Mesher Orders (also known as orders for deferred sale) refer to a type of court order that allows for the sale of a jointly owned asset, such as the matrimonial home, to be postponed until a future date. This allows the parties to sell the family home after a specific time period or upon the occurrence of a triggering event, such as the children reaching a certain age.
Mesher Orders are commonly used in divorce proceedings where one or both spouses are unwilling or unable to sell a jointly owned asset immediately.
In divorce proceedings, the court is tasked with dividing the couple's assets in a way which meets each parties’ needs and considers the welfare of any child. In some cases, one spouse may want to sell the matrimonial home, but the other spouse may not be ready or able to do so. In such cases, the court may order (or the parties may agree by consent) a deferred sale which allows for the sale of the asset to be postponed until a later date.
The use of orders for deferred sale in divorce proceedings can provide several benefits, including allowing the parties to reach a mutually acceptable agreement on the sale of the asset and providing flexibility that meets each parties’ needs. For instance, the parties may jointly agree that it is beneficial for the children to stay in the family home until they reach a certain age. One spouse may want to move out of the property and want the other spouse to buy out their interest. If the paying spouse does not have the funds available to buy out the other, then a deferred sale will give them sufficient time to make the necessary financial arrangements and maintain a stable family home for the duration of the children’s upbringing or specified time. If a court can separate the assets, then they will, but a court will always have regard to the housing needs of dependent children and can prioritise those needs. It may be that the spouse with the care of the children cannot buy out the other spouse’s interest and so the logic behind the order is that when the children are grown up, the spouse can then sell and downsize or make alternative arrangements.
We often see deferred sale orders until the youngest child of the family reaches the age of 18 or finishes full time education being A level or equivalent. A longer period however could be appropriate. Other triggering factors that would lead to a sale are if the spouse in occupation remarries and/or cohabits, the idea being that if the spouse in occupation moves on then they should be able to buy out to other spouse’s interest.
It can also help to prevent the forced sale of an asset at an inconvenient time. For instance, society has seen drastic rises in property prices as well as slumps in the property market. Forcing a sale of property at a certain time may result in a lower sales price and reduced equity in the home. It may be better for each party to sell the home at a time when market conditions are more favourable.
One of the main disadvantages is that they can create uncertainty for both parties, as it is unclear when the asset will be sold and for how much. This uncertainty can make it difficult for the parties to make long-term plans as to their finances and move on with their lives.
An order for deferred sale typically includes provisions for the maintenance of the asset during the deferral period which may span for 5 or 10 years. It is likely to include provisions for the payment of expenses associated with the maintenance of the asset, such as mortgage payments, utility bills and insurance. This can be a burden for the party responsible for these costs and the overall management of the property.
The party moving out must make alternative arrangements for their accommodation but without receiving a financial interest.
In conclusion, the use of Mesher Orders in divorce proceedings can provide a flexible and fair solution for the division of jointly owned assets which considers the needs of all parties concerned, especially the children. However, they can also create uncertainty and additional cost. It is important for the parties to carefully consider the potential advantages and disadvantages of a Mesher Order in each individual case.