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

Part of the debate – in the House of Lords at 1:10 pm on 11th May 2018.

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Photo of Baroness Falkner of Margravine Baroness Falkner of Margravine Chair, EU Financial Affairs Sub-Committee, Chair, EU Financial Affairs Sub-Committee 1:10 pm, 11th May 2018

My Lords, I thank the noble Lord, Lord Davies, for allowing me to continue in the order of proceedings. I commend the noble Baroness, Lady Deech, for her persistence in pursuing this issue over many years. I am also grateful for the clarity of the briefing that she has provided me with and for her acuity in setting out the purpose and objectives of the Bill so clearly and brilliantly today.

I am not an expert on the issue, but I reflected on it a little, particularly during the case mentioned by so many others today—the Radmacher case—which I recall very clearly. I say very humbly in front of two former members of the Supreme Court that I think the balance in the court’s ruling was correct. Otherwise, I am, I think, the first of the lay speakers to comment on the Bill today. The only interaction I have had with divorce in the past few years has been in the context of the Brexit negotiations; I recall taking issue early on with Michel Barnier when he referred to the Brexit negotiations as a divorce. I think I suggested that divorce law was on the whole rather more thought through than Article 50, particularly in the provisions relating to financial settlements and provisions. My committee, European Union Sub-Committee A, had to deal with that part of the United Kingdom’s settlement, and I can just imagine what it must be like for courts to have to adjudicate on the matters in the Bill promoted by the noble Baroness, Lady Deech. Perhaps the use of a lawyer or two might have benefited the drafters of that part of the Lisbon treaty.

Turning to the Bill, I am sure I am not alone in my frustration that the UK, mainly London, is seen as the divorce capital of the world. I read recently about a wealthy couple who had no relevant connection to the United Kingdom, other than that they had parked some of their wealth in London property. Now that they were contesting a divorce, the significant consideration for one of them to was demonstrate, through the ownership of a flat, that they had a connection to the UK. Their application would, if accepted, presumably lead to a more favourable financial settlement for that person, as opposed to one in the jurisdiction where they had a real and ongoing connection. Jurisdiction shopping in this area has much of the same unsavoury scent as tax evasion, both being the preserve of the global wealthy elite. As the noble Baroness, Lady Deech, said, London being seen in that light is nothing to be proud of.

I have a slight reservation about the Bill in that the financial interdependence of couples varies across such a wide spectrum, from those with modest means to those whose cases make the media—the fabulously wealthy—and between those who need clear and accessible law and those who can afford lawyers and accountants. I am slightly concerned that, in order to provide consistency and clarity in disputes, we are in danger of eroding judicial discretion to an extent that may be undesirable. I say “may be undesirable” with great qualification. My discomfort is particularly to do with the commodification of pre and post-nuptial agreements. I see from legal comment in the media that some advocates see that as the equivalent of taking out life insurance or writing a will. I think the expression used by a lawyer was, “It’s as normal as”. In the real world, I would argue, most people do not take out life insurance or write wills before their wedding day, and the binding nature of these agreements may deter couples at a time of hope and optimism in their lives. My question to the noble Baroness, Lady Deech, and indeed to the Minister, would be about the extent to which they see a need for a public information campaign about how these agreements work, and the importance of people understanding the implication of financial settlements on divorce before they even get married.

I also have some niggles with Clause 3. I do not have a problem with the binding nature of prenups and post-nups. I think their take-up is relatively limited—for good reason, as most people who decide to marry do so in the desire for a binding commitment to each other for better or for worse, rather than the contractual mindset of, as we have heard in several cases that have been mentioned, for richer and for richer, which are the ones that make the news. However, for prenups as described in Clause 3(1)(c), I am not entirely clear why there is a requirement that the agreement must have been made 21 days before. I assume that this is so that duress on the part of either party is ruled out but, if so, why 21 days as opposed to 30 days or any other timeframe?

The clause also calls for legal advice to have been obtained. I can see the reason for this but, in the absence of funding for independent legal advice, does it not serve as a disincentive towards prenups for those couples who cannot afford that advice? Are there practical suggestions for the Government to devise a toolkit or guidance that could serve as a generic format and be considered independent advice in the absence of a lawyer? I note that the Law Commission has recommended a divorce calculator, and a cursory search on the internet showed up a number of platforms offering calculations. The question would be about the reliability of those tools.

I am in broad support of the Bill. I look forward to its progress, which I hope on this occasion the Government will agree to support. I conclude with a couple of thoughts. Fairness is a difficult and complex concept, inevitably subjective and very dependent on individual circumstances. The important challenge in this area of law is to achieve certainty in general without complexity eroding the flexibility to account for the individual circumstances of the people involved. I think the Bill acknowledges that and, as I said, I look forward to its progress.