Client Affairs

GUEST ARTICLE: The Challenges With Family Law Agreements For International Couples

William Healing, Kingsley Napley , Family law partner, 22 March 2016

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Cross-border prenups don't exist, the author of this article argues, which can raise certain challenges for protecting wealth in the event of marital strife.

There is as yet no such thing as a cross-border prenuptial (“prenup”) agreement and the challenge of making international family law pacts actually stick is one that can lead to messy cases. In this article, William Healing, family law partner, specialising in the field of international families as Kingsley Napley, considers the issues. The views expressed are those of the author and firm and not necessarily shared by the editors of this publication, but are pleased to share these views and invite readers to respond.
 

Increasingly, I find myself asked by one member of an international couple to draft an agreement which I have to advise them will be difficult to uphold, especially across international borders.

For couples with international connections, whether by nationality, residence, or substantial assets outside England, there is a substantial amount of international family law to help them, yet there are also huge gaps. Unfortunately many of the gaps involve issues which crop up all too often. 

There is no such thing as an international prenuptial agreement, for example, which will have guaranteed recognition across borders. Further, international agreements over child welfare issues do not readily exist either.  

Prenuptial agreements
Generally speaking, there are two categories of matrimonial agreements, to do with property or maintenance, available to international couples - those arising from civil law systems, and those arising from common law (i.e. where Great Britain had its empire reach, including most of the jurisdictions in the US). 

If a London lawyer drafts an agreement for a couple in London and they are posted to Hong Kong or Australia for work reasons for instance, then there is very high certainty that the agreement will be respected in that foreign jurisdiction. The English and foreign jurisdictions talk the same legal language.

However, it is a lot more difficult and complex if the couple are posted from London to Milan or Paris. This is because the civil law system operates in a fundamentally different way. For a start, the agreements reached there are matrimonial regimes and operate from the day the parties get married. They cover death, and insolvency as well as divorce (pre-nups only cover divorce).

So the French or Italian judge might apply some or all of the agreement with a degree of difficulty. If the couple signed an agreement in Milan or Paris where they lived and then came to London and later separate here, the position is even less certain. The English case law since 2010 is confused on the operation of foreign agreements. In many cases, the English judges have refused even to apply them. The weaker spouse (financially speaking) is often rather happy about that as the English courts generally provide for them more generously.

All of this stems from the fact that under English law, a judge does not have to enforce a matrimonial agreement. The judge can go outside it if he or she feels it was drawn up in an unfair way or, as recent cases have said, simply because the agreement is “foreign”.  Couples from abroad who are used to their matrimonial regimes, which are mandatory, find this frustrating. It is no coincidence that the vast majority of the cases reaching the higher courts on the question of prenuptial agreements over the last 20 years have involved couples where one, or usually both, are foreign. 

Careful drafting can help minimise all these risks but, to me, that is not acceptable any longer and the law needs to be clarified. Ideally, there needs to be an international convention but this is a long way off at best.

The children
With children, international agreements are equally difficult.

A very common dispute can arise where an international couple split up and one wishes to return to their home country with their child(ren) or to a new country of work. 
This relocation dispute involves a huge sense of disempowerment for the parent left behind because contact arrangements will be very limited compared with before. Such situations often lead to litigation where the parent being left behind tries to stop the move.

Sadly the chances of agreement in such cases are remote. Even when agreement is achieved there are problems.

Sometimes the parent left behind will seek a mirror order to be lodged in the new place of residence of the carer of the children. This enables access arrangements orders for example, to be enforced more easily. But in reality, the parent who cares for the children will be able to modify the arrangements relatively freely if there are justifiable changes of circumstances.

Pre-departure agreements
What we are seeing more frequently therefore is pre-departure agreements.  Some international couples are fearful enough of a possible separation one day and the complexities this may involve that they try and provide in advance for the day they might separate. They sign up to an agreement which might say, for example, that they agree to the unhindered move of one parent with the children to their designated country - usually the country that parent hails from. 

Such agreements are useful statements of intention should the matter reach a dispute – but as we have to advise clients, they are not binding. What governs at the time of the separation is child welfare and the parent facing the departure of family members can always challenge such an agreement on welfare grounds.

So, like so many family agreements across borders, the agreement is at the end of the day difficult to enforce.

This isn’t to say that international couples should not bother with family law agreements, pre-nuptual, post-nuptual or child related. Far from it they do often protect a party’s interests. But, couples should have their eyes wide open in this area, aware of the parts that are watertight, and reducing the risks for those parts that are not.

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