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SECOND BITE OF THE CHERRY

This paper deals with applications under Part III of the Matrimonial and Family Proceedings Act 1984 for further financial provision which can be made in the Courts of England and Wales after a foreign divorce.

I am going to deal with the following issues:

A. Part III of the Matrimonial and Family Proceedings Act 1984 – what are the criteria for the making of an application

B. Applying for permission to bring a claim under section 13 – the new rules under FPR 2010 and preparing the affidavit

C. EU cases – s 15 and the exclusion of “maintenance” – how is “maintenance” defined?

D. The effect of the new Maintenance Regulation 2009 on what can be claimed in an EU case

E. Has the bar been lowered for applications after Agbaje?

F. The effect of a failure to attempt to enforce an overseas financial order

G. The effect of pre-nuptial agreements on applications under MFPA

H. Recent caselaw on section 13 and the substantive applications

A. Part III of the Matrimonial and Family Proceedings Act 1984 – what are the criteria for the making of an application

1.The MFPA was brought in as a consequence of the many sad cases where mainly foreign wives were divorced abroad and received derisory financial provision. The intention of the Law Commission when reporting on the issues in 1982 “Financial Relief After Foreign Divorce” [Law Com 117] was that there must be a genuine connection with England and Wales and that this is not a remedy for “birds of passage” [para 2.9].

2.The act does not in fact apply to civil partnerships although there is a similar provision by virtue of the Civil Partnerships Act 2004 Schedule 7. The wording is not identical though and caselaw on this provision is awaited with interest.

3.The way that the Act works is by setting up a filter mechanism in the form of section 13 which obligates an applicant to first apply for permission from the High Court. There are then a series of further hurdles for the unsuspecting applicant to jump through at sections 15-20 inclusive – each one imposing yet further obligations.

The Law on Applications

4.The substantive law to bring an application is contained in sections 12, 15 and 16. The powers of the court are then limited and applied by means of sections 17-20.

5. In relation to jurisdiction, essentially an Applicant has to:

(i) have their marriage dissolved or annulled or be legally separated by means of judicial or other proceedings in an overseas country and such divorce etc is recognised as valid in England and Wales – s12(1). This is important as no application can therefore be made on the back of overseas proceedings which are not in fact capable of recognition in England – some talaqs etc are not entitled to be recognised as a foreign divorce in which case the MFPA cannot be used but the MCA may be able to be used. In addition, no application can be made in respect of a divorce or judicial separation via non-proceedings – this is the case even where such a divorce may be recognised in England. In such case, it may be better to seek an order for non-recognition of the foreign non-proceedings divorce and then petition for divorce in England. Interestingly, when a divorce is obtained in a state not recognised by the UK, in this case North Cyprus, the divorce itself is still capable of recognition such that an application can be made under MPFA – Emin v Yeldog [2002] 1FLR 956;

(ii) not to have remarried or formed a subsequent civil partnership – s12(2). It is irrelevant if the respondent has remarried or formed a subsequent civil partnership

(iii) fulfil the s15 jurisdictional criteria ie if any of the following are satisfied:

(a) either party domiciled in England and Wales on date of application for leave or so domiciled on date on which divorce etc took effect in overseas country;

(b) either party habitually resident in England and Wales for a year ending with date of application or date overseas divorce took effect;

(c) either or both parties at the date of the application for leave had an interest in a property in England and Wales which had been a FMH – NB there is no difficulty in the parties having more than one FMH – see Otobo v Otobo [2003] 1 FLR 192 in which the court was content to accept that the parties had residence in homes in two countries;

(d) there is jurisdiction under the EU Maintenance Regulation 2009 – see s15(1A);

(e) there is jurisdiction under Part 1 of the Civil Jurisdiction and Judgments Act 1982 – see s15(2)(b);

(iv) it is appropriate in all the circumstances of the case for an order to be made by a court in England and Wales ie is England the appropriate venue for an application – s16(2) ie:

(a) the connection of the parties with England;

(b) the connection with the overseas country where the marriage was dissolved;

(c) the connection with any other country;

(d) any financial benefit which the applicant or child has received or is likely to receive in consequence of the overseas divorce by virtue of any agreement or operation of the law;

(e) any payment order of transfer of property ordered by an overseas court and the extent to which it has been complied with or is likely to be complied with;

(f) any right to apply for financial relief overseas, and if there has been no application, the reason why;

(g) the availability of property in England and Wales against which an order could be made;

(h) the extent to which an order would be enforceable;

(i) the length of time since divorce.

