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Brexit: To Hell in a Handcart - Episode Two

Date:15 JUN 2016
Third slide
Queen's counsel
The below article appears in the May issue of Family Law at [2016] Fam Law 692 and has been made available, free of charge, as a service to our readers.

We two once again present our united voice for the UK remaining in the EU, in the best interests of families in a world – and particularly Europe – characterised by a degree of mobility undreamt of by earlier generations. For this second episode we have had the advantage of the words of wisdom from David Hodson, to which words we exercise (with appropriate decorum) our right of response in the spirit of debate. We also highlight some aspects of EU law which we consider to be of particular merit in promoting the interests of families in a mobile Europe.

A fundamental feature of EU legal system is the automatic recognition of orders throughout the whole family of Member States. This strong foundation underpins Brussels IIa, Brussels I Recast and the Maintenance Regulation. Each Regulation contains a chapter declaring a single scheme of recognition and enforcement of orders throughout the EU, whichever the Member State in which the order was made (subject to limited exceptions where for example principles of natural justice have been breached). The Regulations enshrine the principle of automatic recognition of orders in all Member States. The policy and political significance of this scheme cannot be too strongly emphasised: it reflects the mutual respect between Member States which is of the essence of the EU.

It is sometimes overlooked that recognition is, necessarily, the condition precedent to enforcement. The consequential enforcement procedures applied under the laws of each Member State treat an order as if it were made in the receiving State itself. This single and automatic system of recognition and enforcement of orders is an enormous advance on that under which recognition and enforcement depend on the national laws of each country, which laws classically require a link such as nationality, residence or domicile between the individual and the country in which the order was made. Under a national law system it is up to each country to determine that link and uniformity is inevitably elusive. It is true, as David observes, that English rules on recognition of foreign divorces are currently liberal. They were not always so: the provisions of s 46 of the Family Law Act 1986 are far removed from the historical common law position where domicile was the sole basis of divorce jurisdiction (Le Mesurier v Le Mesurier [1895] AC 517). But to highlight current liberality is to miss the essential point: national recognition rules are country-specific, vary in content and are not underpinned by any political policy of unreserved mutual respect.

Brexit advocates frequently paint the EU as a political and administrative institution which stifles not only national sovereignty but also individual autonomy. The reality is far different. Turning to jurisdictional rules, Brussels IIa (Art 12), Brussels I Recast (Art 25) and the Maintenance Regulation (Art 4) all permit (and indeed encourage) prorogation of jurisdiction by parties. Prorogation of jurisdiction means that parties may in relation to certain matters of legal dispute choose the courts of the Member State best suited to adjudicate on their dispute. The Regulations achieve a wise balance by imposing certain limitations on party autonomy, such as the requirement in matters of parental responsibility that the choice of forum be in the child’s best interests.

We signalled in Episode I that we strongly favour the lis pendens rule in the Regulations which accords priority to the court first seised (Brussels IIa Art 19, Brussels I Recast Art 29, Maintenance Regulation Art 12). The rule has the inestimable merit of simplicity and again is ultimately rooted in mutual respect between Member States. Some of those favouring Brexit from a legal point of view laud the judicial exercise of discretion on forum conveniens grounds which is the traditional common law approach to resolving the problem of concurrent proceedings and avoiding conflicting judgments. However, the forum conveniens system has the inevitable weakness of any discretionary system: unpredictability. This is exacerbated by differences in the content of the forum conveniens principles applied in common law jurisdictions. Moreover, the recent litigation in Peng v Chai [2015] EWCA Civ 1312, [2016] FLR (forthcoming and reported at [2016] Fam Law 303) aptly demonstrates the different principles of forum conveniens which apply in England and Malaysia (the latter drawn from the approach of the High Court of Australia in Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538). As that litigation shows, the application of subtly different approaches to forum conveniens in common law jurisdictions means that no issue estoppel arises, the race between jurisdictions is run and irreconcilable judgments may well not be avoided. David suggests that ‘a halfway house could be found’ between the unfettered discretion of forum conveniens and the first in time approach. We struggle to see how, since the two approaches differ so fundamentally.

David correctly points out that most EU countries are of the civil law tradition, and he makes various criticisms of the civil law approach. We take a different stance and say that there is much to be learnt from the civil law approach. Working with colleagues within the EU has given us valuable insights which can inform reform of our national law. Civil law systems are generally founded on the principle of codification, derived from the reforms of the Napoleonic era. Codification differs fundamentally in approach from the approach to statutory regulation adopted in common law systems. A code is a comprehensive instrument which declares the principles applying in a given field. Courts in a civil law system simply apply the general principles of law declared in the code: the reasoning is deductive (‘top down’ in current management-speak). By contrast, statutes in a common law system merely make provision for specific rules in a given field, without aspiring to be comprehensive.

