Month: April 2019

One can imagine that it must be very difficult for a party who believes they have succeeded with their case to find that success snatched away from them at the last moment. However, sometimes judges change their mind about decisions they have to make.

As its name suggests, this is what happened in the High Court case H v T (Judicial Change of Mind), which concerned an appeal by a husband against a financial remedies order. The final hearing in the case took place in May last year, but the judgment has only recently been published on the Bailii website.

For the purpose of this post I don’t need to go into too much detail regarding the facts of the case, or the financial remedies order. The parties were married for sixteen years, and have three children. Divorce proceedings took place in 2016, and the wife made a financial remedies application. That application was heard by His Honour Judge O’Dwyer, who awarded the wife some 68% of the capital assets.

The husband appealed. The appeal was heard by Mr Justice MacDonald in the High Court. He explained the ground of appeal, which was that:

“The learned Judge was wrong when he failed to make adequate capital provision for the husband when he awarded the wife at least 68% of the capital assets in circumstances where (1) the wife could re-house at a level the learned Judge found was appropriate without making any, or any significant, departure from equality; and/or (2) the husband was also ordered to pay considerable child maintenance and school fees.”

After hearing the appeal Mr Justice MacDonald circulated a draft judgment to the parties’ lawyers, which indicated that he intended to allow the appeal to the extent of varying the lump sum order made by Judge O’Dwyer, as he considered that Judge O’Dwyer’s award had exceeded the wife’s identified housing need.

It is important to explain here that a judge’s decision in a case is not final until their judgment is handed down. Sending out a draft judgment is not the same as handing it down. The purpose of sending out a draft is to give the lawyers the opportunity to check the judgment, and suggest any corrections or amendments. Normally, the suggestions will relate to relatively minor issues, such as typographical errors, rather than the decision itself. The judge will then consider those suggestions, and make any appropriate corrections or amendments to the draft, before handing down the judgment.

In this case the wife’s counsel, upon receiving the draft, invited Mr Justice MacDonald to reconsider the conclusions expressed in his draft judgment, given “what she contended was a significant material omission in the figures that underpinned those conclusions.” Specifically, he had failed to take into account purchase costs when looking at the wife’s housing need. Whilst not mentioning them specifically, Judge O’Dwyer had taken purchase costs into account, as the wife’s counsel explained, and thus his award provided for the wife’s identified housing need exactly.

This was accepted by Mr Justice MacDonald, who therefore changed his mind, and decided to dismiss the husband’s appeal. He had this to say about the change of mind:

“Whilst I had not formally handed down judgment, and, accordingly, … there was nothing to prevent this change of mind following careful reconsideration … I am conscious that judicial tergiversation [i.e. change of mind] is, rightly, not encouraged. Not least in this case because the husband will have considered himself successful by reference to the draft, only for the court to reach the opposite conclusion in the judgment handed down. Against this however, … a judge must have the courage and intellectual honesty to admit and correct an error or omission and, … in doing so is honouring his or her judicial oath. In the circumstances, whilst, as I can attest, it is an uncomfortable exercise for the judge, particularly where the error or omission acts to change the decision handed down in draft, and is disappointing for the litigant who believed they had been successful, a judge is duty bound to correct his or her omission or error. To do otherwise would not be just.”

I’m sure that the husband would have found the change of mind hard to accept, but obviously, judges can make mistakes just like anyone else, and those mistakes, once brought to light, must be corrected. Normally this will entail correction on appeal, but if the mistake is brought to light before a decision is handed down, then that decision must itself be changed.

You can read the full report of the case here.

The post When a judge changes their mind appeared first on Stowe Family Law.

The family courts in England and Wales are renowned for being a popular destination for wealthy and warring international couples. So much so, that London has been dubbed the divorce capital of the world with people racing to file a petition in England so that our courts determine the financial split (if this can not be achieved amicably).