6.There is a new subsection s16(3) which makes it clear that if the court has jurisdiction by virtue of the European Maintenance Regulation 2009 “MR”, the court may not dismiss the application under s16 if inconsistent with the jurisdictional requirements of the MR. This is an extremely complicated area of the law and is dealt with below, albeit that the MR is not considered in detail.

The powers of the court on an application

7.The powers of the court are identical to on an MCA application [s17], save where the s15 jurisdiction depends solely on the existence of the FMH in England and Wales. In such a case s20 limits the court’s powers to a lump sum, property adjustment order in the FMH, other orders distributing the interests in the FMH or an order for sale. Any lump sum is restricted to the net proceeds of the FMH – s 20(2).

8.In addition, section 18 sets out the matters to which the court must have regard in exercising its powers under s17. These incorporate s25 MCA [s17(3)] with the court in addition having:

“regard to all the circumstances of the case, first consideration being given to the welfare while a minor of any child of the family ...” [s17(2)]

9.Interestingly enough, no doubt due to the phenomenal difficulties in dealing with pensions between jurisdictions the issue of benefits lost under pension arrangements is very much flagged up at s17(3A). Many overseas jurisdictions have no power to make any type of pension order or if they do, then pension trustees located elsewhere cannot be bound by the court.

10.Agbaje v Agbaje [2010] UKSC 13 clarifies how the provisions of sections 16-20 are to be applied together as they effectively form a hurdle race as each section imposes yet further requirements upon the poor applicant. This is dealt with in detail below. Despite Agbaje allowing a wife’s appeal, these applications are extremely difficult as there are simply so many conditions to fulfil.

Protective measures

11. There are also provisions at s23 and s24 MFPA to set aside dispositions intended to defeat an application or to prevent such transactions. Importantly, these can be used even whilst a potential applicant is waiting for his/her jurisdictional 12 month residency to expire – s24(1)(b) MFPA. These provisions are virtually identical to those contained in the MCA.

Onus of proof

12.It is important to bear in mind that despite the s13 leave hurdle, the onus of proof is still on the applicant – see N v N [1997] 1 FLR 900 in which a husband failed in his application as he had taken no steps to seek financial provision in Sweden. See though Moore v Moore [2007] EWCA Civ 361 in which neither party applied for financial relief but the application was allowed.

B.Applying for permission to bring a claim under section 13 – the new rules under FPR 2010 and preparing the affidavit

Procedure

13. Prior to making an application under MFPA, the leave of the court has to be obtained “in accordance with rules of the court” according to s13. These rules have changed substantively following the FPR 2010 and pre April 2011 caselaw must be read with care.

14.There have always been questions over the role of the prospective respondent in any leave application. Sadly, these problems have not really been resolved with the coming into force of FPR 2010 r8.23-8.8.28.

15. The new FPR decrees that all applications for permission must be made in the Principal Registry [r 8.24] save where the respondent has consented to the order for permission under r9.26(6), in which case the proceedings can stay in the court in which the financial remedy application is proceeding.

16.The form to be used is a D50E and is in accordance with the Part 18 FPR 2010 procedure which provides for written evidence to be filed with the application.

