Under Pt 3 of the Matrimonial and Family Proceedings Act 1984 (MFPA 1984), the English courts have the power to grant financial relief where a marriage has been ended by a foreign decree recognised in this jurisdiction. The purpose of Pt 3 of MFPA 1984 is to alleviate the adverse consequences of inadequate financial provision being made on divorce by a foreign court. The English courts can make orders for financial provisionincluding property adjustment, pension sharing, orders for sale, interim orders, avoidance of disposition orders and transfers of tenancies.

Since the landmark Supreme Court decision in Agbaje v Agbaje [2010] UKSC 13, [2010] 2 All ER 877, there have been several notable decisions in this area which have further clarified and developed the law. The outcome of a successful application can be very beneficial to the financially weaker spouse; however, the purpose of this discretionary power is not to “improve” the financial outcome of a foreign divorce.

Considerations for the court in making orders under Pt 3

Before an application for financial relief may be made under Pt 3 of MFPA 1984, leave of the court must be obtained. Section 13 of MFPA 1984 states that “the court shall not grant leave unless it considers that there is substantial ground for the making of an application for such an order” and that leave “may be granted subject to such conditions as the court thinks fit”. There are also strict jurisdictional requirements, as only spouses who have been divorced overseas and who have a connection with England and Wales may bring an application. 

Before making any order for financial relief, the court has a duty to consider whether in all the circumstances of the case, it would be appropriate for such an order to be made by a court in England or Wales. In particular, the court should also have regard to the following considerations as set out in s 16 of MFPA 1984:

a. the connection which the parties have with England and Wales;b. the connection which the parties have with the country in which the marriage was dissolved;c. the connection which those parties have with any other country;d. any financial benefit which the applicant has received, or is likely to receive, as a result of the dissolution of the marriage overseas by virtue of any agreement or the operation of the law of a country outside England and Wales;e. in a case where an order has been made by a foreign court requiring the other party to the marriage to make any payment or transfer any property, the financial relief given by the order and the extent to which the order has been complied with or is likely to be complied with;f. any right which the applicant has, or has had, to apply for financial relief from the other party to the marriage under the law of any country outside England and Wales and if the applicant has omitted to exercise that right the reason for that omission;g. the availability in England and Wales of any property in respect of which an order in favour of the applicant could be made;h. the extent to which any order made under this section of this Act is likely to be enforceable;i. the length of time which has elapsed since the date of the divorce, annulment or legal separation.

In considering whether to exercise its powers and grant financial relief, the court’s first consideration must be the welfare of any minor child of the family and also the factors set out in s 25 of MCA 1973. 

The landmark case of Agbaje

In Agbaje, the parties divorced in Nigeria. Both parties had dual Nigerian and British citizenship and all five children had been born in England. The wife had lived in England continuously since 1999. 

The assets totalled approximately £700,000, including two properties in London. Upon the wife’s application for financial relief, the Nigerian courts awarded her a life interest in a property in Nigeria (valued at £86,000) and a lump sum of approximately £21,000. The Nigerian courts did not taken into account the London properties.

The wife applied in England under Pt 3 and was granted leave. She was awarded 65% of the proceeds of sale of the London property in which she had been residing. This was expected to generate a lump sum of approximately £275,000, representing 39% of the total assets. This award provided for the wife’s reasonable needs. 

The husband appealed. The Court of Appeal allowed his appeal and refused the wife any relief whatsoever. The matter then came before the Supreme Court in November 2009. The unanimous judgment gave guidance on the proper approach to take in relation to applications under Pt 3. 

Lord Collins stated that there were two inter-related duties of the court before making an application under Pt 3. The first was to consider whether England and Wales was the appropriate venue for the application. The second was to consider whether an order should be made having regard to the matters set out in s 16. It was held that the purpose of Pt 3 was not to allow a spouse to take advantage of the more generous approach taken in England and Wales, but that equally, hardship, is not a pre-condition for a successful application. It is an important factor to be taken into account, but it is not a condition. In a similar fashion, it is not only “exceptional circumstances” or cases of “serious injustice” where the remedy should be allowed.

