Contested Divorce Settlements in Economic Uncertainty

Contested divorce settlements in economic uncertainty are reaching record highs, as rising living costs and volatile asset values push more couples to dispute financial remedy orders in court.

This blog explains how economic instability intensifies conflict during divorce proceedings, explores the key financial challenges couples face, and offers practical strategies for navigating settlements in uncertain times

1. The Paradox in Divorce Trends

In recent years, countries like the UK have seen a slow decline in the overall number of divorces. However, family courts are experiencing a very different pressure point: a surge in contested settlements, particularly those involving finances.

According to recent legal reports, the number of financial remedy cases going to trial in England and Wales has reached a 15-year high. Even couples who initially sought amicable separations are increasingly finding themselves in drawn-out disputes—often over property division, pensions, and spousal maintenance.

2. What’s Driving the Rise in Contested Settlements?

a) Inflation and Cost of Living Pressures

Rising prices for everyday goods and services mean each spouse is more concerned about securing enough assets to maintain their standard of living post-divorce.

b) Unstable Property Market

With volatile real estate prices, divorcing couples may disagree on the value of the marital home or whether to sell it immediately or wait for the market to improve.

c) Economic Uncertainty

Global financial instability makes future income harder to predict, increasing the difficulty of agreeing on fair spousal or child maintenance amounts.

d) Shrinking Retirement Security

Falling investment returns and pension fund instability lead to fierce disputes over how retirement savings should be divided.

3. Key Legal Issues in Contested Settlements

1. Property Valuation Disputes – Courts often require expert valuations when parties cannot agree, adding cost and delay.
2. Pension Splitting – With pensions sometimes representing the largest marital asset, disagreements over their value and division are common.
3. Maintenance Duration and Amount – Disputes frequently arise over how long and how much spousal support should be paid, especially when one spouse claims economic hardship.
4. Non-Disclosure of Assets – In some cases, mistrust grows due to suspicions of hidden wealth or offshore accounts.

4. Impact on the Court System

The rise in contested cases has increased backlogs in family courts, with some hearings delayed for months or even years. This can escalate legal costs and emotional strain for both parties.

Some jurisdictions are encouraging Alternative Dispute Resolution (ADR)—such as mediation or arbitration—to reduce the burden on courts and help couples reach quicker, less adversarial resolutions.

5. Strategies for Reducing Contested Settlements

• Early Financial Disclosure – Being transparent from the outset can prevent disputes later.
• Neutral Valuations – Agreeing to jointly instruct a single expert for property and pension valuations can avoid conflicting reports.
• Mediation First – Using trained mediators to resolve disputes before litigation can save time and money.
• Financial Planning Support – Involving a financial adviser alongside a lawyer can help both parties understand the long-term impact of settlement proposals.

While fewer people may be divorcing overall, the economic reality of 2025 means that when couples do part ways, they are often less willing—or less able—to compromise on financial terms. Inflation, market instability, and shrinking retirement security are pushing more cases into the courtroom. For both clients and practitioners, early preparation, transparency, and a willingness to explore alternative dispute resolution can be key to navigating this challenging environment.

Frequently Asked Questions on Contested Divorce Settlements in Economic Uncertainty

1. What is a contested divorce settlement?

A contested divorce settlement occurs when spouses cannot agree on how to divide assets, debts, or determine spousal/child maintenance, requiring court intervention.

2. Why are contested settlements increasing despite fewer divorces?

Economic factors like inflation, unstable property values, and pension uncertainty are making financial negotiations harder. Even couples who want an amicable split may end up in disputes over asset valuation and income security.

3. How long does a contested settlement usually take?

It varies by jurisdiction, but complex cases can take 12–24 months or more, especially if court backlogs are high and multiple valuations or expert reports are needed.

4. Can inflation affect my divorce settlement?

Yes. Inflation can reduce the real value of assets, increase living costs, and influence the amount of spousal or child maintenance awarded. Courts may take current and projected economic conditions into account.

5. What are the most common points of dispute?

• The value and division of the marital home
• Splitting pensions or retirement savings
• Amount and duration of spousal maintenance
• Allegations of hidden or undisclosed assets

6. Can we avoid going to court in a contested settlement?

Yes. Many couples resolve disputes through mediation, collaborative law, or arbitration before trial. Courts often encourage these methods to save time and costs.

7. Do I need a lawyer for a contested settlement?

Strongly recommended. Contesting a settlement involves complex legal, financial, and procedural issues—professional representation can help protect your rights and interests.

8. Will the property market affect how assets are divided?

Yes. If property values are volatile, courts may rely on professional valuations and sometimes adjust settlements to account for market risks or potential sales delays.