However, last week’s decision in the High Court case of Pierburg v Pierburg may, at last, bring clarification to a long-standing debate concerning how to establish whether the court has jurisdiction to deal with a divorce.

We asked Senior Partner, Julian Hawkhead, to join us on the blog to look at the case and the implications for international divorce cases.

Last week a decision of the High Court was handed down which may, at last, bring clarification to a long-standing debate concerning how to establish whether the court has jurisdiction to deal with a divorce.

As has been explained in previous articles in this blog, where there is more than one EU jurisdiction in which divorce proceedings could be commenced, the EU regulations apply.

In the case of Pierburg v Pierburg, the parties were both German nationals, they had resided since the early 2000s in Switzerland for tax reasons but had taken a rental property in London, mainly because their son had been educated here. When the marriage broke down, the wife in or around July / August 2017 moved into the London property. Her time spent between London and Switzerland was carefully counted by the husband, indeed as were all her movements between the two countries, and her visits back to Germany to see her parents from 2015 onwards.

In January 2018, the wife issued proceedings in England on the alternative bases of (a) having been domiciled in England and resident here for 6 months or (b) having been resident in England for 12 months. The reason for the alternative pleading being the fact that they had held the tenancy of the London property as a rental property for many years prior and that she had regularly spent time in England. A month later, in February 2018, the husband issued in Germany. The German court quickly adjourned the German divorce proceedings until the legitimacy of the English proceedings had been determined as the English proceedings had been issued first.

What is clearly at stake here is a financial benefit. When the parties married in Germany back in 1985 they entered into a separation of assets marital regime in which the wife would also not be entitled to any maintenance provision. The English court, however, would be very likely not to regard such a financial prohibition as fair and would award her substantial maintenance whether in the form of regular payments or more likely a capitalised maintenance sum to provide for her lifelong needs. The husband was resisting England having jurisdiction to prevent this and to limit her financial entitlement by a stricter approach as would be adopted in German.

The case involved substantial assets and high powered people. The husband had made his fortune in the German automotive industry. They lived in a Chateau in French-speaking Switzerland (it was a feature of the husband’s case that the wife had never settled into Switzerland and had not attempted to learn or speak French), the son of the parties was educated at a boarding school in England and they had taken a house in London. The wife called upon the Countess of Chichester and the Chief Executive of the Prince’s Foundation as witnesses of her move to and connections with England.

What is the law concerning jurisdiction?

Article 3 of Council Regulations (EC) no 2201/2003  says that jurisdiction in relation to a divorce shall lie with the courts of the EU member state in various scenarios. I won’t go through them in detail here but they can be found in previous blogs here.

The relevant ones for the purpose of this case were:-

The applicant is habitually resident if he or she resided there for at least a year immediately before the application was made;

or

The applicant is habitually resident if he or she resided there for at least six months immediately before the application was made and…in the case of the United Kingdom and Ireland, has his or her “domicile” there.

As mentioned above, the wife sought to rely on pleading both these reasons scenarios in her divorce petition.

The debate that has been ongoing since 2007, in which there were two decisions concerning the basis for establishing jurisdiction through the habitual residence. In the case of Marinos the then Mr Justice Munby took a very literal interpretation of the words habitual residence and residence. He decided that to establish “habitual residence” one needed to be only resident, or living in a jurisdiction for the requisite period of time. This meant that if a person issued a petition on say 1 September 2017, they only needed to have lived for periods of time for the twelve months prior to that time if they couldn’t also evidence domicile there or six months if they could. It is possible to have more than one residence.

Habitual residence, however, has a much stricter definition and a person can only have one habitual residence so that in this case if the habitual residence was the determining factor the wife was either habitually resident in Switzerland or in England.

In the case of Munro, Mr Justice Bennett took an alternative interpretation of the Council regulations namely that to establish habitual residence you had to have been habitually resident and not merely resident in a country for the requisite period of time.