17.Such evidence clearly needs to include all of the following:

• particulars of the divorce or the judicial separation – this will have to include translated copies of the divorce proceedings showing clearly that a final divorce/judicial separation has been obtained

• details of whether an application for financial relief was made, its outcome and whether enforcement has come to pass. It is worth bearing in mind that in the Court of Appeal case of Moore v Moore [2007] EWCA Civ 361, the Court of Appeal was content to give W permission to bring a MFPA claim despite the fact that neither party had in fact applied for financial provision in Spain. s16(2)(f) as to overseas applications for financial relief was significant but not determinative

• the names of the parties and the date and place of the marriage

• the residence, nationality and domicile of each party

• details of any children of the family, including whether they are still minors

• a summary of the income and assets of the parties and an indication as to their whereabouts

• the type of order being sought

• the grounds on which the Court has jurisdiction under s15

• a consideration of the factors in s16(2) ie is England the appropriate venue

• an explanation of any delay – this is not always fatal to an application but clearly must be explained. See for example the case of Lamagni [1995] 2 FLR 452 where a delay of 13 years was excused as the wife had been battling in the Belgian judicial system to obtain proper financial relief against an Italian husband and there were real problems with enforcement. See also M v L[2003] EWHC 328 involving a delay of 30 years but the applicant was unaware of the right to apply and the respondent had acknowledged moral responsibility in the meantime

18.To the extent that there is a hearing for permission, it must be heard before a Judge of the Principal Registry, not a District Judge – r 8.26(a). Once permission has been granted, the Judge, however, may direct that the application is then heard by a DJ at the PRFD – r8.28. The rules do not provide for a transfer to another divorce court at this stage ...

19.When an application for permission from the court is sought, this is normally done without notice – r8.25:

“(1) The court may grant an application made without notice if it appears to the court that there are good reasons for not giving notice.

(2) If the applicant makes an application without giving notice, the applicant must state the reasons why notice has not been given”.

20. It is shame that the FPR 2010 did not in fact clarify under what circumstances notice should be given and/or the respondent allowed to participate in the proceedings for permission. Clearly there is scope for a further Practice Direction or other type of judicial pronouncement on the matter.

21.Prior to the FPR 2010, the practice had developed of respondents being given informal notice of the leave application such that it was considered on an inter partes basis. This procedure was expressly criticised in Traversa v Freddi [2011] 2 FLR 272 (albeit shortly before the commencement of the FPR 2010). It would therefore appear that if the Court [not the applicant presumably] considers that the respondent should be given notice, that matters will be listed for an inter partes hearing.

22.In any event, the provisions of Part 18 FPR 2010 in respect of ex parte applications must be followed. Rule 18.10 provides that an applicant must serve the application and all evidence relied upon on the respondent, whilst Rule 18.11 (2) provides at that a respondent has 7 days from service of any order to apply to set it aside when served with an ex parte order. Such a tight timetable should be brought to the attention of any respondent in accordance with the obligation at r18.10(3). It is worth commenting that a respondent is also entitled to a copy of the application and statement if the application is unsuccessful – see r18.10(2).

23. At paragraphs 56-58 of Traversa Lord Justice Munby also made clear that under the new rules:

(a) any application for leave under s13 should be ex parte

(b) it should be given a time estimate of 30-60 minutes whether ex parte or inter partes

(c) if a respondent upon being served with leave wishes to set it aside, then unless this can be done by means of a “knockout blow” such application should be adjourned to be heard with the substantive application under MFPA

24. Given that the prospective respondent is not a party to this stage, this creates problems further down the line as a successful respondent will have wasted much time and money in defending an unmeritorious application.

25. If permission is given, this can be on conditions – see s13(3) MFPA – thereby enabling the court to control the issues being considered and to prevent a full re-run of the entire financial remedy proceedings. Recent examples have included limiting the assets under consideration to pensions or a particular property. In Agbaje as an example, the findings of fact made by the overseas court were held to be binding and there were to be no revaluations of the overseas properties.

The law on the granting of leave

26.As to the test for the granting of leave, the Supreme Court considered the MFPA in Agbaje v Agbaje [2010] UKSC 13, and in particular the issue of leave under s13 of the Act:

“the court shall not grant leave unless it considers that there is substantial ground for the making of an application”

27.In Agbaje at paragraph 33 Lord Collins stated:

“In the present context the principal object of the filter mechanism is to prevent wholly unmeritorious claims being pursued to oppress or blackmail a former spouse. The threshold is not high, but is higher than “serious issue to be tried” or “good arguable case” found in other contexts. It is perhaps best expressed by saying that in this context “substantial” means “solid”.”