Recent case law

Two recent cases have emphasised the importance of there being a foreign divorce based on a marriage which is, or under English law is recognised as, a valid (or at least void) marriage. In Dukali v Lamrani [2012] EWHC 1748 (Fam), [2012] 2 FCR 574, the wife’s application for permission to apply under Pt 3 was rejected. There had been a marriage ceremony of sorts at the Moroccan embassy in London but the premises were not registered under the Marriage Acts. The parties were therefore never married under English law, although they were validly married under Moroccan law and the husband had obtained a divorce in that jurisdiction. Because the marriage was a non-marriage in England and Wales, the wife’s claim did not fall within the scope of Pt 3 and her application was unsuccessful. Dukali was approved by the Court of Appeal in Sharbatly v Shagroon [2013] 1 FCR 467; [2012] EWCA Civ 1507. The parties went through a ceremony in London purporting to be an Islamic marriage. No attempt was made to comply with the Marriage Acts, nor was there a civil ceremony which complied with English law. The parties subsequently separated and at a later date the appellant pronounced a talaq. The respondent issued an application under Pt 3. The appellant argued that the respondent was not entitled to any relief under Pt 3 of MFPA 1984 because the talaq was not pronounced in respect of a marriage which was recognised by English Law. The appellant’s argument succeeded and therefore the respondent was not entitled to apply for financial relief.

In Z v A [2012] EWHC 1434, the court noted the “scale” of awards adopted in Pt 3 cases since Agbaje by reference to the parties’ connections to this jurisdiction. It was held that where connecting factors are extremely strong, the applicant’s claims can be treated as though it was made in purely English proceedings. However, in truly international cases where the connections are weak, Pt 3 should not be used to top up provision made by a foreign court. 

M v M [2013] EWHC 2534 (Fam) involved two Russian nationals and is believed to be the largest divorce award ever made in this jurisdiction. There were ascertainable assets of over £107m. The parties had been married for 17 years and had lived in England since 2005. There were two children. The wife petitioned for divorce in Russia in 2009 and was divorced there, unaware that the courts of England and Wales had jurisdiction. In 2010, she issued Pt 3 proceedings in London. The final hearing was heard by King J. She held that the award to the wife could not exceed the award which would be made in a conventional financial remedy case. One element of “all the circumstances of the case” was a consideration of any provision from a foreign court and if there has been such provision, whether it is adequate. In this case, the wife has received no provision from the Russian court. The judge awarded the wife £53m, being half the ascertainable assets.

M v W [2014] EWHC 925 (Fam) is the latest reported Pt 3 case at the time of writing. The parties had married in 1987 and moved to New Zealand in 2001. There were three adult children. The marriage broke down in 2008 and the parties concluded their financial claims against each other by agreement with the assistance of their respective lawyers in New Zealand. The agreement was incorporated into a separation and relationship property agreement in accordance with the laws of New Zealand. The wife returned to live in England in 2010, and in 2013 applied to the court for leave to apply for financial provision under Pt 3. At the ex parte permission hearing, the wife argued that the New Zealand separation agreement was not conclusive, the husband’s pension had been undervalued, and she had entered into the agreement under pressure from the husband. She also argued that the agreement failed to make proper financial provision for her. The wife was granted permission to apply for financial provision under Pt 3.

At the on-notice hearing before Coleridge J, the husband argued that the order granting leave for a Pt 3 application should be set aside and the wife’s application struck out. His essential argument was that this was a classic “second bite of the cherry” case. He argued that all the wife’s claims at the time of the divorce were fully and fairly dealt with in New Zealand, and the wife, having spent the full share which she received at the time, should not now be able to come back in England and make a further application for financial relief. He obtained evidence from his barrister in New Zealand confirming that the agreement signed in New Zealand was a final and binding settlement under New Zealand law and there was no requirement for it to be converted into a court order for it to take full and final effect.

Coleridge J found that the judge at the ex parte permission hearing was not aware of, or had not understood, the “true effect” of the New Zealand hearing. There was no reference to the full significance of the agreement in the wife’s skeleton argument. On that basis, Coleridge J set aside Baker J’s order and reconsidered the whole question of leave afresh. He confirmed that in accordance with the principles established in Agbaje, the onus was on the wife to establish that she had a solid basis for proceeding with the application. He found the wife’s case to be weak on all fronts, and concluded that as a matter of fairness it would not be justified to allow the wife a “second bite of the cherry”. The wife’s arguments regarding the undervaluation of the pension and pressure from the husband were held to have virtually no prospect of success at all, and if she were to be allowed to proceed with her application, she would be placed in a very much better position than an English wife in comparable circumstances.

Conclusion

Pt 3 of MFPA 1984 provides an invaluable remedy for an increasing number of spouses who have a connection with England but suffer financially as a result of family law proceedings abroad. However, cases such as M v W demonstrate that prospective applicants should weigh up their prospects of success extremely carefully before launching an application and be confident that they have a solid basis for proceeding with the application.

This article was first published in New Law Journal, 25 July 2014 and is reproduced with kind permission.