Legal
Financial Advantages, Consequences Of Choosing “Wrong” Divorce Jurisdiction

The author notes that London bears the title of divorce capital of the world, particularly given its use by UHNW couples. He examines other jurisdictions and how the choices people make about where to handle such cases play out.
This article considers the pitfalls that arise when people choose a jurisdiction for the purpose of divorce. For years, London gained the reputation (whatever one might think about it) as the “divorce capital of the world.” There are reasons why a particular place is chosen. “Shopping around” for a jurisdiction can be complicated.
Richard Kershaw, partner at law firm Hunters Law, considers this area. The editors are pleased to share these insights; the usual editorial disclaimers apply to views of guest writers. To comment, email tom.burroughes@wealthbriefing.com and amanda.cheesley@clearviewpublishing.com
On 2 July, the Office for National Statistics released
information about the number of divorces in England and Wales. In
2023 (the most recent year for which statistics are available)
there were 102,678 divorces (and dissolutions of civil
partnerships); of those, the Ministry of Justice tell us that
40,873 financial arrangements were litigated to an outcome
through the court, which means that the remainder were sorted out
by the parties around the kitchen table, left unaddressed
(possible but risky) or through recognised non-court dispute
resolution (NCDR).
NCDR is, rightly, increasingly popular as it gives the parties
greater autonomy in how they separate their finances. At a time
when the court system is teetering on the brink of collapse, NCDR
is invariably a swifter process. And it is typically less
costly.
But it is not universally appropriate.
There are some aspects of matrimonial finances which require
prompt, sometimes urgent unilateral advice to one of the parties
so that their position is not prejudiced.
One such area is that of “forum” – essentially, where there is a
choice of which country deals with the divorce and finances.
This is potentially a critical issue because:
1. The jurisdiction which deals with the divorce invariably
then has power to make financial orders;
2. Different jurisdictions have widely varying powers about
what financial orders they can (and cannot) make;
3. Different jurisdictions take different matters into
account when exercising their powers to make financial
orders;
4. The consequences of choosing the “wrong” jurisdiction (or
letting one’s spouse make the call) can be prejudicial and
long-lasting; and
Two examples of the prejudice which can be suffered/advantage
gained, one capital in nature and one income related.
Capital
The recent Supreme Court case of Standish (Standish v Standish
[2025] UKSC 26) endorsed the jurisprudential trend first
articulated 20 years ago in Miller and McFarlane (Miller v
Miller; McFarlane v McFarlane [2006] UKHL 24) that matrimonial
assets should be “shared.” In HNW and UNHW cases, that’s usually
the beginning and end of the calculation. (See articles on the
Standish v Standish case
here and
here.)
An asset is matrimonial if it has been created by the parties, or
one of them, during the marriage or is an asset brought to the
marriage which has been “matrimonialised” – an unwieldy term the
use of which has been blessed by the Supremes.
Uniquely, the courts in England & Wales add periods of
cohabitation which pass seamlessly to the martial state to the
duration of marriage and, in so doing, extend the scope for
assets being matrimonial.
To take an extreme, albeit perfectly orthodox, example; a couple
meet in London in 2002, start to cohabit in 2004, marry in 2023
and start divorce proceedings in 2024. The court will, without
(too much) demur, treat this as a 20 year “marriage” even though
the legal status of marriage subsisted for a mere 12 months. This
is a practice borne out of the courts recognising that (according
to the ONS) 24.3 per cent of couples now cohabit as compared
with the early 1970s when the governing legislation
(Matrimonial Causes Act 1973) was enacted, when living together
outside marriage was extremely rare. All wealth created
during that period (about which there might still be legitimate
argument) will be shared.
This is not so in many other countries or states.
In California, for example, the concept of sharing also applies,
but is confined to the duration of the actual legal
marriage.
In the above example, that would mean a division of that element
of the marital pot which related to the period 2023-2024.
And in England and Wales, pension sharing orders can be made
which divide a party’s pensions to make retirement provision for
the recipient party. This is a power which is not available in
every jurisdiction. There is also a further issue that pension
sharing orders in this jurisdiction can only be made against
pensions held here, and so not against “foreign” pensions. Where
the pension is substantial (perhaps the only asset) and overseas,
there is likely to be significant prejudice if proceedings are
brought in the pension-less jurisdiction.
Income
On the income front (maintenance, alimony) there is yet more
strategic advantage to be gained by the party who has a choice of
jurisdictions and who issues first.
In England & Wales, a party’s income (unlike his or her capital) is not “shareable.” (Waggott v Waggott [2018] EWCA Civ 727).
The court may only make an order that one party pay another
maintenance based on an assessment of both parties’ “needs.”
Quantification of spousal maintenance is not formulaic (unlike
child maintenance) and revolves around the interplay of:
1. The payer’s income;
2. The payee’s income budget (monthly or annual);
3. The payee’s ability to generate an income for themselves;
and
4. The payer’s ability to bridge the shortfall between (b)
[2] and (c) [3].
There are then issues of for how long the maintenance should be
paid, which brings into the equation such questions as for how
long the marriage lasted, what sort of income or profession the
payee might have foregone for family reasons and whether the
maintenance should be “capitalised.”
It will be evident that there is significant room for argument,
both as to quantum and term.
There is no such room in most comparable jurisdictions, even
those most geographically proximate.
In Scotland, spousal maintenance is time limited, typically for
up to three years post-divorce, unless that will cause undue
hardship. Protracted periods of dependency are atypical. The
same, time limited, approach applies in many other European
nations, e.g. Luxembourg, Sweden and Norway where spousal
maintenance is the exception with a strong focus on financial
independence.
Summary
It is no surprise that London is known as the divorce capital of
the world; that epithet is often, rightly, ascribed to the big
ticket UHNW cases the High Court handles; but it applies equally
to the English courts’ generous approach to the elasticity of a
marriage and its (still) paternalistic view of the financial
commitment of marriage enduring for many years after its legal
dissolution.