28.In Traversa, a year later, LJ Thorpe stated [para 30]:

“It is clear that the section 13 filter is there to exclude plainly unmeritorious cases and although in the evaluation of substance, regard must be paid to overall merits, it does not call for a rigorous evaluation of all the circumstances that would be considered once the application has passed through the filter.”

29. Since Agbaje the Court of Appeal has heard a number of appeals against decisions refusing permission in Schofield and Traversa. Comment was also made in the Court of Appeal on a further decision given by Mr Justice Mostyn in CG v IF [2010] EWHC 1062 in which the Judge set down his own, incorrect, interpretation of the s13 test. In both cases the appellants were successful and permission was subsequently given. New caselaw therefore appears to have lowered the bar for permission to apply. Quite what has then come to pass on the substantive application remains an unknown as there have been very few reported cases.

Interim maintenance

30.There is in fact a power to award interim maintenance once leave under s13 has been given. It is important to note that the test for interim maintenance is not that in s22 MCA 1973 of what the court thinks “reasonable” but rather it refers to “if the applicant or any child of the family is in immediate need of financial assistance”. In fact this is the same wording as at s5 of the Inheritance (Provision for Family and Dependants) Act 1975.

31. The case of M v M [2011] EWHC 3574 is interesting as it makes it clear that a part of the “immediate need” can include an element for legal fees. It is worth noting that in this case, the “immediate need” was for £460,000 pa of which £150,000 was for rent plus a further £10,000 pm for legal fees ....

32. Immediate need refers not to urgent need but rather to current need. Such needs are assessed according to s25MCA principles when assessing mps pursuant to s22MCA.

33. Importantly, there can be NO application for interim maintenance when the jurisdiction on which the application is based is limited to that of having the FMH in England and Wales ie s15(1) (c) – see s14(2).

Procedure once leave is given

34.Once leave has been given an application under MPFA is treated in the same way as any other application for a financial remedy and Part 9 applies. The form to be used is the D50F.The matter will proceed in the PRFD, unless there is a consent order.

35. Some commentators have suggested that there may be cases where spouses wish to file for divorce overseas but to sort out their finances in England. This might be for example because they do not wish to wait a year – in Spain parties can divorce after 3 months. It is an unknown as to the weight, if any, which would be placed by the court upon undertakings given by spouses to agree to a MFPA application. Presumably the ultimate decision would remain with the court.

36. As to the format in which the financial evidence should be disclosed, the FPR 2010 has at last provided for the use of obligatory forms – albeit the Form E1 which is much shorter and rather unhelpfully includes nothing specifically about pensions. Arguably they are another asset which must be listed, but given their magnetic importance in many of the MFPA applications, it is unhelpful to say the least...

C.EU cases – s 15 and the exclusion of “maintenance” – how is “maintenance” defined?

37. Section 15 MFPA includes at s15(1A) and s15(2) reference to the Lugano Convention [signatories are non EU but European] and the MR which have the effect, to the extent that they apply, of excluding in whole or in part applications under the MFPA. A key concept in these instruments is that of “maintenance”. This term has its own autonomous ECJ meaning and any label given by the national law is in no way decisive.

38. The jurisdiction on EU maintenance had been governed by Brussels I up to June 2011. BI provided that maintenance came within the convention but property rights arising out of a matrimonial relationship did not. All claims for maintenance within BI were on a first come basis and subject to a mandatory stay of the second set of proceedings for maintenance at Article 27. In addition, Article 28 BI provides that:

“(1) where related actions are pending in the courts of different Member States, any court other than the court first seized may stay its proceedings.

(2) Where these actions are pending at first instance, any court other than the court first seised may also, on the application of one of the parties, decline jurisdiction if the court first seised has jurisdiction over the actions in question and its law permits the consolidation thereof

(3) For the purposes of this Article, actions are deemed to be related where they are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings”

39. Therefore under Brussels I there clearly was a discretionary basis on which an English court could stay a non-maintenance claim which would include those under MFPA if there had been a previous financial order. This could happen if there were maintenance proceedings brought first elsewhere in the EU. In fact the Court of Appeal in Traversa never did come to a conclusion on this issue but rather merely noted that it was very complicated....! The course of action suggested by LJ Thorpe at paragraph 34 of Traversa was that given that it was a discretionary stay, the issue should be left to the trial judge, rather than being a knockout blow in the MFPA application, thereby avoiding a decision on the matter... The issue as to whether maintenance in another EU state or Lugano state precluded an application under MFPA was also raised but not resolved in Agbaje [para 55].