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The common law system of precedent relies essentially on inductive (‘bottom(s) up’ in common parlance) reasoning. We family lawyers – and our bemused clients – are all too aware of the lack of principles articulated in a statute such as the Matrimonial Causes Act 1973. The House of Lords in Miller v Miller; McFarlane v McFarlane [2006] UKHL 24, [2006] 1 FLR 1186 bravely attempted to articulate strands/rationales (now since Charman v Charman (No 4) [2007] EWCA Civ 503, [2007] 1 FLR 1246 usually expressed as principles) to make up for the lack of clear principle (minor children’s welfare excepted). The reality is that Miller; McFarlane provided a dictum for almost any proposition which we practitioners wish to advance for our client’s case in financial remedy proceedings, and that fashions in approach continue to wax and wane. The judicial search for principle not articulated in statute continues unabated in areas such as categorisation of matrimonial and non-matrimonial property and spousal maintenance. The effect on litigation of the lack of clearly articulated principles for financial remedies was tellingly highlighted by Moylan J in the recent case of BD v FD (Financial Remedies: Needs) [2016] EWHC 594 (Fam), [2016] FLR (forthcoming and reported above at p 670). It was agreed that the wife’s award was to be determined exclusively by application of the needs principle. Yet as Moylan J aptly observed at the outset of his judgment:

‘I need only state the parties' respective open positions at this hearing to demonstrate that they cannot both be within the bracket of fair awards. The wife seeks an award which will provide her with resources totalling £29 million. The husband proposes an award which will provide the wife with just over £8 million.’

We add that this disparity stemming from absence of principle is scarcely conducive to the settlement ethos which David sees as a characteristic of the English family law system. In fact the opposite is true. A civil law system which has fixed rules of equal division of defined matrimonial property is far more conducive to settlement, precisely because there is far less to argue about. We have much to learn from civil law systems, and Brexit would severely curtail our opportunities to benefit from the knowledge of our nearest neighbours.

We must also address David’s concerns that ‘EU laws’ make some marital financial agreements binding which have been entered into by vulnerable spouses without legal advice, which he identifies as ‘a real gender issue’. We are not aware of EU laws – as opposed to national laws – which have this effect. Furthermore, the legal position even under national laws in civil law systems is in reality somewhat different from that portrayed. A notarised agreement electing a matrimonial property regime (typically separation des biens) is a matter of private contract entered into at the point of marriage. Courts in civil law systems do not have the power on divorce to interfere with such contracts, although they have powers to award balancing or compensatory lump sum payments to remedy financial inequality between the divorcing parties (such as the prestation compensatoire under the Art 270 of the French Code Civil). It civil law countries it is commonly illegal to enter into agreements (with or without independent legal advice) which would forego maintenance claims.

David is no fan of applicable law and says that if we Brexited, ‘we would not miss the continued struggles with the EU attempting to impose it on us’. But once again we must put family law issues in their proper context. In these days of ever more specialised practices, we risk losing sight of the bigger picture. Family law is out on a limb: in other areas of English law, the concept of applicable law (choice of law) is well established and considered wholly appropriate. Classic texts such as Dicey, Morris and Collins on the Conflict of Laws contain extensive sections on applicable law in various fields. To take a few examples, the proper law of the tort was developed both in common law and by statute (Boys v Chaplin [1971] AC 356, Red Sea Insurance Co Ltd v Bouygues SA [1995] 1 AC 190, Private International Law (Miscellaneous Provisions) Act 1995, s 12; see now the different rules applied by the EU Rome II Regulation 2007 in respect of non-contractual obligations). Intestate succession to movable property is governed by the law of the testator’s last domicile (since Pipon v Pipon (1744) Amb. 799) and the lex situs governs the validity and effect of transfer of movable goods (the long established authorities were reviewed by Moore-Bick J (as he then was) in Glencore International AG v Metro Trading International [2001] 1 Lloyd’s Rep 284, The proper law of the contract was applied in English common law (Mount Albert Borough Council v Australasian Temperance and General Assurance Society [1938] AC 224) until the EU Rome I Regulation on contracts of 2008 introduced its own choice of law rules. 

Application of the lex fori in the English law of divorce and financial remedies is in reality simply a default position in the absence of a choice of law rule. Applicable law is not unknown even in the family law field. The law governing capacity to marriage has long been identified as either the law of the parties’ ante-nuptial domiciles (Brook v Brook (1861) 9 HLC 193 or (more controversially) that of the intended matrimonial home (Radwan v Radwan (No 2) [1973] Fam 35). Formal validity of marriage is governed by the lex loci celebrationis (Berthiaume v Dastous [1930] AC 79. We should rethink our attitude towards applicable law. Choice of law rules (whether developed at national level or enshrined in EU law) serve the wholly meritorious purpose of identifying the law with which the legal dispute has the most appropriate connection.

We could go on (and on), but we will resist the temptation in the interests of the forests of Europe. Our respect and admiration for the EU is equalled only by that which we share for the great Bob Dylan, whose lyric should be a dire warning to those in favour of exit:

‘How does it feel to be on your own?
With no direction home?
A complete unknown?
Like a rolling stone?’

We hope we do not have to say ‘We told you so’.


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