Vive la difference?

Scottish family lawyers tend to be somewhat aghast by the approach taken south of the border to financial provision on divorce, which contrasts starkly with our own legal philosophy.

There are principally two reasons. The first is the wide discretion accorded to divorce courts in England about the treatment of parties’ assets, which makes it very difficult to predict the outcome in any given case. The second is the far more generous approach to spousal maintenance in England, where “joint lives” orders are commonplace.

Scots lawyers need to be alert to these differences so they can give appropriate advice to a client with a potential choice of UK jurisdictions in which to seek their divorce. The conventional wisdom is that if you are acting for a wife she stands to do better in England, whereas a husband is likely to be better served in Scotland. This is of course an oversimplification, but such considerations should be at the forefront of any Scottish practitioner’s mind when faced with the possibility of jurisdiction being founded both north and south of the border.

Needs and resources

At present there is no statute in England & Wales akin to the Family Law (Scotland) Act 1985, setting out a detailed and prescriptive regime for financial provision on divorce. Their most recent legislation in this field is the Matrimonial Causes Act 1973 which, in part 2, ss 21-40A, sets out certain considerations to which the courts require to have regard.

This has been heavily innovated on by subsequent case law, most notably the House of Lords decisions in White [2000] UKHL 54; [2001] 1 AC 596, and Miller and Macfarlane [2006] UKHL 24; [2006] 2 AC 618. As a result of these cases, three principles have emerged which must form the basis of any orders for financial provision in England & Wales, namely needs, sharing, and compensation.

Heading that list is “needs” (being those of the parties and any children), but this concept is not defined in English law, with the result that different judges apply widely differing approaches. Additionally, there is no time-bound definition of matrimonial property – when a divorce litigant makes disclosure of their assets, they require to list everything they own, including assets owned prior to the marriage, assets acquired after separation, and assets acquired at any time by gift or inheritance. The courts then have wide discretion to determine the extent to which that property should be redistributed between the parties.

A route map?

There has, however, been a recent development that has the potential to alter significantly, in years to come, the legal landscape south of the border. The seeds of change have been sown by the publication, on 10 September 2012, of a long-awaited Law Commission consultation paper on Matrimonial Property, Needs and Arrangements. Its purpose is to consider the question of “needs” and the treatment of non-matrimonial property.

The paper starts from the premise that the present situation is unsatisfactory. It likens the position of an English divorce judge to that of a bus driver who has been taught how to drive the bus and told to drive it, but who has been given no information on where to go, other than that the bus should end up at a “reasonable destination”. The paper sets out a number of values that the Commission considers ought to be inherent in any new system for recognising “needs”, namely: clarity; rationality; fairness; equality; realism; support for family relationships; and an expectation of independence.

It should not be assumed, however, that these will lead the Commission to conclude that a system for spousal maintenance akin to ours ought to be adopted. The paper comments somewhat disapprovingly that the system in Scotland “is reputed to be harsh to women; certainly any system that imposes an arbitrary time limit upon spousal support will disadvantage the less well-off whose needs cannot be met out of capital”.

In relation to non-matrimonial property, it appears that here the outcome may see English law moving closer to Scots law in relation to the treatment of pre-matrimonial and gifted/inherited property. The Commission provisionally proposes that such non-matrimonial property should not be subject to the sharing principle, save where it is required to meet the other party’s needs.

In response

It will be interesting to observe this debate as it develops. The Law Commission is due to publish a further paper next year once its consultation period has ended, setting out firm proposals intended to form the basis of a draft bill. While it is unlikely that a system with such a different philosophical underpinning will ever be identical to the current Scottish approach, there may be some levelling. For those interested in commenting on the Scottish experience, responses to the consultation paper are invited until 11 December 2012.