40.The leading case on the ECJ definition of maintenance is Van den Boogaard v Laumen [1997] QB 759 (ECJ) [Case C-220/95] which is worth re-reading, despite its age. This case analyses Brussels I in relation to maintenance issues and enforcement. H and W were married in 1957 in the Netherlands. The marriage was dissolved in London and W was awarded a capital sum in place of periodic maintenance payments. This capital sum included the transfer of property to W (£535,000), as well as payment of a lump sum for maintenance (£355,000).

41.W then applied to have the order enforced in the Netherlands pursuant to Brussels I dealing with maintenance. H appealed the application and a reference was made to the ECJ to determine whether the English order was excluded by Article 1 of the Brussels Convention 1968 as relating to property rights arising out of a matrimonial relationship or fell within Article 5(2), which stated that matters relating to maintenance were covered by the Convention and could be enforced.

42. The ECJ held that the Brussels Convention does not define “rights in property arising out of a matrimonial relationship” or “maintenance”: [18], 784C. It should be possible to deduce what parts of a decision relate to maintenance and what parts relate to apportioning rights in property from the reasoning of the decision in question.

43.If an award is designed to enable one spouse to provide for himself or if the needs and resources of each of the spouses are taken into account when determining the amount, the decision will be concerned with maintenance and could be enforced under BI. Where the decision was solely concerned with dividing property, it concerned property rights and was not enforceable under BI. A decision that did both things could be enforced in part: [22], 784G to 785A.

44.In particular, it makes no difference that the payment of maintenance is in a lump sum, what the Court must consider is the aim of the property transfer [23], 785A:

“[A] decision rendered in divorce proceedings ordering payment of a lump sum and transfer of ownership in certain property by one party to his or her former spouse must be regarded as relating to maintenance and therefore as falling within the scope of the Brussels Convention if its purpose is to ensure the former spouse’s maintenance” [27], 785D to E

45. The case of Moore v Moore [2007] 2FLR 339 reiterates these principles in the context of the consideration as to whether a MFPA application was precluded due to a claim for maintenance in Spain.

46. See also paragraphs 35-36 of Traversa [2011] EWCA Civ 81 [albeit pre MR] where LJ Thorpe expressly considered “hybrid” cases of a capital sum as a property consequence and also maintenance and clarified that only the maintenance part could be enforced under Brussels I.

47. These cases are crucial for an understanding of when MFPA applications can be brought in an EU or Lugano Convention case. If there is a hint of “maintenance” about the claims brought overseas, the case must be considered very, very carefully indeed.

D.The effect of the new Maintenance Regulation 2009 on what can be claimed in an EU case

48.The MR came into force in June 2011 and so far has not been litigated in a MFPA context. However, given the many issues which will arise, there will clearly need to be clarification.

49. Essentially the purpose of the new s15(1A) is to exclude cases where another EU state has jurisdiction to deal with maintenance under MR and does so. S15(2) is still relevant as there are still members of the Lugano Convention in Europe which are not members of the EU such as Norway and Switzerland.

50. It is Article 12 [replicating Article 27 BI] ie first come, first serve on jurisdiction for maintenance claims, and Article 13 of MR [replicating Article 28 of B1] ie discretionary stays for related actions which will of course cause lawyers the most problems. It is still unclear as to how these provisions will actually work in practice and the courts so far have not been keen to tell us!

51.For example, is a pension transfer so closely related to maintenance proceedings, such that a MFPA application for a pension share of an English pension could not be entertained as there was already a maintenance order in Spain? Clearly most pension shares will be have as their clear purpose the provision of income in the future – they would therefore seem be caught under the ECJ maintenance definition.

