The author of this article examines what might happen next after a significant divorce ruling in Singapore and its impact on expats.
As regular readers know, divorce rulings involving wealthy individuals are a frequent topic in this publication because the best-laid plans to protect assets can be torn apart in the courts. This is a global issue, and a recent ruling in Singapore carries serious implications, so the author of this article, of law firm Boodle Hatfield, argues. The author is Barbara Simpson, who is a partner in the family team at the firm. She is also a Deputy High Court District Judge.
The views expressed here are those of the author and not necessarily shared by this publication’s editors but we are pleased to carry this expert commentary on such a complex issue, and invite readers to respond.
The world is becoming smaller and young families who are native to the UK are more and more likely to move to foreign climes enticed by better financial prospects and an escape from the English weather. Inevitably, some of these relationships founder and traditionally the women and children find themselves back in their home country, typically with the children living in the couple's former home, purchased before the parties decided to go ex-pat and retained as a good investment whilst the family lived offshore.
Wives generally issue first in their court of origin and would benefit from that court granting them that home together with generous maintenance. This has suited the wives well, but the downside for the children and their fathers was that, however much the father may try, and however much the mother may support contact, it meant that the children lost the close familiarity of living near to their father.
The established principle in the English Family Court has been that if the parents divorce, where the father is the main breadwinner, living and working in, for example, London, and the non-English mother, being the main carer for the children, applies to take the children to live permanently in her native country she will not succeed should the father not agree. The court takes the view that such a separation will clearly affect his long-term relationship with the children. It will refuse the application. The rationale is that the welfare of the children is paramount and it is vital to their development that they are enabled during their childhood to have that childhood characterised by a close relationship with their father.
At least in England the wife can be sure of a generous financial settlement.
Pity the ex-pat wives in Singapore. A very recent Court of Appeal case in Singapore "BNT(2015)SGCA23", has followed the English Family Court's reasoning. This case involved an ex-pat family. The wife and the husband are both Canadian citizens. The husband is extremely successful in Singapore and wishes to remain there. The wife wanted to return to Canada and made what has in the past been a very normal application in the Singapore courts for permission to do so, expecting permission to be granted with the children. Once back in Canada, she can pursue the usual ex-pat financial package from her court of origin in Canada.
The husband's Singapore lawyers, following the decision of the English cases, successfully applied for an order that the wife be refused permission to leave Singapore with the children, following the principle that the father's relationship with the children overruled the mother's wishes and she has to stay in Singapore. The Singapore courts will have jurisdiction over the financial settlement as the Canadian court lost jurisdiction because none of the parties live there.
This is all very well and on the face of it very right and proper but in the latter case the financial consequences to the wife will be catastrophic; she cannot return to Canada and pursue matters in the Canadian court as she and the children will not be living there. The Canadian courts will not have jurisdiction and she is left to claim in the local Singapore courts, with its financial awards generally being very meagre compared with most ex-pat courts of origin.
Immediately following this reported case the atmosphere amongst Singapore lawyers serving the ex-pat community has become febrile. The stakes have become very high.
Visiting Singapore a few weeks ago, I met an Australian woman with children who had been settled there for several years, with the children attending the local private schools. She was inconsolable. She had gone through local lawyers and the Singapore court for the divorce and had believed she was about to have a settlement whereby her husband agreed that she could go back to Australia with the children and he would pay for their schooling and housing there with generous maintenance.
Immediately following the handing down of the above Singapore Court of Appeal decision the husband's lawyer advised him of the ruling in the case and he withdrew his financial offer. His position is now that only on the condition that she accepted a much lower offer would he agree to her and the children leaving Singapore, otherwise he would exercise his right to have them stay in Singapore.
That situation is likely to be replicated repeatedly from now on.
The ruling, of course, helps loving fathers who want to be on hand while their children grow up, but the Singapore courts will retain sole jurisdiction. If the father is more keen on reducing the alimony than having the children live near he will negotiate making a deal where the mother loses out on maintenance in order to gain freedom to take the children home with her.
The lives of divorcing expats living and working in Singapore has become just a little more difficult.
(An earlier version of this article appeared in WealthBriefingAsia, sister news service to this one, and is repeated due to its cross-border implications.)