Mesher Orders: What They Are and What Courts Do Now

If you are divorcing and the family home is the only real asset, you may hear the term "Mesher order". It is worth understanding, mostly because the courts now tend to use a different tool to achieve a similar result.

What a Mesher order is

A Mesher order postpones the sale of the family home. One parent, usually the main carer, stays in the property with the children. Both names stay on the title. The house is sold when a trigger event happens, commonly the youngest child turning 18 or finishing full-time education, remarriage of the occupying parent, or a further court order. The proceeds are then split in the percentages the order sets.

The name comes from Mesher v Mesher and Hall [1980] 1 All ER 126. The court's powers come from section 24 of the Matrimonial Causes Act 1973 (property adjustment) and section 24A (sale of property). A related order, the Martin order, comes from Martin v Martin (1977). It postpones sale for longer, often until the occupier's death or remarriage, and does not depend on children.

Why courts moved away from them

Their popularity peaked in the 1980s and 1990s. Many family solicitors now regard them as dated, and commentary describes them as generally out of favour with the courts. The problems are practical:

• The clean break is delayed. The courts try to end financial ties between divorcing parties where possible. A Mesher order keeps them tied together for years.
• Both parties stay on the mortgage and title. The parent who leaves can find it hard to borrow for a new home while still liable on the old one.
• Capital stays locked up. The leaving parent's share of the equity is out of reach until a trigger event.
• The end date can hurt. When the trigger arrives, the occupying parent may have to sell with little time to find somewhere else.
• Tax can catch the leaving parent. If they buy a new main residence, a later payout from the old home can raise a capital gains tax question.

Practitioner writing in Family Law describes Mesher and Martin orders as usually a last resort, kept for cases where the home is the only asset of substance.

What courts prefer now: the deferred charge or deferred beneficial interest

The modern alternative transfers the home into the occupying parent's sole name. The parent who leaves keeps a protected financial interest in the property, usually secured by a charge or a restriction at the Land Registry. That interest is paid out when a trigger event occurs. Family Law commentary says deferred charges are usually preferred because the leaving parent can be released from the mortgage.

The result looks similar to a Mesher order. The children stay in their home, and the other parent keeps a share of its value. The legal structure differs, and it avoids most of the problems above.

How it looks in a real case

A recent Family Court consent order, approved on the basis of the parties' agreement, shows the structure in practice. Details are removed here.

• The home was transferred into the occupying parent's sole name.
• The other parent kept a deferred beneficial interest, protected by a Land Registry restriction.
• The first slice of net equity went to the occupying parent, and the remainder was split in agreed percentages.
• Sale was triggered by a fixed number of years, remarriage, cohabitation, ceasing to live in the property, death of either party, or a longstop date.
• The occupying parent paid the mortgage and outgoings and could not remortgage or add further charges without written consent or a court order.
• The occupier could buy out the other parent's interest using an independent valuation, with a set time to complete. If the buy-out did not happen, the property went on the open market with a floor on the sale price.
• The order made a clean break on income, capital and pensions, apart from the deferred interest.

Note how much of that is detailed drafting. The triggers, buy-out route and sale rules are what stop a deferred arrangement turning into a dispute years later.

If you are considering one

• Check whether your lender will agree to the transfer and any release from the mortgage.
• Work out whether the occupying parent can afford the mortgage and upkeep alone.
• Decide the triggers and the longstop date, and whether a buy-out right is included.
• Take advice on tax for both parties.
• Even an agreed order must be approved by the court before it binds you.

This article is general information only and is not legal advice. Every case turns on its own facts.