Getting Divorce Done; Brexit, jurisdiction races and the future of the “Divorce Capital of the World”

Things I never thought I’d hear myself say in 2020:

  1. “I really miss Brexit”

However you voted in the 2016 referendum, you’d be forgiven for growing tired of the infamous B-word over recent years and for rolling an eye at the endless slogans promising to “get Brexit done”.

And yet, in a year that has been plagued (*groan*) by talk of coronavirus, “unprecedented times” and a “new normal”, it is easy to understand why one might look back at the halcyon days of Brexit with a renewed sense of nostalgia.

The UK’s transition period for Brexit comes to an end on 31 December 2020 and it cannot be extended beyond that date. This means that from January 2021, the UK will no longer be bound by EU rules and regulations.

So where does that leave divorcing couples? Well it was recently reported in the Evening Standard that the Family Courts of England and Wales are bracing themselves for a further “spike in divorce cases” before the end of the Brexit transitional period, as couples try to capitalise on the existing system and avoid being engaged in a protracted (and more to the point costly) jurisdictional battle.

The clock is ticking…But what are the new divorce rules? Can we expect to see a spike in divorce cases? And what will this mean for London’s reputation as the divorce capital of the world?

2020-12-31T00:00:00

  days

  hours  minutes  seconds

until

End of the Brexit Transitional period

How will Brexit change our divorce laws?

The rather unhelpful answer is that we still don’t really know. Not for certain at least.

Despite pleas from many prominent family lawyers and justice bodies, family law didn’t appear to get a seat at the Brexit negotiation to date no clear guidance has been produced on this issue. It would appear many of the measures would take us back to the rules under the Hague Convention, but the Hague Convention is an incomplete solution.

This means that the future of family law where there exists an EU cross-border element after 31 December 2020 is extremely murky.

The government website on the changes to UK-EU cross-border divorce cases from 1 January 2021, does not provide much clarity which could lead to a spate of expensive and protracted disputes over jurisdiction in future.

This means that couples with ties to an EU member state who wish to make use of the England and Wales court system, or to have their divorce agreements which have been filed and finalised in the UK, automatically recognised by other member states (as is the present position), may find themselves locked in a lengthy and costly jurisdiction dispute about where their case should be heard if they delay issuing proceedings.

The already overburdened Family Courts have begun to brace themselves for a spike in divorce cases over the next 2 months, as a result of anticipated forum shopping. The UK has traditionally been seen as the “Divorce capital” of the world due to its reputation for being more generous to a financially-weaker party than other jurisdictions.

If you are considering applying for divorce, and there is an EU cross-border element at play the advice is to act swiftly and seek independent specialist advice as a matter of priority.

London as the Divorce Capital of the world

What does this mean for London’s status as the divorce capital of the world? Perhaps divorce isn’t the first word to spring to mind when given the word London in a game of word association.

However London, or to be more precise the jurisdiction of England and Wales, has certainly earned hard its reputation over the last 20 years as the divorce forum of choice for financially weaker spouses married to the world’s global elite.

Open a newspaper today and you’re likely to find at least one headline referring to a high profile or celebrity divorce battle. The recent media circus following the £453million divorce settlement of billionaire Russian oligarch Farkhad Akhmedov is a case in point for why London has long been seen as an attractive forum for divorce proceedings.

photo of woman holding white and black paper bags
A lady who probably wants to get her shopping in before the exchange of Forms E (to be clear that is a joke!)

Therefore divorce tourism, and the divorce industry, is a key driver and contributor to our service based economy. But how did we achieve that reputation? Well essentially, the UK achieved this reputation by being fairer to financially weaker parties. Whereas other jurisdictions would typically look only at a parties’ needs in the case of a long marriage with significant assets, the UK has often treated marriage as a partnership and has placed the role of the “breadwinner” on equal footing with that of the “homemaker”.

Indeed, the Law Commission has attributed London’s prominence on the global divorce stage to the landmark case of White v White in 2000. This case was groundbreaking as it did away with the previous “reasonable needs and requirements” test; meaning that for the first time it no longer followed that the breadwinner in a marriage could expect to retain any surplus assets above the financially weaker parties’ needs. It was held that the starting point in this case was that such surplus assets should be divided equally in recognition of the parties’ respective contributions.

The Law Commission recognised that “as a result of this change, English law has come to be perceived as more generous than the law elsewhere”.

And since that seminal case, a flurry of celebrious international divorce cases has ensued and filled the front pages of the UK’s newspapers. In fact the Times reported that as many as 1 in 6 divorce and financial remedy applications involve an international element of some kind.

One major change we can expect to see however is a change in the way that divorcing couples can choose the jurisdiction for their divorce. The new rules are likely to mean that if you issue for divorce after 31 December 2020, the English and Welsh courts would decide where the divorce should happen based on the most appropriate place.

In practice this would mean the country you and your spouse have the closest connection with, rather than being able to choose the country that would be most advantageous to you. Meaning that such couples lose the autonomy to decide the appropriate forum to decide their financial claims.

As other countries will decide according to their own law where the divorce should take place, it could mean that proceedings can take place in multiple countries at the same time. Additionally, the new laws could mean that you need to apply for your divorce to be recognised in another EU state?

Sounds complicated right? Well, it is. If there’s a possibility that you could divorce within the next year, the advice is to not delay. Obtain legal advice as a matter of urgency and consider petitioning before the transitional period expires on 31 December 2020.

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