Is this just semantics, lawyers just playing with words? Not at all as the importance is very different and is key to the six and twelve-month timescales to enable a person to establish jurisdiction.

When the regulations first came into effect an explanatory note was produced by Dr Algeria Borras in what is known as the Borras report. The problem has arisen that when this explanatory note was translated into different languages, the word habitual was left out in the English and coincidentally the German translations.

The husband’s legal team, however, showed to the court how in the French, Dutch, Italian, Spanish and Portuguese versions,  by way of example,  the need for the habitual residence was clear. In the English version of that report, it merely says “he or she must have resided there for at least six months”. Therefore supporting the Marinos interpretation of the regulations. However, in this recent case, Mr Justice Moor preferred the husband’s arguments and took a wider view of how the EU regulations had been interpreted around Europe. His attention was brought to the fact that in Finland, Latvia and Sweden, for example, the word “habitual” was not used at all.

Considering all the circumstances of the case Mr Justice Moor came down firmly in favour of the Munro interpretation: namely that to establish habitual residence a person needs to have been habitually resident and not merely resident in a country for the requisite period of time.

He recognised that this might be regarded as controversial as he was disagreeing with the opinions of only the then Mr Justice Munby who went on to become not only a Lord Justice but also the President of the Family Division but also the then Mr Justice Peter Jackson who is now sitting as Lord Justice of Appeal. He points out however that they did not have the benefits of the convincing arguments that he had heard in his particular case.

What then ensued in the case was a forensic examination of the wife’s movements between England and Switzerland from the time she said she was resident in England namely from July 2017 onwards. The reason being that the Judge had to determine three questions:

1. When did the wife become habitually resident in England and Wales?

2. Did she become resident (rather than habitually resident) on a different date just in case the Judge’s interpretation of the Marinos / Munro debate was incorrect?

3. Is she domiciled in England and Wales?

The Judge in reaching his decision draws the distinction between residing somewhere and visiting it. A person can reside in England and visit their own holiday home in another country. He also assessed the extent of her ongoing connections with Germany and in doing so reaches the conclusion that the wife had not changed her domicile to England by 12 January 2018 when she issued her divorce petition. In reviewing all the circumstances of the case the Judge found that the wife could not establish jurisdiction in England at the time she issued her petition and therefore the petition had to be struck out.

Ultimately this is a case motivated by money. The husband’s legal team freely admitted that it related to the financial remedies available to the wife if the divorce is progressed in England rather than Germany as in Germany, according to the marriage contract she would not be entitled to anything including maintenance.

It would, in English law be a travesty for her to receive nothing at all and Mr Justice Moor observes that if remains the case then she may be entitled to bring a claim for financial relief following an overseas divorce under Part III of the Matrimonial and Family Proceedings Act 1984 and he deliberately reserves any such application to himself.

It seems to me this is a stark warning to the husband to ensure that regardless of what the German law may provide he should consider making some acceptable level of financial provision to the wife to ensure fairness is achieved.

Conclusion

This case does bring further weight and clarity to the question of how to interpret habitual residence. Only last year I had a case where the parties had been residing in Spain for many years and then the wife unexpectedly came back to England and commenced divorce proceedings claiming that she was domiciled here and had been resident here for six months prior to issuing the petition. Fortunately, we were able to reach a financial settlement agreement which meant that the parties did not need to spend a significant amount of money arguing about jurisdiction.

The terms of our Brexit from Europe may, of course, put a completely different spin our these regulations and there is plenty of guidance issued looking at different scenarios. What seems likely at the moment is that we will not have a hard Brexit in which case overnight all these EU regulations will fall away and it is likely that we will continue to have a relationship with Europe in some shape or form in which these regulations are likely to continue to apply in some way yet to be finally determined.

In the meantime, what is of vital importance is timing. If there is a case of a possible jurisdiction race then it is essential you seek legal advice at the earliest opportunity from lawyers who specialise in a divorce involving international issues.

