UK Supreme Court accused of encouraging ‘divorce tourism’
Ruling allows estranged wife to pursue claim in England rather than Scotland in hope of higher payout
The UK’s highest court has ruled that the estranged wife of an English aristocrat can pursue her maintenance claim in England rather than Scotland, where the petition to end the marriage was filed, in a ruling which lawyers say opens the door to more “divorce tourism”.
The Supreme Court ruled against Charles Villiers, 57, who had contested an English appeal court decision that his estranged wife Emma should have her maintenance award dealt with by the English courts. Courts in Scotland, which has its own legal system, are less generous when awarding maintenance payouts.
Mr Villiers had asked the Supreme Court to reverse an earlier court decision that he should pay his estranged wife £2,500 a month plus legal fees of £3,000 and he accused his wife of “trying it on” as a so-called divorce tourist in the English courts.
On Wednesday the Supreme Court ruled by a majority of three justices to two that the English courts should deal with Emma Villiers’ maintenance claim. She now lives in England even though the couple spent most of their marriage in Scotland until they separated in 2012.
Philip Sales, one of the Supreme Court justices, said that spouses seeking maintenance payments were seen as the “more vulnerable party” and so should be allowed to claim in whichever legal jurisdiction was “most convenient and least expensive for them and allows for the most generous maintenance provision”.
However Nicholas Wilson, one of the two dissenting justices, said in his ruling that the decision would give an “untrammelled licence . . . to a wife to go forum-shopping”.
Lawyers said the ruling would have far-reaching ramifications for cross-border divorce cases involving wealthy couples who had a connection to England.
“The Supreme Court decision in Mrs Villiers’ favour gives the green light to so-called divorce tourists,” said Caroline Holley, partner at law firm Farrer & Co.
“Today the door to the English court remains firmly open to those wanting to bring financial claims in England upon a divorce,” she said, adding that it “reinforced England’s title as the divorce capital of the world”.
Alex Carruthers, partner at law firm Hughes Fowler Carruthers, said that Scotland and England were poles apart on divorce. “This case opens up the possibility of exploiting that gap even more in the future.”
Jane Mitchell, family law partner at Penningtons Manches Cooper, who acted for Mrs Villiers, said her client was “relieved and happy”. However Charles Villiers criticised the ruling, saying in a statement: “This makes life even easier for the would-be forum-shopper.”
In Scotland divorce settlements are less generous as inherited wealth is not usually included in any award and maintenance is usually limited to three years. By contrast the English courts can award generous maintenance payments for life.
The ruling comes days after “no-fault” divorce legislation became law last week in the biggest shake-up of the divorce system in England and Wales for more than 40 years.
The Divorce, Dissolution and Separation Act means that from autumn 2021 couples can start to apply for divorces where neither party is blamed for the split. It has been welcomed by lawyers who have been keen to end the “blame game” inherent in the current divorce system.
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Reuters - ECB lowers bar for bank mergers in hope of spurring consolidation - https://reut.rs/3ihgb9v
FRANKFURT (Reuters) - The European Central Bank is lowering the bar for bank mergers in the euro zone, hoping to encourage an elusive wave of consolidation in a sector plagued by low profits and unresolved issues inherited from the last financial crisis.
In a guide published on Wednesday, the ECB clarified that merged entities won’t necessarily be asked for extra capital and will be allowed to use their own accounting models as well as any “badwill” - a paper profit that occurs when an asset is bought below its book value.
These were some of the concerns flagged by bankers in recent years when evaluating mergers and acquisitions (M&A) in the euro zone.
The ECB stressed, however, that it was not its job to orchestrate deals and these needed to be driven by the market.
“Our prudential mandate is not to assess whether consolidation efforts are beneficial,” ECB supervisor Édouard Fernandez-Bollo said in a blog post presenting the guide.
“But well-designed and well-executed consolidation can help address the overcapacity and low profitability problems that have been damaging the European banking sector since the last financial crisis,” he added.
The guide will now be open for consultation until Oct 1.