52. In addition, the political discomfort of English courts implicitly criticising their European friends may be enough to spell the demise of MFPA applications in Europe.

E. Has the bar been lowered for applications after Agbaje?

53. From the date when the MFPA came into force in 1985 [with, in addition, retrospective effect], it had been little used. A series of decisions had made it quite clear that such orders would only be made exceptionally and mainly in cases where there were no real financial claims at all. The Courts made clear that they did not wish to act effectively as a Court of Appeal from foreign courts which had assessed circumstances, investigated and made enforceable orders. It would only be in “exceptional cases” that leave would be given – see Holmes v Holmes [1989] 2 FLR 364 – this was itself a New York case.

54.Further cases confirming this stance continues during the 1990s, making such an application extremely unattractive save for in cases in which no financial provision had been or could be made at all.

55. All that was to change, however, following the 2010 case of Agbaje which involved Nigeria.

56.The parties were both Nigerian by birth though both had acquired UK citizenship. They had been married for 38 years and all of their children had been born and all but one educated in the UK. The parties had lived in both London and Nigeria where they had properties. The vast majority of the £700,000 assets were in London - £530,000.

57.On separation H brought divorce proceedings in Nigeria in June 2003. At this time W was living in a property in London where she had been living for the previous 4 years. W initially claimed for financial relief within these financial proceedings.

58.After H brought his proceedings in Lagos, W did in fact attempt to bring proceedings in England. In December 2003 W filed for divorce in London and later attempted to withdraw her application for financial relief in Nigeria.

59.There then followed an unsuccessful attempt by W to obtain an anti-suit injunction in relation to the Nigerian proceedings. During the course of this application, reference was made by the Judge that W might in due course have a claim under the MFPA ....

60.The Nigerian court also refused W’s application for a stay on the Nigerian proceedings and refused to allow W use London to determine her divorce claim. The result was that the proceedings continued in Nigeria.

61. In the Nigerian final order, W received a life interest in a property in Lagos and a small lump sum of £21,000. As W had failed to prove any financial contribution to the London properties, seemingly, no account at all was taken of these London properties by the Nigerian court. Decree Absolute was made by the Nigerian court in September 2005 and W did not appeal the Nigerian order.

62.Virtually immediately after DA, W sought leave under s13 MFPA which was given in November 2005. In April 2008 [due to various appeals by H in relation to the s13 issue] a substantive order was made on the MFPA application. This order effectively provided W with 65% of the proceeds of sale of the London property such that W could indeed rehouse herself in London where she had been living in any event. This left W with about 40% of the overall assets – ie still less than she would have received in an English court given the length of the marriage and the state of the law post Miller.

63. The Court of Appeal, however, overturned this decision on the basis of the family’s strong connection with Nigeria. W appealed to the Supreme Court.

64. In the Supreme Court it was made clear that the following were NOT conditions for MFPA applications [para 58 onwards]:

(a) Hardship

(b) Exceptional circumstances – Holmes is now not good law

(c) Serious injustice

65. Furthermore, as far as the amount to be awarded is concerned:

(a) It is not limited to the minimum extent necessary to remedy the perceived injustice, contrary to the decision in A v S [2002] EWHC 1157. This case is no longer good law [para 63];

(b) It is not appropriate to award more than if the proceedings had taken place in this jurisdiction – this was of no real surprise to the lawyers .... [para 62 & para 73]

(c) It is not intended to act as a “top up” to bring the award up to an “English level” – cf Part IV of the MFPA involving Scottish cases which in terms states that the order is to bring the financial award up to Scottish levels – s29(2) [para 69]. The level of top up depends upon the strength of connection with England [para 70]

66.Importantly Forum non conveniens is not the statutory test on these applications as there is not a choice of jurisdictions, but rather an acceptance that there may more than one suitable jurisdiction for the divorce and for the financial claim – ie the bifurcation of the two claims [para 49].

