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Expat Divorce: Forum Shopping

Expat Divorce: Forum Shopping

18_Divorce02In an age of increasing globalisation many families now have an international element to their make-up. Spouses may be of different nationalities, one or both may have relocated abroad or lived in a sequence of different countries, and/or they may own assets in more than one country.

If one or both parties to such a marriage considers that the relationship has irretrievably broken down, then thoughts will eventually turn to the practical implications of a divorce.

A divorce is more than the legal dissolution of the marriage. There are always mutual financial claims that must be formally dealt with which typically include sharing of assets pensions and future income. The shape of a financial settlement will vary depending on the individual circumstances of the couple and the law of the country where the divorce takes place.

A court’s ability to deal with a divorce is called its “jurisdiction”. For international couples there is usually a choice of countries whose courts will have jurisdiction to deal with their divorce. Jurisdictions to consider are that of the husband or wife’s place of birth, the country in which they have lived and settled for a period of time or the local court in the country in which they are now living. For British expats, divorce and financial matters can usually quite easily be dealt through the English courts, without the need to physically return to England.

The choice of jurisdiction can have dramatically different implications in respect of financial outcome. By way of example – if a divorce took place in the UAE courts a dependent housewife and mother is not permitted to seek a share of assets held in her husband’s sole name, and ongoing spousal maintenance is extremely limited. By way of contrast, in English law, the courts have a very wide discretion to redistribute assets and income regardless of the source or strict legal ownership.

“Forum shopping” therefore describes the process where a party to an imminent divorce carefully researches their ability to issue proceedings in different jurisdictions and gives consideration to the likely financial outcome in each jurisdiction. Unfortunately, given that the outcome could be so different in different countries, there is often a perverse incentive to accelerate the decision to divorce, so that the most favourable jurisdiction is secured.

At a first meeting with a specialist lawyer the following issues should be addressed:

  1. What are the parties’ nationalities?
  2. What is the residence status of each of the parties?
  3. What are the parties’ domiciles of origin? Has either party properly acquired a domicile of choice?
  4. In which jurisdictions could a divorce take place?
  5. What evidence is required to prove that the individual satisfies the test to establish jurisdiction in the proposed country?
  6. In which country does each party wish to live following separation?
  7. The location of financial resources including property and land, trusts and companies, pensions and sources of income.
  8. Which jurisdiction would produce the most favourable outcome in respect of division of capital pensions and sharing of income?
  9. To what extent would an order made in the choice of jurisdiction be enforceable in the jurisdiction in which assets or income are based?
  10. To what extent does the grounds for divorce affect financial outcome in each jurisdiction?
  11. To what extent does this individual maintain a public profile and how should the potential media interest affect the handling of the case?
  12. In terms of arrangements for any children post-separation, what is likely to be agreed and what will be disputed?
  13. The immigration/visa status of the parties and any children and how divorce would affect these.
  14. Consider ownership and control of the key assets, risk of dissipation and the merits of an application for a worldwide freezing order.
  15. What constitutes effective service in the proposed Respondent’s country of residence?
  16. The jurisdiction provisions of any pre- or post-nuptial agreement.

It is important to remember that the financial aspects of a divorce are just one element of the overall picture. Additional competing factors must be weighed against each other before a decision is made how to proceed. Some of those factors are strictly legal, but other non-legal but equally valid factors may be at play. For example, the parties may simply prefer to proceed in England so that they can use English lawyers and properly understand the processes involved, they may reach a very early agreement directly and simply require the formalities to be dealt with in England, a husband might understand that inflicting financial harm on his spouse is likely to affect his relationship with his children, or either party may concede on certain claims out of guilt or compassion.

International divorce is a complex and specialised area of law. It is essential to take bespoke fact-specific advice at the earliest opportunity.

This article was written by Sonny Patel is a solicitor at Expatriate Law, a firm specialising in cross-border divorce, separation and other family law matters for British Expats based in the UAE and around the world. For more information please contact [email protected].