Get in touch 

If you require any further advice or information please contact Holly Lamb,  Head of International Family Law

The post Habitual Residence v Residence: What is required and do we have clarity at last? appeared first on Stowe Family Law.

As I’m sure anyone reading this blog is aware, last week the Government confirmed what we already knew, i.e. that it intends to introduce a system of no-fault divorce. The news (if it was actually news) that we are at last to get a no-fault divorce system (as long as nothing, in particular Brexit, gets in the way of the necessary legislation) is obviously most welcome, but has an opportunity to simplify and improve the divorce system even further been missed?

The Government’s proposal is, I would say, quite conservative (with a small ‘c’) when it comes to no-fault divorce systems, retaining a large part of our existing system. In particular, the Government intends to keep the present ground for divorce, i.e. that the marriage has irretrievably broken down. The rationale for this given by the Government in its consultation document was the rather negative: “The Government has seen no evidence that it would be effective to remove or replace the sole ground that the marriage has broken down irretrievably.” The Government also stated rather ‘lacklustrely’ that irretrievable breakdown had “proved effective in many other comparable jurisdictions”. Not a particularly ringing endorsement. Slightly more constructively the consultation response published last week informed us that irretrievable breakdown “was seen to provide a clear and logical threshold”. But just how logical is it, and do we need a ‘threshold’?

As I explained here recently, a ground for divorce is not actually required in some comparable jurisdictions. Spain, Sweden and Finland do not have a ground for divorce. If those countries can manage without it, why do we need it? Why not just have an application to dissolve the marriage? After all, if we will no longer need to prove that the marriage has irretrievably broken down, why do we even need to say it has broken down irretrievably? Why not just say “I want a divorce”? If the court cannot investigate and decide whether the marriage has, in its view, broken down irretrievably, relying solely upon the word of the petitioner, then irretrievable breakdown itself is pointless.

Logically, a ground is not required. It is an unnecessary extra step. If a party to a marriage says they want a divorce, then that, in reality, is the end of the matter. There is nothing that the law can do to change the fact. Yes, the law can, if it wishes, build in a delay to cover the (highly unlikely, from my quarter-century of experience as a family lawyer) possibility that the petitioner may change their mind. But if they don’t change their mind, then the irretrievable breakdown of the marriage is a fact. It goes without saying. A marriage to which one party no longer wishes to belong has irretrievably broken down. Requiring that party to say that “I want a divorce because my marriage has irretrievably broken down” is a superfluity. It is like saying “I need to eat because I am hungry”, or “I need to dry myself off because I am wet”. Yes, we know.

And if divorce is effectively going to be an administrative process anyway (and I am not against that), then putting in a legal ground of any sort is completely meaningless. The divorce is a purely tick-box exercise. Removing one of those boxes will make no difference at all.

So we have seen that the Government’s arguments in favour of retaining the irretrievable breakdown ground for divorce simply do not hold water. Other comparable jurisdictions seem to manage quite happily without it, and there is actually no logic in it. Nor is there any logic in suggesting that a ‘threshold’ is needed, when the system never tests to see whether that threshold has been met.

And then we need to look at things from the perspective of the respondent to the divorce. Under the new proposals, they will be told that their marriage has irretrievably broken down, but they will be given no opportunity to argue that assertion. They will not be given the right of anyone else against whom a court process has been initiated: to defend themselves. It will be a fait accompli. Not a very satisfactory situation, from a purely legal perspective. On the other hand, if they are simply faced with the fact that their spouse wants a divorce, then there is really nothing to defend – they can’t say “oh no you don’t!”

Doing away with fault in divorce is obviously a good thing for reducing unnecessary animosity and complexity, but it seems to me that retaining a ground for divorce keeps an unnecessary element of potential animosity and complexity within the system. A ground-less system of divorce would go the whole hog and make the divorce process as ‘neutral’, and therefore as ‘animosity-free’, as possible, as well as making it simpler.

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