67.The test for leave under s13 was obviously clarified in Agbaje, however, Lord Collins also clarified the correct test to be applied to the substantive application [para 73]:

“First, primary consideration must be given to the welfare of any children of the marriage. This can cut both ways as the children may be being supported by the foreign spouse. Second, it will never be appropriate to make an order which gives the claimant more than she or he would have been awarded had all proceedings taken place within this jurisdiction. Third, where possible, the order should have the result that provision is made for the reasonable needs of each spouse. Subject to these principles, the court has a broad discretion.”

68.Clearly this test reasserts the concept of “needs” which is wholly alien in a great many overseas’ jurisdictions ...

F.The effect of a failure to attempt to enforce an overseas financial order

69. In Lamagni [1995] 2 FLR 452 W had made many efforts to use transnational enforcement conventions in relation to orders made in Belgium but to little effect.

70.The case of Jordan v Jordan [1999] 2FLR 1069 provides useful guidance as to the efforts that the English court expects a litigant to make in relation to enforcing foreign orders. Essentially the burden is on the applicant to show that the enforcement remedies in the foreign jurisdiction and/or under the relevant conventions and/or under the common law were inadequate or had been exhausted. In relation to lump sums, pensions and property adjustment orders, this of course may not be too difficult as such assets are notoriously difficult to enforce across borders, unlike maintenance.

71. In this case the parties were divorced in California where the finances were also dealt with. The husband refused to comply with the order and so the wife brought enforcement proceedings in California and also an application under MFPA. Unsurprisingly the English court wanted the California proceedings to have concluded prior to embarking upon the exercise under the MFPA.

72.Schofield v Schofield [2011] EWCA Civ 174 is an interesting example of a case where due to the impossibility of a German court making any order in respect of an English Army pension, this aspect of the financial remedy proceedings was effectively brought back to England in the form of an application under MFPA.

G.The effect of pre-nuptial agreements on applications under MFPA

73.The Law Commission is still reporting on this issue, so the effect of a prenuptial agreement within English family law is still rather uncertain.

74.As far as applications under the MFPA are concerned, prenuptial agreements clearly are very relevant to a consideration of whether permission should be given under s13.

75.The cases on the MFPA have of course echoed the state of the law on prenuptial agreements. In 2010 the Supreme Court decided Radmacher v Granatino [2010] UKSC 42 which effectively decided that pre-nuptial agreements can be binding in some circumstances, albeit that the circumstances of this case were highly unusual. In this case both parties took or were offered independent legal advice and the agreement was drafted specifically for the couple rather than being a standard agreement.

76. In 2007 the Court of Appeal considered the case of Ella v Ella [2007] EWCA Civ 99. This did not in fact involve an application under MFPA but was a dispute about jurisdiction on divorce as between England and Israel. The parties had signed an Israeli pre-nuptial agreement providing for the separation of the parties’ property. Of course, at this time, prenuptial agreements were accorded very little weight.

77.The Court of Appeal, whilst ordering that the divorce should continue in Israel and staying the English divorce proceedings under the Domicile and Matrimonial Proceedings Act 1973, made it clear, however, that should the Israeli court fully enforce the Israeli prenuptial agreement, that W would have a good application under MFPA. Whether the same comments would be made today post Radmacher, is a matter of conjecture.

78.There have been a series of cases since Radmacher involving more standard matrimonial regimes across Europe. These have included:

GS v L [2011] EWHC 1759 – Spain, Madrid matrimonial regime not upheld

V v V [2011] EWHC 3230 – Swedish prenup given some weight

Z v Z [2011] EWHC 2878 – French matrimonial regime given little weight

Kremen v Agrest (No. 11) [2012] EWHC 45 – Israeli post-nup given no weight

B v S [2012] EWHC 265 – Spain, Catalan default matrimonial regime providing for separation of assets given no weight

79.In these judgments, much has depended upon the legal advice given, the level of disclosure provided (if any) and the overall effect of the prenuptial agreement and/or matrimonial regime.

80.Clearly though, the existence of a matrimonial regime or pre-nuptial agreement should not be a knockout point on a MFPA application as long as the law remains unclear.

81.Albeit at High Court level, standard European matrimonial regimes are simply not being upheld in the English court. It is therefore not arguable that on an MFPA application a W would definitely end up with the same level of financial provision.

