Divorce (Financial Provision) Bill [HL] - Second Reading

Part of the debate – in the House of Lords at 12:41 pm on 11th May 2018.

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Photo of Lord Walker of Gestingthorpe Lord Walker of Gestingthorpe Judge 12:41 pm, 11th May 2018

My Lords, I speak in support of the Bill. I will be reasonably brief because it has been described so thoroughly by the noble Baroness, Lady Deech. She has shown great determination and perseverance with it. In fact, it is virtually identical to a Bill that passed through all its stages in this House in the last Parliament but, sadly, did not have time to make any progress in the other place.

It is a remarkable fact that in these days of constant change—in economics, social life and fiscal and other fields—the law on financial provision on divorce is still regulated, in substance, by Section 25 of the Matrimonial Causes Act 1973, a statute passed more than a generation ago. Section 25(1) gives priority to the claims of minor children of the family; no one seeks to alter that primary need in any way. The trouble is that Section 25(2) contains the other main guidance from Parliament, given in eight paragraphs with no sort of hierarchy or pecking order between them. They are eight remarkably dissimilar paragraphs. Some are totally unsurprising, for instance paragraph (d), concerning,

“the age of each party to the marriage and the duration of the marriage”.

Others are more debatable, for instance paragraph (g), which is concerned with,

“the conduct of each of the parties, if that conduct is such that it would in the opinion of the court be inequitable to disregard it”.

Some are simply the starting point of what may be an almost endless debate, notably paragraph (f), concerning,

“the contributions which each of the parties has made or is likely in the foreseeable future to make to the welfare of the family, including any contribution by looking after the home or caring for the family”.

It is hard to imagine a wider or a more important judicial discretion. Some judges and practitioners—not all, but some—take the view that it all works perfectly well in practice. With respect, it simply does not. The Law Commission reports fieldwork studies showing wide variations in practice between different judges, groups of courts and regions of the country. General guidance may be given from time to time by the Supreme Court, but only the biggest of “big money” cases get to that court and they are by no means typical.

Big money cases often incur very high legal costs, but even much more modest litigation about financial provision on divorce, as the noble Baroness mentioned, can be a heavy burden on ordinary families at a time when they are likely to have all sorts of extra costs to face. Legal aid is no longer available except for issues involving minor children or in cases of domestic violence. But at present the uncertainty of the outcome drives many parties to litigation. Divorce is often traumatic enough without the whole family’s resources being depleted by legal costs of the scale that has been mentioned.

I referred earlier to the Law Commission’s conclusions about whether the present law is predictable. I should add that the Law Commission has strongly recommended that there should be a change in the law regarding what lawyers call prenups. The Bill contains provisions to that effect. I should say a word more about so-called prenups as I was a member of the Supreme Court, which heard the important case of Radmacher v Granatino about seven years ago. To go into the issue of prenups, as so often, involves a bit of history. Before 1857, divorce was totally different. It was dealt with entirely by the ecclesiastical courts. It was not really divorce at all; it was divorce in the Latin phrase, a mensa et thoro—from the board and the hearth. It was much more like judicial separation. In those days, when marriage was indeed regarded as indissoluble, it was not wholly unreasonable that a doctrine arose that it was contrary to the public interest for parties contemplating marriage to enter into an arrangement as to what would happen if, finally, sadly, they separated. It was regarded as a bad thing that they should be thinking about that at all at that stage.

Now that we have had true divorce since 1857—some 160 years—it is less and less sensible to regard it is somehow contrary to the public interest that parties contemplating marriage should consider the prospect, however remote they hope it is, that something might go wrong. But it was not until the important case of Radmacher v Granatino that the Supreme Court decided that the notion that it was contrary to the public interest should disappear. Even so, it simply meant that the court could take account of the provisions of a prenuptial agreement and were not in any way bound by them.

Radmacher v Granatino was a quite remarkable case because Mrs Radmacher was a German national from a very rich German family and almost certainly still had a German domicile although she was living in London, and Mr Granatino was a French national and probably still had a French domicile. It was therefore odd. The noble Baroness referred in another context to London becoming the divorce capital of the world. Mrs Radmacher was advised that if she went back to live in Germany for quite a short qualified period of I think about six months, her divorce would have gone through on the strength of a very strong binding prenuptial agreement that she entered into with her husband in Germany. Surprisingly, she decided to continue the proceedings in this country and must have spent millions of pounds before her eventual victory in the Supreme Court, and then only on the basis that it was possible for the court to take account of the prenuptial agreement rather than being in any way bound by it. That would be dealt with by the Bill.

It is regrettable that the English Law Commission felt unable to recommend other changes to the law because of continuing lack of consensus across the country as to what they should be. On a subject of such general importance, it is understandable that the Law Commission should want to act only on a clear consensus. But change is long overdue.

Many of the Bill’s provisions reflect those which have now been in force in Scotland since 1986, the 1985 Act having come into force straightaway the next year, with minor changes in 2006 to reflect changes to the permitted grounds for divorce in Scotland. A key feature is that only “matrimonial property”, as specially defined in the Bill, is available for division between the parties. The Scottish Law Commission, unlike its English counterpart, has at all stages strongly supported the new Bill in Scotland. The general view appears to be that the provisions in Scotland are working well in practice. That was the main conclusion of a thorough survey conducted in 2015 by a team at the University of Glasgow led by Professor Jane Mair.

The House will want to look closely at the definition of “matrimonial property” and other key features of the Bill, but at this Second Reading stage, I invite your Lordships to say simply that, after 45 years, the time has come not only to sanction prenups but to make radical changes to the very wide and unfocused judicial discretion that is, sadly, a feature of Section 25(2) of the Matrimonial Causes Act 1973.