Divorce capital of the world and prenups

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March 10, 2010

Over the last year London has become notorious as the destination of choice for libel tourists, almost eclipsing its reputation as the divorce capital of the world. After all, aside from Katie and Peter, celebrity divorce court battles have been thin on the ground in the past 12 months.

This morning, however, the Supreme Court gave a ruling that reinforced London’s position as the jurisdiction of choice for divorcing couples. Nigerian born Sikirat Agbaje, a British citizen, was married to Olusola Agbaje for 40 years and had five children. When they were divorced in 2005 the Nigerian courts awarded her just under £7,000, while the husband took £616,000 and ownership of two properties in London.

Appalled by the ruling, which left her virtually penniless, Mrs Agbaje went to the British courts in an effort to overturn the Nigerian ruling.

Today the Supreme Court upheld an earlier High Court decision and said her award should be lifted to give Mrs Agbaje a lump sum equal to 65 per cent of the sale proceeds of their London property – the equivalent of £275,000 – on condition that she relinquished her interest in their Lagos property.

For family lawyers this is good news. The most senior court in the land has effectively asserted London as the place to get a fair and just divorce deal.

The next issue on the agenda for the Supreme Court is the controversial matter of pre-nuptial agreements. On 22 March, nine Supreme Court justices will convene to hear the landmark Radmacher divorce case.

According to Ayesha Vardag of Ayesha Vardag Solicitors, who is representing German heiress Katrin Radmacher, the case is being billed as the “divorce case of the century”.

That could be an exaggeration, but it is fair to say that this is the case that divorce lawyers have been waiting for. In July 2009, the Court of Appeal ruled that Katrin Radmacher should not be forced to pay over £5.8m to her ex-husband, because they had signed a pre-nuptial agreement in which he agreed not to make a claim to her fortune in the event of a future divorce (2 July 2009).

Now Radmacher’s husband, Nicolas Granatino, who instructed divorce heavyweight Fiona Shackleton of Payne Hicks Beach, is challenging the validity of that pre-nup in the Supreme Court.

“English courts are out of touch with the development of international law in this area,” says Frank Arndt, head of the international family law unit at Stowes Law. “In Germany it’s normal to have a pre-nup in place – particularly for wealthy people – but in England it’s frowned upon.”

Manches family partner James Stewart says the Radmacher case has the potential to be groundbreaking.

“In the last decade we’ve moved from a position where pre-nups have had limited value to a position where they have profound evidential value,” Stewart says. “But in English law it can’t be used in full force.

“A clarification in the law would be most welcome, but what’s really needed is an act of parliament to deal with the question of contracts to govern the financial relationships of spouses.”

The Supreme Court today reinforced London as the divorce capital of the world. On 22 March, the most senior judiciary in the country will be given the opportunity to bring English divorce laws into line with the rest of Europe.


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