H.Recent caselaw on section 13 and the substantive applications

Schofield v Schofield [2011] EWCA Civ 174

82.H and W married in Germany where H had been stationed with the British army and accrued a British army pension. They divorced in Germany in 2007, but the issue of pension equalisation had been severed from the decree because the German courts recognised they lacked jurisdiction to bind English Pension Trustees in relation to H’s army pension under English law. The German court envisaged that the pension would be dealt with in England in some way ....

83.As predicted, W brought her application under MFPA seeking permission to bring an application for a pension-sharing order against H. Her application was refused on the basis that W had not established a “substantial” or “solid” ground and the court could not say that the probability of W succeeding at trial was 50% or greater. Mr Justice Mostyn also stated that the level of income that would be generated by the pension was “paltry” [!].

84.W appealed on the basis that the proceedings raised issues of public policy regarding pension-sharing orders in relation to schemes outside the jurisdiction where the divorce took place. The Court of Appeal allowed the appeal and were withering about the approach of Mr Justice Mostyn in this case and in CG v IF. They stated that the interpretation of “substantial ground” in CG v IF was wrong in that case and wrong in this ...! [para 13]. The test for s13 is as in Agbaje and Traversa.

85.Furthermore, the judge’s view that the sums involved were “paltry” was unsustainable [para 14]. There had been a lump sum of £40,000 and a CETV of £280,000 ....!

86.At paragraph 15 LJ Thorpe stated:

“It does seem to me very important that, where a pension is rooted and funded within jurisdiction A and where the divorce is to be pronounced in jurisdiction B, with all ancillary issues decided according to the law of state B, it is very important that there should be judicial collaboration to ensure that the applicant in state B is not deprived of her entitlement to share in the pension rooted and funded in state A.”

87.This is a very useful comment as the reality is that there are huge problems with pensions in very many overseas pensions – there is no power to bind foreign pension trustees, even to the extent that a foreign court considers a pension to be in any way relevant.

88.There has also been a further [though cursory] consideration by the Court of Appeal of the section 16 criteria in the case of Golubovich v Golubovich [2011] EWCA Civ 479 [paragraph 14] . H and W were young rich Russians living in London and on separation embarked upon highly acrimonious litigation in the High Court.

89.Prior to marrying in 2007, H had been given US$6m by his family, and W had been given $1.6m by her family. They had a child and lived in a house in London provided by H’s parents. H had a right of residence in UK under a concession that granted visas to people who invested £1m in the jurisdiction. In 2009 they separated and W initiated divorce proceedings in UK and H in Russia, and H obtained a Russian decree first. The UK courts initially refused to recognise the Russian decree but it was ultimately recognised which resulted in W applying for permission to bring her claim under MFPA. At one of the hearings in relation to the recognition of the Russian Decree, it had been conceded by H that following such a divorce, W could always bring her application under MFPA.

90.At the substantive hearing H failed to give full and frank disclosure. The judge on the MFPA application ordered H to pay £2.485m, comprising a lump sum to W to enable her to purchase a home in London and a lump sum for maintenance. H appealed.

91.The Court of Appeal held that the judge had no alternative but to grant permission to apply under MFPA. If recognition was to be given to the Russian decree then the wife was indeed entitled to bring her claim under MFPA. The amount awarded gives a clear message that under the MFPA, serious heavy awards will be made in big money cases where there is clearly no hardship at all.

92.Rather interestingly, some foreign courts are clearly seeking to limit the powers of the English court under MFPA when they are giving their final judgments on finances. The author has seen a recent Spanish judgment from 2011 in relation to money on a divorce between two British nationals. This judgment included a recital that neither party intended to bring any further applications in any jurisdiction, particularly in England and Wales, alluded to both parties having been provided with full disclosure and accepting that their needs had been satisfied ...The effect of such a judgment on an application under MFPA of course remains to be seen but is a clear indication that foreign courts do not accept that the family courts of England and Wales can effectively be used as a further court of appeal.

SARAH LUCY COOPER
Articles and consultations authored by attorney reflect the state of law as of the date of their writing. The laws change daily. Users of this site are advised to consult attorney regarding their situation.
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