More than the Channel separates England and France: a wife dumped in Paris may lose not just her husband but also a sizeable divorce settlement, says Richard Collins of Charles Russell
LUCY AND MARK have had a house and vineyard in Provence for many years. Approaching retirement, they have enjoyed spending ever more time there; the draw of the food, sunshine, the skiing in Spring and the sea in the Summer with plenty of time on their hands to enjoy themselves and fun with new friends.
It was a shock when Mark told Lucy he felt this was his last chance for some real happiness and would rather start afresh with Chantelle. For Lucy, like many others, a move abroad does not always live up to the dream. The very real new set of pressures associated with living abroad can easily lead to the breakdown of a marriage. For many, divorce in France, or in any other ex-pat community, becomes an uncomfortable reality.
Once Mark and Lucy take advice in France, they learn that the approach of the French court is very different to London, reputed to be the ‘divorce capital of the world’. Lucy is shocked to learn that whilst Mark’s obligation to disclose his finances fully and frankly is rigorous in England, the investigation appears to be less stringent in France. A lot of Mark’s money is in trusts and in the name of someone else.
Whilst the English court will look behind various financial vehicles set up by Mark to establish the reality of who actually has an interest in these type of assets, the French courts are more literal and formulaic in their approach and may not take into account assets which cannot be easily traced to Mark. Lucy worries that the French court is also less generous towards the weaker financial party on divorce than in England, where the court provides a bespoke solution for each individual case and has a broad discretion to order what is fair.
After the case of White v White, the House of Lords interpreted the law to provide that a wife’s contribution as homemaker is equal to that of a breadwinner husband. Since then ‘big money’ awards have been more widespread as the English court has moved towards an equal division of the assets. A further House of Lords’ decision in Miller and McFarlane extended the English generous capital approach to income and maintenance, introducing the English concept of fairness, needs, compensation and sharing when considering spousal maintenance. This contrasts with a vastly less generous approach to maintenance in Europe.
Lucy learns that it may be a stressful and expensive argument to try to ensure the English court makes the financial award if she is deemed habitually resident in France. It is very much in Mark’s interest to persuade an English or French court that they are habitually resident in France. After all, they moved to France to settle there.
A cynical financially stronger spouse is likely to be advised that he would benefit financially on divorce in a civil law jurisdiction such as France. It is true to say that many couples who move to France, Monaco, Spain, Switzerland or Italy are very surprised to learn that their decision to spend most of their time abroad, be it for tax reasons or pleasure, makes it very difficult or sometimes impossible to divorce in England notwithstanding their nationality and history of residence in the marriage.
The possibility to issue divorce in one jurisdiction as against another depends in European Union countries on one spouse or another’s habitual residence or domicile. In the case of Lucy and Mark it is likely their habitual residence would be France and therefore their domicile would be the only foundation upon which they can base a petition.
TOO FEW REALISE under the ‘Brussels II’ European Council Regulation, if divorcing spouses find themselves in a situation where two different European Union countries (excluding Denmark) have jurisdiction to deal with a divorce, there is a very strict first in time rule which means if proceedings are issued in one member country, for example France, the other member country, for example England, would be prohibited from dealing with the financial case.
It is often extremely important to take very urgent advice and to move quickly in cases where two EU countries would be eligible to deal with the divorce. The weaker financial party, usually the wife, will be very keen to issue her petition in England to secure the most generous court for her. A husband may wish to take the first steps in France (or another European jurisdiction) to secure the less generous forum for his wife.
The timing is all decisive. It can often make a significant difference to the award to the weaker financial party and can run to many millions of pounds. We had a reported case where the wife issued in London as soon as the Court door opened. The husband issued in Paris at the same time and because London proceedings were issued about 12 minutes earlier, the English court was secured and the result for the wife was significantly more generous than if the petition had been issued in France 12 minutes earlier.
One way to achieve some certainty about the division of finances upon divorce and which law to apply is to consider entering into a pre or post marital agreement. Until October 2010 these contracts were of doubtful importance in England but the Supreme Court decision of Radmacher v Granatino has now given significant strength to them. The recent Law Commission consultation on marital property agreements is also considering amending statute to make them binding unless there are some exceptional circumstances.
These principles also apply to agreements which are made after the marriage. It would be advisable to enter into such a contract prior to the move. The French court may consider whether to apply English law on divorce. If, however, a marital agreement specified English law, the French court could take into account that English law principles should be applied on divorce.
Even if a foreign court dealt with the divorce and finances abroad, that may not be the end of it for the financially weaker party. In certain limited circumstances where one party has returned to England for a year and has a dwelling house there and if appropriate and there is a strong connection with England, under English law, the English courts can make a financial order following a foreign divorce. Whilst the court is keen to ensure that an individual is not allowed to have two attempts at a financial award just because they are unsatisfied with the decision of a foreign court, the law in England seeks to ensure that injustice should not be suffered at the hands of a foreign court.
It is therefore vitally important to consider the potential legal implications of moving abroad. Couples who are already living abroad, for whom, sadly, the dream is not the reality, should seek specialist advice as it may not be too late to address a number of the issues or at least to appreciate the options should the unthinkable happen.
All names in this case are fictitious.
Richard Collins is an International Law Specialist at Charles Russell