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Has forum shopping had its day?

Date:24 MAR 2014

Andrzej BojarskiLondon is regularly referred to as the ‘divorce capital of the world', principally because the law in England and Wales is felt to favour the economically weaker spouse.  It is generally felt that the wife of a rich man is likely to be better off getting the divorce resolved in England than elsewhere.  If possible, London is the obvious place to go for such a spouse.  (I have written here before about the ‘race to divorce' this can create.)

We have seen another phenomenon in recent years too: domestic forum shopping.  That is when a divorcing party who lives in England or Wales, but outside London, brings his or her case in London or another distant court in the hope of a better outcome.

Often parties choose to have their divorce dealt with in the Principal Registry of the Family Division rather than at their local county court.  Sometimes this is because they have decided to instruct London based lawyers, and the London court is cheaper and more convenient for the lawyers to get to than a county court far from London.  Other times, the parties have lawyers in their hometown but one of those lawyers decides to issue the proceedings in London.

Increasingly we have seen firms traditionally based outside London, opening offices in London to serve the work they are issuing here.  In very high value or complex cases, especially those with an international element, this is understandable.  Those cases need the expertise of a High Court judge.  But quite often the cases do not meet those criteria.  They are often not ‘big-money' cases involving millions, but what I call ‘middle-money' cases which could be dealt with just as easily by a local district Jjudge in a local court.

The reason for issuing in London?  Generally, a perception that the judges in London are more willing to make larger provision for the wife than in provincial courts.  The consequences?  The London court is extremely busy and the waiting times for hearings are very long.  The costs are often higher too.

Is this going to change?  I think there is a reasonable prospect that it will, for three main reasons.  

First, the recent Law Commission report on Matrimonial Property, Needs and Agreements, has noted that there is an unacceptable difference in approach to the assessment of ‘needs' in courts around the country, especially in the Principal Registry and High Court in London compared to other courts.

The Law Commission has proposed that the Family Justice Council prepare clear guidance to judges as to how needs should be assessed.  Once this is done it is hoped that this will be adopted in a way similar to the Judicial Studies Board's Guidelines for the Assessment of Damages in personal injury claims.  The brackets set by those guidelines are rarely strayed from.  Once the family guidelines are in place it might be expected that the current regional variations in approach to quantifying financial settlements might diminish to the point that there is no advantage to choosing one court in favour of another.

The second factor is a clear policy on the part of the judiciary to move more work to specialist court centres outside London, and to encourage more litigation generally to be conducted by lawyers and by judges based outside London.

In October 2013 the Lord Chief Justice, Lord Thomas, spoke about this in the Birkenhead Lecture a Gray's Inn.  He noted the extent to which litigation in all areas of work seemed to gravitate towards London despite the presence of specialist courts around the country.  The effect on this on fees was noted.

In a recent Divisional Court case he had sat on the parties included the Coal Authority and Welsh local government authorities.  The Coal Authority instructed the Sheffield branch of a national law firm.  The hourly rates charged by that office were partner £198.12, solicitor grade C £170.69, trainee £96.52.  The local authorities instructed the London office of the same solicitors.  The hourly rates of the London officer were partner £510, solicitor grade C £221, trainee £148.75.  The court noted that ‘we have seen their work and the work is of exactly the same standard; indeed the Sheffield one can be said to be a little better.' Ouch! It seems likely that parties in civil cases who unreasonably instruct London lawyers or unreasonably issue proceedings in London may fail to recover the extra costs this incurs.

In financial remedy proceedings after divorce, however, costs are rarely awarded against the other party, so this may be more difficult for the courts to control.  Nevertheless, it is a factor where pressure is likely to be brought to bear.

Thirdly, from April 2014 (assuming everything comes together in time) there will be a single Family Court for England and Wales. No longer will each area have its own family county court, with the Principal Registry and Family Division of the High Court being separate courts in London.  These courts will all be unified, theoretically making it easier to ensure that cases are heard and administered in the court centre which is most appropriate for the parties.

I expect there to be less tolerance of ‘forum shopping' within England and Wales in the future.  It might be time to remind yourself where the local county court is based!

Andrzej Bojarski is a family law barrister specialising in the financial aspects of family relationship breakdown, particularly in high-value, complex and international cases.  He has written a number of books and articles (see here for examples), and is acknowledged as an expert in his field.

Andrezej acts in cases throughout England and Wales, and instructed both by solicitors and by clients directly. His advice is also frequently sought on international jurisdiction and enforcement issues by lawyers and individuals based overseas. 

As well as working as a lawyer advising and representing individuals going through divorce and separation he also acts in an independent capacity to assist them resolve their disputes through Alternative Dispute Resolution ('ADR').   Please see his Dispute Resolution page for more details.

This article was originally published on the author's website and has been reproduced here with permission of the copyright owner.

The views expressed by contributing authors are not necessarily those of Family Law or Jordan Publishing and should not be considered as legal advice.