Radmacher v Granatino: sailing close to an applicable law approach

1
Radmacher v Granatino sailing close to an
applicable law approach?

• 14th Ius Commune Conference
• 27 November 2009
• Michael Wells-Greco
• Solicitor, England Wales

2
Introduction

• The Bad News
• The Good News
• The Fine Print
• An Apology

3
The Bad News

• 40 of marriages end in divorce
• It was cheaper in the old days the recipients
  reasonable requirements capped his/her claims
  usually a house, and a capitalised income fund
• Divorce is very expensive in England and other
  common law territories
• Toxic wives/husbands

4
The Bad News

• Mrs White and her followers
• White v White (2000) the new Yardstick of
  Equality reasonable requirements held to be
  discriminatory to homemakers (frequently women)
• Cowan v Cowan (2001)
• Lambert v Lambert (2002)
• Miller v Miller (2005) the short-marriage
  millionairess with no children
• Charman v Charman (2006) biggest divorce order
  in British legal history as wife gets 48m

5
MPR?

• Baroness Hale in Miller/McFarlane
• English law starts from the principle of
  separate property during the marriage
• We do not yet have a system of community of
  property, whether full or deferred
• Sir Mark Potter in Charman
• Almost uniquely our jurisdiction does not have a
  matrimonial property regimewe have no regime at
  all, simply accepting that each spouse owns his
  or her own separate property during the marriage
  but subject to the Courts wide distributive
  powers

6
Dont we have a MPR?

• Often 5050 division but each case fact specific
• Outcome needs to be fair having regard to three
  strands
• Needs parties financial needs going forwards
• Compensation redressing prospective economic
  disparity between parties e.g. one party
  sacrificing career/earning capacity
• Sharing marriage is a partnership of equals
• incommensurability

7
The Courts armoury

• Lump sum Orders (including capitalised
  maintenance)
• Transfer of Property Orders
• Maintenance Orders (alimony)
• Pension Splitting Orders
• Variation of Trusts
• Etc etc etc

8
(No Transcript)
9
S v S (1997)

• Mr Justice Thorpe (as he then was) said
• There will come a case where a pre-nuptial
  agreement might prove influential or even
  crucial. Where both the USA and the EU hold
  parties to their rights under pre-nuptial
  agreements, we should be cautious about too
  categorically asserting the contrary. I can find
  nothing in the English divorce legislation to
  compel a conclusion that escape from solemn
  bargains, carefully struck by informed adults, is
  available here. It all depends.

10
Pre-nups in practice

• Hyman v Hyman (1929) FLR Rep 342
• the wifes right to future maintenance is a
  matter of public concern which she cannot barter
  away
• F v F 1995 2 FLR 45 Thorpe J
• in this jurisdiction pre-nups must be of very
  limited significance
• Crossley v Crossley 2008 1 FLR 1467
• paradigm casea factor of magnetic importance
• the contract entered into.. was akin to the
  separation of goods within the French system

NB CANNOT OUST THE JURISDICTION OF ENGLISH COURTS
11
Radmacher v Granatino 2009 EWCA Civ 649

• German W and French H - German marriage contract
• Elected separate property and no financial
  provision
• At time of divorce, H student at Oxford, with
  debts, W family wealth of about 100m
• Marriage contract willingly signed by H and would
  have been no marriage without it
• H man of the world - investment banker - and
  understood what he was signing
• H awarded 5.5m for his needs by Baron J

12
Radmacher v Granatino (2)

• Ws appeal to CA mostly won v pro prenup
  judgment
• Hs housing fund on trust to revert back to W
• Hs income fund to last until youngest child 22
• Caprice of outcome dependent on jurisdiction
• Both from civil law backgrounds
• Due respect for adult autonomy subject to
  safeguards
• informal presumption of dispositiveness
• Rule that prenups are void unrealistic and out
  of date
• UK should reduce not maintain rules dividing it
  from Europe

13
Radmacher v Granatino (3)

• At paragraph 53 of the judgment Thorpe LJ made
  the following statement
• in future cases broadly in line with the present
  case on the facts, the judge should give due
  weight to the marital property regime into which
  the parties freely entered. This is not to apply
  foreign law, nor is it to give effect to a
  contract foreign to English tradition. It is, in
  my judgment, a legitimate exercise of the very
  wide discretion that is conferred on the judges
  to achieve fairness between the parties to the
  ancillary relief proceedings.

14
The Fine Print Pre-nuptial agreements

• Not binding per se, especially foreign marriage
  contracts
• Full financial disclosure required
• Independent legal advice
• Signed ideally 21 days before marriage
• Terms must be fair in the eyes of the judge at
  date of divorce
• This test weakened post Radmacher?
• NB Singaporean case TX v TR 2009 (SGCA) 6

15
Implications/Questions

• Why apply English law to foreigners divorcing
  there, especially if they have a marriage
  contract?
• How close is Radmacher to grappling with
  applicable foreign law principles (in addition to
  or in parallel with lex fori)?
• Weight of marital property regime?

16
Governing law of marriage contract?

• Rix LJ remarks it is hard to articulate why an
  agreement made in similar circumstances between
  English nationals should not receive more or less
  equal treatment although it has to be recognised
  that English law has not prepared the groundwork
  for such conclusion and it will be difficult to
  articulate, although I suspect it will be a
  matter of common concern, why the English Court
  may pay greater regard to agreements made under
  some foreign systems of law than under others.

17
Future developments watch this space

• Need for proper rational debate in England, not
  knee-jerk Little Englander refusal to opt in
• Law Commission to produce draft Bill by 2012

18
A final word from one who knows

• Im such a good housekeeper, darling! I always
  get to keep the house.
• Miss (!) Zsa Zsa Gabor