mr Peter Fraser Mr Peter Fraser , Angus East 10:52 pm, 3rd June 1985

I beg to move, That the Bill be now read the Third time.

The main provisions of the Bill achieve a comprehen-sive reform of the law of aliment, the introduction of statutory principles to be followed by the courts in making orders for financial provisions on divorce, and the clarification of the law relating to property rights and legal capacity of married persons. They are based, as Scottish Members will certainly appreciate, on the recommenda-tions of the Scottish Law Commission, the proposals of which were widely supported,. That was reflected in the general welcome accorded to the Bill by hon. Members.

I am grateful to Opposition Members for the constructive contributions that have been made, which have resulted, I hope, in an improvement of the Bill in certain important respects, for example, to the incidental orders that we have just been discussing on Report. I commend the Bill to the House.

Photo of Donald Dewar Donald Dewar , Glasgow Garscadden 10:53 pm, 3rd June 1985

On the whole, the Bill is a useful addition to the law of Scotland. The Opposition took something of a battering from the Government for their lack of co-operation. We had examples earlier this evening. I am grateful that it was not the Under-Secretary, the hon. Member for Edinburgh, South (Mr. Ancram), but the Solicitor-General, who was in charge on this occasion.

Question put and agreed to.

Bill read the Third time and passed, with amendments.